BUSS6000 - Strategic Performance Review: Nova Games Case Analysis

This report provides a strategic performance review of Nova Games, a company producing computer games, focusing on its challenges in gaining market share in the US, Canada, and Mexico. It analyzes the company's initial mistakes in the US market, its expansion strategies in Canada and Mexico, ...Read More

Running head: SUCCEED IN BUSINESS 1
Succeeding in Business
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Succeeding in Business
Introduction
The company in focus is Nova Games which produces high quality computer games. The
company has one of the best R&D teams which give the company a competitive advantage in
terms of innovation from other competing companies in the market. The company has been
struggling to gain market share in the US, Mexico and Canada and for this reason it has
changed its product type to ‘Sports’. However, as a strategy to increase its market share the
company has targeted customers who were not sensitive to price as well as differentiating its
products (Novak, 2017)..
The company commenced its operations in the US and being a new entrant it did a series of
mistakes such as overestimating the demand. Nova Games only produced 20,000 units for
the first month and missed the its sales by more than 50,000 units. After analyzing PESTEL,
the company’s management decided to expand in Canada and Mexico in the second and
third month respectively with an aim of making increasing profits. There was a lot of
potential in the Canadian market and the market is not price sensitive unlike the Mexican
market. Secondly, there were no regulatory issues in Canada from the political aspect of
PESTEL and also customers in this market favoured high quality products. However, the size
of Canada was the smallest among the three countries and the brand investment of Nova
Games was not high.
The main undoing of the company in Mexico was overpricing in a market where the
customers were price sensitive. Despite having produced a good quality product , the
company experienced low profitability and decline in market share. There were several
factors according porters five forces that contributed to the low profitability and decline in
market share such as there was product differentiation next to zero among the competitors .

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The five companies in the market invested in the product and were offering basically the
same product (Nesse, et al,2017). There was no switching cost making threat of substitutes
to be high. Threats of new entrants was low and the internal rivalry was high, bargaining
power of suppliers was high making profitability to be low.
Transformative leadership boosted morale among the team . By adopting an autocratic style
of leadership, I persuaded the company to enter the Mexico market and changing the product
line from simulation to sports. The team developed understanding and trustworthiness
among each other which enabled team members to contribute in the meetings. However,
there were times that we made poor decisions due to good friendship or respect therefore
having consensus and implementing it without critical evaluation. This resulted in the team
suffering from such decisions (Macey, 2014).. For example, there was a time when we
concentrated so much on R&D and forgot to invest in branding and marketing and for
continuously four rounds of simulation without considering the consequences.
References
Novak, L. (2017). Succeeding in Business. Network Journal, 24(1), 55.

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Nesse, P. J., Hallingby, H. K., Akselsen, S., Munch-Ellingsen, A., Kähler, J., & Evensen, E.
G. (2017). Succeeding with contactless service innovations-strategic recommendations based
on a comparative analysis of mobile business ecosystems in Norway. International Journal of
Entrepreneurial Venturing, 9(1), 60-80.
Macey, J. R. (2014). Crony capitalism: Right here, Right now. Harv. JL & Pub. Pol'y, 37, 5.