Final Presentation


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Final Presentation

  1. 1. Presented by: Megan Beasley Matt McCulloch Kathryn Williams Hoyt Dwyer
  2. 2. Company Overview- Past <ul><li>1889- Japan (Playing Cards) </li></ul><ul><li>1951- name change </li></ul><ul><li>1974- Exporting </li></ul><ul><li>1977- First home gaming system </li></ul><ul><li>1981- Donkey Kong </li></ul>
  3. 3. Company Overview what we remember <ul><li>1985- NES </li></ul><ul><li>1989- Gameboy </li></ul><ul><li>1991- Super NES </li></ul><ul><li>1996- N-64 </li></ul><ul><li>1998- Pokemon Mania </li></ul><ul><li>2002- Gamecube </li></ul><ul><li>2003- Nintendo DS </li></ul><ul><li>2006- Wii (most innovative gaming console today) </li></ul>
  4. 4. Things to know…. <ul><li>Main Branch- Kyoto, Japan </li></ul><ul><li>America- Redmond, Washington </li></ul><ul><li>Japan, US, Europe, and Australia </li></ul><ul><li>Legal Environment-Anti-Trust Laws </li></ul><ul><li>Competitors- Sony, Microsoft </li></ul><ul><ul><li>New entrants- weak </li></ul></ul><ul><li>Threats- PC gaming </li></ul>
  5. 5. Immediate Challenges <ul><li>Inbound and Outbound Logistics </li></ul><ul><li>Competition </li></ul><ul><li>Expanding their Market </li></ul><ul><li>Increased On-line features </li></ul><ul><li>Need to Diversify </li></ul>
  6. 6. Inbound and Outbound Logistics <ul><li>The Nintendo Wii is sold out </li></ul><ul><ul><li>The second Christmas in a row </li></ul></ul><ul><ul><li>Unpredicted sales and demand have created problems with production </li></ul></ul><ul><ul><li>Essentially, Nintendo has not made enough Wiis to meet the demand of customers </li></ul></ul><ul><ul><li>Spokesperson for Nintendo defined one problem being a bottleneck in the production facility </li></ul></ul>
  7. 7. Competition <ul><li>Nintendo Wii vs. Xbox 360 vs. Playstation </li></ul><ul><li>Clearly defined competitors, both with better graphics/processors </li></ul><ul><li>Those video cards came at a price </li></ul>Price Wii:$249 Xbox 360: $299 Arcade $349 Premium $459 Elite PS3: $399 40 GB $499 80 GB
  8. 8. Expanding The Market <ul><li>Rule of 80/20 </li></ul><ul><ul><li>A basic assumption of video game sales </li></ul></ul><ul><ul><li>80% Male 20% Female </li></ul></ul><ul><li>E3 2007 Nintendo Press Conference </li></ul><ul><ul><li>Rule of 67/33 </li></ul></ul><ul><ul><ul><li>Sales have shifted, with more female customers </li></ul></ul></ul><ul><li>Wii and DS sales are growing in previously untapped markets </li></ul><ul><li>This trend should continue to increase sales and broaden the consumer demographic </li></ul>
  9. 9. Increased On-Line Features <ul><li>Xbox 360: Xbox Live </li></ul><ul><ul><li>Software that allows Xbox 360 games to be played on-line with other people </li></ul></ul><ul><li>Playstation 3: Home </li></ul><ul><ul><li>Interactive 3D Environment </li></ul></ul><ul><ul><li>Also allows games to be played on-line </li></ul></ul><ul><li>Wii: ? </li></ul><ul><ul><li>Surf the web, check the news, see the weather </li></ul></ul><ul><ul><li>Only a handful of games can be played on-line </li></ul></ul><ul><ul><li>Only wireless internet access of the three </li></ul></ul>
