21st Century Fox as a Global and Entertainment Company - Case Study Example

Introduction 21st Century Fox is a global media and entertainment company operating in different business sectors like television, film industry and many more. It has implemented various strategies in accordance with the changing internal and external business environment. This has helped the company to gain uninterrupted growth and recognition in the global platform. Moreover, the company not only works with the aim of profit maximization, but it has also revealed its strong commitment towards becoming socially responsible corporate citizen (21st Century Fox, 2014). To put it briefly, study intends to illustrate the impact of the company’s mission, vision, and primary stakeholders on its overall success. In addition, the study conducts SWOT analysis for the company to determine its major strengths, weaknesses, opportunities, and threats. In the subsequent phase, the study discusses the various levels and types of strategies the firm may use to maximize its competitiveness and profitability. The study further outlines the communication plan for the company for devising strategies as well as it attempts to evaluate the managerial action based on the two corporate governance mechanism. Finally, the study presents recommendations for improving leadership within the company and assesses the impact of the company as a responsible (ethical) corporate citizen on bottom line supported with specific examples. The Impact of the Company’s Mission, Vision, and Primary Stakeholders on Its Overall Success The statement of mission and vision of the company are the core value that gives an idea about the identity and the reasons for its existence in the market. The company has established a clear statement that communicates its goals and objectives to stakeholders. It also supports the decision making process of the company (Alter, 2000). The mission statement of the company delineates the fundamental purpose for its existence. The impact of the company’s mission and vision is clearly apparent in its operations and decisions made by the top-level managers. The company in alignment with its mission and vision focuses on the demand of the consumers so that the highest customer’s satisfaction is delivered. The company aims to provide best stories according to the customer’s need and expectation to ensure growth and increase its profitability while producing films and news coverage that are widely appreciated by the customers. At the same time, the primary stakeholders of the company are constantly engaged in decision-making process with the aim of ensuring financial stability and enduring innovation necessary for operating business successfully in the current highly dynamic and fiercely competitive business environment. Evidently, the company’s mission, vision, and primary stakeholders have massive impact on its overall success (21st Century Fox, 2014). Impact of Five Forces of Competition on the Company Porter’s five-force model represents the competitive environment in which the company operates. The model represents the five forces that are ‘threat of new entrants’, ‘threat of substitute’, ‘rivalry among the existing firms’, ‘bargaining power of buyers’ and ‘bargaining power of suppliers’. These forces are observed to greatly influence the competition in the television and entertainment industry. The bargaining power of suppliers in the industry is moderate to low. This implies that the impact of suppliers on 21st Century Fox is negligible. The primary reason behind the low bargaining power of supplier is due to the increasing size of content providers. On the other hand, the bargaining power of the customers is high in case of the television and entertainment industry. This is owing to the growing numbers of players within the industry offering similar services. In addition, the phenomenon of globalization has further increased the bargaining power of customers in the industry. Thus, the company is required to focus significantly on delivering quality content and services to customers in order to remain competitive in the industry. As far as the threat of new entrants is considered, its impact on the company is relatively low. This is owing to the fact that the new companies willing to enter into the industry is required make substantial investment. In addition, the industry is in its mature stage and has numerous players, which have established its domination in the industry. These aspects act as a barrier for the new companies and demotivate to enter in the industry (Chapman, 2005). The industry is marked by intense level of competition with numerous players such as The Walt Disney’, Warner Bros, CBS Corporation’ and ‘NBCUNIVERSAL MEDIA, LLC’ among others. Correspondingly, the rivalry among the firms operating in the industry is high. The fierce competition prevailing in the industry has significant impact on the operations of the company. In this regard, the company in order to remain competitive is required to deliver quality content to its customers continuously (Chapman, 2005). Similarly, the threat of substitute is also high in the industry. The threat of substitute mainly arises from growing popularity of social networking sites and print media. The impact of threat of substitute