Figure 1: Geographic expansion of Kaspersky

Source: Kaspersky.com. (2017)

Executive Summary

This report was intended towards assessing the strategies of Kaspersky for building an effective CSR strategy with a road map for 10 years for its sustainable development. Kaspersky is a Russian cyber security company which enables the customers to protect their devices from the malicious software and other cyber threats in order to ensure smooth operations for the buyers. The company has expanded its operations in different markets in order to increase their customer base and have built a strong brand reputation all over the world. According to the current trends in the software industry, it has been observed that over the past few years, the Russian software market exports have increased to double digits and reaching about $7 billion. Consequently, the demand for IT companies products has also doubled on the domestic level. The report provides an in-depth analysis on the strategy opted by the company for the expansion and successful operations focused towards the CSR strategy.

Table of Contents

1. Kaspersky Company Profile. 4

1.1 Mission. 5

1.2. Vision. 5

1.3. Corporate Goals. 5

1.4. Growth Objectives. 5

2. Scenario planning. 6

2.1 Schematics. 7

2.2 External environment analysis. 8

2.2.1. PESTE Analysis. 8

2.2.2. Porter’s Five Forces. 9

2.2.3. Stakeholder Analysis. 9

3. Competitor’s Analysis. 10
4. Scenario Analysis and Strategic Options. 11

Scenario 1: A high-tech Future. 11

Scenario 2: Vendors in the Software Industry of UK moving to upward markets. 12

Scenario 3: Increase in use of cloud software (SaaS) 12

Scenario 4: Physical-Digital Integration. 13

5. Building an effective CSR strategy in the UK Market 14

5.1 The Company Resources, Competences and Capabilities. 15

5.2. Strength for Internationalisation. 17

6. Overview of the UK cyber security Market 17
7. Critical success factors and KPIs for expansion in the UK market 20

7.1 Critical success factors. 20

7.2 Main KPIs. 21

7.3. Stakeholder’s Satisfaction for the CSR strategy. 22

7.4. Roadmap for Effective CSR for 10 years. 23

References. 24

1. Kaspersky Company Profile

The computer software industry is the hub of an evolutionary change following up with the new trends in mobile computing and the consumerisation of IT which has triggered permanent shifts in the industrial structures. Such trends are forcing the software organisation to change their strategies for the way they develop their products in order to meet the demands of the customers (Kaspersky.com. 2017).

Kaspersky Lab is a multinational anti-virus and cyber security provider headquartered in Russia and also operated by a holding organisation in the UK. The products and services provided by Kaspersky involved internet security, endpoint security, cyber security product, password management and antivirus products and services (Usa.kaspersky.com. 2017). The company has expanded their operations into different international markets from 2005-2010 and grew with an estimated amount of $700 million according to the annual revenues as reported in the year 2014. However, in the year 2016, the company has about 400 million users because of which it acquired the largest market share in Europe at the cyber security software vendors.

1.1 Mission

The mission of Kaspersky is quite simple, yet ruthless as it is focused towards providing services to small, mid-sized and large-scale companies for mitigating the risk associated with cyber-security and also providing highly responsive, efficient and effective protection to their customers against cyber threats, spams and malware (Kaspersky.com. 2017). This explains that the company is committed to protecting the computer users all over the world.

1.2. Vision

The global vision of the company is focused towards the expansion of the business into international markets. Moreover, the strategy of the company is also reflected in their vision statement that the business is supposed to be transformed into the global corporation (Usa.kaspersky.com. 2017). The company also wanted to ensure that it provides an effective control for the international operations and acquire a leading market share in the industry.

1.3. Corporate Goals

The corporate goals of the Kaspersky are focused towards investing in the best education and research, specialists and developments towards solutions which offers world-beating protection to the customers (Usa.kaspersky.com. 2017).. For fulfilling the vision of the company, it has employed a unique team of malware researchers all over the globe which includes 40 internationally recognised experts.

1.4. Growth Objectives

The company is a leading developer having growth objectives inclined towards expanding its operations in the international markets with the provision of endpoint security products. The company also seeks to acquire the largest market share in the software industry (Usa.kaspersky.com. 2017). Kaspersky is also expected to grow annually at the growth rate of 24.6% which is above the average rate as observed according to other vendors in the software industry. The current expansion of Kaspersky is explained in the figure below,

2.1 Schematics

External environment analysis

2.2.1. PESTE Analysis

Following is the PESTE analysis conducted for Kaspersky in the UK software market,

Category	Trend	Impact
Political/Legal	-Growing political focus on the cyber security and malware practices.	More pressure on the pricing of the Kaspersky products.
	-Harmonisation of internet threats across Europe	Increase in the number of customers.
	-Political stability in major cities of the UK.	Positive impact on the growth opportunities for Kaspersky
	-Increase in the government support for the automation.	Favourable condition for the international expansion of the business.
Economic	-Growing disposable income of the consumers	Consumer will be willing to spend more on the purchase of software.
	- Brexit and UK referendum	Negative impact on the growth opportunities of Kaspersky.
	-Global economic crisis	Minimal chances for the global expansion of business.
Social	-Customers increasing focus towards data security and protection.	It will create positive impact for Kaspersky and increase their customer base.
	-Lower cost and more customisation are required by the customers.	It will help the company in focusing on providing more options to the customers in terms of customisation for meeting their demands
Technological	-Rapid advancement in the technology related to software development	Provide digital opportunities to Kaspersky.
	-Technological breakthroughs	More responsive software development for the customers.
Environmental	Changes in the environmental agenda and the awareness of the community	It is necessary for Kaspersky to identify eco opportunities to make the business competitive.

