Nintendo do not own manufacturing factories. In relation to production process, are outsourced to external product partners. Enterprise partners associated in the product process of Nintendo’s products including first-tier suppliers directly contracted with Nintendo and independent factories demanding from those enterprise partner who Nintendo outsources product accumulation and the suppliers fundamental parts and products. (CSR Report, 2018) Sony and Microsoft have aligned themselves with AMD for current-generation console hardware, and those relationships look set to continue. However, for the Switch, Nintendo chose AMD rival Nvidia, which supplies the Tegra system on a chip (SoC) at the heart of Nintendo's next home console. (Australia, P, Consumers Electronics Review, 2018)Nintendo has among its employees legendary people in the gaming industry such as its current EAD manager Shigeru Miyamoto, the designer Satoshi Tajiri; and in
America it is represented both by Satoru Iwata and Reggie Fils-Aime, both known fortheir sensibility to latent customer demands.CompetenciesNintendo’s ability to develop stories, characters and game concepts which are able to meet the latent demand of a wide audience before the rest of the competition is even aware these needs exist, are well known within the gaming industry (Schmidt, 2014).Simplicity as disruptive innovative to target non-consumers by creating blue oceansEconomies of scale enables them to sell the base console at a higher profit than competitors and with a fast time-to-market.Strong Unique selling proposition – USP Nintendo games can only be played with Nintendo’s consoles.Activity System / Value ChainPrimary ActivitiesInbound logisticsInventory management: timing regarding products when economies of scale is at peakCost efficiency making products overseas, shipping and move to US to make productsSufficient supply: Nintendo’s inability to keep up with demand as sale were lost due to not enough Wii Fit consoles.OperationsDeveloping and ManufacturingNintendo implemented in house and private developer that can pitch ideas to Nintendo in order re-shape and design their image.Most development is done within Nintendo’s Cooperation in Japan, where in comparison to US there are limited positions open. All of Nintendo’s manufacturing process is partnered with Foxconn, where all manufacturing and production of hardware and software is created. (Nintendo investigating manufacturer Foxconn after child labour admission, 2018) Outbound logistics: Nintendo tend to control the retail outlets compared with Sony and Microsoft (Dietl &Royer 2003)
Marketing sales:Nintendo tends to control sales and marketing process (Dietl & Roycer 2003)Nintendo’s marketing and management acuity, demonstrated by decisions such as the restriction of the number of games. (Nintendo Odyssey, 2018)The introduction of Nintendo’s Pursuit for profitability imitated by the third party developers and licensed games for its console, which is commonly practiced in the industry. (Kotler, P)Services:
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- Wii, Video game console, Nintendo, Shigeru Miyamoto