Insurers' journeys to build a mastery in the IoT usage
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12. VISION AND MISSION
VISION
Using the most advanced Internet technology to enhance
the exchange and sharing of information between people,
to achieve "gathering originative people power.”
MISSION
Become China's largest original games company, Gives
players the best entertainment experience, Build the
largest online community, Let more people to enter into
the platform.
13. In view of the observation and analysis on the
mission statement, the revised statement below is
proposed to improve its scope that will suit best in
its business operation.
As an cyber information technology Company:
To contribute to a Happy Environment and to
provide Quality Assurance and Value Creation of
Renovation, Using the most advanced Internet
technology to enhance the exchange and sharing of
information between people and to conform to
build up the cyber community for people to join
and share , let the virtual world become the part of
real life, helping people using the latest technology
to improve the quality of life
14. Components Proposed mission statement for China State
Construction EngineeringCorporation Ltd
Customers Enjoyable surfing experience and easier way of
information share (Retained)
Products or Services Network platform (Retained)
Markets To succeed into being the best online community
and information sharing platform in China (Revised)
Technology Using the latest technology bridge the information
gap between people. (Retained)
Concern for Survival, growth,
and profitability To enhance the value of their investments. (Revised)
Philosophy Share, Renovation, Enjoyable and Closer.
(Retained)
Self-concept To provide superior and reliable, top-quality network
services responsive to netizens. (Revised)
Concern for employees To provide outstanding career opportunities self-
value realized environment (Retained)
Nation Building To become one of the most valuable network
incorporation in China. (Revised)
Components of a Mission Statement
21. NetEase Company：
Barriers to entry：Hard to entry
Website needs to attract readers, the investment is huge, game
developer also requires a lot of money,
Threat of substitutes: Many substitutes
There are many substitutes: Portal has QQ, Yahoo, sina, online
game has Teancent and sanda game.
Bargaining power of buyers: strong
Information Age came to make people's life is full of media,
People can choose their favorite media, play different games,
browse their favorite web pages, it can be several portals
customer.
Bargaining power of suppliers: strong
All media are government control, and telecommunications is to
be concerned about the government in china.
Rivalry among the existing players: Highly competitive
More and more companies are entering this sector
22. Opportunity Score Weight Weighted Score
Political Environment 3 0.2 0.6
Technical level 3 0.2 0.6
Population affected 3 0.15 0.45
Cost Structure 4 0.1 0.4
Lifestyle 3 0.05 0.15
Threat
Consumption levels 2 0.1 0.2
Culture Values 2 0.1 0.2
Product differentiation 2 0.1 0.2
Total 1 2.8
The EFE Matrix (External Factor Evaluation Matrix)
Legend: 1= Response is Poor, 2=Response is Average, 3=Response is Above average, 4=Response is Superior
24. marketing strategy
They employ a variety of traditional and online marketing
programs and promotional activities to build their brand as
part of their overall marketing strategy. They focus on
building brand awareness through proactive public
relations and traditional and online advertising. They invest
in a series of marketing activities to further strengthen their
brand image and continue to grow their user base. Their
marketing campaigns consist of corporate branding and
announcements about their services through outdoor, print
and online advertisements.
They plan to continue investing in various forms of
marketing to further build awareness of their brand and
game titles.
