Strategic or effective management
The News Corporation
Table of Content
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1..... Problem Domain
2..... Overview of “The News Corporation”
3..... Strategy Options
4..... Theoretical Framework
5..... Application (Advantages and Disadvantages of Acquisition Method)
6..... Analysis
7..... Findings
8..... Conclusion
9..... References
The company’s overall performance are said to be influenced by internal and external environments. Such environmental aspects specifically impact the functions of the management of specific industries. In this regard, the company must consider efficient and effective management approach to lessen the impact of such factors and maximize the positive effects of these internal and external influential factors. Herein, this report aims on discussing and evaluating the strategic and competitive position of News Corporation through the use of marketing tools such as SWOT analysis. In addition, this paper will also evaluate the motivation and rational behind the News Corporation approach of changing into satellite broadcasting and assess the advantages and disadvantages of acquisition as an approach of international expansion in accordance with what have been considered by THE News Corporation. Finally, this paper will also attempt to provide pertinent recommendation for a strategic development plan for the company from 2006 to the future.
News Corporation has been established as a publicly traded media corporation which provides media services not only in Australia but in other part of the global market. News Corporation is originally founded in Australia but because of the reincorporation of the company in 2004, the company moved to New York City.
After such reincorporation, the company has gained about 75% of their revenue and they have been included to the S&P index. The products and services of the company operates in motion picture, television programming, TV, satellite broadcasting, cable, newspaper publishing, magazines and books. In addition, the company has also expanded to the promotion and distribution of advertising campaign materials as well as services.
The corporations’ major shareholder includes the family of its first CEO which served the company for 50 years. family has a 30% control of the company’s share. In addition, the chairman and his relatives have been able to establish a media empire from the beginning of the Corporation. The company’s subsidiaries consists of the Twentieth Century Fox and Fox Entertainment group movie studio, Moreover, the company has also 34% control in the DIRECTV Group as well as ownership of over 30 American television stations, New York Post newspapers, Boston Herald and different Britain largest circulation newspapers like The Times, The sun, and the News of the World. The corporation is also operating in major parts of the world. The corporation has the extensive business operations across Europe, Australia, Asia and Latin America.
The News Corporation also generated Intermix Media Inc in July 2005 that owns the largest social networking portal in the internet which is MySpace.com and other websites.
Accordingly, the most utilized strategic management model is the strategies model ( 2003). Different studies have claimed that the intensity of the industrial competition is considered to be a matter of luck or chances. But, studies have shows that competition is based on how different companies compete and how they operate in the market environment. Generally, the strategy refers to the company’s long-term goal and activities that created to achieve their organizational objectives. Strategy is the basis which will serve as a standard for the industry to effectively adhere to their business needs ( 2001).
As based in the given case study, the main strategic approach of TNC is in line with their ability to change ad adjust the business into an industry which give the latest and innovations in the media corporations. The company objective of the News Corporation is to establish a business empire which is united, creative and logical. Their objective is to create a corporation that utilizes strategic opportunities as they arrive, with the aim of anticipating challenges brought by the changing environment.
With their mission to give the highest quality content with the most convenient marketing communication approach and distribution channel, among different clients, News Corporation has been able to offer high quality and innovative media services and productions which suit the needs of the people in the world market.
This section of the report attempts to analyse TNC with the use of marketing tools such SWOT analysis and the company’s diversification will be analyzed.
a. Business Model (Motivation for Diversification to Satellite Broadcasting)
According to (2002), strategic management is regarded as the process of formulating, implementing and evaluating cross-function decisions that enables various companies to achieve their organizational objective. In line with the situation of the News Corporation, the firm has been able to utilize a strategic business model to stay in their competitive position and advantage. In addition, the strategy aims to provide high quality service to their target market.
One of the business models utilized by TNC is the diversification method, in line with their commitment to satellite broadcasting. The main objective of TNC is to diversify their products and services to meet the needs and demands of today’s market. As part of this approach, the company launched the UK Sky Television on February 5, 1989. The Sky television is a direct-to-home satellite broadcasting and this is the answer of the company for the intensified communication in terms of communications satellite broadcasting services provided by others. Furthermore, News Corporation also diversified their services to provide innovative services and media coverage to their clients in terms of changing from analogue to digital and to consider multi-channel broadcasting. Moreover, another motivation of the News Corporation to diversify into satellite broadcasting is to give a new approach in line with programmed material distribution. With such diversification of the industry, the company has been able to give opportunities for any broadcaster to enhance their channel distribution which permits the distribution of different programmers to various nations.
b. Analytical Tool
This section will attempt to analyse the strategic position of The News Corporation through the use of SWOT analysis. As mentioned in the given case study, the strategic position of TNC specifically their BSkyB’s position are being challenges because of the changes that are happening in the media market. Competitors of TNC has announced their establishment of the first quadruple play media industry in the global market that provides broadband, television, mobile communications and fixed line. Such launch affects the strategic position of TNC. To be able to ensure that the industry will not be left behind, TNC has made them involved into the technological development and strategic expansion. Using SWOT analysis, TNC’s strategic position in 2006 will be assessed
Strengths
Being a globally and internationally recognized media industry, TNC, it can be said that the company hold a strategic position in the media market. Based on the given case, it is stated that when TNC streamlined and reincorporation in 2003-2006, they already gain advantage in terms of size and market niche. With the multibillion income and sales, TNC has outgrown their major rival companies to be the largest firm in this market. In addition, the decision of the management to diversify and the consideration of committing to satellite broadcasting and its acquisition of the MySpace.com, the company has been able to enhance more its strategic proposition and developed a brand which is difficult for other rival companies to outgrow. Likewise, the firm has been characterized by different analysts to be capable of adapting to changing market needs so as to maximize their profit. their ability to listen and identify the needs of their target market has permitted TNC to construct corporate culture that is recognized by their loyal and satisfied clients.
