Essay Example on Microsoft: Transforming Humanity's Future Through Cloud Tech

Introduction

Microsoft is one of the few corporations that have transformed the history of humanity. The company is best known for its success as the largest software company across the globe, and for many years its operating system, Windows has dominated in personal computer software. Nevertheless, with the shift of consumer demand from personal computers to cloud-based technology, Microsoft Corporation has been compelled to re-design itself across multiple markets. Today, the company leads the world as it offers various contemporary advantages not only to business enterprises but also to private users. The paper aims to perform an internal analysis of Microsoft Inc.’s strengths and weaknesses.

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Strengths

Flexible Contingent Workforce

One of the main strengths of Microsoft Corporation is its flexible contingent workforce which has enabled managers and Human Resource professionals to deal flexibly with the changing business world. Contingent workers make up approximately half of the company’s workforce, which accounts for peak periods when many workers are required for a short period (Onnen, 2019). The company has also ensured that the temporary workers are assessed and measured in the same way that regular workers are evaluated. Microsoft Corporation has various strategies for managing and handling its contingent workforce in the right way, despite the ever-emerging legal issues that arise from having temporary employees.

Research and Development

Most of Microsoft Corporation’s software products and services are developed internally due to the company’s strong internal development and technical control over the products, which acts as a competitive advantage. The internal development of Microsoft’s products also gives freedom to decide the modifications and enhancements that are of priority for implementation. The company safeguards its intellectual property investments in various ways such as ensuring enforcement of trade secret, trademark, and copyright, as well as other protections to its business plans hardware, software, and branding. Microsoft is a leader in pursuing patents among various technology companies and therefore has a portfolio of more than 31,000 the United States and international patents (Onnen, 2019). Based on the company’s assessment of its key technology trends on long-term research and development, there is significant potential to propel future growth in entertainment, communications, smart connected devices, cloud computing, and productivity. In addition to the company’s main research and development activities, it runs Microsoft Research, which is one of the largest computer science research organizations in the world. Microsoft Research collaborates with giant universities across the globe to advance the state-of-the-art in computer science, hence, creating a special outlook on future technology trends.

Strong Distribution Channels

Microsoft Corporation distinguishes itself from other companies in the industry by employing three strong distribution channels to market its products. The company’s first distribution channel is the Original Equipment Manufacturer (OEM), whereby the manufacturing firms of the devices market the products which use Microsoft’s software packages. In this case, the company installs Microsoft software on the devices before the OEMs sell them to the consumers (Molla, 2017). An example of a Microsoft product distributed using OEMs is the Windows operating system. The company also employs resellers and distributors as a marketing and distribution channel. A significant number of Microsoft products’ distribution chains deal with the main company itself. In this case, the distribution channels are guided by Microsoft in their interactions to optimize the customer’s experience. Additionally, Microsoft Corporation uses the internet as a marketing channel, where the company sells its products to individuals and gives services like subscriptions to users who have Microsoft software. Using the internet to market Microsoft’s products is advantageous because the company promotes its brand by keeping a strong presence on social networking sites like Facebook, Twitter and Instagram.

Strong Financial Performance

One of the biggest Microsoft Corporation’s strengths is its strong financial performance. Microsoft has over $63 billion in both cash and cash equivalents which it can use for investments in areas of research and development as well as in other forms of acquisitions (Onnen, 2019). The company has engaged in various acquisitions in the past such as purchasing Skype in 2011 which for $8.5 billion (Onnen, 2019). Since Microsoft purchased Skype, the number of users has increased tremendously and hence bringing more revenue to the company. Furthermore, the company’s investments in research and development have continued to increase over the years and hence represent a significant percentage of Microsoft's total revenue.

Weaknesses

Slow to Innovate

Despite possessing huge and extensive research and development resources, Microsoft has continuously failed to penetrate new markets with innovative products. The company missed the chance to be the first player in online advertising but was overtaken by other companies in the industry (Molla, 2017). Microsoft’s penetration to mobile OS was also considered to be a bit sluggish, and hence, the market share was captured by Apple and Google. Over the past years, the company has been slow on innovation. Microsoft has experience. Various difficulties in identifying market trends before their arrival and hence being forced to attempt equating to its competitors to satisfy the changing demands of consumers. For instance, the company has been grappling to establish itself in cloud-computing. Nevertheless, this trend has begun to change its course as the commercial cloud revenue of the company has been increasing with a significant percentage. The increase in commercial cloud revenue is attributed to Azure, Dynamics CRM Online services and Office 365 (Onnen, 2019).

Small Market Share

Microsoft Corporation’s mobile market share is still considerably small despite the increase in revenue. Although revenue for the company's Surface tablet and Lumia mobile phones. The small market share posses a major challenge for Microsoft to move forward as the sale of personal computers continues to decline (Molla, 2017). Furthermore, the popularity of smartphones and tablets continues to increase across the world. Regardless of Microsoft’s revenue has increased considerably over the years, the company’s profits have declined partly because of expenses related to restructuring and integration.

Dependency on Hardware Manufacturers

As a giant software corporation, it is ironic that Microsoft does not produce its hardware but relies on firms that manufacture computer hardware. If the company gets competition with cheap and reliable alternatives for an operating system, manufacturers of hardware would choices and Microsoft would do little to change the situation.

Criticism over Security Flaws

Microsoft Corporation’s reputation has suffered due to the Windows Operating System (OS) security flaws. The company’s main product, Windows OS, has received heavy criticism for being very weak against various viruses’ attacks. Relative to OS from other companies, Windows is considered the least protected against viral attacks. As a result, hackers can exploit an unpatched Windows security vulnerability by remotely running malware on the system. There are claims that Microsoft is aware of limited targeted attacks that exploit the inappropriate handling of crafted multi-master font by Windows Adobe Type Manager Library. For instance, hackers can take advantage of the susceptibility of Adobe Type 1 PostScript format by persuading a user to open documents or links that have been specially created (Molla, 2017). The company is aware of these vulnerabilities and is working to solve the problem.

Conclusion

As a leader in software production in the world, it might be hard to predict the future of Microsoft Corporation. Nonetheless, the company may penetrate various spheres like toys and cars to expand its influence. Microsoft has a high weighted scored of 0.68 --- in its research and development, which is driven by its continuous efforts to stay competitive in the market.

References

Molla R. (2017, July 17) Closing the books on Microsoft’s Windows Phone. Vox. Retrieved 17th June 2020 from: https://www.vox.com/2017/7/17/15984222/microsoft-windows-phone-mobile-operating-system-android-iphone-ios

Onnen, J. (2019). Microsoft Store Strategic Audit. Retrieved 17th June 2020 from: https://digitalcommons.unl.edu/honorstheses/168/