Transcript of "Case study assignment technology strategy - www.topgradepapers.com"
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GET YOUR WORK DONE BY www.TopGradePapers.com September ASSIGNMENT – 1 15, 2009 Introduction rs Technological companies have been evolving since last few decades. Advancements in the technology and radical innovation have forced these sorts of companies to upgrade themselves rapidly with the changing environment. Advance Micro Devices (AMD) is pe one of these companies who are in the business of silicon and software since four decades. AMD is founded in 1969. It is a worldwide recognized company which is passionate about innovation. It is a global provider of innovative graphics, processors and Pa media solutions. The main objective of the AMD is to become best energy-efficient that will provide visually realistic solutions. Its revenues have grown up to $5.7 billion (approx) in year 2006 (AMD Official Website). Some of its major competitors are ARM Holdings, Intel Corporation, and NVIDIA. de Components of the Strategy: There are five major components of a strategy which are; scope, goals and objectives, ra resource development, identification of sustainable competitive objective and synergy. [Walker, Mullins, & Larrehe, 2008]. There are many strategic challenges that a companypG has to face. Especially, technological oriented companies have to be flexible and quick in their strategy making and implementing in order to keep them updated with the environments. In this kind of industry, each company struggles hard to attract the customers with their new technological product and features.To AMD always tries to focus on planning exact and well thought out strategies by making the maximum use of five components of strategy. The scope for AMD is clearly identified and circumstances and environment suggests that it is right to assume the scope of emerging technologies and hence of AMD. First, AMD started with only a short product line and at the time passed, it jumped into diversification and more innovative products that caused reasons for AMD’s higher scope. Advanced Micro Devices 2 GET YOUR WORK DONE BY www.TopGradePapers.com
GET YOUR WORK DONE BY www.TopGradePapers.com September ASSIGNMENT – 1 15, 2009 The success of every organization is largely dependent on how clearly it defines its Goals & Objectives. AMD has clear cut goals and objectives to serve its valued customers. AMD has an objective i.e. AMD does not follow the principle “technology just for the rs sake of technology”. It has always an objective of fulfilling people needs ahead of technology. Throughout its journey, AMD always focused on developing its resources in order to tackle any disturbances and hurdles that fall into its way to success. Also the low pe cost resources for manufacturing were of great interest to AMD. The strategies made are consistent with environment and have the flexibility to change along with a change in environment. AMD has the belief that the strategy planned should Pa be sustainable and should create a competitive advantage for the organization. So when planning the strategy, these points grab attention of planners. While talking about synergy, AMD does not seem to be comfortable about sharing its de resources or technologies across the industry. However, AMD and NVIDIA have some sort of synergies as they both are working on the project in which graphic cards by the NVIDIA could get compatible for AMD new silicon boards. ra Corporate Strategies: There is a hierarchy of strategies i.e. corporate level strategies, business level strategies,pG and functional level strategies [Walker, Mullins, & Larrehe, 2008]. While formulating corporate strategies, managers should coordinate the activities of business units or separate legal entities. The primary focus of these strategies is organization’s scope and resource development [Raymond & charies show, 2003]. The main purpose of theseTo strategies is to address the questions like what business we are in. what business we should be in? How much resources should be allocated to each business to achieve organizational goals? Corporate level strategies includes; corporate mission, corporate goals and objectives, corporate development strategies, and development of resources [Walker, Mullins, & Larrehe, 2008]. Advanced Micro Devices 3 GET YOUR WORK DONE BY www.TopGradePapers.com
GET YOUR WORK DONE BY www.TopGradePapers.com September ASSIGNMENT – 1 15, 2009 Each organization wishes to maintain an edge or distinctiveness over its competitors. These competitive edges may be like human resources strength, financial and technological resources etc. AMD has taken initiatives in its corporate strategies by rs Digital Inclusion, Fair and Open Competition, and has adopted modern and latest manufacturing technologies. The strategies for growth of business are made at corporate level. To measure the growth of a company the critical factors are sales of the company, pe unit sales and most importantly percentage change in sales [Raymond & charies show, 2003]. In the nutshell corporate strategy is all about making a distinctive position of your Pa company in the clusters of competitors. This leads the company to the comparative advantage. Same situation is with AMD, they are providing high quality distinctive products to their employees. de "Only two companies in the world develop and deliver x86 microprocessors in volume. Only two companies in the world deliver leading-edge 3D graphics. Only AMD does both." ra - Dirk Meyer, AMD president and CEO This was the message by the CEO and the president of the AMD that shows their basicpG corporate struggle to get a comparative and distinctive advantage over the other companies. They also consider that world is world is focusing on the major changing environment. And they try to position them to have maximum benefits because, they have developed a motto like, when you think value, you think AMD. [Official websiteTo AMD] Business level Strategies: The focus of business level strategy is on the competitiveness of business units to its industry. These strategies strive to find out sustainable competitive advantages for their Advanced Micro Devices 4 GET YOUR WORK DONE BY www.TopGradePapers.com
