E-Sonic Strategic Analysis

E-Sonic Strategic Analysis

Executive summary

The current market environment incorporates different measures that emphasize on successful business development based on strong competitive growth. Companies are coming up with various measures that focus on presenting a strong operational platform for successful change. Improving the level of change defines positive change, which helps present specific measures that promote change and overall individual development. The changing technological aspects within the industry have resulted in declining demand for music CDs in the recent past creating the need for the company to develop an evolved business model. E-Sonic is a digital business firm that has sought to help implement a strong development system for a highly successful business operational strategy. As a subsidiary of Sonic Records, the business has identified a different business platform, which is the Online business context, which helps in promoting change while creating a reliable business operational platform. The existing management has been mainly focusing on general music production techniques with no emphasis on the current technological changes, which present a focus on the online market and the ability to transform the company performance. The management does not have a strategy for software or an online administration. This means that it is essential for the company to diversify its operations and incorporate online technological changes to help promote service delivery and overall management of key operational measures.

Strategic analysis

E-Sonics is a subsidiary of the Sonic Records which have engaged in online services venturing in downloadable music. The identification of the E-Sonic industry groups the company in two different codes based on the North American Industry  Classification System. The two codes include the 512220 and 334614.  The United States Census Bureau groups the 334614 as software and Pre-recorded  Compact Disc, Tape, and Record Reproducing. It is mainly comprised of mass reproducing computer software and other media materials.  The other code, 512220, focuses on Integrated Record Production/ Distribution. This industry focuses on the production, distribution, and promotion of sound recordings. The production and distribution of music is a diverse process that provides a focus on different measures within the industry (US Census Bureau. (n.d.).  The diverse nature of the market allows essential management of better approaches that present a well-defined system that promotes a positive level of engagement (Thomes, 2013).  The assessment of the current company performance requires a better emphasis on different measures that encourage a successful change strategy based on the external and internal environmental assessment.

External market environment

Market engagement presents a well-defined system that helps create a more elaborate system that helps in strategic analysis. The external environment focuses on five major elements that create an effective environment that maintains a proper change within the industry as well as company engagement. The significant features that are assessed in this case include industry profile, competition within the industry, the foreign demand, the existing industry long prospects as well as the labor market.

Industry profile

Sonic Records has been a business leader within the industry with significant revenue generation of around $15bilion. However, the changing technology has presented a different perception where the critical level of operation within the company has declined due to the changing market needs. The decline of the company’s profitability margins in the recent past has been attributed to increased piracy. The decline of company sales has exceeded 30%, which presents a dire need for the company to evolve its operational strategy and control negative outcomes (Lingold, 2017).  The development of online music stores has also had a detrimental influence on company performance, which presents the need to establish better measures that promote change and define improved change development. The preferences of consumers in the market have shifted, which means that the company needs to integrate crucial measures that can help in promoting a certain level of development while creating a strong focus on the need to maintain a competitive advantage. Thus, in response to the shift in the market, Sonic has opted for the development of E-sonic to keep track of the changing market.

Competition

The online music industry is highly competitive, which presents a major emphasis on the need to implement major strategies that help in achieving better policies that define positive level change.  E-Sonic faces fierce competition, although they are determined to remain relevant and highly effective within the industry through the integration of better strategies that promote the level of performance. The major competitors include iTunes, Amazon, Pandora, Rhapsody, and other online free music companies (Wlömert & Papies, 2016).  The digital business model presents a more substantial system that presents a well-defined system that can help create a strong system that presents a wider consideration of improved changes that promote business development. There is a need to offer differentiated services within the industry as well as integrate different branding system to become a global leader.  The E-Sonic mission is to create the world’s leading online music store.

Foreign demand

The foreign demand for E-Sonic services and products has been encouraging in the recent past, which presents the need to help maintain a proper system that helps in improving the level of company performance.  The focus on foreign demand has been based on digital sales, which present a more substantial platform that improve company performance. The digital revolution offers a well-defined system that helps create a highly sustainable environment in enhancing the development of the online music system (Naveed et al., 2017). Digital delivery of music, although it has become efficient in recent years, it has significantly lowered the overhead of record companies.  There exist a strong platform that presents a strong system that can help improve the competitive nature of the company in the coming years.

Industry long term prospects

E-Sonic has implemented better strategies in ensuring that they remain highly engaged while presenting a strong system that helps in building a change platform and overall development of better policies that improve company performance. The Price Waterhouse Coopers have asserted that an estimated two-thirds of revenue growth from consumers and advertising will be digital, which presents a more substantial platform that promotes change and level of change. It is also suspected that $241 billion growth within the online entertainment and media consumer outcomes, which present a strong change platform is transforming the level of change (Aguiar & Waldfogel, 2018). The growth of the global entertainment industry gives an improved platform where there is a need to manage performance. The improving digital market offers E-Sonic a chance to adopt sustainable measures that can help improve the level of performance. Building a substantial change platform presents an overall development.

Labor market assessment

The company has a diverse operational market which presents a reliable platform that aid in improving change strategy while also maintaining a positive system that can help promote change and positive development. Customer service representatives and the operational team, which include software developers and market research analysts, presents a strong system that can help in transforming the level of organizational change (Thomes, 2013).  The compensation strategy that has been put in place offers a well-outlined system that provides a proper operational system for successful change. Competence, knowledge, and skills present an individual with an improved ability to help create a strong system that improves the level of performance.

Analysis of internal capabilities

Internal capabilities present emphasis on company performance and the underlying measures that are likely to have a positive influence on company development. Internal aspects that are assessed in this case include functional and human resource capabilities. The need to promote positive change provides a strong outline of better processes that help maintain a positive context that builds a strong change in the operational context.

Functional capabilities

Functional capabilities present a well-defined context where it is easier to understand the level o company success. Thus, through successful assessment of the company, engineering, research, and development, as well as the management, present a huge basis within which it is possible to help identify critical measures that promote positive change. The high competition within the industry makes it possible for E-Sonic to maintain a strong focus on its functional capabilities, which help in promoting change (Lingold, 2017).

Human resource capabilities

Human resource needs within the company are based on the ability to create a substantial change environment where it would be possible to promote positive change and the level of development. The vital operational centers within the company have provided a strong level of change where it is crucial to define vital operational goals that promote business success. The competence, knowledge, and ability of workers within the company present a strong operating strategy that helps create a strong change platform in improving the level of organizational success. Talent retention presents a strong opportunity that can be successfully evaluated to offer an improved context where it is possible to enhance change strategy. Compensation and benefits strategy must be adequately developed to present a successful change system for an enhanced change and focus on building the company.

References

Aguiar, L., & Waldfogel, J. (2018). As streaming reaches flood stage, does it stimulate or depress music sales?. International Journal of Industrial Organization, 57, 278-307.

Lingold, M. C. (2017). Sonic Records: Listening to Afro-Atlantic Literature and Music, 1650-1860 (Doctoral dissertation, Duke University).

Naveed, K., Watanabe, C., & Neittaanmäki, P. (2017). Co-evolution between streaming and live music leads away to the sustainable growth of the music industry–Lessons from the US experiences. Technology in Society, 50, 1-19.

Thomes, T. P. (2013). An economic analysis of online streaming music services. Information Economics and Policy, 25(2), 81-91.

US Census Bureau. (n.d.). Census.gov. Retrieved from https://www.census.gov/

Wlömert, N., & Papies, D. (2016). On-demand streaming services and music industry revenues—Insights from Spotify’s market entry. International Journal of Research in Marketing, 33(2), 314-327.