The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution and Analysis
Introduction
The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution is the largest publishing business with a highest market share in the China's book retail market. CMP has become a specialized details service provider and a big detailed Science and Technology publishing business through the combination of print media, audio-visual media and the network media.
Vital Issues
Although, The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution has actually invested its 60 years journey efficiently, being an effective publishing home, however, the changing macro market trends and forces bring particular difficulties to the publishing industry in basic and CMP in particular. These aspects include;
• Entryway of the brand-new publishing firms in the industry.
• Decreasing growth of the publishing market.
• Market saturation.
• Introduction of digital publishing methods
• Improvement of science and technology.
The transformation of the macro markets have raised several concerns to the management at CPM that what could be the future of CMP in this situation? Do the long valuable experience, technical resources and the abilities of the company could be used to pursue the future advancement unceasingly? How could the business sustain its long term competitive position in future?
Situational Analysis
Internal Analysis
SWOT Analysis
Strengths
The Role Of The Audit Committee In Risk Oversight 2 Case Study Analysis has specific strengths that can be made use of to minimize the threats, get rid of the weak point and get the opportunities. Strengths of CMP are provided as follows;
• The long term experience of The Role Of The Audit Committee In Risk Oversight 2 Case Study Analysis in the publishing market i.e. 60 years allows the company to offer high quality products at a lower cost using its previous experiences.
• The technical resources and abilities produced by its effective journey provide a competitive advantage to CMP.
• Huge item portfolioof CMP helps it to diversify its risk and provide high worth to its clients.
• Strong financial position permits the company to consider a number of advancement opportunities without any worry of raising fund externally.
Weak points
Along with the strengths, the business has specific weaknesses which could increase restrictions for the company in executing its development program. The weak points of The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution are given as follows;
• Despite of being a science and innovation publishing firm, the business still has traditional methods ofpublishing which are not compatible with the growing technological shift.
• CMP highly relies over the Chinese markets for its growth. It must propose particular expansion plans to avoid its dependence over the Chinese markets to achieve long term development.
Opportunities
The development of the publishing industry is declining considering that 2008, affecting The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution as well, but the development could be revived by availing specific opportunities provided in the market. The market opportunities for CMP include;
• The company could also present Digital Publishing by utilizing its long term technical experience and a strong client recognition in the market.
• CMP could consider an advancement program through the expansion towards foreign markets in order to lower its reliance over Chinese markets by using its vast funds.
Threats
The changing macro trends in the market and increasing competition in the publishing industry has actually postured specific threats to The Role Of The Audit Committee In Risk Oversight 2 Case Study Analysis including;( Gurel, 2017).
• Intro of digital publishing i.e. digital libraries could result in decreasing market share of The Role Of The Audit Committee In Risk Oversight 2 Case Study Help due to the customer shift towards digital libraries.
• The presence of a great deal of rivals in the publishing industry increase the danger for CMP to lose its competitive position in the market, as competitors can gain a strong consumer base by using specific methods like aggressive promo, quality items, etc.
• Entryway of new publishing firms in the industry together with existence of high competition increases the hazard of losing the customer base.
Monetary Analysis.
Due to lack of information, the financial ratios of CMP could not be computed. It might be examined from the Appendix III that the annual total profits of The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution during the duration 2000-2012 are growing at a high development rate, showing that the yearly demand of the products of CMP is growing and the business is quite effective in drawing in a large number of consumers at a prospective rate.
Along with it, the 2nd graph which shows the yearly development in the The Role Of The Audit Committee In Risk Oversight 2 Case Study Help total possessions, reveals that the business is rather effective in adding worth to its properties through its profits. The growth in assets reveals that the overall value of the firm is likewise increasing with increasing the total incomes. (Unidentified, 2013).
Another financial analysis of the business using the given information might be the analysis concerning the circulation of overall profits of the business. Major part of the incomes of CMP originates from the sales of its released books i.e. 64% as displayed in the Case Appendix V. The company could move towards other service sectors with a potential development to achieve its future advancement objective.
PESTEL Analysis
PESTEL analysis could be performed to learn the various external forces impacting the efficiency of the business and the current patterns in the external environment of the business. A quick PESTEL analysis of the company is offered as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a significant impact on the state of mind of the people about the communist ideology of the federal government, therefore, the publishing sector is highly supervised and assisted by the Publicity Department of the Communist Party of China. It could be stated that the overall political forces impacting CMP company are high. The government policies concerning the publishing sector are also increasing with the passage of time.
Affordable.
Financial forces impacting the publishing sector in general and the The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution in particular includesthe rates of paper, the earnings level of customers, the inflation rate, and the overall GDP growth of the country. All these forces combine effect the need for the publishing market. Along with it, the economic policies associated with the import of books impact the general organisation at CPM. China's financial conditions are quite favorable for CMP with high GDP development and consumer income level.
