Nintendo CUEGIS

Change
 Shift in demand in the mobile platform, in which Nintendo has developed its first mobile game Miitomo that attracted more than 10
million downloads in the first month of release
 Followed by Super Mario Run that had topped the app store charts and had about $56 million in revenue

Culture


Ethics
 Some of their audiences are directed to children, where they could use the pester power to ‘force’ parents to purchase Nintendo’s
products, which could be regarded as unethical
 In their content guidelines, they had a strict policy that it is allowed to have graphic violence, but nudity and sexuality was strictly
prohibited (Hiroshi Yamaguchi believed that it would tarnish the company’s image)
 Further supported that their games have never been rated CERO Z from the Computer Entertainment Rating System, which is strictly
for Adults usually due to gore or nudity content
 Parental control, which the parents could monitor on their children’s playing hours, decide which game they can or cannot play,
whether they could post screenshots in social media

Globalization
 Releasing their games in a worldwide scale (150 countries), but they have to take note of the monetization that has been happening in
the world, especially when they are selling it through e-commerce (Nintendo eShop)


Innovation
 Nintendo Switch,
 Upcoming release of Nintendo Labo, which is an extension to the Nintendo Switch console which allows further interaction with the
game software. Also made out of cardboard, which is a recyclable materials (Ethics). It also acts as a way to teach the principles of
engineering, physics, and basic programming.
  Mostly selling their product physically through a cartridge, customers could also purchase their games digitally through the Nintendo e-
Shop, therefore increasing their sales through e-commerce

Strategy

Definition of CUEGIS

Change refers to the modification or transformation in the way businesses is conducted as a response to internal factors or external factors.
Culture refers to the norms, beliefs, and values of a n organization or a collective group of individuals, which shape its practices and
characteristics.
Ethics refer to the moral principles and values that form the basis of how business activity is conducted.
Globalization refers to the process by which people, ideas, goods, and services become increasingly spread around the world, creating greater
integration and understanding of countries, organizations, and cultures.
Innovation refers to the improvements of a product or process to better meet the needs and wants of customers, in a profitable way.
Strategy refers to planned actions designed to achieve the long-term goals or overall aims of an organization.
About Nintendo
Nintendo Co., Ltd. is a Japanese multinational public limited company. It was founded in September 1889 and incorporated in November 1947.
Nintendo’s core business is in the video game industry and consumer electronics market. Main source of finance is through selling their games, toys,
collectibles, and additional content or in-game purchasing. They produce well known franchises/titles such as Super Mario, Zelda, and etc.
Stakeholder
Nintendo’s President/CEO: Tatsumi Kirishima

Believes in their motto, which is “putting smiles on the faces of everyone Nintendo touches”.

Mobile games: Because there are so many mobile devices in the marketplace and in the hands of consumers, this is a great tool for us to push
our IP to a large number of people. This is a great way to introduce them to our franchises and characters, and thereby bring them back to
Nintendo’s dedicated hardware as well as introduce them to Nintendo’s expanded software library. Number two, we’d like mobile to be a
pillar in and of itself—a business pillar that is profitable. And the third goal for our mobile business, in the same way it worked for Pokémon, is
to use games on mobile devices to increase the sales of other games we develop with the same characters. This is synergy, right? In this way
we hope customers will purchase other related goods and services, too. We want to use this synergy.
CUEGIS Essay (With reference to an organization of your choice, examine the impact of innovation on operations management strategy.)

Nintendo Co. Ltd (Nintendo) is a Japanese public limited company originally founded in September 1889 and incorporated in November 1947.
Nintendo’s core business is in the video game industry and consumer electronic markets where they described themselves to manufacture and
sell home and leisure equipment. Innovation refers to the improvements of a product or process to better meet the needs and wants of
customers in a profitable way. Strategy can be explained as planning actions designed to achieve the long-term goals or overall aims of an
organization. Operations management refers to one of the business functions to provide the right goods and services in the right quantities at
the right quality in a cost-effective and timely manner.

Nintendo has recently released they brand new console, the Nintendo Switch (Switch). The Switch is described to be an unconventional
console. The true innovation of the console lies within its uniqueness. The Nintendo Switch allows two modes where the user could play it as a
home console or a portable handheld console, which no other companies have achieved this. The Switch includes a TV mode, Portable mode,
and Tabletop mode (where users can split and share the controller to play multiplayer games). The advantage of this innovation is that it
gained a position in the console market where it has no competition. This has a major impact in the operations management as they would
need to understand the amount of consoles that they would have to produce to the right amount of customers with its growing demand for
the innovative console. However, a limitation of having an innovative console is that there would be a limited amount of suppliers who have
the raw materials which are necessary to create the unique features of the Switch as the raw materials would be considered to be for an
uncommon purpose.

Nintendo’s CEO, Tatsumi Kirishima, strongly stands with his motto, which is putting smiles on the faces of everyone Nintendo touches. This
creates an innovative culture within the company which affects the internal stakeholders of Nintendo which ranges from the CEO to each
employees of Nintendo. This makes them strive to produce their consoles in a way which has a high quality in order to enhance their
experiences with Nintendo’s consoles. In addition, there is a play room filled with Nintendo consoles (including the Switch) which allows their
employees to spend their break time by playing with the consoles. This suggests the strategy in which Nintendo motivates their employees
through fringe benefits as well as helping them understand any flaws within the system itself so that they could update it whenever other than
relying on comments from their customers.

Another innovation is Nintendo’s latest extension device for the Nintendo Switch, the Nintendo Labo (Labo). This device allows for different
additional interactions with the Switch. One of the prominent features of the Labo is that it is made out of cardboard, which is a recyclable
material. This emphasizes on Nintendo’s aim to develop ecological sustainability. The advantage of this innovation is that it allows Nintendo to
promote its products in an ethical way to develop its business image. This in turn allows them to gain good publicity and more suppliers will be
willing to supply them with raw materials, especially when the Labo is made out of recyclable materials. As a result, Nintendo will be able to
select from a wide variety of suppliers, in which they could also minimize costs in their operations while also producing their products at a
possible higher quality.

However, the main limitation to this operations management strategy is that the Labo is specifically customized into different models (i.e
piano, fishing rod, etc.) This would create an uncertainty in which production method Nintendo should use to produce the Labo. Although job
production would be the most optimal choice as Nintendo focuses on producing high quality products, they could produce in batch production
as well due to the high amount of demand that Labo has been receiving. Thus, an implication to an individual stakeholder such as the workers
of Nintendo may face the dangers of redundancies. As Nintendo’s operation management strategy shifts into batch production, some workers
may not be able to produce a higher amount of Labos, in which they might be replaced with robots instead.

In conclusion, innovation has a huge impact on Nintendo’s operations management strategies. Nintendo’s motto on putting smiles of
everything Nintendo touches has created an innovative culture within the company. Nintendo has created innovative products through an
ethical approach which has helped Nintendo in their operations management strategies.

Marks Criterion Marks

(out of 4)
A: Knowledge 4
B: Application 4
C: Reasoning 3
D: Structure 4
E: Individuals & Societies 4
Total 19/20