Rovio Entertainment: Strategic Management Case Study Analysis

This assignment analyzes the strategic management of Rovio Entertainment, focusing on the advantages and disadvantages of its business model. The analysis examines the company's partnerships, merchandising, and the impact of restructuring on its organizational culture, employee retention, and financial performance. The paper also explores the chairman's perspective on the company's current situation and future plans, including collaborations, licensing, and the release of new movies. The role of Chillingo in the company's success and the potential of its free-to-play games are also discussed. The document references several academic sources to support its claims, providing a comprehensive overview of Rovio Entertainment's strategic challenges and opportunities. The document is a case study analysis, providing a detailed overview of the content.

Running head: STRATEGIC MANAGEMENT
Strategic Management
Name of the student
Name of the University
Author note

1STRATEGIC MANAGEMENT
Answer 1)
There are various advantages along with the disadvantages in relation to the current
business model of Rovio. Rovio has transferred the powerful brand to that of the other
products. The company has partnered with that of American toy manufacturer called
Commonwealth Toy & Novelty that has helped the company in placing the Angry Birds soft
toys along with the T-shirts within the stores of US. According to the case study, “Rovio
Entertainment-going back to entrepreneurial roots”, the advantage of the partnership is that it
has helped the company in spreading its influence across the world. It has emerged to become
popular with the consumers with the help of the collaborations and the partnerships. The
company won various partners like Coca Cola, Intel along with the Kraft that helped the
company in creating a unique position among the consumers. There were various kinds of
Angry Birds products that included the board games, fridge magnets along with the key
chains. The advantage of this business model was that it helped the company in becoming
popular among the people. The merchandising business of Rovio can be said to be strongly
linked to that of the games (Ansoff et al. 2018). In the event of the games becoming less
popular it would also simultaneously affect the fate of the other products like the soft drinks,
note books along with the toys. The disadvantage of this kind of business model can be seen
in the fact that it would draw the attention of Rovio from its primary segments towards that of
the other segments that can cost the fortune that is being made by the company. It can cause
the company to suffer the losses that can have a bad effect on the reputation of the brand.
Based on the case study, it can be said that the growth of the company paved the path
for the establishment of the new kinds of the support functions. There were various new
departments that emerged like the personnel department along with the licensing department.
This made the company lose the flat hierarchy and that of the decision making model that
was fast. This paved the path for the vanishing of the original organizational culture. The

2STRATEGIC MANAGEMENT
advantage of this new business model was that it helped the company in carrying out the
various responsibilities in an effective manner. It helped in the division of the responsibilities
in the organization that can increase the efficiency of the various departments in the
organization. The disadvantage on the other hand was that it created the way for the losing of
the original culture and the employees of Rovio had to struggle so that they can cope with the
new kind of the organizational culture (Wheelen et al. 2017).
Rovio Entertainment Limited failed in retaining the employees as there were many
employees who moved out so that they could start their gaming companies. This had an effect
on the performance of the organization as there were many employees who wanted to go out
of the company. The new business model acted as disadvantage for the company as it led to
brain draining that stalled the progress of the company. There were many people who had
helped in the growth of the brand but they left owing to the innovative business model that
was disadvantage for the company. The company suffered from the effect of the layoffs and
the company became leaner as a result of it. The company lost the focus on account of the
restructuring as they tried to involve themselves in doing many things at that of the same
time. The restricting caused the company o lay emphasis on the section of games, media
along with consumer products. The restructuring cost made the company suffer from losses
that proved to be fatal for the company. The company had to incur new costs and this made
them suffer from the brunt of the loss in the business (Lasserre 2017). The employees of the
company could not accommodate themselves with the new business model that greatly
harmed the company. The employees of the company had to adjust themselves to the new
kind of the cultural milieu that damaged the reputation of the company. It acted like a
disadvantage on the part of the company. The business operations on the other hand became
more agile that was an advantage on the part of the company. The company went back to that
of the entrepreneurial roots as a result of the restructuring. The business restructuring of the

