EE204: Business Management for
Electrical Engineers and Computer Scientists

The Five Competitive Forces

Read

1. The Five Competitive Forces That Shape Strategy (HBS course materials)
2. Product Lifecycle
3. Nintendo Wii U: Lessons Learned for New Strategic Directions (HBS course materials)
4. These supplementary articles:
1. Verge: Nintendo is Selling Millions of $12.99 Plastic Figurines (2015)
2. Nintendo Insider: Message From Nintendo President Tatsumi Kimishima (2015)
3. WSJ: Nintendo's Mobile Partner DeNA Says the Game Has Just Begun (2016)
   

Case Summary

Founded in 1889 in Kyoto, Japan, Nintendo has always operated in the entertainment business, beginning with playing cards and, in the 1970s, entering the electronics and video game industry with a small handheld console. By investing in innovation to ensure continuing delivery of new recreational experiences, Nintendo was dominant until the mid-1990s when the two multinational giants, Sony and Microsoft, entered the market with large investment capital and promotional campaigns. Nintendo competed with these new challengers, but its Wii U and 3DS systems, launched in November 2012, met with little success. In 2014, the company faces challenges with innovation, revitalizing existing products, leveraging smart devices, utilizing existing character IP, and expanding into other new markets.

Discussion Questions

1. What are the origins of Nintendo's success?
2. What was successful about Famicom?
3. How did Sony distinguish itself from incumbent Nintendo?
4. Using a competitive forces analysis, what accounts for the success of the Wii and DS?
5. Why did the 3DS and Wii U have limited success in the market?
6. How has the rise of mobile gaming re-shaped the competitive forces for Nintendo?
7. Where is the video game console business in it's product lifecycle?
8. What challenges might Nintendo face with the Five Developmental Axes at the end of the case?