Internet Crisis Potential: The Importance of a Strategic Approach to Marketing Communications - Assignment Example

Assignment 5: capstone Assignment 5: Capstone Introduction Intel Corporation is a public traded company listed in the United States security and exchange commission as a player in computer and mobile technology industry. Established in 1968, Intel has grown to become a major player in the microprocessor and semiconductor chips in the United States. Initially named the NM Company to stand for the initials of Bob Noyce and Gordon Moore who were the founders, the company acquired the sole right to use the name ‘Intel’. During the late 60s, Intel specialized in the production of random access memories but later diversified to other computer chips, personal computers and mobile phones (Thompson, 2010). The company is based in Santa Clara in California and its massive growth and performance despite the strong competitive forces has increased market and investor attraction towards it. In this paper, Intel will be evaluated to highlight its performance despite the strong competition, challenges in the market and the threats presented. Impact of mission, vision and stakeholders on Intel’s success Intel has developed a mission statement that digressed from the tradition adopted by other technology players in the industry. As a result, the company has shifted its focus from its products and instead embraced the people that use its technology product, a strategy that has endeared it to the market. "Delight our customers, employees, and shareholders by relentlessly delivering the platform and technology advancements that become essential to the way we work and live." (Vance 2011, p.51). Based on this mission statement, it is evident that the company is dedicated to the development of great products to meet the needs of its target market. This dedication as highlighted in the mission statement has enabled Intel to remain a formidable force in the market. When it launched its first mobile handset line, the reception that it received from the market was demonstration that its mission statement has massive impacts (Thompson, 2010). The vision of the company further bolsters the image of the company as an equal opportunity employer that embrace cultural and regional diversity. Through the culture of embracing the abilities of the employees and understanding the impacts of cultural diversity in innovation and talent, the technology companies has remained a major threat in the industry. Entry into new and emerging markets like Asia, Africa and Caribbean America has proved easy for the company. This stunning performance in new markets has been attributed to its respect for different viewpoints and the appreciation of cultural diversity. Five-porter force analysis of Intel According to porter, the key to success in an organisation is the nature of the industry and the dynamics that influences success and failure in the sector. As a result, he developed five forces that can be used to evaluate the success dynamics in an industry that include the power of the customers, the suppliers, threat to new entry and the internal level of competition in the industry. Today, the computer and technology industry is one of the most competitive sectors in the United States due to the emergence of new players and the entry of foreign based companies. In the microprocessor and chipset industry, Intel has only faced competition from advance microprocessor devices (Thompson, 2010). The company develops a number of silicon based microprocessors such as Athlon, thunderbird among others which compete with the chips and microprocessor produced by Intel. AMD has developed its products using high-end technology and this increases the competitive pressure on products such as Pentium IV CPUs produced by Intel. The ability of AMD to exert competitive pressure on Intel has been shown through the market share that the company currently controls (Sarason & Hanley, 2013). The dominance of Intel affected the performance of other technology companies that relied on their microprocessors and chipsets to manufacturer mobile and computer gadgets. However, AMD has proved to be a viable replacement to Intel and this further increases the competitive pressure on it. However, the marketing tactics adopted by Intel in the face of growing AMD influence has been attributed to its market comeback. Though described as ‘mafia-like’, these approaches increased its influence in the microprocessor market and escalated the demand for its Pentium microprocessor (Kempf, Erhun, Hertzler, Rosenberg & Chen, 2013). The possibility of new entry into the industry currently remains slim due to a number of industry related reasons, a situation that has benefited Intel. Entry into this market requires massive capital expenditures due to the high costs of manufacturing microprocessors and chipsets. This has acted as an entry barrier to all companies that have expressed interest in joining the sector. Research and development is essential for success in this sector, a venture that is costly and uncertain for new entrants (Sarason & Hanley, 2013). Buyers in this industry are diverse, ranging from single end users to technology companies like HP and Toshiba. Small-scale computer builders and cloners in different parts of the globe rely on microchip processors manufactured by Intel in their assembling