Siemen Ag Global Development Strategy Case Study Solution and Analysis
Siemen Ag Global Development Strategy Case Study Analysis is the biggest publishing company with a greatest market share in the China's book retail market. CMP has become a specialized info supplier and a large comprehensive Science and Innovation publishing business through the integration of print media, audio-visual media and the network media.
CMP has spent its 60 years journey smoothly, being a successful publishing house, however, the changing macro market patterns and forces bring certain challenges to the publishing market in basic and Siemen Ag Global Development Strategy Case Study Help in particular. These factors consist of;
• Entrance of the brand-new publishing companies in the market.
• Declining development of the publishing market.
• Market saturation.
• Introduction of digital publishing techniques
• Improvement of science and innovation.
The transformation of the macro markets have raised a number of questions to the management at CPM that what could be the future of CMP in this scenario? Do the long valuable experience, technical resources and the abilities of the business could be made use of to pursue the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Siemen Ag Global Development Strategy Case Study Analysis has certain strengths that can be made use of to decrease the threats, get rid of the weak point and obtain the opportunities. Strengths of CMP are provided as follows;
• The long term experience of Siemen Ag Global Development Strategy Case Study Solution in the publishing industry i.e. 60 years allows the business to supply high quality products at a lower cost utilizing its previous experiences.
• The technical resources and capabilities produced by its successful journey provide a competitive benefit to CMP.
• Huge item portfolioof CMP assists it to diversify its danger and supply high value to its customers.
• Strong financial position permits the business to think about numerous development opportunities without any fear of raising fund externally.
In addition to the strengths, the company has particular weaknesses which could increase constraints for the business in implementing its advancement program. The weaknesses of Siemen Ag Global Development Strategy Case Study Help are offered as follows;
• Despite of being a science and innovation publishing firm, the company still has conventional ways ofpublishing which are not suitable with the growing technological shift.
• CMP highly relies over the Chinese markets for its development. It needs to propose certain growth plans to prevent its reliance over the Chinese markets to achieve long term growth.
Although, the growth of the publishing industry is declining considering that 2008, affecting Siemen Ag Global Development Strategy Case Study Solution also, but the growth could be restored by availing certain chances presented in the market. The marketplace chances for CMP include;
• The business might also present Digital Publishing by using its long term technical experience and a strong consumer recognition in the market.
• CMP could consider a development program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its huge financial resources.
The altering macro trends in the market and increasing competition in the publishing industry has actually postured certain hazards to Siemen Ag Global Development Strategy Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries might result in declining market share of Siemen Ag Global Development Strategy Case Study Analysis due to the consumer shift towards digital libraries.
• The presence of large number of competitors in the publishing industry increase the risk for CMP to lose its competitive position in the market, as competitors can get a strong customer base by utilizing particular techniques like aggressive promotion, quality products, and so on
• Entryway of brand-new publishing companies in the industry along with presence of high competitors increases the threat of losing the consumer base.
The business has a quite competitive monetary performance. Due to lack of information, the financial ratios of CMP might not be computed. Nevertheless, the total financial efficiency of the business might be examined by using the graphs given up the case Appendices. It could be evaluated from the Appendix III that the annual overall earnings of CMP during the duration 2000-2012 are growing at a high development rate, revealing that the yearly demand of the items of Siemen Ag Global Development Strategy Case Study Analysis is growing and the business is rather effective in drawing in a a great deal of consumers at a potential cost.
Along with it, the 2nd graph which reveals the annual development in the Siemen Ag Global Development Strategy Case Study Analysis overall assets, reveals that the business is rather efficient in including worth to its properties through its revenues. The development in assets shows that the total worth of the company is likewise increasing with increasing the overall earnings. (Unidentified, 2013).
Another financial analysis of the company using the given information could be the analysis relating to the circulation of overall profits of the company. Huge part of the earnings of CMP originates from the sales of its released books i.e. 64% as shown in the Case Appendix V. The business might move towards other organisation sections with a possible development to attain its future development objective.
PESTEL analysis might be conducted to learn the various external forces impacting the efficiency of the company and the recent trends in the external environment of the company. A quick PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
As the publishing sector might have a considerable impact on the mindset of individuals about the communist ideology of the federal government, therefore, the publishing sector is extremely supervised and guided by the Publicity Department of the Communist Party of China. It might be said that the general political forces impacting CMP service are high. The federal government policies relating to the publishing sector are also increasing with the passage of time.