Another strengths of TNC is their ability to continuously reinvent and enhance their service in line with the internet, media and communication while efficiently managing the needs of their customers which enables them to maintain leader status in the competitive market.
Weaknesses
Although the company has not much weakness as compared to other companies and based on the given case, the major weakness of the company is their inability to anticipate the flaws or weaknesses of the industry. It can be said that the company is focusing too much on the high-end acquisition and diversification despite of the risky impact of their decisions.
Opportunities.
The basis for the long-term success of the TNC is their ability to continuously develop new generations of more advanced media services. Hence, one of the TNC’s opportunities is their chance to tap into more markets as the output of their innovations being provided in the television, media, and internet industry.
In addition, the company has also the chance to enter new growth markets because of their acquisition of . They also have the opportunity to get ahead of their competitors.
Threats
Competitors can be considered as the major threats to TNC. In addition, TNC has also the threat from its acquisition, especially when they are not able to maximize their acquired company. The inability of TNC to keep up with innovations can also create a major threat for their. In addition, government regulations and policies can also serve as a threat of the company.
Acquisition of the company can be said to have advantages and disadvantages. TNC has been involved in major deals in the media market from 1981 to 2002. The company has acquired different companies such as Gemstar-TV Guide DirecTV and also they acquire small stakes of 20th century fox and other local TV stations. Furthermore, the company has started to operate a satellite TV system for their UK subscribers and also invested in Asia for another TV system which is Star and cable Fox News Network. The latest acquisition of the TNC is their acquisition of MySpace.com which is the largest social networking website in the internet.
The acquisition approach of the THC has taken advantages and disadvantages for the company. Based on the given case study, one of the advantages of the acquisition for the TNC is in line with market niche growth. With their acquired industry, TNC has been able to diversify their business and meet the demands of the clients in the global market. Furthermore, through this, TNC has also been able to see their potentials in various markets which include the online market. The investment of the company has also grown because of this acquisition, specifically in terms of the market share. The industry has more opportunities to provide innovative services in the communication and interactive media leading to their success.
On one hand, the disadvantages of so many acquisitions are in line with the threat of major downfall if they are not able to handle the acquired companies effectively. The acquisition also entails large values of financial budget involved and if the company would not give importance with each acquired companies, then they have to meet economic disability in the future.
Analysis shows that with the strategic management approach of TNC, the corporation has been able to outgrow other media industries. With the ability of the company to foresee what is needed to grow in the media and broadcasting market, the TNC considered various strategies and business models such as diversification and acquisition method. It can be analyzed that with the goal of the TNC to stay in the competitive and strategic position, they are able to anticipate major challenges and maximize their strategic approach to meet the demand of the media market and outgrow rival industry in the international market.
Based on analysis of the given case and company, the following is the perceived strategic development plan for TNC from 2006 to the future. Strategic planning is an important aspect of the management wherein the management identifies manners and approaches to initiate corporate discount in a corporate unit.
Strategic plan can be utilized in when the company intends to initiate a specific marketing and management decisions which will enhance the competitive of the company (Elkin, 1998). With proper execution of such management plan with the strong commitment of the management and the employees with this plan stability and competitive advantage will be achieved by the company.
For this recommended approach, it is suggested that the management of TNC must give attention on managing their subsidiaries and acquired company. Furthermore, to be able to maximize their advantage in acquiring the largest social networking in the internet which is MySpace.com, TNC management should be able to efficiently manage such acquisition. IN line with the marketing approach, the company should be able to maximize the utilization of their financial resources in the latest trends and innovation in the market environment. They also need to manage their financial resources well to sustain competitive advantage and position and considers employee trainings and customer satisfaction.
Strategic planning can be utilized by the TNC in developing new technology in media market and interactive media (1998). Such strategic plan will help the company it can also be said that the resources, capabilities, and business environment of an organisation or industry can all contribute to the efficacy or success of implementing these strategic changes for News Corporation. The company should then design a project plan for this strategy. Important resources that will serve as the strategy’s framework should be prepared. It is also suggested that the company develop a monitoring system, which will regularly evaluate the strategy’s progress. This will be helpful for detecting problems ahead of time as well as in implementing strategy changes or improvements. In addition, the management must try to implement ways to meet the needs of their stakeholder through constant communication. The management perspective of strategic or effective management is to provide superiors customer experience through direct, comprehensive business relationship and support programs tailored to satisfy the needs of the market.
It can be concluded that the management must be able to know what is occurring in the internal and external environment of the company. This is also done to know if changes are needed by the company to meet the changing needs of the clients. In this regard, strategic management through proper organizing, planning, leading and controlling is needed. Through this, the management will also be able to counter the negative effect of technology advancement and other internal and external factors.
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