ventures. However, large public traded corporations such as Dell and HP remain the main market for the both AMD and Intel. The power of buyers in the industry has not remained constant but Intel has remained influential in the market due to its respected logo ‘Intel inside’. However, the arrival of the Athlon option increased the buyer’s purchasing power as manufacturing companies had varied microprocessor options. The use of exclusive contracts by the government and large technology corporations have however, kept the buyers bargaining powers in check. The selling power of the suppliers is currently ranked equally to other raw material brokers in the technology industry in the United States. The raw materials used by the company include silicon, semiconductors among other group four elements used to enhance the performance of the processors. The presence of a number of suppliers for these products has considerably reduced their purchasing power in the market. The presence of products such as sun microsystems has not considerably increased substitutes to Intel corporation products. Sun Compaq acquired microsystems and this reduced competition avenues for the two companies, thus giving Intel a free day in the microprocessor market. SWOT analysis of Intel Currently, 80% of personal computers distributed to different parts of the world use Intel microprocessor, a demonstration of its control of the market. Intel has a strong market presence, control and brand image, factors that have been used to support its great performance. In this section, a SWOT analysis of the company will be done to provide its strengths, weaknesses, opportunities and threats presented by the market (Sarason & Hanley, 2013). The strong brand name of Intel has enhanced its great global performance and contributed to the growth of brand loyalty among manufacturers. Different technology giants have used the logo ‘Intel inside’ to spur its market dominance and demonstrate the reliability of its products across the globe. Today, computers and mobile telephones are constructed on the premise of speed and accuracy, a property that Intel products have consistently offered with its semiconductor based microprocessors. As the company that introduced the idea of microprocessors in the technology, the company reputation has remained intact in not only the United States but also other countries across the globe. A large base of reliable customers has also supported the initiatives of the company and enhanced its performance across the globe. Finally, Intel has invested heavily in research and development and this has enabled it to produce new products that meet the emerging needs of the market. Despite being the leader in the microprocessor industry, the company has not used its economies of scale to increase its profitability and performance. Though the company has massive production plants, the prices of its products have remained low irrespective of the high demand for its products. This has been attributed to the loss that the company witnessed in 2008 when it failed to reached the expected profit limits. The emergence of AMD into the market has also considerably affected the focus of the company as it embraced new and more aggressive marketing strategies (Sarason & Hanley, 2013). The opportunities available to Intel are quite visible, beginning with the need to improve focus on the customers and diversify its product base. Product diversification especially the mobile industry presents a number of opportunities for the company. The launch of the atom processor also presents a number of opportunities to the company as the new microprocessor can be embraced with large and small-scale computer manufacturers. Partnership and acquisition will also increase the presence of Intel in the technology market as has been the case for other companies like Compaq and sun microsystems (Zhen, 2014). Rapid increase in technological advancement presents a threat to the company as some its products are faced with redundancy in the market. Changes in customer taste and preference is further complicating the situation for the company as the entry of new products from AMD affects the demand for its products. The emergence of new and cheap alternative products in the market has also made it difficult for the company to maintain its market share and competitive advantage (Conway, Ward, Lewis & Bernhardt, 2007). Competitive and profitability maximisation strategies To improve its competitiveness and profitability in the face of stiff competition, Intel Corporation must embrace a number of strategies. Intel can adopt a number of approaches aimed at maximizing its profits and increasing its market share in the globe. Apart from pricing strategies, product differentiation can also be embraced to increase the market share controlled by the company. In this section, a number of profit maximization and market control strategies will be discussed in line with Intel Corporation (Vance, 2011). Product differentiation is a strategy aimed at diversifying the number of products that a company releases to the market. Such products must be developed in line with current market demands and emerging opportunities that fall under the same operation line of the organization. With Intel, an opportunity exists in the mobile and personal computer industry that can be aptly exploited. Though the company has focused