Final Strategic Plan
Createa 10- to 15-slide MicrosoftPowerPointpresentation with visuals and speaker notes to present the strategic plan, summarizing all relevant elements from previous weeks. The objective is to sell the strategic plan to investors or company directors.
Running head: TAKE-TWO INTERACTIVE SOFTWARE 2
TAKE-TWO INTERACTIVE SOFTWARE 2
Take-Two Interactive Software
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Take-Two Interactive Software
Take two interactive software company is one of the major players in the technology industries. The company maintains its dominant position in the market by analyzing various market factors, including internal and external factors that affect the competitive ability of the firm in the industry. The company deals in the manufacture, distribution, and marketing of interactive video games (Gupta & Herman, 2010). Examples of products produced by the company include console games, personal computers, and handheld game systems. Consumers have access to the products of the company by visiting their retail outlets, cloud streaming, online gaming, and digital download. The company has strategic internal advantages that help it to thrive in the industry (Gupta & Herman, 2010). For instance, the company has a very skilled workforce that has been achieved through successful training in current technological developments. The company spends huge resources on training employees, and this is a huge source of motivation for its workers.
The automation of activities in the firm has brought consistency and efficiency in the way the activities of the organization are conducted. Furthermore, Take-Two interactive company has effective customer relationship management that has ensures customer satisfaction (Gupta & Herman, 2010). The strong chain of reliable suppliers has enabled the company to reduce problems related to insufficient raw materials. The company has a reliable corporate culture that defines the behavior of employees. The employees of the organization demonstrate the utmost competency and professionalism. The vast resources owned by the company give it an advantage in the industry (Gamble, 2008). For instance, the organization owns 2k, publishing labels, and rock star games that are very popular among young people. Huge operating income is also a significant internal strength of the organization.
The most important strength of the organization is a strong dealer community. Take-Two interaction has built a strong relationship with the distributors. Most distributors not only advertise and promote the products of the company. They also conduct training for their sales representatives to increase sales in the market (Gamble, 2008). The sales representatives are trained on how to explain to the customers how they are likely to extract maximum benefits from using the products of the company. Most customers have expressed satisfaction from using the products of the company based on information provided by the sales representatives, mostly trained and employed by the distributors of the firm. The main weakness of the firm is that it has not invested in research and development well enough to compete with the faster-growing technology demand compared to other players in the market (Gupta & Herman, 2010). It is important to appreciate that the organization is spending above the industry average in terms of research, but has not been able to compete with the leading industry players. It posits as a mature firm seeking to manufacture products based on the tested market features. However, the company is growing and has accumulated sufficient resources concerning revenue, employees, and equipment to enable it to open the future of technology and innovation in the gaming industry.
Take-Two Interactive Company has various internal environmental factors that have a touch to the general gaming industries. For instance, values are an important undertaking in technology. The gaming industry wants games and simulations that enhance positive values in society. The values advanced by an organization must correspond to the perception of the same in the industry. Furthermore, the organization has a well-defined mission and objectives that are futuristic and corresponds to the dynamic nature of the gaming industry (Gerasimova, 2016). Other important internal factors include the cooperate culture, business structure, human and physical resources. The analysis of the organization’s external environment is crucial in understanding the dynamics of the market. Therefore, it is crucial to assess the major external environmental factors and how they influence the performance of the organization. The stable cash flow is an avenue to invest in the adjusted product (Gamble, 2008). The availability of more cash in the bank provides a crucial investment opportunity, especially in other product categories. The intergovernmental trade agreement enables the company to open more markets to increase the area of operation and profitability. The increase in the country’s economic development has increased the purchasing power of citizens. The lower inflation rate has resulted in more stability in the market, and this enables credit to be obtained at low-interest rates for clients of the firm.