Social and Demographical.
Social and demographical forces consist of the population development, the customer's preferences towards reading helpful materials and so on. China has the highest population in the world with a high population development, revealing the increasing variety of consumers of the The Role Of The Audit Committee In Risk Oversight 2 Case Study Help. The customer choices are shifting towards digital publishing rather than the standard was of publishing. In this regard, CMP must focus on digital publishing to fulfill the changing consumer preferences.
Technological.
Technological forces affecting the CMP consist of the technological improvement in the reading techniques etc. Improvement of science and innovation together with the increase of digital publishing might decrease the need for the CMP items, if particular actions would not be taken soon.
Environmental.
Environmental forces impacting The Role Of The Audit Committee In Risk Oversight 2 Case Study Help includes the issues of environmental communities over the usage 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 policies for the publishing sector at whole are high. The legal regulations concerning the publishing sector is managed by the General Administration of Press and Publication. Publishing Ordinance 1997 needs the publishers to be authorized initially by the Government to be gone into in the publishing market. The ordinance prohibits direct participation 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 evaluate the appearance of the publishing industry China. A short analysis of the Porter's 5 Forces is provided as follows;.
Risk of New Entrants.
Risks of brand-new entrants in the Chinese Publishing Market is moderate. The potential development in the market tends to bring in brand-new entrants to the publishing market. Nevertheless, the existence of extreme competition and the requirement of big capital tends to demotivate brand-new entrants to enter in the marketplace.
Danger of Replacement.
Danger of Substitution is high for the Chinese Publishing Market. The alternative products for the released documents is the documents provided in the virtual libraries on particular sites. The altering customer choices towards digital learning increase the hazard of replacement for the market.
Competitive Rivalry.
Competitive competition in the publishing industry is high. The existence of large number of customers 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 participating in the market increasing the competition for CMP.
Bargaining Power of Supplier.
The significant suppliers of the The Role Of The Audit Committee In Risk Oversight 2 Case Study Analysis consist of the providers of the paper for publishing files. As CMP is the biggest 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 marketplace saturation, the purchasers needs high quality files at competitive rates.
Rivals Analysis.
CMP runs in a highly competitive industry with the presence of a great deal of rivals. The company has a competitive position in the market with the highest market share in the Chinese publishing market. Significant competitors of The Role Of The Audit Committee In Risk Oversight 2 Case Study Analysis include;.
• Chemical Market Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Market Press (CIP).
CIPis among the close competitors of CMP. Founded in the same duration, CIP publishes similar kind of books. For a large period, CIP held the largest market share, and still ranks 2nd and third in various market sectors, with a major focus on instructional publications. CIP acts as a risk for CMP as it could wean its market share due to its long term competitive background. CIP is concentrated on digital publishing and might wean the marketplace share of The Role Of The Audit Committee In Risk Oversight 2 Case Study Help easily in the current market situation.
Posts and telecommunication Press (PTP).
It was likewise established in the same duration as The Role Of The Audit Committee In Risk Oversight 2 Case Study Solution and CIP. It is also one of the popular gamers in the publishing market with a yearly total revenues of RMB 550 million in 2010.
Alternatives
Alternative-1: Broaden towards New Markets
Pros
• Reducing reliance over the Chinese markets.
• Increasing variety of Clients
• Growth opportunities.
• Avoiding the effect of market saturation in the Chinese publishing market.
Cons
• Usage of possible resources in growth.
• Danger of failure in brand-new markets.
• Time consuming.
Alernative-2: Present Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to present utilizing existing capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased item portfolio provides high worth to consumers.
Cons
• Competitors in the market by CIP, who has prior focus on the digital publishing.
• Shift of focus from the core company sections to the new one can lead the business to lose demand of its items in the market.
Suggestions
With the deep analysis of the external and internal environment of the business together with the market analysis and the rival analysis, Alternative 2 is suggested to CMP to achieve its future development. As the preferences are moving towards digital publishing and the business require an instant solution to avoid the declining market development. Therefore, introduction of digital publishing might prove to be an immediate option with low amount of danger for the company. The business might likewise consider 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 first gathers the data related to the customer need, the prospective markets, the federal government policies and the data associated with the rivals provided in the market. After that, the company must decide one possible sector for its preliminary offering. It ought to collect research that how it could differentiate its digital publishing from the existing rivals' items. After all the steps above the company ought to go for the initial offering. If the preliminary offering shows a success, the business ought to opt for the other markets. In this way the business would have the ability to execute its digital publishing program.
Conclusion
The growth of the publishing industry is decreasing given that 2008, revealing a danger to the business's long term presence, however the scenario can be controlled by considering an advancement plan in the future. The company might consider presenting digital publishingin its existing market to implement its development program at instant basis and to avoid the danger of failure for entrance in the new markets.
