Strategic Management Nintendo Company Limited is Gaming Industry

Question: Discuss about the Strategic Management Nintendo Company. Answer: Introduction Nintendo Company Limited is an old firm in the gaming industry. The serves foreign markets like USA and Europe in by delivery video games to the consumers. Initially, the company was called Marafuku and dealt with the manufacture of playing cards. It changed the name in the year 1951 and started been known as Nintendo Koppai. During this time the company was manufacturing and selling hanafunda also known as the flower cards. The company officials afterward saw the need to change the name of the company Nintendo company to cater for all the activities it was involved. The multinational corporation started carrying out taxi services, a TV network, selling toys, Food Company and a hotel chain. All these services were aimed at making more profits for the company (Badurdeen, et al. 2010, pp.1824-1828). Eventually, in 1970's the company entered the video game market in Japan in anticipation of greater returns. It acquired legally the right to manufacture and distribute its first video game console the Magnavox Odyssey Video console. The company then was targeted the local market to purchase its products. It went on to create and distribute the color TV game-6 home video game console. During this time the company was under pressure make new products to ensure market leadership. It employed the legendary creator and manufacturer known as Shigeru Mayimoto who was still a student but later became of the greatest creators of games such as Mario and the Legend of Zelda series. The company has transformed over the years with the help of great creators and innovators such as Shigeru and Gumpei Yokoi. The management of the company has propelled it to withstand competitions from businesses and still be among the market leaders. It is third after the Sony group entertainment producing the Play Station 4 home console and the Microsoft Company providing the Xbox one home console (Egenfeldt-Nielsen, Smith, and Tosca, 2016) Industry analysis Industry analysis is the study of the nature of the industry that the Nintendo Company serves and sees the various factors that may influence its operation. Initially, the company was had sole existences, but due to the changes there are many new entrants into the markets who products same produces or substitutes (Grant, 2016) Profitability Technology has led to cheap ways of executing duties. The gaming industry is very profitable for the entrepreneurs. The profit comes from; Globalization- gaming companies, have the ability to sell their games in international markets thus get high returns. Creativity and innovation- the ability of a firm to create unique products guarantee it big sell as customer needs are ever changing. Technological advancement- technology has brought new ways of doing work which is simple and also it has led to the growth of the mobile technology increasing the platform for people to access video games. Scores of customers- all the individuals in the world are engaged in gaming, and this provides a larger market for the firms' games. High-quality services- companies that offer high-quality games without problems attract scores of customers who increase their sales. Competitor analysis Competition is inevitable for any company in the market as the supplier are many with fewer buyers. All the businesses struggle and strive to attract the highest numbers of customers to increase its sales thus get huge profit margins. Nintendo Company has had many competitors in the market, and they include Sony Company and the Microsoft Company. Competition makes firms management put up strategies to compete effectively. Technological changes have been the greatest contributor to the high competition in the market. Despite the Nintendo Company having many inventions and new products they still cannot be the market leaders (Fleisher, and Bensoussan, 2015). Competitor analysis aims at identifying the strengths and weaknesses of the opponent to utilize them to the benefit of the organization. A company can defeat an opponent by clearly knowing what they do better those them. In the case of Nintendo Company, the competitors have high-quality video game consoles which attract more customers. The customers also had the need to change the supplier as Nintendo Company has been in existence for a long time. Change is good as rest, and this has added a disadvantage to the firm as they prefer the new investors in the market. Some of the competitors such as Sega have no strategic marketing plans which serve as a weakness making then exit from the market leaving little competition the company (Rothaermel, 2015). Macro environmental factors Many factors affect the way the company carries its activities. They include the internal and external environmental factors. Internal factors are the ones the firm has control over to enable its success while the external factors are out to control the business. The