Take-Two Company operates in an environment with very stiff competition. The profitability nature of the industry has attracted many players willing to have a share of the gaming market. High innovation and increased players have reduced the company’s revenue stream (Gamble, 2008). Most companies are competing so hard to maintain the power and profitability in the industry. The competitive basis of the company is based on diversity, the development in the sector, as well as barriers the entry of the industry. Take two interactive software is experiencing stiff competition from major players such as the Microsoft cooperation, GameStop Corp, Sony cooperation, and Electronic Arts, among others. However, the company has positioned itself strategically with unique products and has a significant market share that ensures a stable revenue stream (Gamble, 2008). The main competitive ability of the company is well-trained employees with an understanding of the current dynamics in the gaming industry. Besides, the company has also established an effective relationship with the distributors, which helps in the effective marketing of the products of the firm.
Just like any other organization, Take-Two Interactive has a definite structure that is crucial in enhancing the operations of the firm. The company has a CEO, chairman of the board, and seven directors. Other functional units of the organization are the finance department headed by the chief financial officer, office of the executive vice president, and legal affairs department (Gupta & Herman, 2010). The organization has youthful leaders holding on various positions to steer the agenda of the firm. The structure of the firm is made simple to prevent complex operation procedures that may reduce the time needed to provide services. The staff and the board members clearly understand the mission and objectives of the firm and thus increase productivity and competitive advantage of the firm. The structure makes it possible to share information with all levels of staff to update them on the decisions taken by the management and what is expected of them (Gerasimova, 2016). The CEO determines most of the activities undertaken in the organization. However, the directors also have a significant part to play in the running of the firm.
References
Gerasimova, E. I. (2016). The Investment Potential of the Video Game Market. (11 (53), 24-29.
Gamble, J. E. (2008). Competition in Video Game Consoles: Sony, Microsoft, and Nintendo Battle for Supremacy.McGraw-Hill
Gupta, S., & Herman, K. (2010). Take-Two Interactive Software, Inc. Running head: TAKE-TWO INTERACTIVE 1
TAKE TWO INTERACTIVE 5
Strategy analysis of Take-Two Interactive Company
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Strategic management in companies involves multiple actions such as thinking critically, setting objectives for the firm, planning, executing necessary changes, and analyzing the results. Strategic measuring includes three levels. The following paper evaluates the three strategies; first, the paper discusses business-level strategy, corporate-level strategies, before ending with global level strategies. The paper wraps the discussion by looking at the recommendation for the selected company, which is Take-Two Interactive. All the elements are as discussed below.
Potential Business Level Strategies for the organization
A company’s business-level strategies strive to satisfy the venture’s customer wants and preferences for them to achieve above-average returns. These strategies indicate the events which the company takes to deliver quality services, value, among many more to the clients. The strategies aid the business in accomplishing its competitive advantage by exploiting the main competencies within the industry (Albany, 2020). This level of strategy analyzes the companys position within the industry and compares it to its competitors. Core business-level strategies are focus, differentiation, together with cost-leadership.
Cost leadership is where the firm competes with the rest in the industry over a price that is favorable to the customers. The stated price is usually one set based on internal efficiency for the company to incur a margin that withstands returns above average. Continuous efforts in reducing the costs are necessary to become a cost leader. Cost leadership can be achieved by reducing expenses associated with sales, R & D, control overproduction, and expenses, among others.
Differentiation is the second business strategy where value is offered to clients via special features of the firm’s products other than using the lowest price. The company delivers high quality, characteristic, quality services, quick innovations, and progressive technological features. Some risks that follow the differentiation method include loss of value, imitation, and uniqueness.
Focused differentiation and low focused cost are sometimes used by firms whereby the companies engage in competition not just through differentiation but choose a small part in the industry to deliver products. The companies utilizing low-focused costs do not go in for low prices alone; they want a small section of the market to provide products and services.
Take-Two Interactive utilizes two methods of business-level strategies. The company uses cost leadership and differentiation. With cost leadership, the company targets the middle-class group of individuals. This group of people values the cost of products over the rest of the items. The company concentrates on affordability and quick reach to items across the whole world. The also emphasizes the uniqueness of its products (Maino, 2020). The company also increases innovation in its line of production and uses the same to address concerns over health issues with the clients. The first scenario is where the company grew its product line on learning about their client’s varying interests so that it can differentiate itself from the other rivalry competitors and expand its scope of opportunities in the market.
