Critical Analysis and Evaluation of Operations - Reed Elsevier - Essay Example

Criticl nlsys nd evlution of opertions within chosen orgniztion Reed Elseview is well plced to ccelerte momentum nd cpitlize on the significnt nd underlying strengths of the business (www.reedelsevier.com) This pssge is short outline of the nture of n orgniztion tht I would like to nlyse in present pper. Reed Elseview is leding publisher nd informtion orgniztion founded in 1880. Through the merger in 1992, orgnistion becme strongly represented in North meric, Europe, nd the si Pcific region. With focus on three key mrket res - science, lw, nd business, its businesses in the scientific division publish more thn 1,200 journls worldwide in the physicl, life, socil, nd medicl sciences, nd the compny opertes n interntionl network of medicl communictions services (2) Reed Elsevier's lw division serves, through vriety of publishing formts, importnt legl, tx, reference, nd eductionl mrkets round the world. The ctivities within the business division comprise leding business mgzine nd informtion compnies nd worldwide exhibitions business. Ech of these mrkets is lrge nd grows t 4-7 percent nnully. Its two prent compnies--Reed Interntionl P.L.C. nd Elsevier NV--re listed on the msterdm, London, nd New York Stock Exchnges. Reed Elsevier employs over 26,000 people (1). Orgniztionl structure of Reed Elsevier cn be shped within the following four divisions: Science & Medicl, Legl, Eduction nd Business (3). Compny holds number one or two positions in ll of our key mrkets, with strong brnds, content nd mrket rech in ech. Science nd Medicl Elsevier, Reed Elsevier's globl Science & Medicl division, is the leding provider of high qulity scientific, technicl nd medicl informtion to the cdemic, reserch nd helthcre communities. Legl Reed Elsevier's Legl division, LexisNexis, is globl provider of uthorittive legl, news, public records nd business informtion, including tx nd regultory publictions in print or online. Eduction Hrcourt Eduction, Reed Elsevier's globl Eduction division, is leding publisher serving the pre-Kindergrten to Grde 12 school, ssessment nd trde publishing mrkets in the US nd primry nd secondry school mrkets interntionlly. Business Reed Business, Reed Elsevier's globl Business division, is provider of mgzines, exhibitions, directories, online medi nd mrketing services cross five continents. Its prestige brnds serve professionls cross diverse rnge of industries. Trnsformtion System Trnsformtion hs become wide-used word in the orgniztionl behvior industry of modern ge. There re plenty of sources which introduce nd offer different techniques nd mngement methods to encourge personl nd orgnzitionl trnsformtion. Reed Elsevier's product-mrkets re undergoing rpid nd ccelerting chnges. This mens tht Reed Elsevier will be confronted with the migrtion of informtion from print to electronic formt nd the dditionl interctivity tht electronic services offer. Bsed on this chnge, n Opertion Mnger my orient the principl objective for Reed Elsevier to being n indispensble prtner to their trget consumers for informtion-driven services tht provide solutions cross their three core res of focus. Cpitlizing on the potentil of the Internet seems to be key driver of Reed Elsevier's strtegy. cquisitions nd llinces, prticulrly in the context of Internet development, re used to reinforce Reed Elsevier's strtegy. t this moment, the three core businesses re ll trnsitioning into electronic mrkets. ll of them re becoming more globl, nd the Internet is rpidly becoming the preferred customer ccess system for ll three. Reed Elsevier hs lredy introduced numerous innovtive services nd products. Exmples include the lunch of ScienceDirect, the fully serchble online dtbse comprising content from over 1,000 of their scientific journls. In legl publishing, Butterworths, Reed Elsevier subdivision, lunched Butterworths Direct, the most comprehensive online legl service for English lw. Furthermore, LEXIS-NEXIS, nother subdivision of Reed Elsevier, introduced its universl current wreness web browser product for the business mrket. However, it ppers tht to some degree Reed Elsevier hs underinvested in new product development, mrketing, nd sles. This is key fctor behind the lck of growth in both prticulr trditionl mrkets nd new Internet businesses. Reed Elsevier therefore budgeted [euro]420 million for new development inititives in 2000 compred to n verge [euro]80-120 million in previous yers. This level of investment will be followed by three-yer investment pckge totling in excess of [euro]1.2 billion. round 90 percent of these investments will be Internet relted, including new product nd technology development, mrketing, nd sles. Reed Elsevier expects tht in