Understanding the determinants of Technology Strategy using the Burgelman and Rosenbloom model:
Thus, as shown in the model, the major cause of Nintendos woes was its failure in understanding the industry context and adapting itself accordingly. We can look at the impact of this oversight on its sales. Quantitative Analysis:
Thus, sales took a major blow in the year 2011 and the case states that the company was expected to incur a loss in 2012 (for the first time since inception) If Nintendo was losing, somebody was gaining market share. The following chart summarizes the effect of the observations made above.
Thus Apple and Google (who havent really been the core competitors for Nintendo) are gaining ground in the gaming industry through their iOS and Android platforms respectively. This was largely because of the fact that powerful smart phones were developed at affordable prices and a large number of users (especially the casual ones) preferred to use their mobile phones for playing games instead of going for a dedicated gaming device. Way ahead for Nintendo: As Nintendo has always been able to adapt to a changing environment, we suggest the following approach: a. Innovate disruptively by introducing a gaming device which would have all the capabilities of a modern phone. One could connect this device to the internet and it would also have capabilities to store and read data from the cloud. b. The device would run on a proprietary platform based on Android. c. As the platform would be Android based the users would be able to run not only Nintendo games but also the ones created for Android. d. Promote a developers market exclusively for Gaming giving them incentives for every time their gaming app is downloaded. e. Furthermore, these games would also run on other Android platforms so that they could be sold as software only apps from Nintendo. f. Thus, this would form a two pronged strategy helping Nintendo leverage its hardware and software competencies to bounce back in the gaming arena. 89.36 57.6 10 55.5 8.8 149 6.68 70 200 190 Units Sold (mn) Wii Xbox 360 Kinect PS3 PS Move DS 3DS PSP iOS devices