GET YOUR WORK DONE BY www.TopGradePapers.com September ASSIGNMENT – 1 15, 2009 business units. AMD is using low-cost strategy as it has low cost sources of supply and modern technologies which gives it a competitive advantage over its competitors. Further, the business level strategy takes into account “scope”. Which market segments to rs be compete in? And what products should launch in which segment to give a hard target to competitors? [John A. Byrne, 2006] Business level strategies include business unit objectives, competitive strategy, and development of resources [Walker, Mullins, & pe Larrehe, 2008]. AMD has developed many strategies for its business units, due to greater strength in Human Resources; it has developed the strategy of Superior Customer Services. And, to Pa cope with its major competitors, AMD uses the Low-Cost Strategy by minimizing its costs of production and marketing. As the discussion with the Bob Rivet and AMDs CEO Dirk Meyer about the current strategy plans for the company they said that we have plans for conversion to 45nm manufacturing technology. “Well be fully converted in first de half of next year,” AMDs CEO Dirk Meyer. [Traian Teglet, 2008] Marketing Strategies: ra Market strategies are responsible for effectively allocating the marketing resources for attaining the organization’s objectives within a specific market segment. These strategiespG help to identify target markets for particular products [Ronald, Katharine, Valarie, 2004]. The organization also maintains a competitive advantage by offering a proper marketing mix (4Ps) according to the needs of customers or potential customers in that targeted market. Some of the marketing strategies includes; marketing strategy for product,To market entry for new product, R&D strategy and plans, human resources strategy and plans and operations strategy and plans [Philip & Gray, 2008]. The business level strategies are vital for success of Strategic Business Units (SBUs). SBUs at AMD are delivered with objectives known as business unit objectives. Each unit considers those objectives and gives its maximum to achieve those objectives. Each SBU also needs sources for conducting its part of business. These strategies also underlie the Advanced Micro Devices 5 GET YOUR WORK DONE BY www.TopGradePapers.com
GET YOUR WORK DONE BY www.TopGradePapers.com September ASSIGNMENT – 1 15, 2009 allocation of resources to these business units [Jay B. Barney, 2005]. AMD has a separate Head for managing these strategies and amending them according to changing needs. Conclusion: rs The factors influencing strategies are; competitive factors of competitors, development in pe industry, globalization, and information technology (Walker, Mullins, & Larrehe, 2008). Sustaining in such a competitive industry is not an easy task. AMD is dealing quite well with these factors. Its efficient R&D department is one of the reasons of its presence in such an industry for decades. Its global presence and quality of products are growing its Pa revenues at a steady pace. Overall, AMD has implemented quite good growth strategies that are aligned well with the corporate, business and market level strategies. The key to its success is that they are flexible and quick and that is why it is one of the largest companies providing high profiled technological services over the globe. de rapGTo Advanced Micro Devices 6 GET YOUR WORK DONE BY www.TopGradePapers.com
GET YOUR WORK DONE BY www.TopGradePapers.com September ASSIGNMENT – 1 15, 2009 Works Cited rs 1. Philip Kotler and Gary Armstrong (2008), Principles of Marketing, Prentice hall 2. Raymond miles and charies show (2003), organizational strategy, structure and pe process, McGraw Hill 3. John A. Byrne (2006), AMD standouts, business week April 10,2006, pp. 84-143 Pa 4. Walker, O. C., Mullins, J. W., & Larreche, J.-C. (2008). Marketing Strategy: A Decision-Focused Approach. New York: McGraw-Hill. 5. Jay B. Barney (2005), firm resources and sustained competitive advantage, de journal of management 39, pp. 96-123 6. AMD Annual Report 2008, available at http://phx.corporate- ra ir.net/phoenix.zhtml?c=74093&p=irol-reportsannual, accessed at 13/09/09 7. Interview with Mr. Utz-Hellmuth transcribed on knowledge@wharton (2005), available at www.knowledge. Wharton.upenn.edupG 8. Ronald T. Rust, Katherine N. Lemon, and Valarie Zeithaml (2004), return on Marketing: using Cuustomer Equity to Focus Marketing Strategy, journal of marketing 68, pp.109-127To 9. Management Strategy and Analysis, available at: http://www.amd.com/us/aboutamd/corporate- responsibility/strategy/Pages/management-strategy.aspx, accessed at 14/09/2009 10. Traian Teglet, (2008), AMD Talks About Current Business Strategy, http://news.softpedia.com/news/AMD-Talks-About-Current-Business-Strategy- 95889.shtml, Accessed at 13/19/2009 Advanced Micro Devices 7 GET YOUR WORK DONE BY www.TopGradePapers.com