  10. 10. Need to diversify <ul><li>Nintendo has focused on nothing but the gaming industry for almost 30 years </li></ul><ul><ul><li>Console Design </li></ul></ul><ul><ul><li>Video Game Design </li></ul></ul><ul><li>A need to diversify is important for any business </li></ul><ul><ul><li>Helps reduce risks </li></ul></ul><ul><ul><li>Increases revenues </li></ul></ul><ul><li>Baseball?? </li></ul><ul><ul><li>Nintendo owns the majority of The Seattle Mariners </li></ul></ul><ul><ul><li>Definitely unrelated diversification </li></ul></ul><ul><ul><li>Too unrelated </li></ul></ul><ul><li>Related Diversification </li></ul><ul><ul><li>Branching out into other cutting edge and innovative technologies outside of video game design </li></ul></ul><ul><ul><li>Using Nintendo’s vast R&D abilities and applying it to related fields </li></ul></ul>
  11. 11. To Recap… <ul><li>Inbound and Outbound Logistics </li></ul><ul><li>Competition </li></ul><ul><li>Expanding their Market </li></ul><ul><li>Increased On-line features </li></ul><ul><li>Need to Diversify </li></ul>
  12. 12. 2 Strategic Imperatives <ul><li>Inbound and Outbound Logistics </li></ul><ul><ul><li>Basically, the Wii has been old out since it’s launch last year </li></ul></ul><ul><ul><li>Reduces revenues from sales </li></ul></ul><ul><ul><li>Frustrates customers and drives to purchase other consoles and residual revenue from games and peripherals </li></ul></ul><ul><ul><li>Affects the image and reputation of Nintendo </li></ul></ul><ul><li>Competition </li></ul><ul><ul><li>Coupled with the stock outs, Microsoft and Sony have begun systematically dropping their prices </li></ul></ul><ul><ul><li>High competition among these businesses have made generating sales crucial to success </li></ul></ul><ul><ul><li>Nintendo is at the forefront of sales, these trends must continue </li></ul></ul>
  13. 13. Recommendations <ul><li>Inbound and Outbound Logistics </li></ul><ul><ul><li>Main source of problems: </li></ul></ul><ul><ul><ul><li>Poor forecasting of demand </li></ul></ul></ul><ul><ul><ul><li>Problems with production </li></ul></ul></ul><ul><ul><ul><ul><li>Bottlenecks </li></ul></ul></ul></ul><ul><ul><li>Improved Forecasting </li></ul></ul><ul><ul><ul><li>Initial projections of demand for products are crucial for determining levels of productions </li></ul></ul></ul><ul><ul><ul><li>Creating a better system for forecasting will help Nintendo stay on top of production to decrease stock outs </li></ul></ul></ul><ul><ul><li>Operations Management (TOC, Six Sigma, Lean Production) </li></ul></ul><ul><ul><ul><li>Spokesperson for Nintendo commented on a bottleneck at the production facility </li></ul></ul></ul><ul><ul><ul><li>Implementing Operation Management tactics to identify the bottleneck and to then work around this constraint will help with efficiency of current production </li></ul></ul></ul><ul><ul><ul><ul><li>Reduce inventory costs </li></ul></ul></ul></ul><ul><ul><ul><li>Focusing on this constraint and how to increase its’ production will help increase the overall level of production at the facility </li></ul></ul></ul>
  14. 14. Recommendations <ul><li>Competition </li></ul><ul><ul><li>Decrease Stock Outs </li></ul></ul><ul><ul><ul><li>Reduces consumers buying another console </li></ul></ul></ul><ul><ul><li>Increase On-Line Deliverables </li></ul></ul><ul><ul><ul><li>More games with on-line play </li></ul></ul></ul><ul><ul><ul><li>Important factor to today’s gamers </li></ul></ul></ul><ul><ul><li>Increase Target Market </li></ul></ul><ul><ul><ul><li>Currently a strategy at Nintendo </li></ul></ul></ul><ul><ul><ul><li>Creating a console intended for everyone </li></ul></ul></ul><ul><ul><ul><li>Breaking into new markets has amazing potential for increased revenues </li></ul></ul></ul>