Strategic Management Assignment Sample

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STRATEGIC MANAGEMENT

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EXECUTIVE SUMMARY

Today news channels are not only providing information about the company but also

avails different kind of knowledge. In such context, the present research report is being framed

which is emphasizing on strategic analysis of MSNBC. It is the America’s largest broadcasting

organization that facilitates different type of information to the customers about several aspects.

The present research report is focusing on the strategic analysis of MSNBC in which the

marketing strategies of its competitors are mentioned. The company is also provided with some

recommendations for the purpose of building the brand image of the company in different

markets. The company has been trying to expand the business in other countries in which they

are framing different marketing strategies as that will also help in getting greater market share.

Based on such analysis, the report is going to use strategic options for business development.



TABLE OF CONTENTS

INTRODUCTION .......................................................................................................................... 1

COMPANY OVERVIEW ............................................................. Error! Bookmark not defined.

MANDATE..................................................................................................................................... 2

Mission and core purpose ............................................................................................................ 2

Vision and major goals ................................................................................................................ 2

Core values and guiding principles ............................................................................................. 3

Shareholder Analysis.................................................................. Error! Bookmark not defined.

EXTERNAL ANALYSIS ............................................................................................................... 3

Competitive forces ...................................................................................................................... 3

Macro environmental analysis .................................................................................................... 4

INTERNAL ANALYSIS ............................................................... Error! Bookmark not defined.

Strengths and competencies ........................................................................................................ 5

Weaknesses ................................................................................................................................. 6

STRATEGIC OPTIONS ................................................................................................................. 7

Expansion of unit in new markets ............................................................................................... 7

Widening the service line ............................................................................................................ 8

Increasing advertising and promotional activities ...................... Error! Bookmark not defined.

RECOMMENDATIONS AND IMPLEMENTATION ............................................................... 10

REFERENCES ............................................................................................................................. 15


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INTRODUCTION

MSNBC is an American satellite and cable channel that is being owned by the NBC

Universal News Group that provides commentary and news about political events. It is a unit of

NBC Universal Television Group and division of NBC Universal. The company has been

growing as a successful and profitable unit since 1996. The company faces several challenges in

maintaining its position in the industry. This is the core reason that leads the company to

emphasize on competitive strategies over the next decades so that they retain their position in

competitive market. The present research report is being made for the purpose of analyzing the

strategic management of MSNBC unit. The report is also focusing on the internal as well as

external analysis of environment and majorly the impacts of external factors of MSNBC unit.

The report is also followed by some recommendations in which the organization is

recommended to use the strategic options effectively for the purpose of enhancing customer

base. In the present research report, researcher has been using major strategic options for the

purpose of identifying company’s strengths and weaknesses. Various secondary sources have

been used in the report for the purpose of collecting authentic and relevant data.

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The channel is useful majorly for those people who desire to get political information about the

country and also for these who want to involve with political parties. The cable network has

different channels such as CNBC, CNBC World, NBC, The Weather Channel, NBCSN and golf

channel. All the channels provides information in same language that is English and of any

customer want to translate it in other language then the company provides them a digital box that

converts the language.

MANDATE

Mission and core purpose

The main purpose of company is to enhance the customer base by providing range of

other channels to the viewers. Company is planning to provide seasonal news to the customers

along with weather information. They are also planning to establish the business in remaining

countries as that will help the business to extend the corporate image. The mission of the

company is to augment people so review live programmes and services that inform, educate and

entertain.

Vision and major goals

The vision of MSNBC is to be the most creative organization in the world. The unit is

focused towards their values and they believe only in delivering quality and value for money.

The unit also believes in developing creativity in the organization for the purpose of giving their

best. People in BBC emphasize on great things by working together with the organizational

members. The unit aims to emphasize on diversity for the purpose of providing best and valuable

services to the people (MSNBC Chief Defends Anchor Apologies: 'We Took Responsibility',

2014). The company’s vision is to enhance the level of sales, net earnings and cash flows by

building their position as a leader in American market and to expand the unit they introduced

many channels under the major unit.




Core values and guiding principles

The unit has been following proper code of conduct in which they guides to maintain

integrity, reputation, impartiality and objectivity. The organization adopts the same code of

conduct for each and every department and they highly consider the interest of their stakeholders

(MSNBC Chief Defends Anchor Apologies: 'We Took Responsibility', 2014). All the employees

in MSNBC are directed to follow the general guidelines set by the Board members and they have

to protect the assets of company for the purpose of protecting the interest of stakeholders.