25. Game Genre Revenue Model
Date of Initial
Commercial
Launch
Date of Issue of Latest
Expansion Pack
New Fly for Fun
3D MMORPG,
cartoon-style flying theme
Item-Based October 2008 July 2013
Legend of Fairy
2.5D MMORPG,
European-style fairy setting
Item-Based May 2011 December 2013
Tianxia III
3D MMORPG,
classical Chinese setting
Item-Based October 2011 December 2013
Kung Fu Master
2.5D MMORPG,
classical Chinese setting
Item-Based July 2012 October 2013
Heroes of Tang Dynasty II
2.5D MMORPG,
classical Chinese setting
Item-Based November 2012 November 2013
Ghost II (a comprehensive upgrade of Ghost)
2.5D MMORPG,
classical Chinese setting
Item-Based April 2013 September 2013
New Westward Journey Online III (a
comprehensive upgrade of Westward
Journey Online III)
2D MMORPG,
classical Chinese setting
Time-Based May 2013 September 2013
Fantasy Westward Journey II (a
comprehensive upgrade of Fantasy
Westward Journey)
2D MMORPG,
classical Chinese setting
Time-Based July 2013 -
New Legend of Westward Journey
(previously named Warsong of Westward
Journey)
2D MMORPG,
classical Chinese setting
Item-Based August 2013 -
Dragon Sword
2.5D MMORPG,
classical Chinese setting
Item-Based August 2013 -
New Westward Journey Online II (a
comprehensive upgrade of Westward
Journey
Online II)
2D MMORPG,
classical Chinese setting
Time-Based September 2013 -
The Legend of Tibet
2.5D MMORPG,
classical Chinese setting
Item-Based November 2013 -
26. Human resource
The success of their business is dependent on
their ability to retain their existing key employees
and to add and retain senior officers to their
management.
They depend on the services of their existing key
employees. Their success will largely depend on
their ability to retain these key employees and to
attract and retain qualified senior and middle
level managers to their management team.
Future changes in management could cause
material disruptions to their business.
27. Research and Development
They believe that the ability to develop and
enhance their services is an integral part of
their future success. Their product
development efforts and strategies consist of
incorporating new technologies from third
parties as well as continuing to develop their
own proprietary technology in order to
produce user-friendly Internet and wireless
applications, services and technologies for the
Chinese market.
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31. Seasonality of Revenues
Historically, revenues from advertising and e-mail
services have followed the same general seasonal
trend throughout each year, with the first quarter
of the year being the weakest quarter, due to the
Chinese New Year holiday and the traditional
close of customers’ annual budgets, and the
fourth quarter as the strongest. Usage of their
online games and wireless value-added services
has generally increased around the Chinese New
Year holiday and other Chinese holidays,
particularly winter and summer school holidays.
32. Liquidity Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Current Assets 10,626,895 14,474,186 17,868,673 22,797,763
Current Liabilities 1,828,227 2,282,577 3,676,470 4,378,067
Current Ratio
5.81 6.34 4.86 5.39
Table Current Ratio of NetEase
33. Leverage Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Total Assets
11,586,662 15,444,931 19,277,956 24,546,330
Total Liabilities
1,863,024 2,346,467 3,676,470 4,378,067
Debt Ratio 6.22 6.58 5.24 5.61
Table Debt Ratio of NetEase
34. Leverage Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Total Liabilities
1,863,024 2,346,467 3,676,470 4,378,067
Total Equity
9,723,638 13,098,464 15,601,486 20,168,263
Debt-Equity Ratio 0.19 0.18 0.24 0.22
Table Debt to Equity Ratio of NetEase
35. Activity Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Net sales 5,507,669 7,290,652 8,200,956 9,196,175
Fixed assets 755,778 848,469 815,026 872,113
Fixed Assets
Turnover Ratio
7.29 8.59 10.06 10.54
Table Fixed Assets Turnover Ratio of
NetEase
36. Activity Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Revenue 5,659,789 7,472,751 8,379,961 9,771,255
Total assets
11,586,662 15,444,931 19,277,956 24,546,330
Total assets
Revenue Ratio
1.22 1.14 1.33 1.73
Table Total Assets Revenue Ratio of
NetEase
37. Profitability Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Net income
2,232,025 3,222,973 3,586,570 4,445,218
Revenue
5,659,789 7,472,751 8,379,961 9,771,255
Net profit
Margin Ratio
0.39 0.43 0.43 0.45
Table Net profit Margin Ratio of NetEase
38. Profitability Ratio In thousand of RMB except the ratio
2010 2011 2012 2013
Net income
2,232,025 3,222,973 3,586,570 4,445,218
Total Assets
11,586,662 15,444,931 19,277,956 24,546,330
ROA Ratio 0.19 0.21 0.19 0.18
Table ROA Ratio of NetEase
39. NetEase
Internal Strengths score weight weight score
Human resources 5 0.125 0.625
R & D 5 0.2 1
Quality of Service 5 0.08 0.4
Quality Control System 4 0.08 0.32
Operational capacity 4 0.09 0.36
Financial Structure 3 0.1 0.3
Internal Weaknesses
Marketing 2 0.125 0.25
The capital 2 0.2 0.4
Totals 1 3.655
NetEase Internal
Factor Evaluation
40. NetEase
Internal Strengths score weight weight score
Human resources 4 0.125 0.5
R & D 4 0.2 0.8
Quality of Service 4 0.08 0.32
Quality Control System 4 0.08 0.32
Operational capacity 4 0.09 0.36
Financial Structure 3 0.1 0.3
Internal Weaknesses
Marketing 2 0.125 0.25
The capital 2 0.2 0.4
Totals 1 3.25
strengths should receive only a rating of 3 or 4; 3=minor strength, 4= major strength,
weaknesses should only receive a rating of 1 or 2 ; 1= major weakness, 2= minor weakness.