company tries to eliminate the internal factors but the external factors it finds ways to minimize their weight or implications on the firm enterprise (Ogendo, 2017, pp. 77-88). Nintendo company main internal factors that have great consequences for the enterprise success are the employees, competitors and the customers. The staff decisions and execution of duties determine the success of the company. They can, however, be regulated by the management to ensure they conform to the functions given. The creativity and innovative of the workers makes the organization come up with better video games consoles. Competitors are a great challenge to the business success. Sony, the most significant competitor, holds 53% of the market share while the second threat is the Microsoft Company with 28.5%. The opponents control a large number of customers, and the management must find ways to produce goods that have high customer attraction. Customers are the buyers of the company's video game console and their tendency to choose competitors to make the company lack market for its products. Nintendo firm, therefore, should ensure that it maintains customer loyalty (Teece, 20 10, pp.172-194). Company corporate strategy Companies undertake many activities to make sure that they survive in the competitive environment. Company business plan is the ways the firms firm strives to provide value for all the activities it executes. The aim is to ensure that the corporation competes effectively in the market and all its activities are successful. Corporate Strategies are plans that any business undertakes that can affects the whole gaming industry. The Nintendo Company has engaged in partnership with the DeNA Company as a strategy to enter the 9th generation of video game consoles. The aim of the company is to provide gaming for smart devices, smart phones, phablets, etc. and a dedicated game platform. The platform will be run by a new concept under the development codename NX. The partnership of the company has led to the creation of the Miitomo,' smart phones and they will change the modes of operation in the market. However, the firm must be very careful with the adoption of the new concept as it can lea d to its failure. Like the Sega Company which was once a great rival in the market but a wrong decision made it removed in the market due to failure to meets its objectives (Contractor, Kumar, Kundu, and Pedersen, 2010) Company Business Strategy Company plan of activities is planning the company undertakes which can completely change the way it carries out operations. The procedures are taken to ensure that the company produces products that compete effectively in the market. In the 19990's Nintendo was facing great competition from the competitors making it make a strategic decision to change the focus of manufacturing and creation of game video console. In 2000's the competitors were concentrating in hardware and graphic in manufacture by the Nintendo Company went in a direction by focusing on motion sensor technology. The company had earlier developed the Nintendo DS and the Wii. The new direction was done on the Wii, and the motion sensor technology was with the Wii Remote and the Wii sensor bars. The new inventions of the Wii were very satisfactory to the firm making it get very high sales as it sold 101.63 Million units and 913.13 Million games worldwide. Creativity and innovations are transparent modes of ensuring company business strategy is achieved through unique ways of production of products that have high demands in the market for firms. Managers have the duty to oversee the execution of the enterprise functions in the right way which will lead to the achievement of the goals and objectives. Strategic leadership Leadership is crucial to the success of any organization. Shareholders of the business appoint managers to run the business activities on their behalf. Managers, therefore, have the duty to ensure that targets are met promptly without delays. In the case study, there are some people who acted as the leaders of the Nintendo company and make great contributions. Shigeru Mayimoto created the most famous games of Mario and The Legend of Zelda Series. The two games brought huge profits to the firm through their huge sale. Gumpei Yokoi, an old member of the enterprise, was a great leader who led to many inventions. In 1980, he invented the game and watches. In 1989, Yokoi and his Nintendo R D one team developed the Game Boy which was later advanced to many versions e.g. Game Boy Advance, Game Boy Advance P and the Game Boy Micro. In 1995, Yokoi made his last invention of the Virtual Boy game console. It only sold on USA and Australia market, and it had least sales. Even though it was a critically commercial failure, it was a bridge to more invention in the gaming industry. The market competitors must have best leaders for them to be market leaders (Azar, and Shafighi, 2013, p.432). Importance of gaming in the world Gaming activity is no longer game for children