Potential corporate-level strategies for the organization
Corporate level strategies.
A corporate-level strategy is an accomplishment that is taken to achieve a competitive advantage through the selection and management of a combination of businesses contending in many trades or product markets. A corporate strategy ought to able to make the firm or one of its units of the company accomplish one or much of the creation of value functions at costs that are low or even in a manner that give support to the advantage of differentiation. This strategy is a way for a firm to generate value through the confirmation and management of multi-market accomplishments. There are types of corporate-level plans that a firm may employ to ensure the proper distribution of the firm’s needs. They are the stability strategy, retrenchment strategy, expansion strategy, and the combination strategy (indeed, 2020).
Take-Two Interactive Company is a software that is the developer, publisher, plus dealer of the entertainment for customers all over the world. This frim attempts to the most creative, inventive, and well-organized firm. This particular firm’s central strategy is to take advantage of video games’ popularity by expanding and reproducing high-quality interactive entertainment involvements across various genres. This frim has potential corporate level strategies that have been put in place. One approach is giving support to the label organization to target the different segments of the market. Another strategy focuses on the fundamental strength of coming up with and selecting titles of high quality and taking control of the developing technologies, podiums, and channels of distribution, comprising the Digitally Delivered Content (Take-Two Interactive, 2012). This company has also implemented the expansion strategy, where it aims to expand its business at the international level, mainly in Latin America, Asia, plus Eastern Europe. For the expansion of their business, they have opted to broaden the distribution of their products that are already existing.
Potential global strategies for the organization
Global business strategies refer to the methods used by the company while interacting with other countries. Global integration refers to the extent to which a firm can utilize similar items and techniques but in different nations. Examples if global business methods include export, standardization, multi-domestic, together with transnational.
Exportation is utilized when a firm concentrates on local operations. With the method, the company does not need to move to other countries but takes its items to take advantage of international openings. Standardization is where an organization treats the entire world as a single market. The assumption for this kind of exchange is that a single product is likely to meet individuals’ requirements everywhere. A standardization method delivers efficiencies through centralizing the most popular events like product design. The multi-domestic strategy makes items or processes to suit the conditions of every nation. Transnational is a combination of both the standardization method and the multi-domestic ways. The technique is utilized when the venture is experiencing significant cost pressure, mostly from international rivalry firms, even though it must also give items that achieve the local client demands (Lumen, 2020). The approach is hard to maintain due to facts that the firm has to achieve economies of scale.
From the above analysis, it is recommended that Take-Two Interactive firm engages in business and corporate-level strategies. Every business should be concerned with establishing the main customer base and concentrate on maintaining the group. The business-level procedure involves maintaining the group of customers found, which is critical for company sales. The company also implements corporate strategy as it takes care of the developing technologies and improvements in technologies in different nations. The company ensures that it enjoys operation in different markets, and the two strategies would completely suit the firm as it strives to improve its sales.
References
(2012). Retrieved from Take-Two Interactive: https://ir.take2games.com/static-files/0dfa4a92-066e-472d-8770-68583521987a
Albany. (2020). Business-level strategy. Retrieved from https://www.albany.edu/faculty/es8949/bmgt481/lecture4.html#:~:text=Business-level%20strategy%20is%20concerned,a%20organization%27s%20business-level%20strategies.
indeed. (2020, February 25). Retrieved from What Is a Corporate-Level Strategy?: https://www.indeed.com/career-advice/career-development/corporate-level-strategy
Lumen. (2020). Global Business Strategies for Responding to Cultural Differences. Retrieved from https://courses.lumenlearning.com/wm-principlesofmanagement/chapter/responding-to-cultural-differences/#:~:text=The%20two%20dimensions%20result%20in,local%20responsiveness%20and%20global%20integration.
