Nintendo’s Strategy in 2009: The Ongoing Battle with Microsoft and Sony
Nintendo, which is one of the video game industry competitors, have been the worldwide leader in creating the entertainment games. Nintendo’s video games have been sold everywhere in the world and they became in the list of the worlds best selling. The latest gaming console system, which is considered as a revolutionary video game console, was the Wii. It attracted a large number of people from different ages, which resulted in a large number of sales and profit. Unfortunately, nowadays the demand of the video games slightly decreased because of the new games and devices introduced recently. This internal analysis of Nintendo conducts its competitive strength assessment versus its competitors and analyzes the firm using the value chain analysis tool and the VRIO framework.
Nintendo’s Value Chain Analysis (Primary Activities & Support Activities)
Supply Chain Management
Nintendo, which is one of the largest video game companies, follows several steps and goes through different stages to create a value for its customers. To produce a video game controller, Nintendo outsourced the key components, which are needed for the production such as controller chips, from a number of different manufacturers. Nintendo formed partnerships with those manufacturers to supply them with the required components. The process of outsourcing the components from different manufacturers is considered as a good practice and cost effective because it reduces the production costs that Nintendo might have if they produced the components by themselves. As it is mentioned in the case, “Nintendo is not a technology company – it is a toy company” so, by outsourcing Nintendo als...
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...lities of Employees (Human) Yes No Parity Normal
Innovation Capacities
(Innovation & Creativity) Yes Yes No Temporary Advantage Above Normal
Brand Name
(Reputation) Yes No Parity Normal
Innovativeness
(Organizational Capabilities) Yes Yes No Temporary Advantage Above Normal
Low Production Cost
(Organizational Capabilities) Yes Yes No Temporary Advantage Above Normal
Excellent Product Development Capabilities (Organizational Capabilities) Yes Yes No Temporary Advantage Above Normal
References:
Questions about Xbox 360 Repair, (2014), Xbox Support, Retrieved from http://support.xbox.com/en-US/xbox-360/repair/warranty-faq
Warranties, (2014), PlayStation, http://us.playstation.com/support/warranties/ps3/
Warranty Coverage (USA and Canada), (2014), Nintendo, Retrieved from https://www.nintendo.com/consumer/manuals/warrantyinfo.jsp
3) Based on your reading of Malerba, F. 2007. “Innovation and the dynamics and evolution of industries: Progress and challenges” International Journal of Industrial Organization, Vol. 25, No. 4, pp. 675-¬‐699, choose an industry and describe how its structure and current state of emergence affect competition and innovation.
For three decades, the Nintendo Company has been on the front line of the video game industry. With competitors continuing to develop new video game systems and more exciting games to play with those systems. The Nintendo Company has come up with their own ways to keep video game enthusiasts interests in mind. Even though the video gaming at home did not start with Nintendo, The Nintendo Company did start a video gaming revolution with the release of the Nintendo Entertainment System or NES in 1985. How did the first ad of the NES package have the effectiveness that appeals to video gaming enthusiasts to launch the revolution, as we know it today?
Nintendo has been around for a long time. 125 years, to be exact. This report will explain how Nintendo got so deeply rooted in our culture by examining the moves they made with their consoles, including both successes and failures.
In the console-gaming world people know Sony and Nintendo. Microsoft may be the largest and richest software company in the world, but it’s unknown when it comes to console gaming. Microsoft is counting on the Xbox to change that perception. Gamers may not be willing to take a chance with the Microsoft Xbox, even if it is far superior to any console ever made. Nintendo Gamecube is nothing if charismatic. Nintendo’s new machine is half the size of any other console and looks like a toy with its brightly colored plastic shell and handle. It’s destined to be home of such popular games as Mario, Donkey Kong, Pikachu, and Kirby. Nintendo Gamecube seems mismatched as it goes up against the Microsoft Xbox and the Sony Playstation 2 (a multimedia mayhem that Sony says it’s supposed to be “The Future Of Entertainment”). All this makes you think; what makes Nintendo believe it can possibly go up against the ultra-sophisticated Xbox.