has forced the company to diversify its business to avoid any uncertain situation (Chapman, 2005). SWOT Analysis for the Company SWOT analysis is a useful technique by which the strengths, weakness, threat, and opportunities of 21st Century Fox can identified. The major strengths of 21st Century Fox are related to the availability of huge resources, strong financial status, and globally recognized brand image. On the contrary, the company also possesses certain weaknesses, which are related to its inability to meet with the various legal regulations, which has resulted in legal proceedings against it (Gretzky, 2010). In addition, globalization has provided significant opportunity for the company to exploit the benefits existing across the world. The deregulation of several laws has also paved a way for 21st Century Fox to expand its reach, conquer a larger customer base, and increase it profit-earning capacity. The threats influencing the company are usually associated with fierce competition and volatility associated with the industry. Besides, increasing piracy and unavailability of quality content serve as threats for the company (Gretzky, 2010). Strategy for the Company to Capitalize On Its Strengths and Opportunities, and Minimize Its Weaknesses and Threats Based on the identified strengths possessed by 21st Century Fox, it can be stated that the company should strive to take the advantage of its strong brand image to attract and retain a large base of loyal customers. The company in order to ensure stable financial position should diversify its business to avoid any uncertain event. The company in order to minimize its weaknesses, particularly the legal proceedings against it should ensure that its operations comply with the legal requirements of the host country and should resolve issues more meticulously. The company in order to take the advantages of the existing opportunities should constantly engage in expanding its business to other parts of the world. The company should also devise strategies for merger and acquisition to penetrate into the overseas locations with minimum risk and exploit the opportunities existing in thereupon (Gretzky, 2010). Various Levels and Types of Strategies the Firm May Use To Maximize Its Competitiveness and Profitability Organizations can maximize profits and minimize loss based on their strengths and weaknesses. 21st Century Fox can maximize profit by adopting the strategy of product differentiation and minimizing the costs. Product differentiation offers opportunity to maximize the profit, if they can provide superior quality of entertainment contents including films and facilities of local channels and so forth. Before implementing the strategy, the company needs to identify a target market where the individuals are more quality conscious and less prices sensitive. In case when the demand for the product is more elastic than the company may also follow strategy of charging low price because it will further raise the demand. Apart from product differentiation, the company needs to control the costs of operation. 21st Century Fox may follow the strategy of charging lower prices for a certain period, if it anticipates that this strategy would facilitate it in acquiring greater market share and competitiveness in a long run (Gretzky, 2010). Communications Plan the Company Could Use To Make the Strategies For the successful implementation of product differentiation and cost minimization strategies, 21st Century Fox need to communicate these to the various stakeholders of the company. The communication plan involves various steps that the company needs to identify. First, the company should determine the objectives of the communication plan. In relation to 21st Century Fox, it should first determine the goals and objectives that it intends to achieve from product differentiation and cost minimization strategies, for example increasing profit, business expansion and attaining greater competitive traction. The company in the subsequent phase should define targeted audiences. Here, the targeted audiences of the company are the stakeholders of the company. The company should conduct meetings with managers to circulate the communication plan across the organization. Before implementing the communication plan, the company needs to specify the time frame for the execution of the communication plan. The company should ensure that all individuals or managers of the company are aware of the strategic goals and objectives of the communication plan who are responsible for the execution of the strategies. Finally, the communication plan involves development of a feedback system that can assist the company to identify whether the communication plan was effective or not. In this regard, the company can conduct market research to measure the effectiveness of the implemented strategy (Biosafety Clearing-House, 2015). The communication plan can be depicted through a flow diagram as given below. Source: (21st Century Fox, 2014) Corporate Governance Mechanisms Used By the Corporation and Its Effectiveness in Controlling Managerial Actions Corporate governance refers to the process and mechanism followed by the company that control and directs various managerial and other activities. The Board of Directors of 21st Century