Case Study Description of Electronic Arts: The Blockbuster Strategy
Describes the process that the firm employs to allocate resources to new product development projects. Examines whether the firm can sustain its competitive advantage given its existing game design process.
Swot Analysis of "Electronic Arts: The Blockbuster Strategy" written by Michael A. Roberto, Gina M. Carioggia includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Employs Blockbuster facing as an external strategic factors. Some of the topics covered in Electronic Arts: The Blockbuster Strategy case study are - Strategic Management Strategies, Decision making, Product development, Strategic planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Electronic Arts: The Blockbuster Strategy casestudy better are - – talent flight as more people leaving formal jobs, cloud computing is disrupting traditional business models, wage bills are increasing, challanges to central banks by blockchain based private currencies, there is backlash against globalization, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions,
increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , etc
Introduction to SWOT Analysis of Electronic Arts: The Blockbuster Strategy
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Electronic Arts: The Blockbuster Strategy case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Employs Blockbuster, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Employs Blockbuster operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Electronic Arts: The Blockbuster Strategy can be done for the following purposes –
1. Strategic planning using facts provided in Electronic Arts: The Blockbuster Strategy case study
2. Improving business portfolio management of Employs Blockbuster
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Employs Blockbuster
Strengths Electronic Arts: The Blockbuster Strategy | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Employs Blockbuster in Electronic Arts: The Blockbuster Strategy Harvard Business Review case study are -
Training and development
– Employs Blockbuster has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Electronic Arts: The Blockbuster Strategy Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Ability to recruit top talent
– Employs Blockbuster is one of the leading recruiters in the industry. Managers in the Electronic Arts: The Blockbuster Strategy are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Employs Blockbuster has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Employs Blockbuster to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Analytics focus
– Employs Blockbuster is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Michael A. Roberto, Gina M. Carioggia can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Successful track record of launching new products
– Employs Blockbuster has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Employs Blockbuster has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Employs Blockbuster digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Employs Blockbuster has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Cross disciplinary teams
– Horizontal connected teams at the Employs Blockbuster are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Strong track record of project management
– Employs Blockbuster is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Employs Blockbuster is present in almost all the verticals within the industry. This has provided firm in Electronic Arts: The Blockbuster Strategy case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Learning organization
- Employs Blockbuster is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Employs Blockbuster is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Electronic Arts: The Blockbuster Strategy Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Employs Blockbuster has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Superior customer experience
– The customer experience strategy of Employs Blockbuster in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Electronic Arts: The Blockbuster Strategy | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Electronic Arts: The Blockbuster Strategy are -
Products dominated business model
– Even though Employs Blockbuster has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Electronic Arts: The Blockbuster Strategy should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael A. Roberto, Gina M. Carioggia suggests that, Employs Blockbuster is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Slow to strategic competitive environment developments
– As Electronic Arts: The Blockbuster Strategy HBR case study mentions - Employs Blockbuster takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Aligning sales with marketing
– It come across in the case study Electronic Arts: The Blockbuster Strategy that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Electronic Arts: The Blockbuster Strategy can leverage the sales team experience to cultivate customer relationships as Employs Blockbuster is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Electronic Arts: The Blockbuster Strategy, it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Lack of clear differentiation of Employs Blockbuster products
– To increase the profitability and margins on the products, Employs Blockbuster needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Electronic Arts: The Blockbuster Strategy HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Employs Blockbuster has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Electronic Arts: The Blockbuster Strategy, it seems that the employees of Employs Blockbuster don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Low market penetration in new markets
– Outside its home market of Employs Blockbuster, firm in the HBR case study Electronic Arts: The Blockbuster Strategy needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Employs Blockbuster is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Electronic Arts: The Blockbuster Strategy can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Interest costs
– Compare to the competition, Employs Blockbuster has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Opportunities Electronic Arts: The Blockbuster Strategy | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Electronic Arts: The Blockbuster Strategy are -
Building a culture of innovation
– managers at Employs Blockbuster can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Strategy & Execution segment.
Using analytics as competitive advantage
– Employs Blockbuster has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Electronic Arts: The Blockbuster Strategy - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Employs Blockbuster to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Employs Blockbuster has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Developing new processes and practices
– Employs Blockbuster can develop new processes and procedures in Strategy & Execution industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Employs Blockbuster in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Manufacturing automation
– Employs Blockbuster can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Employs Blockbuster to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Employs Blockbuster can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Employs Blockbuster to increase its market reach. Employs Blockbuster will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Employs Blockbuster can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Employs Blockbuster can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Electronic Arts: The Blockbuster Strategy suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Employs Blockbuster can use these opportunities to build new business models that can help the communities that Employs Blockbuster operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Creating value in data economy
– The success of analytics program of Employs Blockbuster has opened avenues for new revenue streams for the organization in the industry. This can help Employs Blockbuster to build a more holistic ecosystem as suggested in the Electronic Arts: The Blockbuster Strategy case study. Employs Blockbuster can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Electronic Arts: The Blockbuster Strategy External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Electronic Arts: The Blockbuster Strategy are -
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Employs Blockbuster in the Strategy & Execution sector and impact the bottomline of the organization.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Employs Blockbuster needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Employs Blockbuster is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Employs Blockbuster in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Employs Blockbuster can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Electronic Arts: The Blockbuster Strategy .
Increasing wage structure of Employs Blockbuster
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Employs Blockbuster.
High dependence on third party suppliers
– Employs Blockbuster high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Electronic Arts: The Blockbuster Strategy, Employs Blockbuster may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Environmental challenges
– Employs Blockbuster needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Employs Blockbuster can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Employs Blockbuster with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Employs Blockbuster can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Employs Blockbuster business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Electronic Arts: The Blockbuster Strategy Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Electronic Arts: The Blockbuster Strategy needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Electronic Arts: The Blockbuster Strategy is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Electronic Arts: The Blockbuster Strategy is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Electronic Arts: The Blockbuster Strategy is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Employs Blockbuster needs to make to build a sustainable competitive advantage.