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[email protected] EXTERNAL ANALYSIS

Competitive forces

In order to identify the external environment of the unit, Porter’s five forces model can be

applied as that will also help in identifying the number of competitors of MSNBC in American

market (Linus, 2001). There are number of other cable channels in American market such as

BBC news channel, The Blaze and WFIO TV. All these channels are also involved in providing

English news and live telecast to the people about different concerts. The degree of competitive

pressure is high as so many existing channels are also there in the market which in turn lowers

down the brand identity of the unit. The customers have low switching cost because of lack of




product differentiation. Moreover, BBC news channel is also posing great threat to MSNBC

because of their greater market share, extensive resources, effective promotional activities and

developed customer base (Kraft, 2005). All the competitors can highly affect the market position

of MSNBC and thus would possess a negative impact on the financial performance. Hence,

competition is intense and also a major risk factor that MSNBC is facing.

Other risk threatening is the potential for new competitors to enter the American market.

New competitors can come in the market because other countries do not have economic and

regulation barriers thus they can enter in the American market. This could highly affect the

business operations of MSNBC because of low capital investment, easy access to distribution

and low service differences. Similarly the third factor that affects the business functions of

MSNBC and its competitive environment is the threat of substitute cable channels. Although the

company is providing range of channels to the customers but the rivalries have the same

competency; therefore the threat is high in this industry (Kelliher and Henderson, 2006).

Consumers can easily switch over to other brand particularly because of high availability of

substitute goods. The last affecting factor is the high bargaining power of customers as because

of low product and service differentiation, customer can switch over to other brands. In other

words because of having range of cable networks customers have more options to get services.

Macro environmental analysis

Here are some of the key macro factors that also possess threat to the organization. The

economic condition of the company can change as per changes in flow of money in the

economy. MSNBC has been trying to serve low priced services to the viewers but that is also

beyond the control as that could impact the profitability factor of the company. Poor economic

conditions also reduce the economic power of suppliers and investors which in turn reduce the

credit opportunities as well (Ivy, 2008). The economic recession in America reduces the

purchasing power of customers and thus they spend low on these products, whereas some of the

customers switch over to other companies. High unemployment, lack of credit facilities, low

power of purchasing and high interest rates adversely affect companies operations. Fluctuations




in the currency rates highly affect the profitability factor of company as in that time labor costs

seems to be increased and thus it increases the overall occupancy costs (Hunt and Arnett, 2004).

Other than this, technological factors also affect the operations of MSNBC as a slight change in

technological aspect can impact the functionality of business. Disruptions in information

technology could reduce the efficacy of entire operations of MSNBC because it is not possible

that every individual can cope up with technological advancements. The operations of MSNBC

can get affected by the influence from political parties and legal facets framed by the ruling

bodies.



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[email protected] Strengths and competencies

It is the largest broadcaster in the world with approx 50,000 staff members all around the

branches. It employs more than 10,000 journalists all over the world and this highly underpins

the operations of the company (Harris, 2000). It is the world’s largest broadcast news

organization which avails news and information to people and it generates television output each

day as well as covers online news. Compared to the competitors, the company has penetrated the

market by providing news about different categories at different places. All the channels in

MSNBC are directly linked with the universal network, thus it facilitates them to communicate




with each other whenever required. It has been seen in various researches where the brand is

getting high recognition as so many viewers commented on its official website. It is the brand

identity of the unit that allows the divisions to operate business in different counties. As per

earlier reviews, it has been seen that the unit is planning to diversify the business in North part

for the purpose of enhancing the customer base (Gundlach, 2007).

Other strength of the company is that it covers information from any part of the world as

all the employees are available with 24 hour services. The company is also focusing on the needs

and demands of kids and thus they are looking forward to introduce some cartoon channels for

the entertainment of kids. One of the most important things about the unit is that it charges

relatively less prices from the customers by availing their services (Yannopoulos, 2011). The

company is also getting huge recognition from the public and because of public demand the unit

is planning to introduce cartoon channels. The unit continuously is expanding the branches

which in turn help in creating a competitive edge over the competitors. The unit is also focused

towards the needs and demands of its customers and thus helps them to enjoy high customer

loyalty. In order to meet the needs of the customers, the unit is planning to cover other news such

as personal interviews of celebrities and about sports also. The unit renders 24 hour services in

which customer can anytime get news about weather or political conditions (Fulford, 2013).

Some of the customer also says that this is the only channel that provides latest, updated and

relevant information to the customers. The unit also provides update information to the potential

customers with free of cost and they are also allowed to access the company’s sources of

information. People can access their user generated content easily and effectively.

Weaknesses

The company has been suffering from low product differentiation in which they most of

the customers are switching over to other brand also because of high product substitutes.