but all the people in the society. In Australia, research shows that the average gamers are of 33yrs. In every ten persons at least one of the people is a gamer. Percentages of the people who play video games are as follow; 78% are 18yrs and order, 49% are from 50 years and above and 37% are 65 age and above (Phan, Jardina, Hoyle, and Chaparro, 2012, pp. 1496-1500). The main reasons for playing video games are; Improve personal skills. Improve the coordination and dexterity. Fight dementia among people. Increase the mental stimulations. Current position of this company/industry Technological changes have changed the world especially the gaming industry. In Australia for example majority of the people play the game. Games nowadays are available in mobile phones and computers. The people have changed from the traditional video game consoles and handheld devices to the mobile technology. The gaming industry has, therefore, change completely over the years (Astrachan, 2010, pp.6-14). Nintendo Company has tried to cope with the variations in the environment and also remain competitive. Currently, the company has put up strategies to adapt to the changes in the environment. The company has engaged in a partnership, and this will improve the quality of products. The smart mobile device produced is itself significant achievements and an indication that the corporation is conforming to the new changes in the society. The company is in the 3rd position in the market, but if the new changes are efficient and attract more customers, it will grow to higher levels in the industry (Purce, 2014, pp. 67). Conclusion The future of the gaming industry is bright as the new technological changes are marketing the industry to have more users regardless of their age, gender, social class, etc. The returns are expected to be high for the shareholders. As the market growth, the probability of risks increases and managers should ensure that before a decision is adopted thorough investigation and consultation is done to avoid any errors (Puccio, Mance, and Murdock, 2010). However, managers when designing new products they should make them distinct from the previous items to avoid confusion by the customers. The Nintendo Company created the Wii U video game console which was better, but people did not buy because they thought it was an add-on of the Wii video game console. The Wii U was the lowest selling video game of the company. These was due to back naming strategy of the company to new products (Solansky, 2010, pp.675-681). References Astrachan, J.H., 2010. Strategy in family business: Toward a multidimensional research agenda. Journal of Family Business Strategy, 1(1), pp.6-14. Azar, M. and Shafighi, A.A., 2013. The effect of work motivation on employees' job performance (Case study: employees of Isfahan Islamic Revolution Housing Foundation). International Journal of Academic Research in Business and Social Sciences, 3(9), p.432. Badurdeen, S., Abdul-Samad, O., Story, G., Wilson, C., Down, S. and Harris, A., 2010. Nintendo Wii video-gaming ability predicts laparoscopic skill. Surgical endoscopy, 24(8), pp.1824-1828. Contractor, F.J., Kumar, V., Kundu, S.K. and Pedersen, T. eds., 2010. Global outsourcing and offshoring: an integrated approach to theory and corporate strategy. Cambridge University Press. Egenfeldt-Nielsen, S., Smith, J.H. and Tosca, S.P., 2016. Understanding video games: The essential introduction. Routledge. Feijoo, C., Gmez-Barroso, J.L., Aguado, J.M. and Ramos, S., 2012. Mobile gaming: Industry challenges and policy implications. Telecommunications Policy, 36(3), pp.212-221. Fleisher, C.S. and Bensoussan, B.E., 2015. Business and competitive analysis: effective application of new and classic methods. FT Press. Frankel, T., Laby, A.B. and Schwing, A.T., 2015. Regulation of Money Managers. Wolters Kluwer Law Business. Grant, R.M., 2016. Contemporary strategy analysis: Text and cases edition. John Wiley Sons. Ogendo, J.L., 2017. Achieve Sustainable Performance in Dynamic Business Environment. In Emerging Economy MNEs (pp. 77-88). Springer International Publishing. Phan, M.H., Jardina, J.R., Hoyle, S. and Chaparro, B.S., 2012, September. Examining the role of gender in video game usage, preference, and behavior. In Proceedings of the Human Factors and Ergonomics Society Annual Meeting (Vol. 56, No. 1, pp. 1496-1500). SAGE Publications. Puccio, G.J., Mance, M. and Murdock, M.C., 2010. Creative leadership: Skills that drive change. Sage Publications. Purce, J., 2014. The impact of corporate strategy on human resource management. New Perspectives on Human Resource Management (Routledge Revivals), 67. Rothaermel, F.T., 2015. Strategic management. New York, NY: McGraw-Hill. Solansky, S.T., 2010. The evaluation of two key leadership development program components: Leadership skills assessment and leadership mentoring. The Leadership Quarterly, 21(4), pp.675-681. Teece, D.J., 2010. Business models, business strategy and innovation. Long range planning, 43(2), pp.172-194.