MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________

Organizational Background - Summary
of companys history, vision, mission,
growth, development, and core
competencies

ORGANIZATIONAL BACKGROUND
Based out of Kyoto Japan, Nintendo (formerly Nintendo Koppai) was founded in 1889
by a Japanese craftsman nammed Fusajiro Yamauchi, and in its early years, Nintendo
was primarily a playing card company, becoming the first company to sell western style
playing cards in Japan (Firestone, 2011, p. 15-17). By the 1960s Hiroshi Yamauchi, heir
to the company, shifted Nintendo's image from playing cards to an entertainment
company, focusing more on creativity and innovation (p. 25).
Hiroshi eventually changed the company name from Nintendo Koppai, meaning Leave
luck to heaven, was changed to Nintendo Company Ltd and began delving into the
world of toy design and production (Firestone, 2011, p. 25). By the 1970s, the company
had begun experimenting with simple electronics (p. 29), and by the 80s, Nintendo was
taking its first major steps into the very young video game industry with the help of toy
designer, Shigeru Miyamoto (p. 53). Nintendo then began moving west, founding
Nintendo of America (NOA) and releasing the Nintendo Entertainment System to the
western world in 1985 (p. 77). Since then, Nintendo has released several iterations of its
home-console lineup, including the Super Nintendo, Nintendo 64, Gamecube, Wii and
Wii U. Nintendo is also responsible for a booming handheld video game lineup, starting
with the major success of the Game Boy, released in 1989 (p. 82). Much of Nintendo's
success, as well as failures, can be attributed to its obsession with taking risks on new
innovations that often push the boundaries of what a video game platform can be, which
is a philosophy that carries the company forward to this day (Jatuporn, 2011).
Analysis of Management Functions:
PLANNING
Planning. Based on what you have learned From a planning perspective, Nintendo operates almost entirely within its own
through your research, how would you
ecosystem of products, rarely branching out to outside hardware and software
characterize conditions in the planning
manufacturers, even going as far as producing its own proprietary disc format in order to
environment? What types of problems does avoid media standards, such as DVD and Bluray (Gilbert, 2012). The internal processes
the organization face (e.g., structured,
of Nintendo are largely kept secret to the public, however it is safe to assume that
unstructured), and to what extent should
Nintendo hardware undergoes an R&D process, and generally releases software
the organizations decisions be programmed development kits (SDKs) to the public within about a year or so of the product's release
or nonprogrammed? How would you
(Futter, 2015). In the past, Nintendo has primarily focused on major trade shows as
characterize the level certainty, uncertainty, events to hold public press conferences, however in recent years, Nintendo has released
and risk the organization faces?
its press events and public announcements via its Nintendo Direct events throughout the
Organizing. How is the organization
year (Nintendo, 2015). These events are streamed online and in terms of its products,
organized? Would you characterize it as
these showcase both hardware and software.
centralized or decentralized? Describe the
The major risks Nintendo faces revolve around their ability to find a secure place within

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
organizational structure and evaluate how
appropriate this structure is for the
organization (the strengths and drawbacks
of its structure). If you learned about the
organizational culture, describe the culture
and evaluate the extent to which the culture
enhances organizational effectiveness and
efficiency.
Leading. Based on your research, how
would you characterize the nature of
leadership of your organization? How
would you characterize its leaders
leadership style, communication style and
interpersonal skills? How effective is this
leader?
Controlling. Describe what performance
indicators are important for this company
to track and measure. How effective is
management at using these controls to
ensure that it is achieving its goals and
objectives?

