BANGABANDHU SHEIKH

MUJIBUR RAHMAN SCIENCE &

TECHNOLOGY UNIVERSITY,
Gopalgonj-8100

Assignment On
Analysis of SWOT of Microsoft
Group: 9

Course Title : Strategic Management

Course Code: MGT 364

Submitted By Submitted To
Student ID Name
18 PAD 018 Suman Mondal
18 PAD 030 Md. Jamshed Howlader
18 PAD 045 Chiranjit Bain
18 PAD 077 Md. Saju Mia
18 PAD 091 Syeda Rubeya Yesmin
18 PAD 096 Sabrina Yesmen Nurpia Dr. Md. Bashir Uddin
18 PAD 097 Md. Rasel Rana
Associate Professor,
18 PAD 103 Mst. Sharmin Akter Sumi
18 PAD 109 Ahsan Habib Department of Management Studies
17 PAD 070 Md. Rafiul Islam Sazal BSMRSTU, Gopalgonj-8100

3rd Year, 2nd Semester

Session: 2018-19
Department of Public Administration
BSMRSTU, Gopalgonj-8100

Date of submission: 05 June, 2023

 Table of Contents
Name of Topics Page No.
Acknowledgement ii
Introduction 01
Background 01
Executive Summary 02
SWOT Analysis of Microsoft 03
Strengths 03
Weaknesses 05
Opportunities 06
Threats 08
Recommendations 09
Conclusion 09
References 10

i
 ACKNOWLEDGEMENT
First of all, we would like to thank our Course Teacher, Dr. Md. Bashir Uddin, who
was a constant source of inspiration. He encouraged us to think creatively and motivated us to
work on this assignment without giving it a second thought. He expressed full support and
provided us with the different teaching aids that were required to complete this assignment.
He believed in us even when we could not believe that we could do it.

We are also thankful to every member of this group. This assignment couldn’t be
completed without the effort and cooperation of our group members. We were always there
to lift each other up, and that was what helped us stay together till the end.

We thank our parents for always trusting in us and teaching us to believe in our
abilities and strengths and never give up until the goal is achieved. We are thankful to all our
friends who extended their moral support, and above all, we are thankful to God for being
with us and giving us the wisdom and ability to do this assignment.

ii
 Analysis of SWOT of Microsoft
Introduction :
Microsoft is a well-known American multinational technology company founded by Bill
Gates and his business partner Paul Allen on 4 April 1975. Microsoft is one of the most
famous software companies in the world. It has played a significant role in the development
of the computer industry and has created numerous popular software products and services. It
is famous for the Windows operating system, Microsoft Office Suite, and the Azure cloud
platform. In addition to software products, it has also ventured into hardware with products
like the Xbox gaming console and Surface line of devices. Microsoft continues to innovate
and shape the technological landscape, providing various tools and resources that can be
utilized in educational settings. It has been at the forefront of technological advancement for
over 40 years and has contributed significantly to the technology industry. The company has
global customers who have helped it earn a name . After Apple and Amazon, Microsoft
became the third American public corporation. As of 2022 Microsoft has the 4th brand
valuation globally.

Background:
Microsoft Corporation is the Leading PC software developer. The company makes books,
multimedia, hybrid tablet computers, e-mail services, electronic game systems, and computer
peripherals. Worldwide sales offices. Microsoft has research labs in Cambridge (1997),
Beijing (1998), Bengaluru (2005), Cambridge (MA) (2008), New York City (2012), and
Montreal (2015).
Establishment and early expansion:
Bill Gates and Paul G. Allen, boyhood friends from Seattle, updated BASIC for the Altair, an
early personal computer (PC), in 1975. Gates and Allen combined the microcomputer and
software industries to form Microsoft. They improved BASIC and built additional
programming languages throughout time. IBM hired Microsoft in 1980 to create the IBM
PC's operating system. Microsoft acquired an operating system from a third party, tweaked it,
and renamed it MS-DOS. 1981 IBM PCs included MS-DOS. Windows, a graphical user
interface debuted in 1990, increased Microsoft's stronghold in operating systems. By the early
1990s, MS-DOS had sold over 100 million copies and trounced CP/M, which it had replaced
in the early 1980s, and IBM OS/2. Windows 3.0 and its predecessors sold one million copies