41. S:
1)Human resources
2)R & D
3)Quality of Service
4)Quality Control System
5)Operational capacity
6)Financial Structure
W:
7)Marketing
8)The capital
O:
A. Political Environment
B. Technical level
C. Population affected
D. Cost Structure
E. Lifestyle
SO
1.Use of new technologies to
developing new products
2. Develop new markets (moblie
games)
3. To establish a new brands
4. Continuously cooperate with
other industries
comprehensively.
WO
1. Increase investment
to open new market.
2. Optimize the group
structure to
rationalize the
expense further.
3. Control the capital.
T :
F. Consumption levels
G. Culture Values
H. Product differentiation
ST
1.Develop different products,
2.Diversification development
3. Provide seminars and training
for employees, management
and investor
WT
1.Reduce costs, increase
market share and establish
new sales channels
2.Conduct of Annual
Business Continuity Plan
3. Benchmark against
strong competitors.
42. Through plotting scores NetEase obtained in both IFE and EFE
matrix, it was plotted at the cell four, or the “hold and maintain”
region, this would suggest that NetEase tactical strategies
should focus on intensive strategies
43. Internal Strategic Position External Strategic Position
(1 to 6) Financial Strengths (-6 to -1) Environmental Stability
5 Liquidity -2 Foreign exchange fluctuations
4 Return on investment -4 Technological changes
4 Return on sales -3 Inflation rates
4 Leverage -4 Increase in Demand
3 Profitability -5 Price range competitors
Average 4 Average -3.6
Internal Strategic Position External Strategic Position
(-6 to -1) Competitive Advantage (1 to 6) Industry Strategy
-3 Industry Know-how 6 Numbers of competitors
-3 Competitive workforce 5 Competitors performance
-3 Improve facility (delivery truck) 6 Increase in export industry
-1 Location 5 Growth potential
-5 International tie-up 5 Resource utilization
Average -3 Average 5.4
Total Y axis score = 1 Total X axis score = 1.8
44. SPACE
NetEase falls in Quadrant I, which means that the organization is in a
aggressive region, and it should pursue the strategies that prefer to use
its internal strengths to take advantage of external opportunities, improve
internal weaknesses and avoid external threats. So, in detail of the
strategies, include expand internally, market development, product
innovation and diversification related
45. NetEase is located in Quadrant I. It is in an proficient strategic position.
The suitable strategies of the especial group are to exploit new market,
comprehensively cooperate within the relevant industries, also need
engage in develop more creative products for integration.
47. • Long Term: (3-5 years)
• More market share in online games and mobile games, strive to have a
certain proportion in the online advertising market
• Increase the brand recognition and new brand, Attract more users.
• Cooperate comprehensively with diversified industries
• NetEase Culture to affect the whole group circumstance, to reform the
management mode, consequently expand to the entire employees
• Short Term Objectives
• I Increase Revenue by 20% (total)
• Increase Market Share of major product(online game) from 35% to 40%,
also improve the online advertising market share.