the yer 2005 qurter of its revenue, [euro]1.5 million, will come from the Internet (2). To chnge Reed Elsevier from trditionl "pper" compny into n electronic publisher tht cn survive in rpidly chnging industry demnds huge reorgniztion. The Internet ctivities of the compny will be orgnized seprtely nd hve distinct mngement responsibilities nd ccountbility. lthough the electronic medi group will work closely with the printing brnds nd mrketing, they will lso independently pursue growth opportunities in existing nd crefully defined new mrket segments. In ddition, the compny estblished venture fund of initilly up to [euro]100 million to mke erly stge investments in Internet-relted businesses, to provide insight nd involvement in these new mrkets nd new technology inititives, nd to generte dequte finncil returns. The lst yers hve brought significnt progress in the trnsformtion of Reed Elsevier. Recently comprehensive new strtegy tht is ment to deliver sustined nd ccelerted growth took plce. It is needed to report rel progress ginst ll the key milestones of its detiled execution. s result, the compny is now seeing strengthening momentum cross Reed Elsevier, confirming the core qulities of the business. The results for the lst opertionl period re hed of mngers' expecttions on both revenue nd profit with performnce improving s the yer progressed. lmost ll of the businesses hve exceeded objectives. yer go, trget for 2003 nd beyond of revenue growth hed of the mrket ws set, nd of double-digit ernings growth. There is still lot to be done, but mngers re firmly on trck to deliver. nother progress hs been reched s it ws cquired n greement with Hrcourt Generl, Inc's Scientific nd Medicl business nd US Schools Eduction nd Testing businesses in $4.5 billion trnsction. The cquisition will give Reed Elsevier high qulity leding position cross the Scientific, Technicl nd Medicl spectrum, nd n excellent position in the fst growing US schools eduction mrket. It will further ccelerte compny's revenue nd profit growth. Opertion mngement techniques used by current orgniztion hve been lernt s those tht led compny to diversify into number of new ctivities tht re centered round the Internet, e-business, nd other electronic products nd services--ctivities tht form the core of the new economy. Besides, when mnging Reed Elsevier, the compny follows strtegy of grdul nd relted diversifiction into these new ctivities. In tht sense its strtegy cn be seen s rtionl in tht it ppers to lrgely void "risky" diversifiction into unknown, new businesses tht re completely unrelted to it current portfolio. This diversifiction into new multimedi nd communictions nd informtion technology gins importnce for the understnding of how the compny is chnging if to relize tht it lmost simultneously divested number of it existing businesses in the trditionl publishing sector. Both the divestment of some trditionl ctivities nd the investment in new but relted businesses indicte tht current compny is going through rther rpid trnsition from trditionl, single-industry publishing compny to compny tht is operting in its trditionl industry s well s in importnt new nd developing ctivities tht re relted to the Internet nd wide rnge of multimedi services. nother trnsformtionl chnge within the limits of n orgniztion hve been mde by its effective mrketing nd sles progrmmes . Customer reserch hs been expnded cross the business. Mrketing progrmmes hve been redeveloped. Sles forces hve been significntly incresed, most prticulrly in Science & Medicl nd Legl. In Science & Medicl, the sles force nd customer service ctivities hve been doubled. In Legl, the sles force nd mrketing progrmmes for smll lw firms nd US lw schools in prticulr hve been substntilly expnded. Competitive prity hs been re-estblished in lw schools, confirmed by independent reserch; n importnt milestone since this is where product preferences re first formed. The nlsys mde in bove demonstrtes tht one of the leding compnies in trditionl sector such s the publishing industry prefer to diversify grdully through relted ctivities. This finding supports those theories on diversifiction tht stress the importnce of grdul chnge through relted diversifiction tht reduces the complexity for compnies. Consequently, this lso suggests tht Reed Elsevier follows the dvice of those who wrn of the dngers of unrelted diversifiction tht cretes complex problems for compnies tht enter into "unexplored territory." References: 1. Reed Elsevier CEO comments. http://www.library.yale.edu/llicense/ListArchives/0404/msg00085.html 2. Reed Elsevier. Case Study. November 19, 2002. http://www.microsoft.com/resources/casestudies/CaseStudy.aspCaseStudyID=13565 3. http://www.reed-elsevier.com/ 4. www.reedelsevier.com Read More