Strategic Audit of Microsoft Company, mission, vision, pestle analysis, porter five force model, swot matrix, recommended strategies.

1. Microsoft Corporation
Prepared by: Mariam

2. Brief Overview
• Introduction
• Vision Statement
• Mission Statement
• Microsoft Segment
• Pestle Analysis-2018
• Porter’s Five Force Model
• SWOT Analysis-2018
• Recommended Strategies

3. Introduction
• Founded in 1975,by Bill Gates. Microsoft is the
worldwide leader in software, services, devices and
solutions that help people and businesses realize their
full potential.

4. Mission and Vision
Our Mission
• Empower every person and every organization on the
planet to achieve more.
Our Vision
• Build best-in-class platforms and productivity
services for a mobile first, cloud-first world.

5. Intelligent Cloud
• It segment consists of our public, private, and hybrid server products and cloud services.
Including Microsoft SQL Server, Windows Server, Visual Studio, System Center, Microsoft Azure, and
GitHub.
Personal Computing
• Windows, including Windows operating system, Windows Vista, Windows7, Windows 8, Windows 10
Windows cloud services, Windows Internet of Things.
• Devices, including Microsoft Surface, PC accessories, and other intelligent devices.
• Gaming, including Xbox hardware, software , Xbox Live transactions, subscriptions, video games,
and third-party video game.
Productivity and Business Processes
• Office Commercial, including Microsoft Office 365 Commercial subscriptions and Office
• LinkedIn, including Talent Solutions, Marketing Solutions, and Premium Subscriptions.
• Microsoft Dynamics business solutions, including Dynamics ERP on-premises, Dynamics CRM on-premises,
and Dynamics 365.
• Office Consumer, including Office 365 Consumer subscriptions and Office licensed on-premises, and Office
Consumer Services, including Skype, Outlook.com.
Microsoft Segment

7. PESTLE Analysis-2018
Political
• European Union hits Microsoft by 730 millions dollars.
• For formation of political environment he provided more than
10 million dollar.
Economic
• Microsoft forced to lay off 5000 employees during 2007.
• High growth of developing countries.
Social
• Microsoft has not adopted smart phones easily.

8. PESTLE Analysis-2018
Technological
• It experienced profit growth after adopting LinkedIn.
• Walmart-Microsoft 365 to fuel its digital transformation the
shopping experience.
Ecological
• Increase reference of green producers.
• Electronic scrap harming the environment.
Legal factors
• Electronic waste disposal regulations.
• Energy consider regulations.

9. Porter’s Five Force of Microsoft
1) Bargaining Power of Buyers (Low):
• High switching cost.
• Unique Product (User Friendly).
• Less number of suppliers.
2) Bargaining Power of Suppliers (High):
• Since buyers have few choices of whom to buy from,
supplier power is high.
• Limited option of suppliers.
• High switching cost.
• Unique Product.

10. 3) Threat of substitute(Low):
• Every computer manufactured in the world has to have an
operating system in order to work. Microsoft appears to be
dominant in this area. Microsoft possesses monopoly
power in the market for operating systems
4) Threat of new entrants (Low):
• A new competitor would face a number of entry barriers
before entering this market. Customers are very loyal to the
Microsoft brand and would expect any competitor to offer
at the very least the same features that Microsoft already
has.

11. 5)Competitive Rivalry (High):
Today electronic industry s very competitive.
• In Business Processes segment Microsoft competes
with software application such as Apple, Facebook,
Google and IBM.
• In Intelligent Cloud segment, Microsoft compete with
CA Technologies and Hewlett-Packard.
• In Personal Computing segment, Microsoft compete
with Apple and Google

12. SWOT Analysis-2018
Strengths:
• Global Presence: Used in more than 190 countries which reflects
higher sales and a vast reach. More than 500 million devices all around
the globe use the Windows Operating system.
• Large product/services portfolio: operating systems; productivity
applications; server applications; business solution applications;
desktop and server management tools; software development tools;
video games; and training and certification of computer system
integrators and developers.PCs, tablets, gaming and entertainment
consoles, cloud computing services.

13. Strength:
Growing cloud business: The cloud industry has achieved faster growth in
the recent years fueled by a huge investment in innovation.
Focus on innovation: Microsoft is working to stay ahead of its competitors
in several areas including AI and Mixed reality. It is investing heavy sums in
Research and development in these areas.
Brand image/ Customer Loyalty: Microsoft software can help its users
achieve very high degree of efficiency and productivity which has led to a
high level of trust among Microsoft users whether individuals or
businesses.

14. Weaknesses:
Declining PC market: The PC market has been through severe decline in the recent years
fuelled largely by the rising sales of smartphones and tablets. Since Microsoft is a major
provider of software and devices, it also found its sales being affected by the reducing sales
of computers.
Slower in terms of innovation: when you compare MS with its nearest competitors like
Amazon and Apple, you will find its speed of innovation slower. Its search engine and
browsers are also not as powerful as the ones created by Google.
Smaller advertising market share: Advertising revenue of Microsoft has grown in the
recent years, but yet its share is much smaller compared to the other major players in the
online advertising industry like Google and Facebook.
Lacking market leadership in Internet browser segment : Microsoft Edge had very weak
position with only 2% of users. When we look at comparison worldwide, Google Chrome is
leader again in web browsers

15. Weakness:
Cybercrime theft: The increasing cybercrime cases have left
Microsoft in a vulnerable state. Hackers have reportedly attacked
the cyber security of the Windows Operating System several
times.
Unsuccessful acquisitions: Microsoft’s fewer acquisitions like
WebTV, LinkExchange, Nokia, and Skype resulted in failures and
divestitures. Such unprofitable investments are the biggest
weaknesses of Microsoft

16. Opportunities
Innovation and Artificial Intelligence : Microsoft has a massive opportunity in many
innovative areas like AI and game technology. Investing in these areas can give an
upper hand to Microsoft.
Partnerships and Acquisitions : Microsoft can focus on entering into new strategic
alliances and partnerships. It will enable the company to gain high market share.
Acquiring major hi-tech firms will also be a profitable opportunity for Microsoft.
Smartphone industry :The fast-growing market of smartphones and tablets offer an
excellent opportunity for Microsoft. It can capitalize on the rising demands of these
products.
Reducing Cost: Microsoft can gain the opportunity of increasing its sales and revenue
by offering its products at low prices. It may also prevent the hackers to use its
software illegally.

17. Threat
Aggressive competition :Microsoft is in intense competition with Google and
Apple. These companies’ established positions can be a threat to Microsoft’s market
position.
Changing preferences of consumers : People are highly attracted to the market of
smartphones, notepads, and laptops. Microsoft has modest shares in these markets.
Open source projects : Like Linux OS and Open Source Office, many new open
source projects have successfully entered into the market offering similar services for
free. It can threaten Microsoft that offers these products at an expensive rate.
Cybercrime and piracy : Rising cybercrime thefts and software piracy issues have
dramatically affected Microsoft’s security network system

18. Recommended Strategies
Growth through Product development: The most suitable strategic option for
Microsoft Corporation is to make smart phones and hardware devices for the
customers as because this is the ever challenging as well as demanding market.
Growth through mergers and acquisitions: Acquisition plays an instrumental role to
connect the world’s professional cloud and the world’s professional network. The
list of the most notable recent acquisitions includes Nokia Corporation business and
LinkedIn.
Growth through Market Penetration: This intensive growth strategy involves selling
more products to the markets where the company currently has operations through
online marketing and advertising.
Cost Leadership Strategy: Microsoft can gain the opportunity of increasing its sales
and revenue by offering its products at low prices.

19. THANK YOU!