The Kashagan Production Sharing Agreement Psa Case Study Solution and Analysis
Introduction
The Kashagan Production Sharing Agreement Psa Case Study Analysis is the largest publishing company with a greatest market share in the China's book retail market. CMP has actually ended up being a specialized details company and a big detailed Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
Vital Concerns
CMP has actually invested its 60 years journey efficiently, being an effective publishing home, nevertheless, the altering macro market patterns and forces bring particular difficulties to the publishing industry in basic and The Kashagan Production Sharing Agreement Psa Case Study Solution in specific. These aspects include;
• Entrance of the brand-new publishing firms in the industry.
• Decreasing development of the publishing market.
• Market saturation.
• Intro of digital publishing methods
• Enhancement 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 capabilities of the business could be made use of to pursue the future development unceasingly? How could the company sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
The Kashagan Production Sharing Agreement Psa Case Study Analysis has certain strengths that can be used to decrease the dangers, overcome the weakness and avail the chances. Strengths of CMP are provided as follows;
• The long term experience of The Kashagan Production Sharing Agreement Psa Case Study Help in the publishing industry i.e. 60 years permits the business to supply high quality items at a lower expense using its previous experiences.
• The technical resources and capabilities created by its successful journey offer a competitive benefit to CMP.
• Vast product portfolioof CMP assists it to diversify its risk and supply high value to its customers.
• Strong monetary position allows the business to think about a number of development opportunities with no fear of raising fund externally.
Weaknesses
Along with the strengths, the business has particular weak points which could increase restrictions for the business in implementing its development program. The weaknesses of The Kashagan Production Sharing Agreement Psa Case Study Solution are offered as follows;
• Despite of being a science and innovation publishing company, the company still has traditional 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 expansion plans to prevent its dependence over the Chinese markets to accomplish long term development.
Opportunities
The growth of the publishing industry is declining given that 2008, affecting The Kashagan Production Sharing Agreement Psa Case Study Solution as well, but the growth might be restored by availing particular chances provided in the market. The market opportunities for CMP include;
• The business might also introduce Digital Publishing by using its long term technical experience and a strong consumer acknowledgment in the market.
• CMP might consider a development program through the expansion towards foreign markets in order to minimize its reliance over Chinese markets by utilizing its large funds.
Dangers
The altering macro trends in the market and increasing competitors in the publishing market has positioned particular threats to The Kashagan Production Sharing Agreement Psa Case Study Help consisting of;( Gurel, 2017).
• Intro of digital publishing i.e. virtual libraries might lead to decreasing market share of The Kashagan Production Sharing Agreement Psa Case Study Analysis due to the consumer shift towards virtual libraries.
• The existence of a great deal of rivals in the publishing industry increase the threat for CMP to lose its competitive position in the market, as rivals can acquire a strong customer base by using certain techniques like aggressive promotion, quality products, etc.
• Entryway of new publishing companies in the industry in addition to presence of high competition increases the danger of losing the consumer base.
Monetary Analysis.
The business has a rather competitive monetary efficiency. Due to lack of data, the financial ratios of CMP might not be calculated. The general monetary performance of the business could be examined by using the charts offered in the case Appendices. It could be evaluated from the Appendix III that the yearly overall earnings of CMP during the duration 2000-2012 are growing at a high growth rate, revealing that the annual demand of the products of The Kashagan Production Sharing Agreement Psa Case Study Help is growing and the company is quite effective in drawing in a a great deal of consumers at a possible price.
Together with it, the 2nd chart which reveals the annual growth in the The Kashagan Production Sharing Agreement Psa Case Study Help total possessions, shows that the company is rather efficient in including worth to its possessions through its earnings. The growth in possessions shows that the overall worth of the firm is likewise increasing with increasing the total revenues. (Unidentified, 2013).
Another financial analysis of the business utilizing the given information could be the analysis relating to the circulation of total revenues of the business. Major part of the revenues of CMP comes from the sales of its published books i.e. 64% as displayed in the Case Appendix V. The business could move towards other business sectors with a potential development to attain its future advancement objective.
PESTEL Analysis
PESTEL analysis might be conducted to find out the different external forces affecting the efficiency of the business and the recent trends in the external environment of the company. A quick PESTEL analysis of the company is provided as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable influence on the state of mind of the people about the communist ideology of the government, for that reason, the publishing sector is extremely supervised and directed by the Publicity Department of the Communist Party of China. Therefore, it might be stated that the general political forces impacting The Kashagan Production Sharing Agreement Psa Case Study Analysis company are high. The government policies regarding the publishing sector are also increasing with the passage of time.
Economical.