1
per month in 1993 and ran on 90% of the world's PCs. Windows 95 combined MS-DOS and
Windows for the first time and competed with Apple Computer's Mac OS. Microsoft beat
Lotus and WordPerfect in spreadsheet and word processing software.
Microsoft's Encarta division, formed in 1985, expanded tremendously. Its information
services and entertainment sector products and services included the Microsoft Network and
MSNBC, a 1995–2012 joint venture with the National Broadcasting Company.
Thus, by the mid-1990s, Microsoft, which went public in 1986, had become one of America's
most powerful and profitable brands. It earned 25 cents for dollar of sales. The company's net
income first exceeded $2 billion in 1996 and $14 billion in 2009. However, its quick
expansion in a fiercely competitive and rapidly changing business aroused resentment and
jealously among competitors, some of whom alleged the corporation violated U.S. unfair
competition statutes. Microsoft and its supporters countered that the company's expansion
had spurred competition and technological innovation and that its software had steadily
become cheaper and more useful. Microsoft modified its sales methods to settle a 1994
Justice Department probe alleging that they unfairly deterred OS customers from utilizing
other apps. In the following year, the Justice Department halted Microsoft's acquisition of
Intuit Inc., the largest PC financial software maker.

Executive Summary :
Microsoft generate revenue by developing, licensing, and supporting a wide range of
software products and services, by designing and selling hardware devices, and by delivering
relevant online advertising to a global customer audience. They are known for producing and
selling laptops, computer programmes, PC games, cloud devices and many other types of
software. They face many rivals such as Apple Inc. and Intel Corporation. For this reason,
they have to fulfil customer's need better. It has been very successful by adapting to consumer
demand and shifting their company goals to generate more revenue and more attractiveness
to investors. They are struggling a bit such as managing its debts and its retained earnings.
They pay out more to investors than what they can support which could lead to investors
seeing this a risky investment. The number of their employee is about 182000 people. It's
operating income is about US$ 83.4 billion, total assets is about US$ 364.8 billion and total
equity is about US$ 166.5 billion. Their mission is to protect customers and Microsoft
from current and emerging threats related to security and privacy and empower every
person and every organization on the planet to achieve more

2
SWOT Analysis of Microsoft:

Following is the SWOT analysis of Microsoft:

 Strengths – Internal Strategic Factors:

1. Leading Software Company:
Microsoft is the undisputed global market leader in software technology, specifically in cloud
computing. It’s the world’s largest developer of Windows OS and the leading cloud player. It
offers commercial cloud services through Azure, Office 365, and Dynamics 365. In 2022,
daily users of its remote work solution, Microsoft Teams, doubled from 145 million users in
2021 to 270 million in 2022.
2. World’s largest company with a dominant market share:
Microsoft ranks 2nd largest company globally, with a market value of $2.17 trillion as of
April 2023. It also reported a 2% market share growth from 21% to 23% from Q3 2022 to Q4
2022. On the contrary, the market share of Amazon went down from 34% to 33%, while that
of Google remained constant at 11%.
3. Vast market reach:
Microsoft operates in more than 190 countries worldwide. After launching the promoted
version of Windows 10, it reached one billion monthly active users before being succeeded
by Windows 11 in 2021.
4. Constant growth:
The latest earning results of Microsoft demonstrate its strong growth in the cloud
business. The company reported year-over-year revenue growth of 17.96% to $198.3 billion

