Strategic Review At Egon Zehndr International A Case Study Solution and Analysis
Introduction
Strategic Review At Egon Zehndr International A Case Study Solution is the largest publishing company with a greatest market share in the China's book retail market. CMP provides a variety of services consisting of; collecting info, processing information and communication services. Significant company segments of the company consist of; books, periodicals, consultancy and circulation. The business has a large item portfolio and its major items consist of books, periodicals, online media, exhibitions, research study reports and so on. Strategic Review At Egon Zehndr International A Case Study Help has ended up being a specialized details provider and a large comprehensive Science and Technology publishing company through the combination of print media, audio-visual media and the network media.
Critical Concerns
Although, Strategic Review At Egon Zehndr International A Case Study Solution has invested its 60 years journey efficiently, being a successful publishing house, nevertheless, the altering macro market patterns and forces bring certain difficulties to the publishing market in general and CMP in particular. These elements include;
• Entrance of the brand-new publishing firms in the market.
• Decreasing growth of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Improvement of science and technology.
The improvement of the macro markets have raised several questions to the management at CPM that what could be the future of CMP in this circumstance? Do the long important experience, technical resources and the abilities of the business could be made use of to strive for the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
Strategic Review At Egon Zehndr International A Case Study Analysis has certain strengths that can be utilized to reduce the risks, overcome the weak point and get the chances. Strengths of CMP are offered as follows;
• The long term experience of Strategic Review At Egon Zehndr International A Case Study Help in the publishing industry i.e. 60 years enables the company to provide high quality products at a lower cost utilizing its previous experiences.
• The technical resources and abilities created by its successful journey supply a competitive benefit to CMP.
• Vast product portfolioof CMP assists it to diversify its threat and offer high value to its customers.
• Strong monetary position enables the company to consider a number of development opportunities with no fear of raising fund externally.
Weaknesses
Together with the strengths, the company has certain weak points which could increase restrictions for the business in implementing its development program. The weak points of Strategic Review At Egon Zehndr International A Case Study Analysis are provided as follows;
• Despite of being a science and technology publishing company, the business still has traditional ways ofpublishing which are not suitable with the growing technological shift.
• CMP extremely relies over the Chinese markets for its growth. It must propose specific growth strategies to prevent its dependence over the Chinese markets to attain long term growth.
Opportunities
The development of the publishing industry is decreasing considering that 2008, affecting Strategic Review At Egon Zehndr International A Case Study Analysis as well, but the development might be revived by availing particular chances presented in the market. The market chances for CMP include;
• The business could likewise present Digital Publishing by using its long term technical experience and a strong client recognition in the market.
• CMP might think about a development program through the growth towards foreign markets in order to decrease its reliance over Chinese markets by utilizing its vast financial resources.
Threats
The changing macro trends in the market and increasing competitors in the publishing industry has posed certain dangers to Strategic Review At Egon Zehndr International A Case Study Solution including;( Gurel, 2017).
• Introduction of digital publishing i.e. virtual libraries could result in declining market share of Strategic Review At Egon Zehndr International A Case Study Solution due to the consumer shift towards virtual libraries.
• The presence of a great deal of rivals in the publishing market increase the hazard for CMP to lose its competitive position in the market, as competitors can get a strong consumer base by utilizing particular techniques like aggressive promotion, quality products, etc.
• Entryway of new publishing companies in the industry together with presence of high competition increases the hazard of losing the customer base.
Monetary Analysis.
Due to absence of information, the financial ratios of CMP could not be determined. It could be examined from the Appendix III that the yearly total revenues of Strategic Review At Egon Zehndr International A Case Study Analysis during the duration 2000-2012 are growing at a high growth rate, revealing that the annual need of the items of CMP is growing and the company is rather efficient in bring in a big number of clients at a prospective rate.
Together with it, the 2nd graph which reveals the yearly development in the Strategic Review At Egon Zehndr International A Case Study Solution overall possessions, reveals that the company is quite effective in including value to its assets through its earnings. The growth in properties reveals that the overall worth of the company is likewise increasing with increasing the total earnings. (Unidentified, 2013).
Another financial analysis of the business utilizing the offered data could be the analysis regarding the distribution of total revenues of the company. Huge part of the revenues of CMP originates from the sales of its published books i.e. 64% as shown in the Case Appendix V. The company might move towards other business sections with a potential development to achieve its future advancement goal.
