Read this report to learn about Microsoft's organizational structure in 2021, as well as its key stakeholders, threats, and developments. There is an explicit chart template for Microsoft structure analysis and current corporate state judgments.
Table of Contents
Organizational Structure & Design at Microsoft Microsoft's Approach Leadership at Microsoft Microsoft Human Resources Microsoft Control and Data Management Microsoft Private Perspective Conclusion Bibliography
Organizational Structure & Design at Microsoft
Microsoft's present organizational structure is divisional. This indicates that the organization is separated into various divisions that make their own judgments while keeping the big picture in mind. The divisional organizational structure, according to Winnubst (2017), has a number of benefits, including simple decision-making. This is owing to the fact that each department has autonomy in decision-making, so long as it is consistent with the company's mission and vision. In addition, the structure facilitates coordination across departments. The departments are permitted to develop their own work plans and objectives.
Additionally, the fact that each department governs itself guarantees that each department's particular difficulties are addressed. Further, Winnubst (2017) asserts that the company's structure provides for a great deal of flexibility, which has served it well. The flexibility permits the various departments to individually solve their specific market concerns. For a divisional organizational structure to be effective, Winnubst (2017) indicates that organizational sharing methods must be implemented. This sharing of information ensures that management is aware of what the various departments are doing and how their efforts contribute to the total.
Product development, support, research and development, networking and operations, and retail are the five primary departments at Microsoft. The corporation employs a horizontal management landscape to ensure that all of its departments function harmoniously. Several intra-organizational processes, such as a sophisticated enterprise resource planning tool, facilitate this. In addition, the organization utilizes an intranet and other information tools to improve communication. It might be argued that the organization is organic because employees have easy access to superiors. This is also attributed to the organization's adaptable structure.
Microsoft's Mission and Objectives
Microsoft's current mission statement ("About," 2019) is to empower every individual and organization on the earth to achieve more by generating opportunity, growth, and influence. The mission is frequently derived from the company's larger vision, which can be defined as a means of altering the connection between humans and technology to maximize human social pleasure for growth, opportunity, and beneficial effect ("About," 2019). This section of the essay analyzes the corporation based on Porter's Five Forces, the company's stakeholders, and its corporate, industry, and firm-level strategy.
Porter's Five Forces Analysis
The five forces include the threat of new entrants, the threat of replacement products, customer bargaining power, supplier bargaining power, and competitive rivalry.
The danger posed by New Entrants
The threat posed by new entrants is minor. This is owing to the fact that the industry is monopolized and offers comparable services, making it practically impossible to enter. This threat is weakened by the fact that new entrants require substantial cash to compete with the enterprise.
The Danger posed by Substitute Products
The danger of alternative products, like the first force, is a weak force. One explanation for this is the industry's limited availability of replacement products. Second, the development of these substitute items is incredibly costly. Possibly, some companies have developed these alternatives, but they are of worse quality compared to Microsoft and some of the company's major competitors.
Customer negotiating leverage
The bargaining power of clients is arguably moderate. This is owing to the fact that there are few items in the industry of comparable quality to Microsoft's. Therefore, consumers have little choice but to select Microsoft as one of their preferred brands. This premise implies that Microsoft has the upper hand, and this may be the only reason why this force is weak. On the other side, Microsoft has access to the information it needs to make its products dependable and efficient thanks to the buyers. Considering the stated cons and pros, it is arguable that this is a moderate force.
Power of Bargaining for Suppliers
Notably, this force is mild. Microsoft can collaborate with a large number of vendors in the business for a variety of services. They have a substantial impact on Microsoft's core business, but not enough to undermine the corporation. To further explain, an illustration may be provided. Some of the company's favored hardware suppliers may opt to raise their prices, which would immediately affect the pricing of Microsoft's products. However, Microsoft can reach out to other vendors and acquire their desired hardware at a lower cost. This equilibrium ensures that this force inside the industry is mild.