3
in 2022 and a 19.26% year-over-year growth in operating income to $83.4 billion in the same
period.
5. Addition of newer SKUs (Stock Keeping Units):
Microsoft has recently added newer SKUs to its brand portfolio. This includes Microsoft
365, combining Office 365 and Windows 10. Its M365 is a multi-billion dollar business.
6. Reputed Brand with superior customer loyalty:
Microsoft had 1.2 billion Office users and 345 million Office 365 commercial customers in
2022. It undoubtedly has the most extraordinary loyal customer base. Customers trust the
brand and remain loyal to it.
7. Huge Market Capitalization:
With $2.17 trillion of market capitalization, Microsoft is one of the biggest hi-tech companies
on the planet. Microsoft was ranked the 2nd largest company in 2023 based on market value
and was the 4th most valuable brand in the world in 2023.
8. Effective Adverting platform:
With its strong and effective marketing strategies, Microsoft has influenced people
worldwide. Its emotive advertisement aired in July 2015 with the title ‘The future starts now’
touched many worldwide.
9. Brand Reputation:
Microsoft was ranked 2nd by Interbrand as the world’s most valuable brand in 2022, with
a brand value of $278 billion. And, In 2022, Forbes Global 2000 Ranking, Microsoft was
ranked 12th in the world based on its financial metrics.
10. Easy-to-use software:
Microsoft is known for its hi-tech and quality product offerings. Windows OS and Office
software products are quite user-friendly with the highest quality standards.
11. Diversified Portfolio:
Microsoft divided its businesses into three segments:

1. Productivity and Business Processes – The segment represents about 32% of total
revenue. This segment consists of products and services related to communication and
information. It is mainly comprised of Office 365 Commercial and
Consumer, LinkedIn, and Dynamics 365. Revenue is generated through subscription
fees or one-time license-using fees.

4
 2. Intelligent Cloud – represents about 36% of total revenue. This segment provides
cloud services for enterprises and consumers. Signature products include Azure, SQL
Server, Windows Server, Visual Studio, and Microsoft Consulting Services.

3. More Personal Computing – represents about 32% of total revenue. This segment
sells personal computing devices and services such as the Windows operating system,
Surface and PC accessories, and Xbox hardware and Xbox content and services.

Revenue ($Billion)
Segment % Revenue Share
(2022)

Productivity and Business

63.4 32%
Processes

Intelligent Cloud 75.3 38%

More Personal Computing 59.7 30%

Total 198.2 100%

Source: Microsoft Annual Report 2022

 Weaknesses:
Weakness is the opposite word of strengths. Without a doubt, Microsoft ranks among the
world’s top businesses. In spite of being one of the worlds largest companies, Microsoft has
a few weaknesses.
In this Microsoft SWOT analysis, here is some weakness
1. Unsuccessful acquisition :
Microsoft fewer acquisition like WebTV, Link exchange, Massive and Danger resulted in
failures and divestitures. Such unprofitable investment are the biggest weakness of Microsoft.
2. Changing consumer needs and habits:
Consumer needs change over time. This can be result of technological improvements or of
changes in peoples knowledge and priorities, such as new information about world.
3. No market leadership in the Internet browser segment:
Microsoft is leading software market. However, in the internet browser segment and
Microsoft browser, Microsoft is losing the upper hand. Statista reports that Microsoft has no
more than a 5.92 market share in the US, lagging behind Apple Safari and Google Chrome by
a large margin. Chrome owns 48.74% of the market share, while Safari owns 36.74%. This

5
loss of market leadership by Microsoft can be attributed to Microsoft’s relenting in
marketing.
4. Dependence on hardware manufacturers:
Microsoft is a giant software corporation but it does not produce its own hardware and
depends on computer hardware manufacturers to develop products that run Windows
operating system . If cheap and popular alternative operating system would appear, hardware
manufacturers may simple choose the alternative and Microsoft could do little to change the
situation.
5. Slow to innovate:
Microsoft has huge Research &Development resources and great position to enter new
markets with innovative products but constantly failed to do so. It had an opportunity to be
the first player in online advertising but missed the opportunity. It’s entrance to mobile
operating system was also too late, while Google and Apple captured the market share.
6.Unfair business practices:
The unethical practice Microsoft undertook was to use illegal and unfair practices to kill off
competition to maintain its dominant position. In Europe, Slack Technologies filed a
complaint against Microsoft on the grounds of anti- Competitive practices.