Maino. (2020). Revisiting the strategic management process through the levels of strategy analysis. Retrieved from http://www.ipublishing.co.in/ajmrvol1no1/volsix/EIJMRS6004.pdf Running head: ENVIRONMENTAL SCAN FOR TAKE-TWO INTERACTIVE 1
ENVIRONMENTAL SCAN FOR TAKE-TWO INTERACTIVE 7
Environmental Scan for Take-Two Interactive
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‘Perform an Environmental Scan for Take-Two Interactive’
Determine how to create value and sustain competitive advantage using the environmental scanning strategy.
The corporate world is changing where there are growing turbulent and dynamic environments which calls for new competitive outlooks. Environmental scanning is a crucial stage in the strategic management for each firm. It entails assessment, monitoring and information dissemination from the internal and external environments to sustain essential individuals like stakeholders in the company. Firms should evaluate the internal environments, which include strengths and opportunities, and weaknesses as well as threats in the company. Technological, political and economic factors are also part of the evaluation in the scanning of the environment process.
Both external and internal environments are operating grounds for each company. There is a profound effect on the environment for firms, although the organization itself has less impact on the environment. Establishments can often scan for strengths, opportunities, threats and weaknesses in the environment (Yu et al., 2019). Organizational strengths’ are vital in the maintenance and creation of competitive advantages. Companies focusing on competitive advantage have the power to value and offer outstanding services compared to other firms in the same market.
Consumers are increasing daily in the new economy, and the customers are focusing on companies that give quality products which have relatively a lower price. Each consumer has a desire for unique, convenient products. The Take-Two Interactive Company offers excellent value for its consumers through the delivery of its products to the customers specially and uniquely. Two Take Interactive organization offers its services at low prices, making the firm distinct from the other competitors (Take-Two Interactive Software, Inc. 2019 Annual…).Creation of sustainable advantage in the Take-Two Interactive Company enables it to be competitive at the same time being a hardworking company to retain its superiority. Failure to focus on that will make consumers look for services which will exploit the rivalry among the Take-Two Interactive companies like Valve software.
Evaluate the company’s external environment.
The Take-Two Interactive market analysis is responsible for substance and monitoring of the internal and external environments of the firm. Different factors influence the external environment of the Take-Two Interactive Company. Political factors like President Donald’ foreign policy is hindering the company from accessing talented clients from outside (Sarkar, 2017). The executive order to permit H-1B visas indicates that immigrants are not likely coming because of the political climate. Schooling is another issue as the organization needs experienced personnel, and it is difficult to import foreign workforce. The probable cuts in the public institutions funding will not assist in the local part regarding science, technology, engineering, and mathematics (STEM) education is significant in the enhancement of essential skills for game developers.
Growth rate, employment level together with currency rates, are part of the economic factors affecting the company. To the everyday gamers, gaming is considered not a necessity. Recessionary periods have adverse effects on Take-Two Interactive Company because the government regards it as a luxury company (Take-Two Interactive Software, Inc. 2019 Annual). When it comes to employment, the firm requires highly skilled personnel that is difficult to recruit because it requires high payment.
Ecological factors like digital transformation in gaming mean abandoning of the physical games to digital ones which they have to create based on the customer’s preference. The materials and the machines that the producer uses when creating the game have to be dependent on energy efficiency (Take-Two Interactive Software, Inc. 2019 Annual). The legal influences in the Take-Two Interactive Company are significant because intellectual property is the biggest asset to the company. The corporation has agreements and contracts with Sony and the Microsoft Company to ensure that its customers have access to the games.
Sociocultural factors keep changing, and this demonstrates that in the gaming industry, there is a change in trends and demographics. Females are becoming part of the e-sports sector, where they form 46% of it (Bosman, 2019). Such is a significant factor for Take-Two interactive corporation to regard because it indicates a change in the traditional target market. Their target market in the past was young male gamers, but now things are changing. There is also a debate about violent video games which result in violent comportment among young gamers.
