Archive for October, 2012


Midterm!

1.Choose one of the top 10 most innovative  companies attached.

2. Show and explain the innovation of the company those on: a) technology b) process c) the product / service d) business model

3. Make suggestions or predictions of future innovations to the company concerned.

Nintendo Co., Ltd. is a multinational Japanese company from Kyoto that specializes in consumer electronics.With around 1,500,000 JPY (Mn) of revenue last year, Nintendo furthermore employs almost 4500 employees, making it the world’s largest gaming company by revenue. Nintendo’s history is the perfect example to show how innovation and creativity can achieve goals that were never even dreamed of. The company was founded on September 23, 1889 by Fusajiro Yamauchi to originally produce handmade playing cards. As sales started decreasing on a rapid scale and Nintendo needed to come up with a new business plan, the company underwent several changes and tried its luck within several niche businesses, such as a cab company or even a love hotel. None of these niche businesses actually resulted into the hoped access until Nintendo ventured into the video game segment in 1974. The rest is history. Nintendo revolutionized the electronic entertainment with the invention of the home video game console “NES” as well as the “GameBoy” up to recent market launches such as the Nintendo Wii. While its first console the NES was sold 62 million times, the Nintendo Wii has currently been sold roughly 100 million times.

Innovation of Technology

In the years following 1974 Nintendo was still trying to find foothold in the home video game market and started of slowly by releasing the “Color Tv Game” a predecessor of the NES. Graphics only reached merely a few colored blocks that wandered over the screen but as the NES was released with so called “Jump’n’Run”games that would actually allow the user to control the story line of the game a revolution was reached. Seven years later, in 1990, the Super Nintendo was released and instead of the NES’ 16 bit engine, this console featured a 32 bit engine, allowing for much greater colors, screen resolution and better graphical effects. 6 years later when the N64 was released people realized that there will be no limit to video game consoles as after a certain amount of time better technology would be developed to allow for an even more realistic gameplay. The Nintendo Wii, Nintendo’s current console, is a good example for this. Instead of only innovating the technological performance of the console’s graphic engine, Nintendo developed a way to actually put the user itself into the center of every game. Simply by inventing motion controlled controllers, the user nowadays actually gets the feeling that he is in the game.

Innovation of the process

As consumer demand for better quality and higher technological performance increased over the years Nintendo had to react in order to meet this demand. Unlike Sony, Nintendo had to buy parts and components for its consoles and outsource manufacture as well as assembly plants. As this resulted in vertical integration into the manufacturing industry, Nintendo was able to gain from economies of scale in different ways. Not only was a decrease in manufacturing costs visible but moreover, the increasing demand for its products let Nintendo to increase production which even further resulted into an overall cost reduction. Furthermore, almost all consoles are backwards compatible, meaning that games from older generations (i.e. GameCube games) were compatible with newer generation consoles (i.e. Nintendo Wii). This gave Nintendo the advantage of saving time and money when developing new game systems as the engineers at Nintendo used the technologies which were featured in older generation systems as a base in order to develop an improved console with new features.

Innovation of the Product

Nintendo launched its products into already existing video gaming markets facing ever increasing expectations of consumers for better products. As already being elaborated in the “Technological Innovation section” Nintendo improved its consoles’ performance continuously and tried to make sales dependable on that factor. Only for its current console, the Nintendo Wii, they targeted a different set of customers than the usual gamers. Nintendo had already launched a number of stationary consoles in previous years with the most recent one being the GameCube. Seeing its decline in market shares Nintendo wanted to add some features to it, to differentiate it from other video game consoles, the feature being the wireless remote controller and a more interactive game play. After the release of the Wii in 2006, Nintendo kept adding new innovative features to its existing console in order to even further economies on the success of differentiation.

Nintendo’s business model

Just as Nintendo’s main competitors Playstation and later on also XBOX, Nintendo initially focused on competing on technology by offering state of the art power and performance in the video game industry. However, Nintendo’s business model changed with the launch of the Wii. Instead of believing in the assumption that a console’s success is dependent upon its performance and hardware specifics, Nintendo shifted its focus towards player interaction and experience.

With the Wii Nintendo brought to market a console that technologically underperformed rival consoles, but differentiated itself with new motion technology. Players could control the game through a controller simply through physical movement.