 Opportunities:
Here, there are some opportunities Microsoft can leverage:
1. Cloud Business Growth:
Microsoft can expand its range of cloud services and software as the demand for cloud-based
services is expanding.This would be easier because the company is well known, with a good
reputation, so introducing a new product or service to the market would meet with customers
acceptance.Some of Microsoft's products and services, such as Azure and Office 365, are
cloud-based, and over the years, these merchandises have become popular among users. In
this context, Microsoft has the potential to continue its growth in the cloud computing
industry and strengthen its position as a leader in the tech industry.

2. Mobile device industry:

Smartphones and tablets markets will grow steadily over the next few years and Microsoft
could exploit this opportunity by introducing more of its own tablets and a new company
phone. Growth through acquisitions.With a huge reserve of cash Microsoft could start

6
acquiring new startups that would bring new technology, skills and competences to the
business.There is an open opportunity for Microsoft to explore the smartphone market better
by researching and producing better smartphones.
3. Remote Work Solutions:
With the increase in remote jobs, there is a need for online services that make collaboration
and communication easy for employers, employees, and partners.Microsoft can leverage this
by enhancing its remote work solution (Microsoft Teams) for users.

4.Innovation and Artificial Intelligence:

There are a thousand innovative aspects.Microsoft can invest in, and part of these is Artificial
Intelligence. Artificial Intelligence can be an enormous opportunities for Microsoft.
Artificial lntelligence can be applied to virtually every aspect of the company's business from
product development to customer service. Microsoft has made significant progress in this
area, with room for further growth and innovation.

5.Gaming Industry:
Xbox is only one of Microsoft's many impressive creations. A well-known game system that
has been around since 2001 is the Xbox from Microsoft. Although it is one of the most
prominent gaming systems in the world.Microsoft has the chance to strengthen Xbox's
standing in the gaming market and attract a larger audience.

6. Partnership and growth through acquisitions:

By partnering and making alliances with some companies, Microsoft can grow and gain high
market shares. They can reach even more consumers. For example, Microsoft's acquisition of
Nokia can help it reach a wider audience, i.e., smartphone users. However, it needs to work
on this acquisition. This also applies to acquiring other firms, especially hi-tech firms.With a
huge reserve of cash Microsoft could start acquiring new start-ups that would bring new
technology, skills and competences to the business.In 2020, Microsoft made a five-year deal
with Coca-Cola. The deal involved supplying the company's business software, a significant
win for Microsoft.

7
 Threats – External Strategic Factors
1.Workforce’s related criticisms: Microsoft’s 2022 workforce diversity statistics showed a
discrepancy in its recruited workforce. The number of women and minorities working was
quite low, fueling intense criticism and arguments against the company’s HR policy.
2.Gay reference controversy: Microsoft has confronted many criticisms for its Xbox
Live game service. Reference to gays and homosexuality can’t be used in the Gamertag and
user’s profile, as the company considers this thing ‘inappropriate' and ‘trolatitious' for other
users.
3.Aggressive competition: Microsoft has severe competition with Google and Apple. These
companies’ established positions can be a threat to Microsoft’s market position. In June 2020,
Google raised its competition for remote work by commencing video call features , editing
tools, and other remote job tools in Gmail to lure clients from Microsoft.
4.Changing preferences of consumers: People are extremely enticed to the market of
smartphones, notepads, and laptops. Microsoft has unpretentious shares in these markets.
5.Open-source projects: Like Linux OS and Open-Source Office, lots of new open-source
projects have successfully entered the market, offering analogous services for free. It can
threaten Microsoft, which offers these products at an expensive rate.
6.Cybercrime and piracy: Rising cybercrime thefts and software piracy problems have
dramatically affected Microsoft’s security network system.
7.Politicized contracts: Favoritism by the government undermines confidence. Recently,
Microsoft was awarded a $10 billion Pentagon contract over Amazon. Critics and various
officials alleged that Amazon was more eligible, but Trump’s administration influenced the
decision to award Microsoft because of to the president’s feud with Amazon owner Jeff
Bezos.
8.Anti-encryption drive: Governments and child welfare communities have been pressuring
Microsoft and other tech companies to invalidate customer encryption technologies that allow
child exploiters to manage online with impunity. Microsoft and other giants promised to
standardize disclosure of the culprits, but various governments and child welfare groups want
more.
9.Competition in software products: Microsoft is more than ever on the pressure to
introduce successful OS both in mobile and PC markets as such rivals like Apple and Google
have already established positions.

