Executive summary for the following (one page maximum):

Problem statement:

There are two main problems in Microsoft. The first is financial problem and market share of the Xbox 360. Microsoft suffered a great loss, billions loss suffer from 2005-08, because of major design flaws in the Xbox 360. The second problem for Microsoft was that it sacrificed something to rush into the market and establish the Xbox 360 as the premiere platform of the living room.

Situation Analysis:

Microsoft launched Xbox 360 in 2005 with the aim to outgun their competitors Sony and Nintendo. They also intended on capturing a greater portion of the market and becoming the leader for game console.

Microsoft have since discontinued the production of the Xbox 360 but its strategy was to try and gain back the confident of its users by extending the warranty to replace or repair any of console that experienced the three flashing red light as per the open letter from the then manager Peter Moore in July of 2007. While this was encouraging it did not cover all the technically issues consumers were experiencing with the console, as another major defect was the scratching of disc when inserted into the console. This defect was also pointed

SWOT:

Strength: The Xbox Live provided gamers with a community of like-minded individuals, even though consumers had to pay a premium to use the service.

Xbox 360 automatically had the novelty associated with the Microsoft brand, a brand that is popular and known worldwide among the leading technology companies.

Weaknesses: Two weaknesses that plagued the console were product development and production cost. Microsoft unravelled the gaming world when it launched the Xbox 360, then the dominant gaming company was Sony.

The company wanted to be the front runner within the gaming world with the Xbox 360 and as a result all 7 steps to developing a new product were not followed which led to a product with multiple issues, disappointed and unsatisfied customers and public relations nightmare for the company.

Opportunities: Xbox 360 presented Microsoft with the opportunity for diversification, the company knows and does software development and production very well; if they were able to penetrate the gaming sole market this would add hardware to their portfolio as well.

Threats: Microsoft competitors, Sony and Nintendo were the greatest threat that the company faced. Both companies were ahead in terms of experience, resources and know-how; they were able to offer a similar product and service at a lower price to consumers.

Another threat that the console faced was compilation, the hardware contains many different components that were produced by different manufacturers.

Market analysis:

Producing a console with many capabilities that is viewed as being highly innovative is critical to gaining consumers' trust so that they will rely on Microsoft for more than just gaming and PC operations. Microsoft's strategies fit well with the future issues it is likely to encounter of continuing slow growth in PC sales and a need to increase its growth through both gaming and receiving a greater share of consumers' home entertainment expenditures.

Segmentation:

Microsoft has multiple targets for the Xbox 360. First the company is trying to attract hard-core gamers. This group of segments is usually within age 15-35. Main gender will be male. They spend 3 or more hours per days playing games. They care about the performance and sustainability of the console.

However, the company is also broadening the appeal of consoles to non-traditional demographics - casual player. Xbox 360 able to target player who do not play game that often but will impress by the incorporating multimedia features.

Competition:

Sony - PS3: As a product, one of the most stands out feature for PS3 is its High-quality Blu-Ray function. Sony is always among the top graphics and audio capabilities and performance. Secondly, Sony has large installed base of the PS2 and already mature online gaming network (service non-charge for customer) Strategically, the PS3 has incorporated multiple functions including high-end gaming, Blu-Ray playback and various others.

Nintendo Wii: Nintendos Wii has successfully distinguished itself from rivals by an innovative motion-sensing controller (Wiimote). The console is wireless and simpler design allow for easier game play.

Financials:

The total life-to-date Xbox losses are conservatively estimated at around $6 billion dollars. As much as it sounds like, this lost only able to wipe out Microsofts revenue for one and half quarter.

Case keys:

Key success factors:

Maintaining good quality. In order to keep up customers confidence to your brand, quality is always number one factor. The management believed that they couldnt afford to stop and delay the launch in order to solve its quality problems

Bring Something New to the Table. In order to make a game console stand out, it has to have something different, something new.

Proven ability to improve. These days, Video game industry have to have the ability to improve their product overtime for the fast-increasing needs and demands for the customer.

Key uncertainties: One uncertainty that stand out is the expertise characteristic of this Microsoft company. The fact they are a software company.

Analysis of alternative solutions:

Release the financial pressure from the game division. Refocus on software development. However, the loss of the Xbox 360 can only be so big thats only a small part of lost for the whole Microsoft.

Microsoft's ultimate goal is to provide the hardware and software "brains" for delivery of all types of entertainment through consumer electronics. In this regard, Microsoft's strategies fit well with the future issues it is likely to encounter of continuing slow growth in PC sales and a need to increase its growth through both gaming and receiving a greater share of consumers' home entertainment expenditures.

Recommendations:

To be success in the future, they need to make three changes. Acquire more elites from the hardware. And they need to fix the technical failure of the Xbox 360 and renamed it. This time make sure it works the way it advertised. Also, they need to have a strong customer support and engineering debugging team to back it up. The product needs to be more innovative and fit right into players heart.

Action plan:

They need to completely eliminate the system failure they discovered so far. Resemble a new Xbox 360 (reborn). Also, Microsoft can partner with a manufacturer who has more experience in designing better hardware for the console. Microsoft wanted to cut costs by not using a traditional microchip designer, instead they used a cheaper processor which led to failure.

THANK YOU!

Question is:

Form an executive summary (maximum one page) for the text below!

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