Value Chain Analysis of Microsoft 

Microsoft is an American tech giant and cloud computing Multinational Corporation. Paul Allen and Bill Gates stated the tech company in 1975. Today, we’ll discuss the value chain analysis of Microsoft; primary and supporting activities in the process of value chain analysis example company. They are inbound and outbound logistics, operations, marketing, and customer service; infrastructure, HRM, technology, and procurement as an application of value chain analysis.

Products and services of Microsoft

  • Corporate venture capital
  • Video games
  • Cloud computing
  • Social networking services
  • Computer hardware
  • Software development
  • Xbox Game Pass
  • Windows updates
  • GitHub
  • Outlook

Key statistical facts and figures of Microsoft

  • Employees – 221000
  • Asset net worth – 411.9 billion USD (2023)
  • Annual revenue – 211.9 billion USD (2023)
  • Net income – 73.4 billion USD (2023)

Business divisions of Microsoft

  • Gaming Microsoft
  • Press Microsoft
  • Microsoft Digital Crime Unit
  • Microsoft Engineering Group

Top competitors and rival companies of Microsoft

  • SAS
  • HP
  • Google
  • Oracle Netsuite
  • SAP
  • Apple
  • Oracle
  • Sony
  • Salesforce

The Value chain analysis of Microsoft would analyze the primary and supporting activities in the process of value chain analysis. They’re inbound and outbound logistics, operations, marketing, and services; infrastructure, HRM, technology, and procurement. Here’s Microsoft value chain analysis company example as follows;

Value Chain Analysis of Microsoft

Let’s discuss the primary and supporting activities involved in the process of value chain analysis of Microsoft. It is an application of value chain analysis based on Porter’s model; some of the key elements and components of value chain analysis are as follows;

Primary Activities of Microsoft 

Some of the five main primary activities in the value chain analysis of Microsoft are as follows;

Inbound Logistics of Microsoft

I-Relationship with Global Suppliers

Microsoft has established relationships with global suppliers and vendors in various countries. They help the company to ensure the smooth flow of complex supply chain operations and processes without any disruptions. In fact, the tech giant company has set up a supplier code of conduct, and all the suppliers and vendors of Microsoft have to comply with the supplier requirements of the company.

Some of the key elements that would add value to the inbound logistics of Microsoft are as follows;

  • Economies of scale
  • Developing strategic relationships with suppliers
  • Knowledge and expertise in SCM methods and strategies
  • Microsoft Dynamics AX software to beware of SCM processes

Outbound Logistics of Microsoft

I-Microsoft Retail Stores

Microsoft has established a network of more than 116 retail chain stores in various countries worldwide like Puerto Rico, Australia, Canada, and the USA. The retail stores of Microsoft are just like Apple and they offer customers an opportunity to use products and tech assistance to the customers.

II-Online Sale

Microsoft has a well-diversified service portfolio and the tech brand sells its services at Windows Stores, Skype, OneDrive, Outlook.com, Xbox Live, Office 365, MSN portal and channels, and Bing. They all are separate platforms and they sell their services online.

III-Resellers & Distributors

The resellers and distributors of Microsoft are as follows;

  • Developers
  • Web agencies
  • LSPs (license solutions partners)
  • Microsoft retail stores
  • Dixons
  • Walmart
  • Retail outlets

IV-OEMS (Original Equipment Manufacturers)

OEMs are the main distribution channel and they pre-installs MS software on various new devices like intelligent devices, smartphones, servers, tablets, and PCs. However, the pre-installation of Windows on new laptops is the largest area of the OEM distribution channel.

Operations of Microsoft

I-Business Processes & Productivity

The business process and productivity segment in operation outlines various products and services relevant to information services, communication, and productivity. It deals with a wide range of platforms and devices and they’re as follows;

  • Dynamics
  • LinkedIn
  • Office consumers
  • Office commercial

II-Intelligent Cloud

The intelligent cloud in the operational area consists of various products and services relevant to the server and they’re as follows;

  • SQL Server
  • Windows server
  • System center
  • Visual Studio
  • Azure and CALs
  • Enterprise service
  • Support service
  • Microsoft consulting services

III-Personal Computing

The personal computing category focuses on the screen of all sizes for IT professionals, developers, and IT users.