3STRATEGIC MANAGEMENT
company on the other hand helped in bringing about the preschool concept along with the
emergence of the digital learning tools.
Answer 2)
In my view, I agree with the opinion of the chairman of the company Kaj Hed that the
current situation of the company is admirable and can pave the path for a good future for the
company. According to case study, “Rovio Entertainment-going back to entrepreneurial
roots”, the new business model has helped the company in having the true vision that can
ensure the success of the company in the future. It has helped in readjusting the focus of the
company that can ensure a better future for the company. It can help them in becoming
leading entertainment company that can help in creating a unique position in the world. The
company Rovio Entertainment Limited has strategic plans for future that can help in growth
of company. The company has hired Sony Pictures Image works for the production of
animation. The kind of collaboration on the part of the company can help the company in
succeeding within the competitive environment. The company being associated with such a
prestigious brand can create a distinct impression on the mind of the people. The company
has been able to get Lego along with Spin Master as the partners that has helped in the
growth of the company (Meyer, Neck and Meeks 2017). The gaining of the toy partners can
help the company in creating a prominent position in the market. The restructuring has helped
in acquiring the new licensing partners that can help in the development of the company. It
can hence be said that the words of Hed is true when he asserted that the new vision of the
company is true. It can help the company in creating a dominance in that of the world. They
have also acquired the help of the technology companies that can help the organization in
making superior animation films that can cater to the tastes of the modern day consumer
(Morden 2016). The case study has brought out the essential fact that the restructuring would
be able to help the company in retaining the element of the creative control that can help in

4STRATEGIC MANAGEMENT
the marketing of the company. The company can utilise global marketing along with
distribution skills that can aid the company in the arena of spreading its influence within the
market. The new focus of the company are the games along with the media that is hugely
popular among the young people of the present age. The eye of the company in the area of
the acquisition can help the company in having a hold on the consumers.
The releasing of the new movie can help the company in achieving sales growth that
can help in the survival of the company. The public share offering of the company can help it
in creating a dominant position within the market (Bettis et al. 2016). Being capable of
delivering hit feature can help in ensuring the market success of Rovio Entertainment
Limited. The company made use of Chillingo that is a British games publisher that has helped
the company in negotiating the deals with the reputed brands like the Apple. It can play an
important role in pushing the movie “Angry Birds” into that of the world market which can
ensure the long term growth of the company. Chillingo was instrumental in persuading Apple
for featuring the Angry Birds that can help the company in getting the attention of people
from across the world. The utilisation of the company of the gaming industry can act as an
important step that can seal the success of the company and help it in getting ahead of the
competitors. The merchandising business of Rovio Entertainment Limited helped the
business in making the profits in the industry. The company followed the footsteps of Disney
that can help the company in making a great deal of the profits. The company sold the games
to that of the third parties that helped the company in sealing its position amongst the
competitors (Zhao et al. 2017). The characters in that of Angry Birds movie are popular like
the characters like the Mickey Mouse or the Donald Duck that can prove to be an important
cause for success of the company. The down load fees of the movie can help the company in
creating a unique position within the world. The free-to-the-play games can help the company
in creating its presence in the world.

5STRATEGIC MANAGEMENT
References
Ansoff, H.I., Kipley, D., Lewis, A.O., Helm-Stevens, R. and Ansoff, R., 2018. Implanting
strategic management. Springer.
Bettis, R.A., Ethiraj, S., Gambardella, A., Helfat, C. and Mitchell, W., 2016. Creating
repeatable cumulative knowledge in strategic management: A call for a broad and deep
conversation among authors, referees, and editors. Strategic Management Journal, 37(2),
pp.257-261.
Lasserre, P., 2017. Global strategic management. Macmillan International Higher Education.
Meyer, G.D., Neck, H.M. and Meeks, M.D., 2017. The entrepreneurship‐strategic
management interface. Strategic entrepreneurship: Creating a new mindset, pp.17-44.
Morden, T., 2016. Principles of strategic management. Routledge.
Wheelen, T.L., Hunger, J.D., Hoffman, A.N. and Bamford, C.E., 2017. Strategic
management and business policy (p. 55). Boston: pearson.
Zhao, E.Y., Fisher, G., Lounsbury, M. and Miller, D., 2017. Optimal distinctiveness:
Broadening the interface between institutional theory and strategic management. Strategic
Management Journal, 38(1), pp.93-113.
Reading Material
Case Example: Rovio Entertainment- going back to the entrepreneurial roots