• Cooperation with foreign companies together to develop products
• Increase Research and Development cost by 20% continuously
• Enhance marketing and advertising activities
48. Strategy framework suggest that NetEase should concern about the
intensive strategies on market development, market penetration, product
innovation, forward integration, backward integration, horizontal integration
and diversification related or unrelated.
For the objective of increasing revenue, based on the real condition of
internet industry and combined the detail of NetEase, the best and
practical method is to extend the market share. And then, the business
strategies will be guided as market orientation, supported by operation
management, finance, R&D, human resource.
Further develop of new internet technology and establish new brands and
products to attract huge customer base
More activities of advertisement and promotion to improve brand
recognition .
Collaborate with other IT company – it is the rare occasion to learn
advanced technology and management experience, conversely, rationally
amply these knowledge can accelerate the evolvement of NetEase’s own
business.
Develop more advertising supplier resource – base on the Five Force
Model, if obtain more suppliers resource respectively, how easy for them to
drive up the price as many options existing.
Efficient operation capital – provide the impetus for the development of
new markets.
49. Recommended Organization
Strategies
At first NetEase need strengthen the
management of subsidiaries. NetEase corporate
structure restrict their ability to receive dividends
from, and transfer funds to, NetEase PRC
subsidiaries and variable interest entities, which
could restrict their ability to act in response to
changing market conditions and reallocate funds
internally in a timely manner.
50. OBJECTIVES ACTION PLAN DEPARTMENT/ COMPLETION
PERIOD
RESPONSIBLE
Recruiting skilled
programmers
Recruiting through
intermediaries
Top Management
(HR Manager) Weekly
New Product
Development
Conduct training
and seminars of
Employee and
research and
development about
new product focus.
R&D department
Weekly
Marketing
Research
Get first-hand
information for
changing market
Marketing
department
dayily
Deepening
cooperation with
Blizzard
Carried multifaceted
cooperation with
Blizzard, learning
technology
R&D department
2014-2016
51. Focus on Quality,
Services, Customer
Satisfaction
Spread investment to
different business.
Corporate Treasurer
weekly
Expansion through
Group of companies
stockholders and
investors
Visit companies
cooperation with the
group of companies to
get information and idea
for new niche market
and referrals
Marketing & Account
Officer
Weekly and continuous
Product Strategy : upgraded and wider
product, accelerate
update an existing game,
to prevent the loss of the
player, the player collects
sounds and fed back,
good communication and
customer
Research and
Development
department, Customer
service department
Monthly
New product Strategy –
development of mobile
application and other
information technologies
Through management of
customer interview
satisfaction and or
advertisement and
monthly monitoring
Top Management and
Quality control
department
Weekly Continuous
global Strategy - focus
on mobile technology,
providing services to the
world Marketing Management 2014-2016
R&D department
52.
53. Area of
Objectives
Measure Target Initiatives
Financial
Revenue Increase by 20% Market explore
Return on Investment Increase by 5%
Market explore & Develop new
products
Earnings before interest, taxes,
depreciation, and amortization
Increase by 10% control cost
Customer
Customer satisfaction above90%satisfaction rate Investigation, correction
Customer complaints Decrease10% complaints
rate
Investigation,
feedback,complaints
Brand recognition Increase40% distributors Market share
Internal Process
Quality of product Reduce errors or bug Quality management
Process arrangement
Decrease the operation cost
2%
Scheduling, flow optimization
Service provider
Imcrease service satisfactory
rate to 98%
Service assessment& More
provider resource
Material supplier
Increase material
satisfactory rate to 99%
Supplier evaluation&more
supplier resource
54. Learning and Growth
Continuous education
90% employees with skill
improvement
Training, seminar,
absorb talent into the
group
Job satisfaction
98% job satisfactory rate Bonus incentives,
career design
Employee performance
Elect 20 prominent employees
Human assessment
Corporate Social Responsibility
Government Regulation
100% compliance Compliance of the
government regulation
strictly
Nongovernmental activities Community involvement Proactively attend the
community
Environment Sustainability
Environment friendly
advocate positive energy Organize more
activities of caring for
the environment
Natural Resource Protection
Decrease 50% paper utilization
rate
Waste paper recycling
Development office
software
