Friday, September 13, 2019

News Corporation Strategic Management Case Study

News Corporation Strategic Management - Case Study Example In the 1920s, News Corporation started out as an Australia-based chain of newspapers. Its growth has been driven mainly by an aggressive acquisition strategy, with large stakes in the film, television, publishing, and several other industries. Today, the company operates and owns, among others, Twentieth Century Fox, Star TV, British Sky Broadcasting, DirecTV, and several joint ventures worldwide. In 2004, it reincorporated in the US. Corporate strategy is used to set "the purpose of the organisation and the plans and actions to achieve that purpose" (qtd. in Lynch, 2006). It pertains to scope, which is always depicted along three dimensions: geography, product market, and value chain or vertical integration (Figure 1). For instance, which industries and markets are most suitable for the company Or, considering the various competing forces surrounding the firm, which direction would deliver the most value: diversification, vertical integration, mergers, or acquisitions Perhaps, it could be a combination of these approaches or a new business venture altogether. In the last century, industry has become increasingly internationalised, due to three main drivers of change: economic growth, fewer barriers to multinational expansion, and technological developments (Leontiades, 1987, 5). Once a company takes its operations beyond national borders, it grows not only in size but impact, making strategic decisions even more critical. Moreover, the meaning of strategy shifts as the corporate purpose is localised and translated at the business level. As the company operationalises its blueprint, it is faced with competitive pressures and so, to succeed, it must be able to match its strengths with the various opportunities available in the environment. At the same time, it must stay flexible and dynamic, since the market landscape is never static. In other words, business strategy deals with continuously building comparative advantage over its rivals (Grant, 2002, 23). The Rise of the Transnational Media Corporation Perhaps more than any other type of organisation, mass media companies have established worldwide operations of the widest scale, thus, giving rise to the "transnational media corporation" (TNMC). But as internationalisation spread, trends of privatisation and consolidation also arose - especially after the 1980s, when mergers, acquisitions, and strategic alliances were negotiated worldwide at an unprecedented pace - not just in mass media but also in finance, aviation, and other fronts. The massive realignment of industries intensified further when information and communication technologies (ICTs) were widely adopted by businesses and, later, entered the consumer mainstream. Besides News Corporation - one of the more iconic examples in the industry of an internationalised company - these TNMCs also include Time Warner, Walt Disney, Sony Inc., and Bertelsmann A.G. According to Gershon (1996, 6), these entities have engaged in the TNMC strategy for at least one of five reasons: proprietary assets and natural resources, foreign market penetration, production and distribution efficiencies, overcoming regulatory barriers to entry, and empire building. The Role of Leadership While Murdoch may have been motivated by a

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.