the home console space, and in the video game industry as a whole. Nintendo's approach
to market focuses heavily on new and innovative ideas, or typical products with some
sort of gimmick in most cases. Unfortunately the video game industry is platform-based
and relies almost entirely on network value in order to sell software for a specific
console or device (Basuroy, 2013). Nintendo's best option at the moment is to pay
attention to what its competitors are doing, replicate what makes them successful, and
then apply the Nintendo charm around it. Nintendo is blessed with immensely iconic
properties and would do well if they returned to selling traditional style devices that
third-party developers are willing to support.
ORGANIZING
Nintendo and its affiliated company branches, including Nintendo of America, Nintendo
of Europe GmbH, etc, are all organized as centralized divisions that are primarily driven
by a single CEO, and while each of the large regions (North America, Europe and Japan)
are mostly autonomous, the entire enterprise almost completely follows the lead of
Nintendo Co., Ltd. President, Tatsumi Kimishima (Nintendo, 2015).
The three most influential men in the Nintendo company are as follows: the previously
mentioned Kimishima, Senior Managing Director Genyo Takeda and Senior Managing
Director Shigeru Miyamoto (Nintendo 2015). While many company decisions are split
between these three men, the vast majority of what Nintendo does worldwide are passed
no further than these three. At most, global division managers are given free reign on
SKUs and games being released in their regions, for example, NOA originally had no
plans of releasing the smaller size of the New Nintendo 3DS in North America
(Sarkar, 2015). While a centralized form of organization is generally seen as a slow and
cumbersome way of managing a business, Nintendo uses this to run a tight and
consistent ship. This company holds its cards incredibly close, so from a decision
making standpoint it benefits from mainly operating under one central group of company
leaders.
LEADING
In the past, Nintendo's leadership was primarily defined by harsh CEOs with incredibly
high standards for its employees. While younger generations of the Yamauchi family,

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
such as Hiroshi, praised creativity, it was still common for the family to run Nintendo in
a harsh manner (Firestone, 2011, p. 25). In recent years, the company has been primarily
known for its popular franchises, which has put Miyamoto (the creator or Mario and
Zelda) in the public eye as one of the prominent leading figures for the Nintendo brand.
To add to this, Nintendo has almost given in to the internet popularity of its high ranking
managers by almost making them characters themselves. The three major names for
Nintendo in recent years have been Shigeru Miyamoto, Reggie Fils-Aime, and the
recently deceased Satoru Iwata. Creating these somewhat fictional representations of
company executives has played a major part in bringing consumers closer the corporate
aspect of the company, while simultaneously humanizing the faces of Nintendo, for
example, the three mentioned above were depicted as puppets during last year's E3
presentation as a gesture to their fans (Kotaku, 2015). It will be interesting to see if this
trend continues with Nintendo's new CEO, Tatsumi Kimishima. From a branding
perspective, this friends with the consumer approach has been genius for Nintendo, as
it creates and atmosphere where consumers become fans of Nintendo employees as if
they were video game characters themselves to the point where fans had requested
Reggie Fils-Aime to be a character Super Smash Brothers via a change.org page
(Khawaja, n.d.), a fighting game that mashes up all of Nintendo's characters into one
game. It's something that few companies manage to pull off, but it makes the company
as a whole seem friendly and trustworthy.
CONTROLLING Nintendo relies mainly on its product sales figures as company performance indicators,
and unlike many other video game publishers, Nintendo doesn't seem to go heavily into
detail in regards to the critical reception of their games, however it is unlikely that it is
neglected when considering the performance of individual video games. Nintendo
releases its sales figures via public press releases both on their Nintendo Direct portal, as
well as directly on their website, including sales transitions ranging from 1998 until
present day (Nintendo Co., Ltd., 2013). Nintendo as a whole has struggled in the home
console market for a very long time, with the exception of the original Wii, beyond even
its own expectations, with the Wii U often greatly underperforming to Nintendo's
expectations. This has forced the company to modify its sales forecasts multiple times,
dropping expected sales in 2015 from 9 million to a mere 2.8 million units (Nintendo,
2014).

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________

Analysis of companys internal strengths

and weaknesses
Strengths: What does it do better than
anyone else in its industry? What sets it
apart from its competitors? Some examples
of strength could be a particular product,
high customer satisfaction, brand
recognition, loyalty of customers, being
innovative, financial resources, uniqueness
of product or service, skills of employees,
etc. The strengths are what will help the
company survive.
Weaknesses: Every organization has them.
As with strengths, weaknesses are internal
concerns. These are the factors that the
company is not good at or at least not as
good as most of its competitors. These are
the issues that can and often do hurt the
company in some way. Examples of
weaknesses are poor management, a lack of
proper planning, inadequate financial
resources, poor product line or services,
low customer satisfaction, high employee
turnover, etc.

