The World Is Flat The World Is Lumpy Case Study Solution and Analysis
Introduction
The World Is Flat The World Is Lumpy Case Study Help is the biggest publishing company with a highest market share in the China's book retail market. CMP has actually ended up being a specialized info service provider and a large comprehensive Science and Technology publishing company through the integration of print media, audio-visual media and the network media.
Crucial Problems
Although, The World Is Flat The World Is Lumpy Case Study Help has spent its 60 years journey smoothly, being an effective publishing home, however, the changing macro market trends and forces bring certain obstacles to the publishing market in general and CMP in particular. These elements consist of;
• Entrance of the new publishing firms in the market.
• Declining growth of the publishing market.
• Market saturation.
• Introduction of digital publishing strategies
• Enhancement of science and technology.
The improvement 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 circumstance? Do the long valuable experience, technical resources and the capabilities of the business 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 World Is Flat The World Is Lumpy Case Study Solution has specific strengths that can be made use of to minimize the dangers, conquer the weakness and avail the chances. Strengths of CMP are given as follows;
• The long term experience of The World Is Flat The World Is Lumpy Case Study Analysis in the publishing market i.e. 60 years enables the business to provide high quality items at a lower cost using its prior experiences.
• The technical resources and abilities generated by its effective journey supply a competitive benefit to CMP.
• Huge item portfolioof CMP helps it to diversify its risk and offer high worth to its consumers.
• Strong financial position permits the company to consider numerous development opportunities without any worry of raising fund externally.
Weaknesses
In addition to the strengths, the business has certain weaknesses which could increase restrictions for the business in implementing its development program. The weaknesses of The World Is Flat The World Is Lumpy Case Study Analysis are given as follows;
• Despite of being a science and innovation publishing company, the business still has traditional methods ofpublishing which are not compatible with the growing technological shift.
• CMP extremely relies over the Chinese markets for its development. It must propose specific growth strategies to prevent its reliance over the Chinese markets to achieve long term development.
Opportunities
The growth of the publishing industry is decreasing given that 2008, affecting The World Is Flat The World Is Lumpy Case Study Help as well, but the growth could be revived by availing specific opportunities provided in the market. The market opportunities for CMP consist of;
• The company could also present Digital Publishing by utilizing its long term technical experience and a strong customer recognition in the market.
• CMP might consider a development program through the growth towards foreign markets in order to minimize its dependence over Chinese markets by utilizing its huge funds.
Threats
The altering macro trends in the market and increasing competition in the publishing market has positioned certain hazards to The World Is Flat The World Is Lumpy Case Study Help including;( Gurel, 2017).
• Introduction of digital publishing i.e. digital libraries could result in decreasing market share of The World Is Flat The World Is Lumpy Case Study Analysis due to the consumer shift towards digital libraries.
• The presence of large number of rivals in the publishing market increase the risk for CMP to lose its competitive position in the market, as competitors can acquire a strong customer base by utilizing particular techniques like aggressive promo, quality items, etc.
• Entrance of brand-new publishing firms in the industry along with existence of high competitors increases the hazard of losing the consumer base.
Financial Analysis.
The business has a rather competitive monetary efficiency. Due to absence of data, the financial ratios of CMP might not be calculated. The total monetary performance of the company might be analyzed by utilizing the charts offered in the case Appendices. It might be analyzed from the Appendix III that the yearly total profits of CMP during the duration 2000-2012 are growing at a high development rate, showing that the annual demand of the products of The World Is Flat The World Is Lumpy Case Study Analysis is growing and the company is rather effective in bring in a a great deal of customers at a potential price.
In addition to it, the 2nd chart which reveals the annual development in the The World Is Flat The World Is Lumpy Case Study Analysis overall possessions, shows that the business is rather efficient in including worth to its assets through its profits. The development in possessions reveals that the overall value of the company is also increasing with increasing the overall earnings. (Unknown, 2013).
Another financial analysis of the company using the provided data could be the analysis relating to the circulation of total earnings 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 might move towards other company sections with a prospective growth to achieve its future development goal.
PESTEL Analysis
PESTEL analysis might be performed to learn the numerous external forces affecting the performance of the business and the current trends in the external environment of the business. A short PESTEL analysis of the business is given as follows; (Alanzi, 2018).
Political.
As the publishing sector could have a considerable impact on the state of mind of the people about the communist ideology of the federal government, for that reason, the publishing sector is extremely supervised and guided by the Publicity Department of the Communist Party of China. It might be said that the total political forces impacting CMP company are high. The federal government policies regarding the publishing sector are likewise increasing with the passage of time.
Affordable.
Economic forces affecting the publishing sector in general and the The World Is Flat The World Is Lumpy Case Study Solution in specific includesthe rates of paper, the earnings level of consumers, the inflation rate, and the general GDP development of the country. All these forces combine effect the demand for the publishing market. Along with it, the financial policies related to the import of books affect the overall service at CPM. However, China's financial conditions are rather favorable for CMP with high GDP development and customer income level.
Social and Demographical.
Social and demographical forces consist of the population development, the consumer's preferences towards reading informative products etc. China has the greatest population worldwide with a high population development, revealing the increasing variety of customers of the The World Is Flat The World Is Lumpy Case Study Solution. The consumer choices are moving towards digital publishing rather than the traditional was of publishing. In this regard, CMP ought to focus on digital publishing to satisfy the altering consumer choices.