Unquestionably, this is a formidable market force. Apple, IBM, Cisco, Facebook, and Google are among Microsoft's principal competitors. The company's competitors are quite aggressive, despite the fact that the market competition is rather tiny. They have structures and corporate practices that are very identical to Microsoft, making it impossible for one company to maintain a significant competitive advantage. In addition, the diversity of the competitors implies that they are always searching for fresh ideas that will offer them the elusive competitive edge.
Microsoft's stakeholders consist of customers, employees, investors, vendors, and the board. Each of these groups has a unique impact on the operations and profitability of the business. The consumers are the ones who purchase the given things. In addition, they serve as the company's focus group for any goods under development. This stakeholder group is affected by the product's quality, punctuality, and customer service.
Notably, the crew strives to satisfy the needs of the customers at all times. They are a crucial stakeholder group since their contributions result in the creation of relevant products and consumer pleasure. Since employees rely on the company for their salaries, it is imperative that their financial demands are also satisfied. They are affected by work quality, productivity, the work environment, and the profitability of the organization.
Investors, on the other hand, are those who invest in Microsoft's businesses and goods in the hopes of generating a profit. It may be argued that employees are also investors because they contribute their time to the success of the company. The market influences the investors in terms of competitor competition, consumer satisfaction, and economies of scale. In addition, the suppliers provide Microsoft with the components necessary to improve their own products. Therefore, they are impacted by the firm's profitability and stability. The final category of stakeholders is the board of directors, which is charged with determining the company's overall strategic direction. They are affected by the profitability and stability of the company.
Microsoft Business Strategy
It might be said that the company's corporate goal is to ensure cloud and mobile are the market leaders (Ulrich, 2017). This means that all of their solutions aim to improve cloud and mobile usage. The corporation must maintain its industry position because cloud solutions are its primary product development focus. Intelligent cloud solutions are offered by the organization to enhance the user experience. In addition, the mobile-first approach aims to make all user demands and activities accessible regardless of the user's location at the time of use. The portability of all its services has also provided the organization with a commercial advantage.
Microsoft Strategy for Industry
Notably, the company's emphasis on technology intensity during the past few years is an industry strategy. Microsoft has been strongly focused on infusing technology into every part of life in an effort to collect data, make life easier, and achieve a perfect blend of business and culture, according to Ulrich (2017). It is arguable that the strategy has been successful in guaranteeing that clients who want to incorporate artificial intelligence into their organizations or even homes seek out Microsoft over any other industry competition.
Microsoft's Corporate Strategy
It may be said that the company has used mergers and acquisitions as its firm-level strategy in order to maintain its position in the market. Any possible new market entrant has been absorbed by Microsoft or one of its competitors. Microsoft recently acquired the professional social network LinkedIn in an effort to broaden its portfolio (Ulrich, 2017). The acquisition of LinkedIn was also significant, as it feeds professional relationships and activity into the cloud, thereby benefiting the company's main business.
Motivation of Employees
Microsoft employs a variety of strategies to inspire its employees. The corporation may use both extrinsic and intrinsic motivation to motivate its employees. Lee and Raschke (2016) explain that extrinsic motivation emphasizes external benefits more than intrinsic motivation, which emphasizes interior rewards. Parental benefits are one of the external rewards Microsoft utilizes to motivate its employees. For instance, all employees receive discounts on child-care services (Lee & Raschke, 2016).
The organization strives to create a comfortable work atmosphere for its employees. Notably, managing professional and parental responsibilities is one of the most difficult issues individuals face today. Microsoft encourages its employees by providing child care facilities at each of its sites, so that parents are not overburdened with concerns for their children while at work. A second extrinsic reward is the 401K plan that employees have access to (Lee & Raschke, 2016). In addition, employees can purchase business stock at a discount. The corporation also provides a financial education program for its employees to ensure they make great financial decisions.
According to Lee and Raschke (2016), one of the intrinsic rewards Microsoft utilizes to inspire its employees is philanthropy, in which new employees receive a $50 credit to donate to a charity of their choosing (Lee & Raschke, 2016).