Fox has established a committee of Corporate Governance who has the authority to terminate or hold the contract with the individuals external to the company related to the execution of its business operations. The committee is also responsible paying the firms and fixing the terms of contract with the firms. The members of the committee are the director of the company who works independently. The Board has the authority to terminate any member of the committee. It is the responsibility of the Chairman of the company to conduct a meeting with the other members of the committee regarding any management or other related issues. The Board follows “Standard of Business Conduct” that deals with various assets and information of the corporation. The company’s overall monetary fund, property and the accounts and records are maintained according to “Standard of Business Conduct”. The various legal issues and conflicts arising due to the personal interest of the individual are solved according to the ethical standards. In order to support the decision making process of the management the Board has also implemented a “Code of Ethics” for the senior officials of the finance department that is also mentioned in the “Standard of Business Conduct” (21st Century Fox, 2014). Effectiveness of Leadership within the Corporation The main purpose of effective leadership is to organize the internal activities of the company and to motivate the employees to accomplish the organizational goals. Lachlan Murdoch is the Non-Executive Co-Chairman and James Murdoch serve as Co-Chief Operating Officer of 21st Century Fox. It is the responsibility of the team leaders to develop the competency skills of the team members. The decision regarding the job roles of the team members are also decided according to the skills of an employee and are motivated by the leaders to improve their efficiency. The resilient performance of the company provides evidence that the leaders within the company have been effectively performing their duties. Nevertheless, the leaders within the company should consider the views and ideas of employees to promote creativity and innovation within the company. This will also increase the effectiveness of leadership within this corporation (21st Century Fox, 2014). The Impact of Corporate Social Responsibility (CSR) on the Company’s Bottom Line with Examples to Support In order to achieve success in the global market the company follows Corporate Social Responsibility along with fulfilling the aims and objectives of the business. 21st Century Fox not only provides entertainment to the audiences, but also develops various programs that give social message to the individuals. The company also focuses on various sports events and wellbeing of the people living in the society. For example, employees of the company are observed to participate in social event such as sports organized by Equinox for contributing towards social welfare and development. Apart from promoting various external activities the ‘Fox News’ also promotes journalism industry. The company also provides scholarship to the college student and employment opportunity within the corporation. All these supports the fact that 21st Century Fox is not only performing their business activities, but are also very responsible toward the betterment of the society (21st Century Fox, 2013). Conclusion It can be concluded that the objectives of 21st Century Fox are not only based on their business goals, but it is equally responsible promoting social and community development. The analysis of the porter five force demonstrated that the company is immensely influenced by the competition prevailing in the industry as well as the substitutes available such as internet and print media. Similarly, numerous strengths and opportunities were determined through the SWOT analysis. At the same time, the company has been determined to face challenges from legal proceeding and the increasing piracy. In addition, the company has established strict corporate governance culture for ensuring ethical practice within the company. Besides, leaders of the company are recognized to deliver their dedicated effort towards the efficient management of the company. Conclusively, the company over the years has been able to maintain proper balance between its business goals and social responsibilities. References 21st Century Fox. (2014). 21st Century Fox. Retrieved from http://www.21cf.com/#&panel1-1 21st Century Fox. (2014). Statement of corporate governance. Retrieved from http://www.21cf.com/StatementofCorporateGovernance/ 21st Century Fox. (2013). Twenty-First Century Fox, Inc. (the “company”) nominating and corporate governance committee (the “committee”). United States Securities and Exchange Commission, 3-153. Alter, S.K. (2000). The vision, mission, objectives, and business description. Retrieved from http://www.virtueventures.com/files/mdbl-chapter2.pdf Biosafety Clearing-House. (2015). Creating a communications plan. Retrieved from https://bch.cbd.int/protocol/outreach/wallacefoundation.pdf Chapman, A. (2005). Porter’s five forces model. Retrieved from http://www.caps.am/data.php/879.pdf Gretzky, W. (2010). Strategic planning and SWO analysis. Retrieved from http://www.ache.org/pdf/secure/gifts/Harrison_Chapter5.pdf Read More