Nintendo’s Revolution reports on Nintendo’s development, an exceptional video game console with a remarkable wand-shaped controller. The case investigates the manner in which Nintendo created an inventive product, through a creative process of generating, communicating, and developing concepts, which spawned management creativity and deliberation of lowly regarded segments, as well as a speedy process of product development.
The president of Nintendo Corporation was extremely happy when his engineers demonstrated a video game controller that was dependent on a stubby rod that was manipulated by a gamer by one hand, rather than using a joystick. This technology made it possible to create real-world game actions. Of course, this advancement was an essential vision to help expand the customer base. This was achieved through the formation of a design that comes up with stipulations that involve solving potential problems through the reduction of costs and shortening of marketing duration.
Though the cost-cutting strategy is good for improving the efficiency of a company, managers face challenges when specifying the cost of given goods services, due to limited information. Managers are required to be flexible when using these methods for different situations. Marketers use the process by totaling all costs that are related to the delivery of the product to the market, including production, distribution, transportation, and sales expenses.
Iwata also thought that this technology could help target new audiences such as mothers who are very influential. This controller prototype sounded very attractive to Iwata because they were the first ones to release such a controller and because many of the methodologies for making the rod controller function might fail to operate perfectly, while away from the lab. In addition, Iwata knew that any new Nintendo controller required backward compatibility with Nintendo console games.
This is a strategic planning and management system used to streamline business activities as per the vision and strategy of the organization, improve communication internally and externally, and monitor the performance of the organization against the set goals. It breaks monitoring of performance into four perspectives that are interconnected, including internal processes, customer, financial, and learning and growth.
The internal operational goals of a business and the outlines governing the key processes required to deliver customers’ objectives are under the internal process perspective. Customer perspective covers matters affecting the customers, such as the final product and services, the market share goal, and their satisfaction among other issues. The value of shares and the financial benefits of the organization are summed up in the financial perspective, whereas, the intangible tools driving for future success such as human capital, organizational culture, databases, are covered in the learning and growth perspective.
Nintendo Management
Nintendo was started in 1889 with the aim of producing playing cards adorned with flowers and drawings among other things. The business of selling these cards was very successful; hence, the company experienced dramatic growth. The company, at first focused on the cards business but eventually expanded to other activities. For example, in the 1970s, the company invested in the toys and foods business. Yamauchi reinvented the company, which was previously family-owned. He was a practical leader and very quick in making decisions with the aim of steering the vision of the company. His thinking was focused on customer satisfaction, and he freely welcomed new ideas, original products, and experimentation.
Organizational structure
He also introduced a flat organizational structure at Nintendo, which facilitated customer focus and bureaucratic flexibility. In addition, he preferred this structure because decisions could be made very quickly. Organizations that have lean personnel structures create a ground for greater innovation and creativity, as opposed to complex personnel structures. This structure allows employees to submit new ideas and report valuable feedback and customer responses on operational processes and offerings of the company.
This is critical in enhancing continuous improvement in product offerings, as well as the development of new and diverse products. Under the leadership of Yamauchi, risk-taking culture was promoted, though it was not usual to experience such an aspect in a large Japanese company. That is the reason why the company was ready for a highly competitive and uncertain environment in 2002 when Iwata became the president.
Although Iwata was not a member of the promoting family, he was chosen to lead the company to the new millennium starting from 2002. Iwata introduced a number of changes in the company’s organizational culture. First, he led other executives in pondering on the factors that lead to the success or failure of plans. He thought that the results should come after the process. These ideas led to the enhancement of communication across divisions. Also, more autonomy was introduced across the company.
Secondly, he introduced the culture of discussion, which changed the top-down management style that had been practiced previously. This culture promoted coordination among the hardware and software departments of the company. This culture was very crucial during the project revolution.
As an immediate cause of action to salvage the organization, the executives should voice their opinions and agree to correct their mistakes. This should be done in a respective and constructive manner. Secondly, the introduction of regular meetings will help restore the communication channel and possibly resolving the conflicts. For the long-term cause; there is a need to modify the culture of the entity, to make its involvement focused, with the objective of creating a cohesive relationship among the three departments.
The focus should be shifted from extrinsic motivational factors to intrinsic factors with clear goals and guidelines. Employees should be encouraged to work together as a team through the introduction of a variety of motivational factors. It is crucial that the company ensures that each department understands the role of each other.
Revolution
The company’s revolution project is aided by its engineers and lieutenants. This followed extensive discussions with the leadership of Iwata. The development course for the new console entailed the initiation of one process, while at the same time the subsequent one is thought about. In other words, no components were designed from scratch. Instead, new designs have to be designed from the existing know-how. Nonetheless, the engineers and the executives had started finding issues with the preferences of the traditional hardware, such as slick graphics, faster processors, and sophisticated controllers. Also, Iwata led his team in discussing the ways of increasing the gamers beyond the conventional customer base.
This included the upgrading of certain features from GameCube, including redesigning of other features in accordance with new product ideas. Most importantly, this development had to be backward attuned with previous GameCube games.
This case has exemplified how the gaming industry used exceptional product strategy to capture a wider market while fleeing away from technological wings advocated by bigger competitors. It has also demonstrated product development methods and the process of decision making applied by top engineers and Nintendo’s new CEO to create the Wii.