Bezzubenko Katya

BEM 518a.e
TASK 4. LEVELS OF STRATEGY IN MICROSOFT COMPANY
First of all, there are four levels of strategy: corporate level, business level, functional
level and operational level. Corporate level of strategy: CEOs, Board of Directors and corporate
staff. They oversee development of strategies for the entire organization. They take high level
decisions about the overall direction of the entire company. After that we have business level
managers. They are divisional managers. Business level managers are responsible for business
unit that provide products/services to particular market. They take top level decisions in that
product/business line. After that we have functional level managers. Functional level managers
supervise particular function/operation (marketing, operations, accounting, human recources
etc). Marketing manager, Operations manager, Accounting manager, HR manager are examples
of functional level managers. Functional level managers make decisions on their own and they
lower level decisions that can improve the business process. For example, marketing manager
knows more about marketing department that the CEO of the organization. After that we have
operational level of strategy. It refers to the means the companies use to accomplish overall
objectives.
Corporate level of Microsoft company
Microsoft has a lot of corporate level strategies to increase their market share for
Windows.
Among them:
1. Strategic Alliance. By creating strategic alliance with more cell phone companies by

rebranding Windows would create a buzz in the market. Also to be successful in this venture this

has to rely on another strategy and that is backward vertical integration.

2. Backward vertical integration. Despite having one the best R&D facilities in the

world Microsoft could still use a different set of approach and acquire some software and

application developing companies. This would enable them to mitigate the very problem, which

is lack of availability of applications for Windows. Microsoft would be able to develop more

applications compatible for Windows which would make the OS more user-friendly and create a

lot of demand in the market. These acquisitions can also enable them to develop features or

applications which are only available or compatible for Windows.

3. Taper integration in case of Microsoft, can work better in terms of independent

distributor. Microsoft already has stores all over the world. However, what would help more in
competing in the market in the developing countries is by making the retail sector dense.

Emerging companies are either opening up new stores or giving their product to a particular

distributor very rapidly. While opening new stores can be problematic in terms of controlling the

operation, Microsoft can hire more independent distributors to sell their products. Again the

success of this approach will be dependent on the outcome of the previous two mentioned.

Business level strategy

There are some business level strategies which Microsoft Corporation can implement to sustain

their profitability and market share for a longer period of time.

Strategy to support:

1. One drawback of Windows OS is vulnerability to virus attacks. There are cases where

system has crashed as well. Microsoft OS should come up with a unique feature which

provides the customers a sense of relief that their PC is safe. So, providing more security

would make life easier for the end user of the OS which will support them in differentiating

their OS as well.

2. Innovation has been lagging for Microsoft for quite a few times, it should be focused on

how it can make its interface more user friendly and cloud based service can help here

greatly. Cloud based service is getting more and more demanding so Microsoft has a good

opportunity to expand their services to the customers through this.

3. Microsoft’s main goal is to run Microsoft software in every PC so that everyone can use

Microsoft product. In order to do that, Microsoft can use a low pricing strategy that can help

them achieve their goal and it will help them to gain strategic lock-in position in the market

and dominate for a longer period of time.

4. Microsoft has one of the best R&D facilities in the technological industry so they can use

their R&D and invest to create a value innovation and shift above the efficiency frontier

through greater differentiation with lower cost. As they are already enjoying economies of
 scale, they can provide customers with more flexibility and range of other services to their

customers.

5. They can create an OS which will provide services to the disable people and thus they can

attract a new segment of market. As they have a great market reach, they can easily

capture the market and thus they can use focus differentiation as well.

6. Microsoft has the ability to offer good benefits and services and they should utilize it more

effectively to help the customers solve their issues. They can do it via online services which

will add value to their customers. The more satisfied customers are, the more sustainable the

organization is.

7. Microsoft should let other software or technological company use Microsoft platform so

that the threat for new entrants gets lower and later Microsoft can standardize the product or

service they offer.

Functional Level strategy

To support corporate level and business level strategy Microsoft should generate inter-related

functional level strategies.

Marketing Strategy: Microsoft can adapt one strategy for their marketing where they can focus

on the customer feedback/suggestions to facilitate innovation. They should communicate with

the customers on a level which doesn’t only provide feedback on the quality of the existing

product but also suggestions for products that will be launched in the future.

R & D Strategy: Microsoft’s R & D facility is one of the biggest in the world and they are

already working on some lucrative projects like Lightspace, OmniTouch, Kinput project all of

which focuses either on interactive 3D display on different surfaces or scanning objects. These

types of innovative devices should be available to end-users so that the users can replace their

current handheld devices to new devices to experience the new taste and features. Also they
should formulate the method where they can bring customer into product development process.

This method should allow customers to recommend or even submit new designs and

modifications of the product which are available in the market or which are going to be released

at a later date and from there the best possible alternative(s) can be chosen to work on.

Information Management Strategy: Information management strategy of Microsoft

should be in sync with its R&D strategy and that is they should transfer all the feedback data

from the customers over to the R&D department. In order to do that, their Information

Management System should also collaborate with the Marketing Department which will allow

the feedbacks and suggestions to be categorized.