STRENGTHS
Nintendo is associated with its strong approach to product branding, which has resulted
in consistently high software sales, even when hardware sales suffer. Nintendo's primary
strengths lie in its family-friendly approach to the video game market and its house-hold
first-party software titles, including Mario, Zelda, Pokemon and Wii motion software. In
recent years, it has become evident that Nintendo is interested in building their brands
into its own platforms as a way of reaping brand benefits without over-saturating the
market. For example, downloadable content (DLC) being regularly released for titles
like Mario Kart 8 and Super Smash Bros. for Wii U and 3DS (Nintendo Co., Ltd., 2015).
Nintendo also relies heavily on both hardware and software innovation in order to stay
on top of the game. They know that the way to keep the company going strong is with
new, creative, and interesting games, some of which might include DS successes like
Nintendogs and Brainage, or a system defining game like Wii Sports (Firestone, 2011, p.
89).
WEAKNESSES Excluding the Wii, Nintendo has struggled to meet the same sales numbers as its
competing brands, Sony's Playstation and Microsoft's Xbox (D'Angelo, 2015).
Nintendo's innovative tendencies are high risk, which makes it one of its strengths, but
also one of its biggest weaknesses when paired with its consistent struggle to understand
its own market.
Nintendo often struggles from an identity crisis as both a hardware manufacturer, as well
as a software developer. The Wii was a major success, not only because of its novel
innovation, but because it capitalized on Nintendo's new approach that focused more on
the family than the sole gamer. As this market moved more into the mobile and tablet
space, Nintendo began to lose its footing and sought to be equal parts family and core
gamer focused. The resulting split focused has created a brand identity problem for
Nintendo.

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
AAnalysis of companys external
environment - Opportunities and
Threats.
Opportunities. What opportunities does
the organization have to grow? Where does
it see itself in the coming years?
Opportunities can come from new products
or services, expanding its market share,
getting into new markets, diversification,
de-diversification, correcting current
weakness, etc. Opportunities are derived
from conditions in the external
environment, such as demographic trends,
consumer lifestyle patterns, political,
economic, and legal forces, etc. The
organization turns these patterns into
opportunities by planning on how it will
respond to these external conditions.
Threats. What are the potential threats that
will keep this organization from attaining
its stated opportunities? The most typical
threats are competition, the economy,
technology or consumer demand. As with
opportunities, threats are factors in the
external environment.
Conclusions

OPPORTUNITIES Nintendo's primary opportunities stem from its strong software brands, like Mario and
Pokemon. A similar approach to Disney's Disney Difference (Robbins, Decenzo,
Coulter, 2011, p. 109) take on branding and entertainment. Nintendo is in the unique
position to sell its characters outside of Nintendo's hardware platforms, and even outside
of video games entirely. For example, according to Nintendo, it has sold over 10.5
million Amiibo figures, toys based on their popular brands, as of February 2015 (Iwata).
Additionally, Nintendo plans to launch several games to mobile platforms outside of its
current handheld, the 3DS.
THREATS Nintendo's threats come from the two sides of the market that it is split in between. From
the family-focused side of the company, Nintendo has to to compete with the mobile
market through smart phones and tablets, as well as the growing popularity of gaming
through smart TVs and cheap set-top boxes (Newhouse, 2015). On the other end of the
industry, Nintendo faces its two main home console competitors, Sony and Microsoft.
According to a report from Sony, the Playstation 4 had sold 25.3 million units as of June
2015 (Kain, 2015), where Nintendo had only sold 9.2 million units as of January 2015
(Nintendo Co., Ltd, 2015), with a full year of being on the market before Sony's
competing platform.

CONCLUSIONS I learned that Nintendo has really been two different companies throughout its long
In this section you should state your
history, a playing card company and a video game company, and has behaved quite
opinion on what you have learned from
differently in recent years than in the past. One thing seems to stay consistent, and that is
your research. Would you want to invest
innovation. Whether its designing cards in a new way, or releasing a video game console
your money in this company? Do you think that runs on radically new hardware, Nintendo has always been about doing things
it is a survivor? Would you buy its product differently. In some cases this has paid off for them, but in other cases it has been an
or service? Is its competition better than it
uphill battle. Nintendo is a very unpredictable company in many regards, and in addition
is? If the reader only read this section, what to it being very secretive internally, it's hard to tell what lies in its future. Nintendo's