Because of the ITV, customers are getting attracted towards other channels and they get TV

license. As the company is rendering 24 hour news, although it is beneficial but on the other side

they fill the space with unnecessary news which in turn affects the interest of people and when

they get bored they switch over to other channel such as sky news for the purpose of getting




constant coverage (Fuchs and Diamantopoulos, 2010). Because of the low budget, company is

unable to broadcast the events and programmes that have well known actors as they demand for

heavy investment. In spite of having key competencies, the company is going through with some

weakness that further reduces the profitability ratio. For instance- currently the company is

suffering from low budget in which they are unable to spend on promotional activities and thus it

affects their financial capacity.



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[email protected] STRATEGIC OPTIONS

Here is the description of some strategic options that could help the company to capture

more market share which in turn directly helps in marinating the competitive advantage over the

competitors. MSNBC has various options to expand the market share with the help of

substantive growth strategies.

Expansion of unit in new markets

MSNBC has been experiencing intense growth in this broadcasting industry since the

establishment of the channel (Salaimeh, 2008). The company is getting several suggestions from

some viewers in which they demand for their channels in other countries as that will help other

people to access news. Generally, all the retail companies adopt this strategic option for the

purpose of expanding the business line which also helps in enhancing the customer base (French,




2009). Most of the company implements this strategy when get failed to survive in the existing

market. Same as in the case of MSNBC, they can also expand their business in other markets by

introducing range of new channels in the existing line. Company reviewed in its current status

that it earns up to $500 million in every six months which increases its resource capabilities and

thus they can attain high competitive advantage in the same sector (El-Ansary, 2006). In order to

introduce new channels in the existing line, they need more journalists and editors that can

manage those divisions.

Based on the review data, it has been recorded that 50 million people review the channel

on internet for the purpose of getting political information. In order to satiate all these viewers,

company can plan out to establish the branch in other countries. This strategy is further

supported by changing demographics and economic climates (Rosenbloom and Dimitrova,

2011). By doing so the unit can also attract new customers from word of mouth publicity by the

potential viewers. In order to differentiate the unit from its competitors, MSNBC can provide

news in different languages because there are many competitors that have captured the market

through this strategy as they are delivering multi lingual news. Going through with this strategy

allows the firm to get high profits and recognition from the capital market (Doole and Lowe,

2008). This will also help the unit to generate more opportunities for employment.

Widening the service line

Earlier the company was involved in providing English news but to accomplish the

viewer’s choice, they introduced a set top box which helped them to attain revenue of

$200million (Richard and Colin, 2005). The strategy also gets an opportunity of recognition

from its potential viewers which further give them the opportunity to operate the business in

other countries. In order to expand the business in other countries, MSNBC should have to offer

range of creative channels for the customers. The company might involve some promotional

strategies to persuade range of customers towards their channels by providing authentic and

relevant information. MSNBC can also sell direct services to the customers in which the

customers can contact with the team members when not having proper services (Dekimpe and

Hanssens, 2004). By doing so, company can retain its potential customers and thus it reduces the




level of switching to other brands. In order to survive in the market, the company can offer the

services at low cost as that will also help them to become the leader in telecast services. This

strategy will also help MSNBC to capture new segment of the market with minimal risks and

capital investment.



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[email protected] The main intension of doing so is to increase the frequency of viewers for their channel.

These are the most effective tool that could help MSNBC to capture larger market share and to

promote the channels amid customers. This is also a sure way to enhance the customer base.

Although the business has been capturing larger market share without having any specific

marketing strategy, but it is also suggested not to ignore the potential threats from the

competitors who have a strong marketing strategy and whose impact can highly impact the

business operations of MSNBC (Chris Christie Is Going To War With MSNBC, 2013). The

business can also put focus on competitors practices as that will also help in determining their

marketing strategies. It is must for the company to find new and innovative alternatives to

persuade range of customers as well as to retain position in the broadcasting area.




RECOMMENDATIONS AND IMPLEMENTATION

MSNBC is recommended to expand the business in other countries by advertising the

channels with the existing one as that will help the customers to get knowledge about the newly

established channels. The business is also recommended to introduce sports, cartoon and other

entertaining channels for the purpose of enhancing the competency of the business. The above

mentioned strategy would definitely leverage the profitability ratio of MSNBC and thus can also

promote the brand name. Prior to expanding the business in other regions, it is must for the unit

to recognize its own strengths and competencies as that will help them in fulfilling the needs and

demands of its customers of different regions (Buckley, 2002).