Technological factor means a lot to the company because its operations depend on the technological industry. The company has to be at pace with current trends where it has to keep upgrading to produce excellent games and experiences for their consumers (Take-Two Interactive Software, Inc. 2019 Annual). Innovation is also a factor to consider because other publishers and developers are innovative and are becoming more competitive. Investing in cloud computing would make the company more competitive.
Assess the company’s general environment.
Take-Two interactive company ensures effectiveness in production procedures, appropriate communication channels and efficient organizational skills in the internal environment. In monitoring and managing the internal environments, the company conducts assessments concerning its operations, and it ascertains provision of the customers’ needs (Take-Two Interactive Software, Inc. 2019 Annual). The firms have set outlooks to monitor and economize on services to lower credit rating problems. Take-Two Interactive organization has prospects in charge of ensuring conventionally low margins in profit and high inventory targets and costs.
The needs of the consumers are the greatest priority for the company. The staff focuses on meeting the set objectives of the company. Social, legal, political and economic factors make up the external environment. The company ensures that it ensures the latest technology in the provision of its services (Take-Two Interactive Software, Inc. 2019 Annual). Abiding by the laws is a crucial element for the company to succeed in its operations. The influential culture in the company assists it in providing affordable services to the customers.
Evaluate the organization’s industry operating environment.
The upcoming competitors and government policies challenge the operating environment for the company. No company takes it easy with new entrants in the market. The company require high levels of knowledge to develop new video programs. The size of the portfolio required in matching the existing firms creates a challenge because it is difficult and costly for the company to make a move to a competitive level (Take-Two Interactive Software, Inc., 2019). The corporation works with resources that are in two types which are tangible and intangible. Organizational culture, brand competence and reputation are the intangible resources in Take-Two Interactive Company. The tangible resources are the financial capital and the possessions that create value in intangible resources.
Conclusion
The external and internal environments of the Take-Two Interactive organization are significant in the company’s success. The firm is dominating in e-sports games because of its observance of the business aspects. Companies that want to achieve success and beat the competitive world they must offer excellent services to the consumers for them to continue thriving in the market.
References
Bosman, S. (2019). Women Account for 46% of All Game Enthusiasts. Retrieved from the new zoo: https://newzoo.com/insights/articles/women-account-for-46-of-all-gameenthusiasts-watching-game-video-content-and-esports-has-changed-how-women-andmen-alike-engage-with-games/
Sarkar, S. (2017). Trump’s policies are hurting the US game industry. Retrieved from Polygon: https://www.polygon.com/2017/8/2/16083638/trump-game-industry-ea-taketwo
Take-Two Interactive Software, Inc. (2019). Corporate. Retrieved from Take2Games: https://ir.take2games.com
Take-Two Interactive Software, Inc. 2019 Annual Report. Retrieved from https://www.annualreports.com/HostedData/AnnualReports/PDF/NASDAQ_TTWO_2019.pdf
Yu, W., Chavez, R., Jacobs, M., Wong, C. Y., & Yuan, C. (2019). Environmental scanning, supply chain integration, responsiveness, and operational performance. International Journal of Operations & Production Management. STRATEGY MANAGEMENT PROCESS 1
Strategy Management Process: Case Study of Take-Two Interactive Company
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Strategy Management Process
Every business entity must have a strategy used to enhance its performance. The formulation of a business strategy occurs through a process known as the strategic management process (Sundiman, 2018). In this process, the managers of an organization make choices on the appropriate strategies to steer the organization’s performance. Primarily, strategy management is a continuous process that involves the evaluation of the organization’s strategy as well as the industry where the entity operates. The management appraises the organization’s competitors and works to fix the goals of the present and future competitors and use this to reassess its strategies (Drobyazko, Okulich-Kazarin, Rogovyi, Goltvenko & Marova, 2019). The strategic management process involves four main components.
