Identify, Analyze And Make Recommendations On Strategic Management Problems At Nintendo (Essay Sample)

Strategic Management Analysis and RecommendationsNintendoRex SittiUniversity of MemphisNintendo’s culture is a result of its distinct environmental attribute that contributes to its distinctive and unique products. However, this also contributes to slow growth into other technological innovations as is the norm in the gaming industry. It might be time for the company to reinvent itself and taste the waters in new technology such as internet of things and mobile devices through partnership with like-minded institutions.
* Brief Diagnosis of Problem
The main problem facing Nintendo is the growing perception from gamers, and consumers in general, that Nintendo, Ltd. has, as of yet, failed to produce a Nintendo experience within the present competitive environment. The gaming environment is increasingly defined by product development lifecycles that integrate more and more mobile connectivity, cloud-enablement, social-orientation into gaming design and user experience engineering, and all that at a breathtaking pace (Liu, 2010). At the same time, I must acknowledge and very much respect the honorable corporate culture of Nintendo as inseparable to the culture and history of Kyoto and the people of Japan; therefore, I herewith would very much like to assert that integrating new technologies (e.g. mobile, social, and cloud integration) into the Nintendo experience is not a new challenge and, in fact, is one challenge in particular that Nintendo takes the greatest pride in solving, decade after decade (O’Donnell, 2011).
I strongly feel that the corporation should continue to endeavor in its own sense of the fullness of time, to take the long-view towards the ongoing and never-ending translation of the Nintendo experience into present and future technology ecosystems. In summary, I am certain that Nintendo culture and Nintendo’s internal corporate decision making is its strongest market asset, and yet, at the same time, I am also in a most privileged position to provide the comprehensive diagnosis that Nintendo must renew and enliven an established culture of innovation, to bring the Nintendo experience, the corporate cultural values of Nintendo, to families and people everywhere, to the markets of 2020 and beyond.
In the following, I make points of analysis and recommendation in an effort to initiate conversations and cultivate strong relationships based on the “family fun values for everyone” that Nintendo represents. Likewise, I also provide points on implementation to provide a path for my common mission. Just as Nintendo is inseparably part of Kyoto and the people of Japan, I see myself as the link to novelty and innovation for all of Nintendo people everywhere. In this way, I am able to endeavor together to fortify and enrich the Nintendo experience in the fullness of time sooner rather than later, so that it can be shared with future generations of families all over the world. Connectivity is now, technology-enabled. I am happy to be your link to invigorating the fullness and riches of Nintendo experience and culture.
II. Analysis of the Problem
Hardware sales of consoles such as the Wii U have fallen far below expectations (Nintendo Ltd. 2016). Although the release of games such as The Legend of Zelda (delayed to 2016) can be expected to boost hardware sales, it will not fix the problem, but instead just treat the symptoms as seen in the analysis of Binken, & Stremersch (2009). The cause of these problems is rooted in the corporate culture, which places too much emphasis upon group consensus decision-making (O’Donnell 2011). One dissenting voice is enough to shut down a proposal entirely. In today’s rapidly changing world, however, and especially in a market as changeable as electronics, such slow movement is no longer sufficient (Liu, 2010). Nintendo needs to move in a new direction.
Evidence of Nintendo’s reluctance to innovate may be found in their more recent hardware releases. The Nintendo DS, for example, was upgraded to the 3DS. While the 3D feature that was the selling point of this device was an impressive innovation, most gamers came to find it an inconvenience, turning it off entirely during gameplay (Nintendo Ltd. 2016; Marchand, & Hennig-Thurau, 2013). This poor performance was addressed in the release of the 2DS, which offered a more streamlined shape and lower price, removing the 3D feature entirely. Other handheld releases included 3DS XL, and collector’s editions of handheld consoles. While this line of hardware is a good seller for Nintendo, it clearly illustrates a lack of innovation on their part. Nintendo’s main rival in the handheld market is Sony, which produced the PlayStation Portable and the PS Vita (Pekham, 2012). Although each of these devices was similar in shape, the PS Vita showed significant advance in graphics, and innovation in technology.
Another example of Nintendo’s lack of innovation is the release of their Wii U product. According to Marchand, and Hennig-Thurau (2013), many Nintendo enthusiasts have complained that the Wii U barely has any differences in comparison to its original predecessor, the Wii (Pekham, 2012). While it can be said that the Wii U is an exceptional video game console, Nintendo has done little to differentiate it and make it a truly unique product. When the Wii launched, it was a completely new, innovative product which gained attention from the gaming community Nintendo Ltd. (2016), - the same could not be said for the Wii U. Consumers have little reason to purchase the Wii U as it has few games to play and is far more expensive than the Wii; this has resulted in an unanticipated lack of sales of the Wii U (Pekham, 2012)..
Also, when compared to their competitors such as Sony and Microsoft, Nintendo works with fewer third party developers for software production, which grants the company more creative control but limits the number of titles available for their software (Pekham, 2012). In addition, as part of their well-known stance on limiting access to Nintendo intellectual property, Nintendo has shown reluctance to expand in any significant level into the online platform. Nintendo may have introduced their Miiverse as part of an online virtual space for socialization, but they have underutilized it. Although many gamers may have created a Mii in their image, few really interact with this feature on any meaningful level. Thus, this virtual space remains underpopulated, failing to live up to its full potential (Marchand & Hennig-Thurau, 2013).
Another well-known policy of Nintendo is to limit Nintendo software to Nintendo hardware. While many software companies will make their new titles available on multiple platforms, Nintendo has consistently shown a lack of interest in cross-platform software (Nintendo Ltd. 2016; Marchand & Hennig-Thurau, 2013). Because hardware such as consoles require a significant outlay of cash on the part of the consumer, many consumers flock to the console with the largest availability of titles. It has been shown that software can push hardware, but with Nintendo refusing to produce cross-platform software, some consumers will never experience Nintendo’s software unless they commit to the expense necessary to purchase its hardware.
III. Recommendations
Nintendo presents mobile and social gaming for Wii U and Mii, too
Nintendo has recently joined with Japanese mobile gaming company DeNA. They entered into an alliance to create and operate smart devices’ game apps and also build a new multi-device membership service for consumers (Nintendo Ltd. 2016). This plan is a step in the right direction, addressing two areas in which Nintendo is weak when compared to some of its competitors.
My recommendation is that Nintendo continues its tradition of making games suitable for the family, and effectively bring mobile gaming into the living room. Beginning originally with the fireplace, and later moving to the radio and television, much of a family’s time together in the home has traditionally taken place in the living room. The Wii and Wii U offered an opportunity for a family to spend time together and play together, supporting Nintendo’s image as a family friendly solution to electronic entertainment. Nintendo should be able to continue in this tradition through their development of mobile and social gaming.
Many parents have faced the dilemma of whether or not to allow their children to play video games, especially in light of the unsuitable violence and vulgarity present in so many different games. Nintendo has the leverage to present parents with a simple, elegant solution to this problem. Instead of giving in to the temptation and pressure to move with the market, Nintendo should continue to operate according to its long-held values, protecting the trust customers hold in the company.
Nintendo should take this opportunity to work with DeNA and start to produce several different prototypes, working around the concept of a communications hub. Possibilities for hardware include devices such as a children’s smartphone for the home, connected via an app to parents’ devices, effectively allowing parents to approve and unlock content for their children. Prototypes like this should be part of a concentration on mobile and social gaming as the first phase of this plan. Software options could bring mini-games from console platforms into the app store, or could involve games for series such as Zelda or Mario, but on a smaller scale suitable for playing on one’s phone or smartwatch. This focus on mobile and social gaming, already be...