The business is also recommended to change the structure of the organization in which all

should be provided with training sessions for the purpose of meeting customer’s queries. In some

of the departments, the business is advised to remain with centralized structure while in others

they can adopt decentralized structure. The manager should also monitor the performance of all

the journalists in order to provide full telecast to the people. They should facilitate new channels

and variety of channels for the purpose of differentiating the business (Trim, 2004). The business

is also suggested to contact frequently with the customers and viewers as that will help in

determining the effectiveness of services. They need to focus on the quality aspects as proper

controlling should be there on content of the news. The company should have to differentiate the

duties and responsibilities to all the employees so that each and every department can perform

their duties effectively (Brooks and Simkin, 2012).

MSNBC is recommended to allow the managerial level employees to give their advices and

views in company’s corporate decisions as that will also help in comprehending the areas where

attention is required to put. The company is suggested to target new customers and to fulfill their

needs and demands; they must look forward to innovations (Proctor, 2013. The business is also

recommended to monitor the external environment for the purpose of identifying the strategies of




competitors. They could also get certain benefits by doing so such as accessing the external

market could help in getting local talent pool and thus they can employ the best candidates.



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[email protected] Also if the company opens new channels in the same unit, it may result in inadvertently

over saturating the market and adversely cannibalization which could affect the sales ratio and

therefore it directly could affect the overall financial performance of the company (Narasimhan,

2005). Aside from these operational, there are other factors that may pose greater threat or

difficulty to MSNBC which in turn could affect the brand image and reputation of the firm. In

spite of being an American news organization, they work in the same manner in which they also

require raw materials, technical equipments and skilled journalists and editors. In order to

manage all these aspects, they must put focus on management level (Badur and et.al., 2011).

They should indulge in other marketing practices in which they can promote the services of the

company by focusing on different promotional techniques.




APPENDIX A

Porter’s Five Forces Competitive analysis

As mentioned in the previous part that risks and threats are high as having substitute

products. Risk of industry rivalry maid established firms is high because of their brand identity

and competitive products. Customers can easily switch over to other channels which in turn

states that they have range of substitute products. Product complexity is also low and

competitor’s dissatisfaction in market position is high. Other players can also enter in the market

because of product differentiation. The American broadcasting industry has several players in

which some are small and some are medium sized. Capital investments costs are also moderate

and thus new entrants can access the market.

Threat of substitute is high which also results in customer switching. Customers prefer

substitute products. It has been seen in the annual report of MSNBC that in a survey customers

are demanding sports and other channels for daily updates. Earlier the greater market share of

MSNBC was captured by BBC because it provides regular updates about different facets which

were highly liked by the customers and they rated it as the top most channel. Customers can

Bargaining power of customers

Threat of new entrants

Bargaining power of suppliers

Threat of substitute products

Risk of industry rivals




bargain for these products as the company is focused towards differentiation strategy. The impact

on cost of supplier inputs is high and threats of suppliers entering industry is low and it can be

said as forward integration.



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APPENDIX C

SWOT analysis of MSNBC

STRENGTHS

The largest broadcaster in the world

Range of other channels

Strong network

Number of viewers

Diversified business

Covers information from any part of

the world

About to include other categories in

channels

Less subscription charges

High customer loyalty

WEAKNESSES

Low product differentiation

Customer switch over

Range of competitors

Less efforts in marketing the products

Technological constraints

Ineffective employees

Low budget

OPPORTUNITIES

Strong supplier network

Economic growth in American market

Technological advancements may

provide growth opportunities

Compliance with legal rules and

policies can help the company to reduce

the level of potential threats

Organize global events to further

strengthen brand

THREATS

Changes in economy may reduce the

market share

Threats from product substitutes

Disruptions in technical aspects may

affect the business and its financial

results

Threat from competitor and domestic

news channels




REFERENCES

Badur, B. and et.al., 2011. Analyzing the Effectiveness of Marketing Strategies. IBIMA Publishing. pp.17.

Benson, M. and Barclay, I., 2000. New Product Development: Theory into Practice. Leadership & Organization Development Journal. 11(6). pp.24 – 30.

Brooks, N. and Simkin, L., 2012. Judging marketing mix effectiveness. Marketing Intelligence & Planning. 30(5). pp.494 – 514.

Buckley, P., 2002. International Business versus International Marketing. International Marketing Review. 19(1). pp. 16-20.

Chris Christie Is Going To War With MSNBC. 2013. [Online]. Available through: <http://www.businessinsider.in/Chris-Christie-Is-Going-To-War-With-MSNBC/articleshow/29027973.cms />. [Accessed on 20th January 2014].



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[email protected]

Homburg, C, and et. al., 2009. Implementing the Marketing Concept at the Employee – Customer Interface: The Role of Customer Need Knowledge. American Marketing Association. 73(4). pp. 64-81.

Hunt, D. S. and Arnett B. A., 2004. Market Segmentation Strategy, Competitive Advantage, and Public Policy. Australasian Marketing Journal. 12 (1).


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