The first aspect of the process is environmental scanning. It involves collecting, analyzing, and providing data for strategy use. It is crucial to understanding the external and internal factors that influence the operation of an organization (Sundiman, 2018). The environmental analysis should be subjected to continuous evaluation and improvement where necessary. Strategy formulation is an aspect of the process that involves selecting the best course of action to complete the organization’s goals (Drobyazko et al,. 2019). It helps in formulating business and functional strategies. Additionally, the process involves strategy implementation, which involves putting the chosen strategic plan into action. Moreover, it involves activities such as designing the structure of the firm, human resource management, developing the decision-making process, and distributing resources (Sundiman, 2018). The last component of the process is strategy evaluation. It involves the evolution of the external and internal factors that constitutes the core strategy in question. The process involves activities such as measuring performance as well as taking various correctional measures.
The gaming industry has become competitive, especially with the advancing technology. Therefore, the analyses of external and internal factors help the company understand the market and the major competitors in the industry (Software & Zelnick, 2020). The understanding of the market and industry is crucial in creating a compelling vision and mission statement that conforms to the organization’s goals and objectives. Environmental scanning is essential to understand the gaming market dynamics, this assists Take-Two Interactive management in formulating strategies that take advantage of the market opportunities (Drobyazko et al,. 2019). Besides, environmental scanning also provides crucial information on competitors allowing the firm to make necessary improvements on their products or services to address the distinct needs of the customers. Besides, the data provided during environmental scanning helps predict the future market situation that enables the company to adjust appropriately.
The company uses strategy management process to formulate goals based on the information obtained from the environmental scanning (Software & Zelnick, 2020). The organization makes decisions that favor the goals and strategic implementation of the same. Implementing decisions made in the organization may involve making certain adjustments during the execution. For instance, the company may decide to increase the number of employees with specific skills to achieve certain strategy decision implementation. Take-Two Interactive is an established tech firm. Strategic implementation process must be evaluated to assess if it addresses the initial intentions of the firm. It assesses the effectiveness of the decisions made during the strategic implementation process. That is if the strategy implemented works to better the performance of the firm.
Take-Two Interactive Company only has a vision statement that states, “The future is in your hands, (Software & Zelnick, 2020). The vision statement means that creativity and innovation is likely to unlock opportunities going forward, especially in the gaming industry. The industry has become dynamic and complex, thus, they intend to adhere to the changing circumstances to satisfy the needs of their customers (Software & Zelnick, 2020). However, the company lacks other crucial objective indicators such as motivation strategy, mission statement, and people’s strategy statements, which could significantly affect the business’s performance. The establishment of mission statement is crucial in the strategy formulation process. Therefore, without a clear mission statement, the organization lacks guidance for creating objectives and goals for the organization. Besides, there is no clear roadmap that everyone abides by during decision making in the organization. Moreover, the lack of motivation strategy statement results in poor incentives to work. The statement is crucial in defining the organizations position concerning the welfare and wellbeing of employees. It is crucial to have a well defined objective on employee relation and well being in an organization. Workers form part of the strategy planning since they are the implementers of strategy objective of an organization. Take-Two Interactive Company lacks people strategy statement. The company has not defined effective goals of relating to the employees. Therefore, the supervisors and managers of the company may not understand how the organization the companys objective concerning employee relations. Therefore, it is likely that the management may make decisions that are inconsistent with the company strategy and objectives.
Strategy planning process is significantly influenced by ethics and cooperate social responsibility (Sitnikov & Bocean, 2017). While an organization may want to increase its performance through establish feasible strategies, it is crucial that it does not involve in activities that harm individuals or the society. Ethics and cooperate social responsibility influences the decisions of the management of organizations. That is, the decisions are reached after considering all the possible harmful effect it could bring to the society. Organizations must ensure that their strategy plans integrate the organizations culture with ethics as well as corporate social responsibility. Ethical considerations shape the behavior of the firm towards employees, customers and the society at large. For instance, the customer relations strategy must be designed to increase customer satisfaction.
The firm should be honest on the services and products they provide concerning the customers expectation. Moreover, employee relations strategy may include managers treating workers with respect even if the companys strategy is to reduce employee turnover an increase production. Take Two interactive company must design their customers and employee strategy objectives based on the ethic
