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Assignment #1: Foundation for Team Presentation

Team B3: Oluwabunmi Lashore, Utkirbek Khasanov, Pranali Kawade, Pranubh Dewan, Utsavi

Awasthi

Master of Global Management, Royal Roads University

MGMT562: International Business Strategy

Dr. Deb Linehan and Sandy Walker

March,17,2024
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Assignment #1: Foundation for Team Presentation

Choosing NVIDIA as our focus organization:

We have chosen NVIDIA as our focus organization due to its significant presence in

artificial intelligence computing and its contributions to various industries. NVIDIA offers a wide

range of products and services that cater to the gaming and creating industry, cloud and data

center solutions, networking, embedded systems, and more. NVIDIA’s GPUs have seamlessly

transitioned from gaming PCs to the heart of large data centers, where AI pioneers train their

models. Since 2012, NVIDIA has meticulously optimized its GPUs for AI applications, reaping

substantial rewards. Their dominance in AI-related GPU hardware is unrivaled, with a staggering

70% market share. NVIDIA’s growth trajectory and market dominance make it an exciting subject

for exploration, especially when juxtaposed with its competitors’ strategies and offerings

Nvidia’s official website: https://www.nvidia.com/en-us/.

Task breakdown:

To provide ideas on how NVIDIA can maintain its leadership in this rapidly expanding

market, this project intends to provide an extensive strategic analysis of the company's multiple

verticals.

PESTEL Analysis:

Political and legal factors like trade tensions, regulations, and intellectual property rights

impact NVIDIA's global operations. Economic and social factors, such as consumer spending,

enterprise investments, and the adoption of AI, gaming, and virtual reality, drive product

demand. Technological advancements and environmental pressures shape innovation and

sustainability efforts.

Action Plan Inputs: Identifies external factors that may impact NVIDIA's business, guiding

strategic planning aligned with the external environment.

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Porter's 5 Forces:

Moderate supplier power due to reliance on foundries. Moderate buyer power with a

mix of individual and enterprise customers. Moderate threat from substitutes like CPUs and

FPGAs. Low threat of new entrants due to high capital requirements and brand loyalty. Intense

rivalry with AMD and tech giants like Google and Apple in AI hardware.

Action Plan Inputs: Enables formulation of strategies for sustainable competitive

advantage and better understanding of competitive forces.

Supply Chain:

As a fabless company, NVIDIA outsources manufacturing to foundries like TSMC. Effective

supply chain management involves collaboration with contract manufacturers, quality checks,

strategic supplier relationships, and economies of scale. Comprehensive supply chain analysis

identifies bottlenecks, assesses capabilities, and develops contingency plans to meet growing

GPU demand efficiently.

Action Plan Inputs: Comprehensive supply chain analysis supporting strategies to meet

growing GPU demand efficiently and maintain the competitive edge.

Threats and Opportunities:

Threats: Intense competition, rapid technological changes, consumer preference shifts,

geopolitical uncertainties, and supply chain disruptions.

Opportunities: Growing AI computing demand across industries, expansion into new

applications, strategic partnerships and acquisitions, GPU technology advancements, leveraging

gaming and content creation markets, capitalizing on metaverse and virtual reality trends.

Action Plan Inputs: Identifying threats and opportunities guide strategies to mitigate

risks and capitalize on growth prospects.

Global Strategy:
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NVIDIA caters to diverse markets with a consistent product offering, focusing on sector-

specific solutions for gaming, data centers, and professional visualization. The company offers a

wide price range and forms strategic partnerships with global tech leaders to expand its reach

and integration into emerging technologies.

Action Plan Inputs: Tailored global strategies will be analyzed to ensure effective market

penetration and adaptation to local contexts worldwide.

Risk Monitoring and Responses:

NVIDIA identifies potential risks like market fluctuations, regulatory changes, supply

chain disruptions, cybersecurity threats, and reputational risks. Responses include diversifying

product portfolios, strengthening cybersecurity, developing supply chain contingency plans, and

maintaining effective stakeholder communication. NVIDIA also adapts strategies based on

technological advancements and consumer trends.

Action Plan Inputs: Proactive risk identification and mitigation strategies safeguard

NVIDIA's operations and long-term sustainability.

Conclusion:

Through this comprehensive analysis, NVIDIA can formulate effective strategies to

leverage strengths, mitigate threats, capitalize on opportunities, and maintain its industry

leadership position.

The solution from these findings will be a well-rounded strategic plan that addresses NVIDIA's

internal capabilities, external environment, global reach, risk mitigation, and future growth

prospects. This plan will guide NVIDIA's decision-making and ensure its continued success in the

rapidly evolving technology landscape.

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Task Allocation

S. Task Assigned Dependencies Targeted Due

No. To Date

1 Introduction Utsavi 25/04/2024

2 Internal Analysis: Strengths And Utsavi 25/04/2024

weakness

3 External Analysis

 PESTEL Analysis Pranali 25/04/2024

 Industry Life Cycle Pranali 25/04/2024

 Porter’s Five Forces Pranubh 25/04/2024

 Supply chain Pranubh 25/04/2024

4 Threats And Opportunities Bunmi 25/04/2024

5 Global Strategy Bunmi 25/04/2024

6 Monitor Risk and Risk Responses Bek 25/04/2024

7 Conclusion Bek 25/04/2024

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Industry Life Cycle: Determining what stage the AI hardware industry has reached to
inform strategic planning. It facilitates the anticipation of future trends, informs strategic
decision-making, and assists in navigating forthcoming opportunities and challenges.
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Strategic Plan for Supply Chain: To meet the growing demand for GPUs, NVIDIA's
strategic plan must include a comprehensive supply chain analysis. This analysis should
identify potential bottlenecks, assess supplier capabilities, and develop contingency plans
to mitigate risks. A robust supply chain strategy will enable NVIDIA to efficiently scale
production, maintain a competitive advantage, and capitalize on emerging opportunities in
the rapidly evolving GPU market.
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Internal Tool: Value Chain Analysis- Nvidia can perform a value chain analysis to
evaluate its internal activities and identify areas for optimization. This analysis examines
primary activities like operations and service, as well as support activities like
procurement and technology development. By understanding the cost drivers and value-
adding processes within its value chain, Nvidia can enhance efficiency, reduce costs, and
strengthen its competitive position.