Financial forces affecting the publishing sector in general and the CMP in specific includesthe rates of paper, the earnings level of customers, the inflation rate, and the general GDP development of the nation. All these forces combine impact the demand for the publishing market.
Social and Demographical.
Social and demographical forces consist of the population growth, the consumer's choices towards reading useful products etc. China has the greatest population on the planet with a high population growth, revealing the increasing number of consumers of the Siemen Ag Global Development Strategy Case Study Analysis. The customer preferences are moving towards digital publishing rather than the conventional was of publishing. In this regard, CMP needs to focus on digital publishing to fulfill the changing customer choices.
Technological forces impacting the CMP consist of the technological development in the reading strategies etc. Enhancement of science and innovation along with the increase of digital publishing could reduce the need for the CMP items, if particular actions would not be taken soon.
Ecological forces impacting Siemen Ag Global Development Strategy Case Study Help includes the concerns of ecological neighborhoods over the usage of paper in publishing books. The paper used in the books while publishing is needed to be disposable and the ink utilized while publishing should not be harmful for the environment.
Legal guidelines for the publishing sector at whole are high. The legal policies relating to the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 requires the publishers to be authorized initially by the Federal government to be gone into in the publishing market. The regulation prohibits direct involvement of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's Five Forces Model).
Porter's Five Forces Model could be used to analyze the appearance of the publishing industry China. A brief analysis of the Porter's 5 Forces is provided as follows;.
Risk of New Entrants.
Dangers of new entrants in the Chinese Publishing Industry is moderate. The potential development in the industry tends to attract brand-new entrants to the publishing market. However, the presence of extreme competition and the requirement of big capital tends to demotivate brand-new entrants to enter in the marketplace.
Risk of Substitution.
Threat of Replacement is high for the Chinese Publishing Industry. The alternative products for the released files is the files presented in the virtual libraries on specific sites. The changing consumer preferences towards digital learning increase the danger of alternative for the market.
Competitive rivalry in the publishing market is high. The existence of large number of customers in the Chinese Publishing Market like CIP, PTP etc. tends to produce high competitive competition for CMP. Together with it, new entrants are likewise participating in the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major suppliers of the Siemen Ag Global Development Strategy Case Study Solution include the suppliers of the paper for releasing files. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the general bargaining power of supplier for CMP is low.
Bargaining Power of Buyer.
Bargaining power of purchaser in the publishing industry is high. Due to the existence of a large number of publishers in the Chinese market and the market saturation, the buyers needs high quality files at competitive prices.
CMP runs in an extremely competitive industry with the presence of a great deal of rivals. The business has a competitive position in the market with the greatest market share in the Chinese publishing market. Major competitors of Siemen Ag Global Development Strategy Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIP acts as a risk for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and could wean the market share of CMP easily in the present market scenario.
Posts and telecommunication Press (PTP).
It was likewise founded in the same period as Siemen Ag Global Development Strategy Case Study Solution and CIP. It is also one of the popular players in the publishing market with an annual overall earnings of RMB 550 million in 2010.
Alternative-1: Expand towards New Markets
• Lowering reliance over the Chinese markets.
• Increasing number of Clients
• Growth chances.
• Preventing the effect of market saturation in the Chinese publishing industry.
• Use of possible resources in expansion.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to present using existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio offers high worth to clients.
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core company segments to the brand-new one can lead the company to lose demand of its items in the market.
With the deep analysis of the internal and external environment of the business together with the market analysis and the rival analysis, Alternative 2 is suggested to CMP to achieve its future advancement. As the preferences are shifting towards digital publishing and the business require an instant solution to prevent the declining market development. Therefore, intro of digital publishing could show to be an immediate solution with low quantity of risk for the business. The business might also think about the growth program after the success of its digital publishing program.
In order to present digital publishing in its item portfolio, the business needs to initially collects the information connected to the customer demand, the possible markets, the federal government regulations and the data associated with the rivals presented in the market. After that, the business ought to decide one possible segment for its preliminary offering. It must collect research study that how it could separate its digital publishing from the existing rivals' items. After all the actions above the business ought to opt for the preliminary offering. If the preliminary offering proves a success, the company needs to opt for the other markets. In this method the company would be able to execute its digital publishing program.
The growth of the publishing market is declining since 2008, revealing a danger to the company's long term presence, however the situation can be controlled by considering a development plan in the future. The business might consider introducing digital publishingin its existing market to implement its advancement program at immediate basis and to avoid the risk of failure for entrance in the new markets.