PESTEL Analysis
PESTEL analysis might be carried out to find out the different external forces impacting the efficiency of the company and the current trends in the external environment of the business. A quick PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable effect on the state of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is highly monitored and guided by the Publicity Department of the Communist Celebration of China. It might be said that the overall political forces impacting CMP service are high. The federal government policies regarding the publishing sector are also increasing with the passage of time.
Cost-effective.
Economic forces affecting the publishing sector in general and the Strategic Review At Egon Zehndr International A Case Study Help in particular includesthe costs of paper, the earnings level of customers, the inflation rate, and the total GDP growth of the nation. All these forces integrate impact the need for the publishing market. In addition to it, the economic policies connected to the import of books impact the overall service at CPM. However, China's economic conditions are rather favorable for CMP with high GDP development and customer earnings level.
Social and Demographical.
Social and demographical forces include the population growth, the customer's choices towards checking out helpful materials and so on. China has the highest population in the world with a high population growth, revealing the increasing number of consumers of the Strategic Review At Egon Zehndr International A Case Study Analysis. The consumer choices are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP must concentrate on digital publishing to satisfy the altering consumer choices.
Technological.
Technological forces affecting the CMP consist of the technological advancement in the reading methods and so on. Improvement of science and innovation together with the increase of digital publishing could lower the demand for the CMP items, if certain actions would not be taken soon.
Environmental.
Environmental forces affecting Strategic Review At Egon Zehndr International A Case Study Solution includes the concerns of ecological neighborhoods over the use of paper in publishing books. The paper used in the books while publishing is needed to be non reusable and the ink utilized while publishing must not be damaging for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal policies concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be approved initially by the Government to be entered in the publishing market. The regulation forbids direct participation of foreign entities and people in the publishing sector.
Industry Analysis (Porter's 5 Forces Model).
Porter's 5 Forces Design could be used to examine the beauty of the publishing industry China. A short analysis of the Porter's Five Forces is given as follows;.
Danger of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The possible growth in the industry tends to bring in new entrants to the publishing market. Nevertheless, the existence of extreme competitors and the requirement of substantial capital tends to demotivate brand-new entrants to enter in the market.
Hazard of Alternative.
Threat of Alternative is high for the Chinese Publishing Industry. The alternative products for the published files is the files presented in the digital libraries on specific sites. The changing consumer choices towards digital learning increase the hazard of substitution for the industry.
Competitive Competition.
Competitive rivalry in the publishing market is high. The existence of large number of consumers in the Chinese Publishing Industry like CIP, PTP etc. tends to produce high competitive competition for CMP. In addition to it, new entrants are likewise entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The significant suppliers of the Strategic Review At Egon Zehndr International A Case Study Help consist of the providers of the paper for releasing documents. As CMP is the largest publisher in the Chinese Publishing Market, for that reason the overall bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Bargaining power of buyer 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 purchasers needs high quality documents at competitive prices.
Competitors Analysis.
CMP runs in a highly competitive industry with the existence of a great deal of competitors. The company has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant rivals of Strategic Review At Egon Zehndr International A Case Study Solution include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIP acts as a threat for CMP as it might wean its market share due to its long term competitive background. CIP is focused on digital publishing and might wean the market share of CMP easily in the current market scenario.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also founded in the very same period as CMP and CIP. It ranks sixth in the state-owned publishers in regards to service scale. It is likewise among the popular players in the publishing industry with an annual overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Decreasing reliance over the Chinese markets.
• Increasing number of Consumers
• Development opportunities.
• Preventing the effect of market saturation in the Chinese publishing market.
Cons
• Use of prospective resources in growth.
• Danger of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to introduce using present abilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased item portfolio supplies high value to customers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core organisation sectors to the new one can lead the business to lose need of its products in the market.
Recommendations
As the preferences are moving towards digital publishing and the business require an instant service to prevent the declining industry growth. The business might also consider the expansion program after the success of its digital publishing program.
Execution
In order to introduce digital publishing in its item portfolio, the company needs to first gathers the information related to the consumer demand, the potential markets, the government guidelines and the information related to the rivals presented in the market. If the initial offering shows a success, the company must go for the other markets. In this way the business would be able to execute its digital publishing program.
Conclusion
Although, the growth of the publishing industry is decreasing given that 2008, revealing a hazard to the business's long term presence, but the scenario can be managed by considering a development strategy in the future. The company could consider presenting digital publishingin its existing market to implement its advancement program at immediate basis and to avoid the threat of failure for entrance in the new markets.