Marketing Strategy for Nintendo Gamecube FEATURES OF APPENDIX = == == ==
When Microsoft entered the video game console market, they were faced with a dilemma: whether to manufacture the Xbox themselves or outsource it to a third company. Microsoft ultimately chose to outsource the production to Flextronics. Flextronics’ 'industrial park' strategy is what allowed it to manage its supply chain, making the production of Xbox more efficient and cost effective. They also had factories around the world, which were all under the centralized information system, s they could shift the production from one country to another if necessary for optimal profitability.
The first type is the primary activities and costs that is contains of five different activities. Nintendo had only one manufacturer in the past which was “Taiwan based Foxconn precision Components”. This company was responsible to manufacture the components of Wii; the last new video game of Nintendo. But after the firm noticed that the demand on its new video game continue to increase, the management of Nintendo decided to diversify its suppliers that manufacture their video games’ components such as; the chips, and for assembling the Wii system. This was related to the supply chain management.
This essay plans to focus on the corporate strategy of Microsoft, and show how Microsoft has used diversification successfully within their corporate strategy to gain a competitive advantage.
In the previous part of our work we were talking about Porter’s value chain of McDonald’s fast-food restaurant. It is known, that before making a statement about competitive priorities, the company should know the objectives of the operation. Is it customer oriented? Does it cover shareholders’ and suppliers’ interests? However, now we consider that McDonald’s has taken into account all of the interests of business environment.
For instance, Harley Davidson may be forced to change their marketing strategy due to the entrance of a new competitor into the market. Second, Harley Davidson has to learn new skills and technologies quickly. For example, technologies are changing rapidly, so it is crucial for Harley Davidson’s business plan to change or alter in order to keep up with innovation. Third, this organization has to effectively leverage its core competencies while competing with its competitors. This is, Flexibility is required for Harley Davidson to learn how to use primary value-chain activities and support functions in the way that allow the organization to produce their products at a lower cost with differentiated features compare to their competitors in the market
Value chain analyses a firm 's internal activities such as planning, production, and development, packaging and distribution so as to create value for clients. The function of the value chain is to identify the sources for cost reduction along with quality improvement. It means value chain is used to identify the strong and weak points, positive and negative points, the scope of improvement; in a nutshell, the advantages and disadvantages of the activities taking place in the system. The value chain is also called as a strategic analysis tool and it is a well-known concept in business management industry.
Since the beginning of 2000, FAW-Volkswagen has grown rapidly in the face of international competition. Before 2004, the company used the traditional value-chain model, which is based on sales’ production (Mazen, 2010). This is a risky model for a company to follow in a volatile market. Use of the forecasting model provides, no analytical evidence to support different options. Both marketing people and financial management people are under great pressure to balance costs and profits. As a Chinese automaker, FAW-Volkswagen didn’t want to have a passive and disadvantaged position in the industry, so the R& D department began to analyze the build-to-order model of foreign auto manufacturers, and adopted a new value-chain model on this
Because the subject matter of strategic management is so inherently complex and because each one of us brings his own personal biases to the analysis, it was suggested early on that virtually all case material in the field be analyzed from the perspective of more than one methodology. Profit theory and industrial chains were selected as the first of a number of viable approaches to the analytical process. It would have been equally correct to select the Five Competitive Forces analysis refined by Michael Porter, one of the major figures in the field of strategic management. This methodology addresses the same issues but differs only in the language that they use to describe corporate behavior. The five forces are:
Firstly, there is a need to focus on the company competitive dimensions before embarking on the decisions. In this aspect, the Competitive capabilities are the Cost, Quality, Time, and Flexibility dimensions that a process or value chain actually processes and is able to...
...d to learn from the chess game in terms of the ground rules and specific strategic management points of views. There are three common strategic principles and management expertises that the corporations need to be aware of and follow. First of all, it is highly advisable for them to conduct a macro environment evaluation through resorting to the PESTLE Analysis and the Porter’s Five Forces Model. Second, it is of significance to carry out self evaluation analysis with a view to better understanding the firms’ own advantages and capabilities through using SWOT Analysis. Last but not least, the corporation is advisable to conduct an all rounded competitor analysis in order to gain a detailed acknowledgement of the current circumstance possessed by the major competitors so as to assist them to generate a better corresponding strategies in the future business operation.