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
would you want him or her to know about
this organization?
References Your Annotated
Bibliography from Week 4, with
improvements, if they were needed.

family-friendly, innovative approach to games is, and always will be an important part of
the video game industry.
ANNOTATED BIBLIOGRAPHY (PASTE HERE)
Firestone, M. (2011). Nintendo: The company and its founders. ABDO Publishing
Company: Edina, Minnesota.
This book is about the founders and leaders of Nintendo. It goes into detail about
leaders such as Shigeru Miyamoto and Hiroshi Yamauchi. A large portion of this
book is also dedicated to the history of Nintendo as a video game company, as
well as their general approach to the gaming market.
This book is relevant to my research because it goes into detail about Nintendo's
leaders, including their influences on the company, and the internal strategies laid
out by upper management. With a very closed-off company such as Nintendo, this
book should be helpful in highlighting someone the internal workings of the
company from a management perspective.
Jatuporn, S. (2011, April). Leading innovation and change management Characteristics
of innovative companies. Journal of Applied Management and Entrepreneurship, 16(2),
126-128.
This article is about the importance of innovation from a business perspective. It
focuses on the top innovative companies, including Apple, Google, Toyota,
Microsoft and Nintendo. It covers why effective talent management and
motivation are the keys of thriving innovation within a company, which helps
propel business forward.
This article is relevant to my research because it shows Nintendo as an
innovative, risk taking company, but this also reveals Nintendo's strategy as a
sink or swim operation as a video game company trying to sell a product to a
market that may often be reluctant to buy into video games as media. This will
certainly lend itself to a portion of my SWAT analysis.
Gilbert, B. (2012, November 12). Take a very, very close look at the round-edged Wii U
proprietary discs. Retrieved from: http://www.engadget.com/2012/11/12/nintendo-wiiu-proprietary-disc/

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
This article is a quick, detailed overview of Nintendo's proprietary disc format
that was developed specifically for the Wii U, as opposed to utilizing the
standard formats that are found everywhere else, such as DVD and Bluray.
Futter, M. (2015, October 16). Report: Nintendo begins distributing NX software
development kits. Retrieved from:http://www.gameinformer.com/b/news/archive
/2015/10/16/report-nintendo-begins-distributing-nx-software-development-kits.aspx
This article states that Nintendo has begun to release software development
kits to video game developers for their upcoming console, set to release in the
holiday season of 2016. In other words, this is one example of Nintendo
releasing SDKs roughly a year prior to the launch of a console.
Nintendo (2015) Nintendo direct archive. Retrieved from:
http://www.nintendo.com/nintendo-direct/archive/
This site is simply an archive for every Nintendo Direct press briefing for the
years 2015 and 2014.
Gretz, R. T., Basuroy, S. (2013, March). Why quality may not always win: The
impact of product
generation life cycles on quality and network effects in
hight-tech markets. Journal of Retailing, 89, 281-300.
This article is about the influence of both quality and network effects in the video
game industry. From a console manufacturers standpoint, high network
externalities means a higher install, or consumer base for a particular platform,
where quality refers to benefits created through product features and software.
For example, quality influences a consumer when a particular game is released
on a specific platform. Network effect, on the other hand, influences a developer
when more people are playing on a specific platform.
This article is relevant because it goes over a very important aspect of the video
game industry as a platform-based market. Nintendo has historically gained the
upper-hand over its competitors using its network effect. In recent years, with its
struggle to entice third-party developers, Nintendo has stayed afloat almost
entirely on a quality approach.