Financial forces impacting the publishing sector in basic and the CMP in specific includesthe prices of paper, the income level of consumers, the inflation rate, and the general GDP development of the country. All these forces integrate impact the need for the publishing market.
Social and Demographical.
Social and demographical forces include the population development, the customer's preferences towards checking out informative materials and so on. China has the highest population worldwide with a high population growth, showing the increasing variety of customers of the The Kashagan Production Sharing Agreement Psa Case Study Solution. The customer preferences are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP should focus on digital publishing to meet the altering customer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading techniques etc. Enhancement of science and technology together with the increase of digital publishing might minimize the need for the CMP items, if particular actions would not be taken soon.
Environmental.
Ecological forces impacting The Kashagan Production Sharing Agreement Psa Case Study Help consists of the issues of environmental communities over the usage of paper in publishing books. The paper utilized in the books while publishing is needed to be disposable and the ink used while publishing needs to not be hazardous for the environment.
Legal.
Legal policies for the publishing sector at whole are high. Publishing Regulation 1997 requires the publishers to be approved initially by the Government to be entered in the publishing market.
Market Analysis (Porter's 5 Forces Model).
Porter's Five Forces Design might be used to analyze the attractiveness of the publishing industry China. A quick analysis of the Porter's 5 Forces is offered as follows;.
Threat of New Entrants.
Dangers of brand-new entrants in the Chinese Publishing Market is moderate. The possible growth in the market tends to draw in brand-new entrants to the publishing market. However, the existence of intense competitors and the requirement of substantial capital tends to demotivate new entrants to enter in the market.
Risk of Replacement.
Risk of Substitution is high for the Chinese Publishing Industry. The substitute products for the released files is the files provided in the digital libraries on specific websites. The changing customer preferences towards digital learning increase the danger of replacement for the industry.
Competitive Competition.
Competitive competition 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 entering into the marketplace increasing the competition for CMP.
Bargaining Power of Provider.
The significant providers of the The Kashagan Production Sharing Agreement Psa Case Study Solution include the suppliers of the paper for publishing documents. As CMP is the biggest publisher in the Chinese Publishing Market, therefore the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Haggling power of buyer in the publishing market is high. Due to the presence of a a great deal of publishers in the Chinese market and the market saturation, the buyers requires high quality documents at competitive rates.
Competitors Analysis.
CMP operates in a highly competitive market with the existence of large number of competitors. Nevertheless, the business has a competitive position in the market with the highest market share in the Chinese publishing market. Significant rivals of The Kashagan Production Sharing Agreement Psa Case Study Analysis consist of;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis one of the close rivals of CMP. Founded in the same duration, CIP publishes similar type of books. For a large time period, CIP held the largest market share, and still ranks 3rd and 2nd in different market sections, with a major focus on instructional publications. CIP serves as a danger 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 marketplace share of The Kashagan Production Sharing Agreement Psa Case Study Solution quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
Another close competitor of CMP is PTP. It was likewise founded in the exact same duration as CMP and CIP. It ranks 6th in the state-owned publishers in terms of service scale. It is also among the popular gamers in the publishing industry with a yearly total earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Lowering dependence over the Chinese markets.
• Increasing variety of Consumers
• Growth opportunities.
• Preventing the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of possible resources in growth.
• Threat of failure in brand-new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining consumer base.
• Approaching brand-new markets.
• Easy to present using existing capabilities.
• Low danger of Failure.
• Low requirement for funds.
• Increased product portfolio provides high worth to consumers.
Cons
• Competition in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core service sections to the brand-new one can lead the company to lose demand of its products in the market.
Recommendations
With the deep analysis of the internal and external environment of the business in addition to the industry analysis and the competitor analysis, Alternative 2 is recommended to CMP to attain its future development. As the preferences are moving towards digital publishing and the company need an immediate option to prevent the declining market development. Intro of digital publishing could prove to be an instant solution with low quantity of danger for the business. Nevertheless, the business could also think about the expansion program after the success of its digital publishing program.
Implementation
In order to present digital publishing in its product portfolio, the business ought to initially gathers the data related to the customer need, the possible markets, the government policies and the information related to the rivals provided in the market. After that, the business needs to decide one potential sector for its preliminary offering. It must gather research that how it might distinguish its digital publishing from the existing competitors' items. After all the steps above the business must go for the initial offering. If the preliminary offering proves a success, the company should go for the other markets. In this method the business would have the ability to implement its digital publishing program.
Conclusion
Although, the growth of the publishing market is decreasing because 2008, revealing a risk to the business's long term presence, but the circumstance can be controlled by thinking about a development plan in the future. The company might consider introducing digital publishingin its existing market to execute its advancement program at instant basis and to avoid the threat of failure for entryway in the brand-new markets.