8
10.Potential lawsuits: Microsoft has already been sued for many times and lost quite a few
large scale lawsuits. Lawsuits are costly as they require money and time. And as Microsoft
continues to handle more or less the same way, there is high possibility for more expensive
lawsuits to come.

Recommendations:
To remain the leading software provider, Microsoft needs to work on its weak aspects and
embrace opportunities. A few recommendations are given below in this regard:

1. Upgrade its software and bring innovation. Microsoft must take radical steps
to embrace the future of innovation.
2. Continue enhancing its brand reputation through effective marketing tools.
3. Update its internet browser market and take initiatives to increase the market share in
this segment.
4. Build more competitive advantages to compete with technology rivals like Google
and Apple.
5. Increase partnerships, strategic alliances, and acquisitions to strengthen its market
standing.
6. Resolve cybersecurity issues and address global cyber thefts by advancing its security
network systems.
7. Decrease the prices to reduce the illegal use of its software systems.
8. Diversify its business to enhance potential growth and market share.

Conclusion:
Microsoft Corporation is a technology company that deals with the selling of computer
software and services. It’s publicly traded and has been growing significantly since its
inception. The company has grown its income base over the past few years. Comparing the
income statements and the balance sheets for the past three years, the company current assets
have risen significantly. The company’s Accounts Receivables that ended for the quarter as at
December 2015, the figure was at $12,247 million. The company gross margin has however,
been on the decline for the past thirteen years.
Microsoft Company has performed well over the past and has managed to secure a
competitive market position. Its success is attributed to a variety of factors for instance a

9
strong management body, an established brand name, strong and experienced workforce and
utilization of information technology among others. Although it has some weaknesses and it
faces some threats, it has been able to overcome this and its financial performance has been
excellent over the past.

References:

1. Curry, David (2023, January 9) Microsoft Teams revenue and Usage Statistics,
BusinessofApps.
2. Murphy, A. and Contreras, Isabel (2022, May 12). Forbes Global 2000: The World’s
Largest Companies. Forbes
3. Wolfe, J. (2020, July 6). Fed Circuit to consider reviving case v. Microsoft over a 20-
year-old search-engine patent. Reuters
4. Nellis, S. (2020, May 19). Microsoft to adopt its cloud software for the healthcare
industry. Reuters
5. Nellis, S. (2020, April 27). Microsoft wins a five-year deal with Coca-Cola to supply
business software.
6. Statista Most Valuable Brands Worldwide in 2023.
7. Reuters Microsoft Annual Report 2022
8. David, Ch (2023, January 17) Microsoft Teams Revenue and Growth Statistics 2023
9. Taylor, Mollie (2022, January 19) Microsoft to acquire Activision Blizzard for $68.7
billion. PC Gamer
10. Dave, P. (2020, July 1). Google ties more work tools into Gmail, aiming to get ahead
of Microsoft. Reuters
11. Macias, A. (2020, February 10). Amazon wants to question Trump after losing a $10
billion Pentagon cloud contract. CNBC
12. Paul, K. (2020, June 11). Battling anti-encryption drive, tech companies pledge new
child abuse disclosures. Reuters
13. De George, R. (2003). The Ethics of Information Technology and Business
(Illustrated., pp. 181-184). Wiley-Blackwell.
14. Hall, M., & Zachary, G. P. (2023). Microsoft Corporation. In Encyclopedia Britannica.

10