on the development of microprocessors and chips for other companies like HP and Dell, the company has a strong footing in the computer industry. This gives it an advantage to begin producing its own computers using its latest Pentium technology and reach out to the emerging markets. The computer and technology industry have a less price conscious market that can embrace high performing computers from new industry entrants, an opportunity for the company (Conway, Ward, Lewis & Bernhardt, 2007). Apart from product differentiation, Intel can embrace a new pricing strategy that will enhance its reception in the market but still allow improved profitability. Currently, Intel has been associated with the production of high quality products that are however, priced lowly. This has affected its ability to improve its profitability in the industry, especially after the entrance of AMD. The company should marry its high quality products with a higher price as the market is price unconscious and buoyed by quality. The success of the two strategies can be measured through the level of profitability and the increase in market share controlled by the company. The strategies adopted should not just be aimed to improve performance, but to control the level of performance that has been registered by the company. As a result, Intel must work towards maintaining its traditional market share while also entering new and emerging markets across the globe (Sarason & Hanley, 2013). Communicating strategies to stakeholders at Intel The adoption of the strategies discussed must be done in a transparent manner, where all the stakeholders are involved and communication made in a timely manner. As the stakeholders are averse with the happening in the organization, communication challenges are minimal. A number of strategies can be used to reach out to them and improve their support for the strategies adopted. First, formal and informal dialogue forums should be initiated to bring the management of Intel and the stakeholders together (Kolodzey, Maki & Shur, 2007). During the forums, the long-term benefits of the strategies will be communicated and their support sought. Structured meetings can also be used to bring together the stakeholders such as the annual general meetings where the new plans will be communicated to them. Other approaches such as electronic communication such as emails and company website can be used to enhance interaction with the stakeholders (Zhen, 2014). Corporate governance mechanisms and CSR at Intel Corporate governance is approaches adopted by an organization to provide a balanced platform where the needs of the stakeholders and the management can be achieved. Intel’s corporate governance is guided by the desire to do the right thing at all times and abide to its code of ethics. As a result, the code of ethics developed by the company is applied across the board to include the employees, the management, customers and the stakeholders. Apart from doing the right thing, Intel’s corporate governance encourages the employees, distributors and stakeholders to embrace good faith reporting approaches. This has enabled the company to address emerging issues in a timely manner and eliminate harm to the company (Conway, Ward, Lewis & Bernhardt, 2007). Apart from the corporate governance approaches adopted, Intel has also embraced corporate social responsibility as part of its corporate citizenship plans. The company has made a commitment towards environmental conservancy through the adoption of clean production technologies. Due to the nature and source of its raw materials, Intel developed conflict minerals sourcing policy aimed at preventing supply of mineral raw materials from conflict prone countries like Congo in Africa. Human trafficking and slavery are also captured in the company’s corporate social responsibility document, a demonstration of the company’s commitment to free labor. References Conway, T., Ward, M., Lewis, G., & Bernhardt, A. (2007). Internet Crisis Potential: The Importance of a Strategic Approach to Marketing Communications. Journal of Marketing Communications, 13(3), 213-228. Doi: 10.1080/13527260601086462 Kempf, K. G., Erhun, F., Hertzler, E. F., Rosenberg, T. R., & Chen, P. (2013). Optimizing Capital Investment Decisions at Intel Corporation. Interfaces, 43(1), 62-78. doi:10.1287/inte.1120.0659 Kolodzey, J., Maki, P. A., & Shur, M. (2007). Advanced Semiconductor Devices: Proceedings of the 2006 Lester Eastman Conference, Cornell, Ithaca, NY, USA, and 26 August 2006. Singapore: World Scientific Sarason, Y., & Hanley, G. (2013). Embedded Corporate Social Responsibility: Cant We Do Better Than GE, Intel, and IBM? How About a Benefit Corporation? Industrial & Organizational Psychology, 6(4), 354-358. doi:10.1111/iops.12066 Sarason, Y., & Hanley, G. (2013). Embedded Corporate Social Responsibility: Cant We Do Better Than GE, Intel, and IBM? How About a Benefit Corporation? Industrial & Organizational Psychology, 6(4), 354-358. doi:10.1111/iops.12066 Thompson Jr., L. (2010). A Look at Intel and Monsanto, Two CSR Pioneers. Compliance Week, 7(77), 50-51 Vance, B. (2011). INTC [Finance] Intel Corporation. Oxford University Press. doi:10.1093/acref/9780199698295.013.50451 Zhen, Z. (2014). Introduction to Intel® Integrat Ed Performance Primitives for Android* With A Case Study. Intel Technology Journal, 18(2), 188-202. Read More