IV-Production & Manufacturing

Microsoft outsources the manufacturing of most of its products and devices except phones from third-party manufacturers. The manufacturing plants of the tech company are situated worldwide and they’re in close proximity to suppliers to decrease the fuel consumption and limited impact on the environment. However, cost efficiency is the main driving force behind outsourcing the manufacturing work and adds value to the company’s operations.

Marketing & Sales of Microsoft

The advertisement message has a close association with convenience, efficiency, and effectiveness. Microsoft employs various licensing and legal channels for the sale of its products and services depending on the scope and size of operations and resources;

  • Open licensing
  • Select Plus licensing
  • Services agreement licensing and Microsoft products
  • Enterprise agreement licensing
  • Service of Microsoft

The licensing method allows the company to reduce the sale cost.

Service

I-Customer Service

Microsoft offers a high level of customer support and service to its clients and customers pre-purchase, during, and after the sale due to the complex nature of its products. The company offers support to IT professionals and tech businesses so that they can achieve maximum benefit from its products and services. However, some of the main areas in which the tech brand offers customer support are as follows;

  • Purchasing devices
  • Installation support
  • Setup
  • Tech support
  • Account and billing

II-Online Security

The other objective of customer service is online security; the online security centers on Microsoft’s website offer necessary information about downloading security essentials. The company also provide antivirus tool to remove malicious viruses from the computer of customers.

Supporting Activities of Microsoft 

Some of the four main supporting activities in the value chain analysis of Microsoft are as follows;

Infrastructure

The infrastructure of Microsoft comprises various activities like; strategic management, planning, financing, accounting, managing legal matters, and quality management. Well-managed infrastructure helps the company to amplify its value and strengthen the tech brand’s competitive position.

Human Resource Management

The human resource department of Microsoft comprises various HR activities and processes like performance management, reward, promotion, training, selection, and recruiting. HRM helps the company to improve the skills and expertise of its employees and decrease competitive pressure. However, the tech brand also invests a significant amount of resources in the training programs of its employees, which helps the company achieve its objectives.

Tech Development

Microsoft is the world’s top tech giant company and the brand invests a significant amount of resources in tech innovation to stay ahead in the competitive environment. Research and development is the key department of the company that focuses on the latest technological development, new product and service design, tools, software, automation technology, and data analytics.

Procurement

Microsoft outsources most of its manufacturing works to third-party manufacturers. For smartpones, the company carefully develops contracts with suppliers that comply the Microsoft supplier regulations and guidelines.

Conclusion: Microsoft Value Chain Analysis Example Company | Application of Value Chain Analysis Process

After an in-depth study of the value chain analysis of Microsoft; we have realized that Microsoft is the world’s leading tech giant company. If you are learning about the Microsoft value chain analysis company example; then you should keep in mind the abovementioned primary and supporting activities involved in the process of value chain analysis. They’re inbound and outbound logistics, operations, marketing, and services; infrastructure, procurement, HRM, and technology as an application of value chain analysis.

References 

  1. https://en.wikipedia.org/wiki/Microsoft
  2. https://swotandpestleanalysis.com/swot-analysis-of-microsoft/
  3. https://www.linkedin.com/company/microsoft
  4. https://www.bbc.com/news/business-67080391
  5. https://www.microsoftpressstore.com/
  6. https://www.microsoft.com/investor/reports/ar12/financial-review/business-description/operations/index.html
  7. https://strategicanalysishub.com/ansoff-matrix-of-microsoft/
  8. https://www.tryexponent.com/blog/microsoft-interview-process
  9. https://learn.microsoft.com/en-us/dotnet/api/system.diagnostics.process?view=net-8.0
  10. https://www.wikijob.co.uk/interview-advice/company-interview-questions/microsoft
  11. https://unstop.com/blog/microsoft-recruitment-process
  12. https://learn.microsoft.com/en-us/sysinternals/downloads/process-explorer
  13. https://learn.microsoft.com/en-us/credentials/certifications/certification-process-overview
  14. https://www.manatal.com/blog/microsoft-recruitment-process
  15. https://www.geeksforgeeks.org/microsoft-recruitment-process/