Competitive Analysis of the Organization
In a statement issued to government Executive GSA administrator said that the experience had convinced him that they needed to do a better job of helping Congress understand how their contacts work. The roles and responsibilities of the professional contracting officers, what steps they should take to ensure that American taxpayers get the best deal in their investment. Another GSA source said the Sun’s contract was a good deal for taxpayers and for federal agencies that purchased the contractors IT services through GSA multiple awards schedules (Brodsky, 2007).
The contracts did not succeed because a toxic political environment, which made the situation untenable for the embattled technology contractor. The source said that the perceived lack of cooperation could be attributed to a distrust many contractors would have had with the IG’s office. The source reveals that most of the officials are afraid that any information shared with the IG could be leaked to the media while it is on a mission to make industry look bad. They were looking for headlines and this made the IG to decline the comment.
However Doan states that she would not interfere with the decisions made by GSA’s warranted contracting officers (Brodsky, 2007). Competitive Analysis of the Organization Sun Microsystems is facing very great challenge from its rival company IBM that is making products and selling them at much lower prices than the Sun’s products. This is more so in the prices of the servers which has been transformed into a price war, Currently the Sun is the leader in the $19 billion global market for UNIX servers.
Recently Sun unveiled its most powerful server known as Star cat which are in many ways more powerful than IBM’s new release. The U. S response to the terrorist’s attacks has made the spending on the computer servers to drop and has greatly interfered with the already sluggish technology market. The dot-com crush and the telecommunications market uncertainty has also led to fiscal loss. The IBM posses a great challenge to the Sun, especially when it realized that Sun was absorbing much of its high end server sales and reduced their prices as well as improving their technology.
They started offering discounts of over 50% and adding also free service and equipments, this saw the increase of the IBM market share to 20% this year up from 15% last year (Justin, 2001). As Sun depends on its servers to account for 10% of revenue and 25% of the operating profits, the IBM High-end Unix servers accounts for only 1% of its revenue and 4% of its operating profits which gives it ability to drastically cut prices. The Sun is planning the release of its own version of lower-priced servers, and also focuses on the investment in research and development of which will help reinforce its lead on other competitors (Justin, 2001).
The company has experienced most significant global cost savings and an improvement in employee satisfaction. This has been achieved through their global document outsourcing provider which agreed on lowering the cost structure and overhead. This has been done on the assessment of Sun’s document process infrastructure. The ratio of users of the print infrastructure to device has improved currently running on average at more than 98% above the target of the company. Sun is reducing its operations costs, by giving all its offices the ability to print their own color documents with total control and cost accounting.
This has made the company to reduce the print costs by more than 25% globally. It has reduced the document-related consumables which are toners and packaging, this has lowered waste and energy costs since they have installed energy efficient multifunction devices (Xerox Corporation, 2008). There is also the implementation of rehosting off the mainframe, this has seen ploughing back of over 500 million lines of COBOL code by more than 300 enterprises, into the rehosting programs with improved performance on application and also reduction in IT costs.
Through the server consolidation, the company has reduced their server count by 30% and at the same time lowered their IT costs by 25%. Within four months the company has managed to consolidate twelve legacies IPs from fifteen servers to six servers. This is done during the regular maintenance windows and it has given the company four month paybacks (Sun Microsystems Inc, 2007). Current Situation The company realized a big loss in its fiscal first quarter of the year, because of the stiff competition from other companies and the slowing demand of its products.
The Sun’s mission is to create technologies and to fuel the communities that power the participation age in order to eliminate the digital divide. The company, due to it’s deteriorating competitive position and vulnerability to the economic meltdown plans to write down the value of its business. The Sun plans of developing free open-source software giving it to spur sales of its high end computer servers and support has not delivered as per expectations of the investors (Robertson, 2008).
The company’s taking impairment charges on the businesses that currently make up $1. 8 billion of the $3. 2 billion of Sun’s total revenue should be reviewed. The shares of the company fell 12 cents, 2. 1% to $5. 66 few hours after the reported trading results. The stock however gained 20cents, 3. 6% closing at $5. 78 during the regular trading session (Robertson, 2008). Conclusion The company recognizes that controlling of the environment in any business enterprise is of vital importance.
The traditional deterministic approaches to strategy are proving not to be helpful as the companies try to soar owing to the current situations in the market. As the entire environment continues to change and the risk levels rises workable portfolio-of-initiatives is the only way the company can adopt to be flexible and adaptive to the markets. As the global economy evolves and the geographic markets and industries structure comes together, Sun expects to enjoy a variety of advantages by adopting the company to the fluid environment and taking the risks primarily where it enjoys current advantage.
If Sun chooses to compete only where it has significant advantage of familiarity and build a portfolio of workable initiatives, then they have great chances of prospering even amid a high level of complexity and uncertainty. The company has to optimize the areas it enjoys familiarity advantages, and particularly be familiar with the use of all its new technologies and use it to improve the productivity.
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