Understanding the impact of globalization, technology and other factors on businesses and industries is vital while learning business administration. In the recent years, technological advancement has become rampant, which has prompted businesses to embrace the new technology so as to remain relevant and competitive in the industry. In addition, globalization has also presented numerous opportunities for businesses to reach new markets throughout the world. In addition, it is vital to understand the manner in which companies apply the resource-based model, as well as the industrial organization model in the determination of the manner in which companies earn above-average returns. The current paper will analyze organizational vision and mission and their alignment to the success in the industry. Stakeholders are also important in every business, and their effect in the business and the industry will be evaluated. The paper will center on the music industry and the Universal Music Group.
Globalization and Technology
The paper is a research on the Universal Music Group, which is the music industry’s largest organization. The company has a branch in almost every country worldwide and owns, either wholly or partly, over 100 other music labels. It is an all-round company as it has various divisions, which deal with different aspects of the music industry. The Universal Music Publishing Group (UMPG) owns and obtains licenses. The company also has a retailing company called Bravado while its service management is undertaken by another company called Twenty-First Artists (Universal Music Group, 2015). Globalization entails the improved interdependence amongst countries through their organizations, and it is reflected through the flow of products and services among nations (Hitt, Ireland & Hoskisson, 2013). Technological advancement has impacted in various ways on the music industry. Technological advancement has assisted artists due to the advanced recording studios and high quality of music. In addition, the artists can sell music through the online platform. However, it has also led to a decline in the sale of music compact discs and increased music piracy. Nowadays, it is possible for an artist to record a single and release it throughout the world through the Internet at the same time. Nevertheless, it has led to issues where music is released to the consumers without the consent of the recording company.
The Universal Music Group has embraced technology to ensure that it makes its sales through the digital platform as it is more accessible and consumer-friendly. The company has signed artists in every region of the world. Therefore, it is making revenue from the globally-known artists, as well as the regionally-known artists. Through embracing technology and globalization, some artists who were only recognized in their countries are touring the world and are becoming global sensations. The company has combined globalization and technology to reap the benefits. The music industry has since moved from analogue to digital. However, most companies failed to capture the opportunity to embrace the digital platform in time. Nevertheless, the Universal Music Group has had a smooth transition, and has enlarged its market share through the digital platform. Therefore, globalization and technology are some of the factors that have led to the success of the company within the industry.
Industrial Organization and Resource-Based Model
There are four underlying assumptions in the use of the industrial organizational model in the music industry. First, it is important for a company to learn about the current status in the music industry and economy. When the economy is declining, the customers will not be able to purchase the records, which will reduce the revenue. Their budgets will be tighter, hence, their main emphasis will be on the necessities, and buying records is not a basic need. On the other hand, when customers lack enough money to purchase the records, they will engage in illegal means of accessing the records. The quality of music determines the sale of records. When the records being released are of poor quality, clients will be less willing to purchase them. In the recent years, the sale of records has declined due to the lack of artistic development. Second, the company has to allocate its assets in the development of artists and attraction of clients. It is necessary that a company focuses on stars that can attract fans in order to raise sales. Third, the company must embrace a strategic approach in ensuring the success of its start musicians. It will lead to an increase in the sales. Finally, the management must utilize their expertise in sales to ensure that clients demand their music, and the music is released in time. Thus, the Universal Music Group must develop a marketing plan, which will undertake all the outlined issues. It has to ensure that its artists are leading the charts so as to remain relevant.
When applying the resource-based model to ensure above-average returns, it is assumed that each organization is a cluster of specific competencies and resources. These resources and competencies create basis to earn above average returns (Hitt, Ireland & Hoskisson, 2013). The resources of Universal Music Group, as well as other companies in the music industry include labels, artists, marketing, publishing, and distribution. It is necessary to make a comparison on the resources between the company and the competitors. After the comparison, it is necessary for the company to identify the resources that will assist in making profits. It is a factor that will enable competitiveness, but it requires investing towards research. The company must also conduct demographic analysis of the clients so as to identify the group of individuals who have interest in its products. The company has to ensure that its marketing strategies are focused towards their target market so as to avoid misuse of resources. It should also invest in various advertisement platforms in order to ensure that it earns above-average returns.
Influence of the Vision and Mission Statements on the Overall Success
The company has a vision of being the largest music content company globally. The vision has a huge impact on the company’s performance. All the people involved are expected to perform exemplarity in their roles so as to make sure the company maintains its position as a leader. The management is involved in making strategic decisions. The company has set the goals to be achieved by the artists and the employees extremely high. Also, the company has succeeded in becoming the largest player in the music industry. However, it has to remain competitive. The company’s mission is to discover and develop recording artists, which is followed by marketing and promoting their music in diverse formats and stages. The company has different divisions that undertake every aspect of its mission. Having different companies implementing those tasks ensures that there is specialization. Therefore, the company meets all its required tasks so as to succeed. Through the publishing company, it discovers and develops the artists. It also possesses and controls the copyrights to the music compositions to ensure that whenever it is used, the company reaps benefits. It shows that the company’s mission and vision influence its success. They set the framework that guide the company towards being a leader and maintaining its position in the industry.
Impact of Stakeholders on the Success of the Company
The company has numerous stakeholders. The company has shareholders, and they also supply capital. The stakeholders’ vision is to earn interest through increase of the company’s profits and reduction of the risks involved in the operations. The shareholders ensure that the management has a mentality of succeeding so as to satisfy the needs of the shareholders. The company has succeeded in order to have a good image and get more investment from the shareholders. It has to ensure that there is an increase in the sale of music albums. The artists signed to the label must have the talent and will to succeed. The customers are the company’s product market shareholders. They purchase the music from the company, and go to the company’s concerts. They are among the most important shareholders to the company. In order for the clients to purchase the company’s music and merchandise, as well as going for the concerts, the company has to raise the standards of their products. Failure to release high quality music will lead to loss of market and clients will opt for other products from competing companies. Therefore, the company must meet the demands of the customers so as to be successful.
Another group of stakeholders is the company’s employees. Employees’ satisfaction results in motivation. When the employees are motivated, their output is high and it is of good quality (Shaikh, 2012). They are part of the organizational stakeholders. Employees enjoy when they work for a company that has a vision and one which aims to succeed. Therefore, the company has to remain successful so as to maintain its employees and reduce high employee turnover, which is detrimental to business. Finally, the other organizational stakeholders are the artists signed by the company. Every artist aims to succeed in the industry and become relevant. It is the responsibility of the company to ensure that it gives the artists an opportunity and guidance to succeed, which translates to the organizational success. Thus, each of the stakeholder categories has an impact on the overall success of the company.