This provides the new employee with a sense of community service. Many individuals would likely welcome the opportunity to work for Microsoft. Therefore, giving back to others, particularly to vulnerable areas, after joining this firm may instill a sense of pride and appreciation in its employees. Additionally, the organization uses the work environment to motivate its employees to be productive. Staff has also been motivated by the essence of teamwork, respect for everyone in the organization, and appreciation for all efforts made on a project.
Theories of Leadership at Microsoft
One can assert that the organization employs participative leadership theory. This is because not only are all employees treated with the same respect regardless of their work position, but each employee is also given the opportunity to make decisions based on their department and work. In addition, decision-making in the organization is inclusive, as no one person makes all the decisions. Lam, Huang, and Chan (2014) claim that the participative leadership style allows all employees to feel a part of the company's strategic direction.
This inclusivity not only motivates the workforce, but also assures that they care about the company's future; thus, they will exert maximum effort to boost productivity and profitability. It is crucial to highlight that the company's present divisional organizational structure fits well with the stated participative leadership strategy.
Theories of Motivation at Microsoft
Microsoft can be used to illustrate two primary motivational ideas. The first is Mayo's theory of motivation, which stresses the significance of intrinsic motivation (Abyad, 2018). At times, teamwork and employee appreciation are deemed more vital than material rewards. According to Abyad (2018), Mayo says that the greater an employer's involvement in an employee's working life, the better. This is owing to the fact that management will be able to identify the employee's difficulties and ensuring a viable working environment and culture are implemented (Abyad, 2018). Herzberg's motivation theory, which advocates the use of extrinsic rewards for employee motivation, is the second hypothesis (Abyad, 2018).
Microsoft Human Resource Management
Microsoft's human resources department is broad and directed by the human resources strategy. The plan strives to both attract the greatest people on the market and assure quality service delivery by providing staff with adequate support. The company's employees are viewed as its most significant asset. Consequently, the HR department is frequently responsible with ensuring that staff are comfortable and highly engaged.
The HR planning process is really straightforward. First, it examines the department's size and "health." The "health" of the department is the appraisal of its performance based on the qualifications of its personnel. The HR department then evaluates the impact of talent management concerns on each department. Additionally, diversity and manager capability are taken into account to guarantee the best appointment is made. In the HR planning process, learning, leadership development, and rewards are also considered. Monitoring and feedback are the final steps in the process. Rees and Smith (2017) affirm that the company also employs succession planning indicators and utilization of succession planning.
Rees and Smith (2017) believe that intelligence, not experience, is the company's primary entry point for recruits. The company selected its favorite applicants through problem-solving and composure-testing interviews as opposed to regular interviews. In addition, the organization believes in headhunting rather than waiting for candidates to apply in order to recruit the top talent. Since the organization prefers individuals with little or no experience, they provide numerous training opportunities for new hires. The organization has encouraged training approaches such as online learning and even physical learning on the job.
Annual employee performance reviews are conducted by the business. Microsoft, unlike other organizations where employees are ranked during their performance reviews, focuses on the employee's accomplishments over the past year. Typically, the employee is also encouraged to discuss obstacles and recommend strategies for effortlessly achieving their goals for the future year (Rees & Smith, 2017). Additionally, the procedure enables line managers to address any difficulties they may have identified with their subordinates throughout the previous year. Possibly, performance appraisal in the firm is an ongoing procedure that enables all participants to attain their objectives and boost their productivity. The organization permits subordinates to evaluate their superiors and line managers as well. This reversal of roles enables the leadership to comprehend the requirements of the subordinate staff and develop initiatives for a friendly work environment.
Microsoft Control and Data Management
Microsoft values information security, management, and protection. Managers develop a complex control system at the organization. It is essential to recognize that management as a whole provides internal control for financial reporting. However, at a departmental level, managers are allowed to either approve or reject data, finances and other work-related materials. Due to the divisional organization structure that the company has adopted, although the managers have the mentioned