Technological.
Technological forces impacting the CMP include the technological development in the reading techniques and so on. Enhancement of science and technology along with the increase of digital publishing could decrease the demand for the CMP items, if specific actions would not be taken soon.
Environmental.
Ecological forces affecting The World Is Flat The World Is Lumpy Case Study Analysis consists of the issues of environmental neighborhoods over the usage of paper in publishing books. The paper utilized in the books while publishing is required to be non reusable and the ink used while publishing must not be hazardous for the environment.
Legal.
Legal guidelines for the publishing sector at whole are high. The legal guidelines concerning the publishing sector is controlled by the General Administration of Press and Publication. Publishing Regulation 1997 needs the publishers to be authorized first by the Federal government to be entered in the publishing market. The ordinance forbids direct participation of foreign entities and individuals in the publishing sector.
Industry Analysis (Porter's Five Forces Design).
Porter's Five Forces Model could be utilized to evaluate the appearance of the publishing industry China. A quick analysis of the Porter's Five Forces is offered as follows;.
Risk of New Entrants.
Risks of new entrants in the Chinese Publishing Industry is moderate. The prospective development in the industry tends to bring in brand-new entrants to the publishing industry. Nevertheless, the existence of extreme competitors and the requirement of huge capital tends to demotivate new entrants to enter in the marketplace.
Hazard of Substitution.
Threat of Substitution is high for the Chinese Publishing Industry. The replacement products for the published documents is the documents provided in the virtual libraries on particular websites. The altering consumer choices towards digital knowing increase the hazard of replacement for the industry.
Competitive Competition.
Competitive rivalry in the publishing market is high. The presence of a great deal 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 also entering into the marketplace increasing the competitors for CMP.
Bargaining Power of Provider.
The major suppliers of the The World Is Flat The World Is Lumpy Case Study Help consist of the providers of the paper for releasing files. As CMP is the biggest publisher in the Chinese Publishing Market, for that reason the general bargaining power of provider for CMP is low.
Bargaining Power of Purchaser.
Haggling power of purchaser in the publishing market is high. Due to the presence of a large number of publishers in the Chinese market and the market saturation, the buyers requires high quality files at competitive costs.
Competitors Analysis.
CMP runs in an extremely competitive industry with the presence of a great deal of competitors. The business has a competitive position in the market with the greatest market share in the Chinese publishing market. Significant competitors of The World Is Flat The World Is Lumpy Case Study Help include;.
• Chemical Industry Press (CIP).
• Posts and telecommunication Press (PTP).
Chemical Industry Press (CIP).
CIPis among the close rivals of CMP. Established in the very same duration, CIP releases similar kind of books. For a big time period, CIP held the largest market share, and still ranks second and 3rd in numerous market sections, with a major focus on academic 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 could wean the marketplace share of The World Is Flat The World Is Lumpy Case Study Analysis quickly in the existing market circumstance.
Posts and telecommunication Press (PTP).
Another close rival of CMP is PTP. It was also established in the same period as CMP and CIP. It ranks 6th in the state-owned publishers in terms of business scale. It is also among the popular gamers in the publishing industry with an annual overall earnings of RMB 550 million in 2010.
Alternatives
Alternative-1: Expand towards New Markets
Pros
• Decreasing dependence over the Chinese markets.
• Increasing variety of Customers
• Development opportunities.
• Avoiding the impact of market saturation in the Chinese publishing industry.
Cons
• Usage of potential resources in expansion.
• Threat of failure in new markets.
• Time consuming.
Alernative-2: Introduce Digital Publishing
Pros
• Sustaining customer base.
• Approaching brand-new markets.
• Easy to introduce using present capabilities.
• Low threat of Failure.
• Low requirement for funds.
• Increased product portfolio supplies high worth to customers.
Cons
• Competitors in the market by CIP, who has prior concentrate on the digital publishing.
• Shift of focus from the core business segments to the brand-new one can lead the business to lose demand of its products in the market.
Recommendations
With the deep analysis of the external and internal environment of the company in addition to the market analysis and the competitor analysis, Alternative 2 is advised to CMP to attain its future development. As the choices are shifting towards digital publishing and the business require an immediate option to prevent the declining industry development. For that reason, introduction of digital publishing could show to be an immediate solution with low amount of danger for the company. The company might likewise think about the expansion program after the success of its digital publishing program.
Application
In order to introduce digital publishing in its product portfolio, the business ought to first gathers the data related to the customer need, the prospective markets, the government guidelines and the information related to the competitors presented in the market. After that, the company should decide one prospective segment for its initial offering. It must gather research study that how it might separate its digital publishing from the existing competitors' items. The steps above the company must go for the preliminary offering. If the initial offering proves a success, the company needs to choose the other markets. In this way the company would be able to implement its digital publishing program.
Conclusion
The growth of the publishing industry is declining since 2008, revealing a risk to the business's long term existence, however the circumstance can be managed by thinking about a development strategy in the future. The business could consider presenting digital publishingin its existing market to execute its development program at immediate basis and to prevent the danger of failure for entryway in the new markets.