 

2.2.2. Porter’s Five Forces

The figure presented below represents the porter’s five forces for Kaspersky in the UK market. It can be observed that there is a fierce competition in the software industry of the UK such as McAfee, Norton and e-Set which has entered the market aiming towards gaining market share and reaching the scope of software market.

 

2.2.3. Stakeholder Analysis

In the light of Shakhshir (2014), the stakeholder’s analysis is the process of gathering and analysing the information which is used to determine the interest of the stakeholders towards a particular organisation’s services and products. In case of Kaspersky Lab, the figure below explains the power-interest matrix of the existing stakeholders of the company.

Figure 2: Power-Grid Matrix of Kaspersky

 Source: Author

3. Competitor’s Analysis

Kaspersky is perhaps the most competitive and largest endpoint protection software in the software industry. However, from the competitive perspective, the company faces direct competition with Symantec, Norton and McAfee as vendors who are offering products that encompasses same functionality which Kaspersky integrates into their products. Following is the competitor analysis of the company in terms of profits, revenues, products and services and employees. According to the table it can be observed that Symantec has a strong position in the market with high revenues and profits.

Factors of Comparison	Kaspersky	Symantec	McAfee
Profit	US $ 529 million (2015)	US$2.488 billion (2016)	US$ 515 million (2016)
Revenue	US $619 million (2015)	US $3.6 billion (2016)	US$1.68 billion (2016)
Employees	3500 (2016)	11,000 (2016)	6,768 (as of 2017)
Products and Services	Security Software	Security software	Security Software

 

4. Scenario Analysis and Strategic Options

There are four different scenarios explained in the table with description against each scenario, the impact of each scenario on Kaspersky and the strategic options which are consisting of company’s reaction to the scenario.

Scenario 1: A high-tech Future

Scenario: The high-tech future can be viewed as the gateway to world in which Kaspersky can get highest demands for their software due to increase in the cybercrimes and malware practices. Since most of the companies will be transforming its strategy by big data applications, therefore, it will require protecting that data for the company. Hence, that protection will be facilitated by the security software.

Effect on Kaspersky:  Kaspersky will experience a growth opportunity due to the shift of business from traditional modes to digitisation and rectifying the cyber security issues.

How might Kaspersky react?

1. Kaspersky can focus on becoming a highly efficient software provider in the existing market.
2. Kaspersky can expand its operation into different markets such as Asian countries and emerging markets.

Scenario 2: Vendors in the Software Industry of UK moving to upward markets

Scenario: The software vendors that provide services to the small organisations will move towards tier 1 and 2 enterprise markets where the revenue of the company is above $250 million and the users are more than 1000 in number.

Effect on Kaspersky: Kaspersky can face decrease in the sales as it will be facing direct competition from the new competitors.

How might Kaspersky react?

1. Kaspersky has to improve their scalability and functionality for competing with the new entrants in the market.
2. 2. The company should also focus on improving the technology in the software and allow web portal access to their suppliers and customers for resolving the issues.

Scenario 3: Increase in use of cloud software (SaaS)

Scenario: In the third scenario, it can be possible that the customers begin to look for cloud-based software solutions which is also gaining market acceptance. In this case, the software vendors host the application of software ad enable the access to the customers from internet.

Effect on Kaspersky: It is providing growth opportunity to Kaspersky by market development

How might Kaspersky react?

1. Focus on introducing different cloud-based software such as ERP, CRM or Project management.
2. Kaspersky should tap into those markets which are underserved or carry out related diversification in the software industry through merger and acquisition.

Scenario 4: Physical-Digital Integration

Scenario: In the fourth scenario, mobile devices are gradually adding the technology element into the daily lives. The customers purchases online via smartphone and also through the physical store. The online purchase of the customers through smartphones should be taken into consideration by Kaspersky.

Effect on Kaspersky: The demand of the antivirus software will remain medium to high because of different companies providing the same services to the customer.

How might Kaspersky react?

1. The company can strengthen its market position by providing the software at low cost for becoming market leader in the software industry.
2. Kaspersky should carry out related diversification by providing antivirus software to the smartphone which will not take an ample space in the customer’s smartphone.

Using the Ansoff Matrix Peppard and Ward (2016), the strategic position and strategy of the company is explained as,