Corporation Analysis
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BUS 302 Group Report
THE NEWS CORPORATION
CASE STUDY
Bernardetta Tusacciu
Yun Kyong Choi
Noubda Bojoudi
Naresh De Silva
Xi Xi Cheng
Table of Contents
Executive Summary
Findings
Appendices
pg.11
External Analysis
PESTEL
PORTERS FIVE FORCES
SCENARIOS
Internal Analysis
TOWS MATRIX
VALUE CHAIN
ACTIVITY MAP
RESOURCE AND COMPETENCES MATRIX
STAKEHOLDERS MAPPING
Portfolio Analysis
BCGS MATRIX
ASHRIDGES MODEL
Strategic Analysis and Choice
ANSOFFS MATRIX
POSSIBLE ALTERNATIVES
Executive Summary
This report analyses the sustainability of The News Corporation within the future context.
In this respect, the report first undertakes a thorough analyses of the issues surrounding NewCorps, and then goes on to find solutions to these specific issues. These are used to generate options which are an amalgamation of the different solutions, with the purpose of deriving viable strategies to counter the issues with a holistic approach.
Finally and perhaps most importantly, the report appraises the viability of each of these compositions of strategies, evaluating them under the strict criteria of suitability, acceptability, and feasibility. This proved to be an appropriate measure of the soundness of each solution.
The report however stops short of recommending specifically the strategy option that NewsCorp should take, since all of three are equally viable for a number of reasons. It is therefore the responsibility and discretion of management and shareholders to determine the adoption of one of these options.
The appendices follow which provides essential information to the comprehension of the report, since all of the models used for evaluation are outlined here. The use of theory was pervasive throughout our analysis and subsequent reporting, as it is only with sufficient theoretical proof that solutions become viable and appropriate.
Findings
THE ISSUES
The crisis in the late 80s that led to a massive debt restructuring scheme in 1990, and the significant losses incurred in 2001 and 2002 came on the heels of periods of large scale acquisition, and could be a symptom of an inefficient post merger integration system. It is probable that the many acquisitions and investments have been value destroying at the strategic business unit level.
There exists a need for consolidation and integration (or divestiture) of business units within the organization, with specific emphasis on profit generation capabilities at the SBU level, in order to realign the profitability and financial stability of NewsCorp as a whole.
Ownership of its various media channels entails an ethos and responsibility toward unbiased, impartial content, yet the Murdoch stable of newspapers and magazines around the globe have garnered a reputation for being short on quality . Its other units have also suffered from a lack of credibility, such as Fox News Channel at Fox Broadcasting Company which has purposely been positioned with a right wing bias, and NewsCorps British papers, who have been stalwart opponents of the European Union, most likely due to self interested motives (the stringent regulatory environment within the E.U. would restrain NewsCorp). Murdochs conducive ties with political figures throughout the globe have further contributed to this skepticism.
There is a need for revaluation of the mission and purpose of the organization so as to restore credibility to the corporate parent and within each SBU in the field of news coverage. Examination of corporate social responsibility objectives is also therefore necessary.
With a large and potentially negative implication for the future, the intrinsic attachment between NewCorp and its founder has raised yet another serious concern. The drive of the organization can always be traced back to Rupert Murdoch, and an issue therefore arises regarding management and development of NewsCorp in the event of death or retiring of Murdoch.
Contingency plans need to be prepared in the event of departure of Mr. Murdoch which would entail a restructuring of management structure and culture, and henceforth developing strategic position.
A plausible threat lies within the realm of regulation within the media distribution framework. Regulatory barriers have been prominent throughout NewsCorps growth and existence, and have at times acted as impediment. In most cases however, NewsCorp, with the use of informed strategy and Murdochs political allies, has continually been able to circumvent these barriers. Yet the future has the potential to bring with it pervasive legislation that could effectively restrict further expansion, or in the worst case, oblige the divesture of parts of its multi subsidiary structure in the interest of competition.
a need to avoid complacency regarding legislature governing control of the media within all of its international markets, and to be ready with appropriate tactics at corporate and business level.