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Kimberley Niu

on 8 May 2013

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Factors Wii U Duplicate TV screen PS 4 has a better power
PS 4 provides better experience with hand holding set
Consumers will have to wait for the release of PS4 before making a decision between the PS4 and Wii U Gaming Strategies Focus on exclusive games- lack of variety
Focus on Luigi Nintendo Strategic Analysis Nintendo Strategic Analysis Business Level Strategies Nintendo 3DS physical structure Technological
Factors Government Control (Entertainment Software Control,
eg. Age Control) - Competitions
between graphics

- Lower costs PEST PEST For Gaming Industry Economic Factors - Adding GDP

- Interest rate

- Currency fluctuatons (eg. USD & EUR)
- Culture and traditions
- Japanese Games Vs. Western Games
- Japanese inclination
Social Factors Competitive Rivalry
High - High entry barriers Threats of Substitutes
High - Fewer suppliers
- Lack of alternative sources
- High switching costs Bargaining Power of Buyers
Medium - Major Players

- Others (eg. Sega & Ubisoft) Threats of New Entrants
Low R&D
Costs to get economies of scale
High capital investments - Mobile Gaming
- Browser-based
- Board Games
- Outdoor Activities Bargaining Power of Suppliers
Medium - High switching costs
- Few dominates but strong
- Weak negotiation power Overview of Game Industry "Flower" Cards Manufacturer 1960s The King of Video Games Industry 1980s 1996 1889 @Japan, by Fusajiro Yamauchi Expanded to Toy Maker 1970s Entered Video Games Industry Suffered from huge losses
Lost its leading position Nintendo 3DS analog stick
- A lack of a second analog stick
- Favours left hand players

Smaller screen but device same size
XL similar screen but device bigger in size Vs. 3DS limited connection: ex. Lack of 3g connection Vs. Incompatibility of Wii U with 3DS Lack of third party support
Lacking focus on delivering brand image
Late online strategy VRIO Internal Analysis Mintzberg listed 5 structural configurations to identify organisations.

Nintendo tends to be a divisionalised organisation. Organisational Structure
& Culture Dimension 2: Method of decentralisation Analysing Nintendo’s structure 3DS PS VITA
Decisions are made by the head of divisions and CEO

Teams adopt an approach - on the completion on one system, they
immediately start

Working on the next The major part of the organisation is responsible for success Dimension 1: Method of cordinated activities In 2003, the organisation corporate restructuring that brought a clearer understanding on the company’s strategy

Disadvantage - the duplication of resources. However, under Iwata’s leadership, the coordination and planning has improved significantly in comparison to its reign Dimension 3: Mintzberg (2012) records 3 types of decentralisation: the vertical, horizontal and selective decentralisation

Nintendo’s decentralisation tends to move from vertical to horizontal decentralization due to the different management styles Strong corporate structure
Decentralised structure
Major player in the gaming industry
Effective coordination and control Value Chain Analysis for Nintendo Ansoff Matrix Now New Now New Product Market Recommendations
For 1. Purchasing some smaller size companies rather than constantly buying resources from suppliers.

2. Build in a second analog stick without the need to offer an add-on attachment, and reconsider a way to not affect the battery or the size of the 3DS XL.

3. Nintendo should take funding in software developments into consideration in order to enhance the quality on graphics and vision express Recommendations 4. Go into segments that have never been reached.

5. Focus on the various markets they have diversified into in order spread risks.

6. Nintendo should focus in improving their technology by reducing their employees’ wages or to downsize the company. eg. - Games for the older generation
- Educational games for children and toddlers
- Move into the casual gaming market Porter's Five Forces Analysis MCKREE Ltd. Reference List Bowman, C. (1990). The Essence of Strategic Management. Prentice Hall International (UK) Ltd. Great Britain.
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