Find one for which you completely understood the challenges for that company and the recommended strategy. Post what you saw valuable in terms of that student’s work.
My work is
Thestrategic analysis of Noble Corporation plc began amidst the emergence of the COVID 19
pandemic. The vast majority of the research put into this project does not consider the current
effects of the pandemic on the world economy nor that of the oil and gas market globally.
Having worked for Noble Corporation from 1998 to 2002 when first joining the workforce out of
college, many were privileged to be given access to some of the industry’s most emergent
technology, liberal workforce, and financially flexible projects.
Reviewing what the company has accomplished, what the company has endured, and what the
company now faces, it is not very easy to predict if there is any real opportunity remaining.
When Noble was reliable, and leading industry innovation in the late 1990s, employee stock
options were close to $10 per share and would split on the stock market annually. Before the
real estate market crash of 2008, Noble Corporation stock was near $65 per share; as of the
submission of the project, the company is now worth $0.26 per share. The analysis and
discussion to follow is based on the 2018-year end annual report released in February of 2019
and does not take into effect the current pandemic and worldwide economic recession.
However, for the sake of contrast, it must be noted that Noble should draw what’s left of
the company’s credit and start negotiations with creditors because the company needs a
comprehensive restructuring. Noble cannot carry the weight of its massive debt in current
conditions, and the company will suffer massive cash burn going forward if it does not eliminate
the debt load and the corresponding interest payments. Chances for common equity survival in
the current economic environment are almost non-existent. Investment in Noble for the
long-term is unrealistic, due to the specific weakness of the offshore drilling industry and the
potential risk of the company forced to restructure under chapter 11. The fourth quarter 2019
backlog of $1.5 billion, will remain high into the second quarter of 2020 due to the lack of any
period of stability. The real issue is the debt load, and if Noble can avoid a restructuring, either
of these factors is hard to ignore given historically low and dropping oil pricing, conflicts with
OPEC and between Russia and Saudi Arabia, and most significantly, the global pandemic. The
current state of the corporation affected by the pandemic and the resulting global recession is
discussed in the latter part of this paper.
Executive Summary
Founded in 1994 as an online bookstore, Amazon has grown to become one of the world’s leading online retailers and founding fathers of online retailing. Today, the organization offers a wide range of products and services via its three segments namely, North America, Amazon Web Services, and International. Although the company experiences immense competition from other large corporations such as eBay and Noble and Barnes, it has grown to become the second company in the world to have a value of $1 trillion after Apple Incorporation. The success is because of its customer centric mission statement, and concentric diversification strategy. The organization can also link its success to its strategic partnerships and acquisitions of numerous organizations, and Jeff Bezo’s style of leadership.
In fact external factor evaluation shows that Amazon.com has a combined weighted external factor evaluation score of 2.72, which is higher than the average value of 2.5. Internal factor evaluation shows that the company has a total weighted score of 3.10, which is also higher than the average value of 2.5. An analysis of the company’s competitive position shows it has a total weighted score of 3.60, which is higher than Noble and Barnes’ total value of 3.25 but lower than eBay’s value of 3.70. Amazon has a strong internal position and an average external position, which places the company into cell IV of IE matrix. Most importantly, the company’s none of the company’s segments is a question mark or a dog. Whereas Amazon Web Services and International are stars, the North American segment is a cash cow.
From the financial performance perspective, Amazon is in a better position to meet its short term financial obligations but less profitable. The organization is also insolvent and does not effectively utilize its total assets to generate revenues. Nonetheless, the company’s total revenue is expected to increase by 13.44 percent to at least $318 billion by the year 2022. This would lead to an increase in net income by more than $2 billion over the period. The SPACE vector for the company is in the aggressive quadrant based on its 1.65 long term debt to equity ratio, intense competition in the e-retail industry, and dominant market share. Based on Amazon’s strategic management analysis it is recommended that the company should pursue market penetration, market development, and product development strategies to exploit its opportunities. The organization should also enhance its technological strategies and employee relations.