The shift in target groups from the gamer, who desires technological performance, graphic quality, and game realism, to casual gamers was an immediate success and outsold its rivals.

Nintendo new business model has the following characteristics: A shift from “hardcore” to casual gamers, which allowed the company to reduce console performance and add a new element of motion control that created more fun; elimination of state-of-the-art chip development and increased of use of off-the-shelf components; reducing cost and allowing lower console prices; elimination of console subsidies resulting in profit on each console sold.

Suggestions for the Future

Demand for online gaming is increasing in line with the growing number of broadband connections. Worldwide usage of broadband is expected to reach 501 million by 2014 from 422 million in 2009 (Datamonitor 2011). With the already exisiting Wii channels which enable users to update game content, download games from older generation consoles, news feeds and many other options, Nintendo has already build a great platform to accommodate the increase in demand for online services. However, as many of these features, such as the news feed or wheather forecast, can be much easier obtained by a computer or smartphone, Nintendo should furthermore encourage users to use its services by offering a greater gaming experience via the internet. More games should offer online mutliplayer levels and extensions, that will encourage the player to use these feauteres extensively.

Another important factor is the change in demography with video game players. The average age of gamers in the US reached 35 years in 2008. Entertainment Software Association says 65% of American households play computer and video games; 38% of American homes have a video game console; 94% of parents are present when games are purchased or rented; 88% of parents report always or sometimes monitoring the games their children play and 63% of parents believe games are a positive part of their children’s lives.

Nintendo should therefore try to expand its target group and offer more games suitable for even older generations. Although the Wii already encourages all age groups to “play”, there are only a few games nowadays suitable for the children’s parents or even grandparents. Conclusively, Nintendo could offer games that can be played together with the whole family. As board games are ceasing to exist in the modern family Nintendo might be able to fill the void and increase its market share even further.

Sources: wikipedia.org/nintendo

http://samidob.blogspot.com/2010/06/casetudy-blue-ocean-strategy-nintendo.html

Nintendo Co., Ltd. SWOT Analysis. (cover story). (2012). Nintendo Co., Ltd. SWOT Analysis, 1-8.

11. Louis Pasteur

12. Galileo Galilei

13. Aristotele

14. Euclid

15. Moses

16. Charles Darwin

17. Shih Huang Ti

18. Augustus Caeser

19. Nicolaus Copernicus

20. Antoine Laurent Lavoisier

Louis Pasteur, formally known as double 1 in his hood, met up at 12 o’clock with his G Galileo and the leader of the MS 13 Aristotele. As a bodyguard he took is bro Euclid, who carried a 14mm, and Fifteen Cents Moses along. Both muscle from the Pasteur Unit to make sure that the transaction of 16k Dollars to Darwin in exchange for 17kg of Shih Huang Ti’s famous Nasi Goreng went as planed. Little they knew that it was a set up by the Caeser, the King of Warung, who tried 18 years to copy the recipe but never succeeded. Copernicus was the snitch in this set up, a new member of the Pasteur Unit who was able to gain their trust at the subtle age of 19. But the naivety of the Nasis (name of the members of the King of Warung) towards Copernicus, didn’t make them realize that his thirst for money might actually also bring other players to the game. It was Andy L. Lavoisier, an American police officer who’s goal was it to stop the spread of Nasi Goreng towards the western world, who paid Copernicus twice the money that Caeser paid to get the information about the meeting. The Pasteur Unit, Darwin and the Nasis were all busted at once by 20 agents of the Burger Squad.

 

It is hard to think about the most important innovation as there are too many things that had a great impact on my life, but having to pick one I would have to say it was the invention of music. Music is a gate to another perception of life and makes you forget anything or remember everything. It’s an infinite abyss of melodies with one always fitting your mood, enhancing any situation you might encounter. The first thing I did before writing this assignment was to turn on some music in order to concentrate and eventually get into the mood to actually do it. But there is more to it than just personal satisfaction. Music brings people together. Be it in concerts/festivals by making thousands of people share the moment or a song that is played in the radio while being listened by half the country. It can move the masses, for better or for worse, cause anger and hate or bring peace and love. It can annoy parents when their kids are listening to the “wrong” type and make them proud when their kids learn how to play it themselves. It defines generations, assembles groups, and makes unique at the same time.  There are endless possibilities on how music influences everyday’s life, but it is certain that without it everything would be just black and white.