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
Nintendo. (2015). Company profile. Retrieved from:
http://www.nintendo.co.jp/corporate/en/outline/index.html
This page is simply a company profile that lists affiliated companies, the
headquarters location and representative directors for Nintendo.
Sakar, S. (2015, February 18). Here's why Nintendo didn't launch the smaller New
Nintendo 3DS in North America. Retrieved from:
http://www.polygon.com/2015/2/18/8063627/new-nintendo-3ds-launch-northamerica-explanation
This article provides an example of one of Nintendo's affiliated companies
(Nintendo of America in this case) making its own business decisions based on
regional demands.
Kotaku. (2015, June 16). Nintendo introduces Star Fox as puppets [video file].
Retrieved from: https://www.youtube.com/watch?v=2RpipJToXKQ
This video is an example of Nintendo's approach to marketing its leadership to
the public, and more importantly its consumer base.
Khawaja, S. (n.d.). Masahiro Sakurai: Make Reggie Fils-Aime a playable
character in Super Smash Bros. Retrieved from: https://www.change.org/p/sorasakurai-make-reggie-fils-aim%C3%A9-a-playable-character-in-smashbrosreggieforsmashbros
This is an example, albeit a silly one, of fan loyalty to Nintendo CEOs. This
particular example is a change.org page dedicated to asking a Nintendo
director to include a Nintendo CEO as a playable character in one of his
games.
Nintendo Co., Ltd. (2013, April 24). Consolidated sales transition by region.
Retrieved from:https://web.archive.org/web/20130526130209/http://
www.nintendo.co.jp/ir/library/historical_data/pdf/consolidated_sales_e1303.pdf

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
This page is a comprehensive sales transition report that ranges from 1998
through 2013 and details sales of every Nintendo hardware device being
supported between those years.
Nintendo (2014, January 17). Opening explanations by the President at the
press conference regarding full-year financial forecast and dividend forecast
modifications. Retrieved from:
http://www.nintendo.co.jp/ir/en/library/earnings/140117/index.html
A statement from Nintendo's earnings release as of January 2014. This
page details sales forecast changes for the Wii U, going into 2015. The
sales changed dramatically, from 9 million expected units sold, down to
2.8 million.
Nintendo Co., Ltd. (2015, May 7). Consolidated financial statements.
Retrieved from: http://www.nintendo.co.jp/ir/pdf/2015/150507e.pdf
This page is simply an earnings report that details current and future
downloadable content for Nintendo's Wii U title, Mario Kart 8.
D'Angelo, W. (2015, September 4). PS4 vs Xbox One vs Wii U global
lifetime sales July 2015 update PS4 24.8M, Xbox One 13.6M, Wii U
10.1M Sales. Retrieved from: http://www.vgchartz.com/article/260800
/ps4-vs-xbox-one-vs-wii-u-global-lifetime-salesjuly-2015-updateps4248m-xbox-one-136m-wii-u-101m/
This is a Vgchartz page, meaning it's a speculated sales compilation
based on information from retailers and hardware manufacturers.
This page provides estimated sales figures for the three major home
consoles as of September 2015.
Robbins, S., Decenzo, D., Coulter, M. (2011). Fundamentals of
management: Essential concepts and applications. Pearson Education,
Inc.: Upper Saddle River, New Jersey.

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
This source is specifically used to reference the Disney
Difference, what it is, and how it compares to Nintendo.
Iwata, S. (2015, February 17). Third quarter financial results briefing
for fiscal year ending March 2015. Retrieved from:
http://www.nintendo.co.jp/ir/en/library/events/150508/index.html
Another financial report. I'm using this specifically to detail
the sales numbers for Nintendo's Amiibo figures.
Newhouse, A. (2015, June 22). Nintendo boss says that high price
point, tablets led to Wii U's struggles. Retrieved from:
http://www.gamespot.com/articles/nintendo-boss-says-that-highprice-point-tablets-l/1100-6428380/
This article is about Nintendo's explanation for the Wii
U's poor sales performance. This article is helpful because
it is Nintendo's acknowledgment that the tablet and mobile
market is a serious competitor to their business.
Kain, E. (2015, July 30). Lifetime PS4 sales cross 25 million,
double Xbox sales last quarter. Retrieved from:
http://www.forbes.com/sites/erikkain/2015/07/30/lifetime-ps4sales-cross-25-million-double-xbox-sales-in-first-quarter/
This article gives a rough number of PS4 sales that is
relatively up to date. This is useful because it allows
me to show a contrast between the Wii U and the PS4
in terms of sales.
Nintendo Co., Ltd. (2015, January 28). Notice of full-year
financial and dividend forecast modifications. Retrieved from:
http://www.nintendo.co.jp/ir/pdf/2015/150128_3e.pdf
This article shows sales numbers for the Wii U as of

MGT 302 Final Research Project Worksheet

Student Name : __Andrew Daywalt___________________
January 2015.