Game Not Over, Not Yet Electronics Art’s (EA) competitive advantage from the perspective of the industrial organization view (I/O) is their choice of industry is very attractive. Todays world consist of many people who spend several hours playing video games. EA is from this aspect is stacking up ok against their competitors but they are also failing in their position. EA’s sales are down from previous years and they also missed the initial social gaming trend of which they are now trying hard to develop a digital platform for many of their popular games.
The next perspective is resource-based view (RBV). EA’s resource based view in the past was great until the digital gaming came on board. EA was used to the technology at that time when they were popular for their games such as Madden NFL and Battlefield. It seems they’ve lost their innovative “touch” now that most games are becoming digital and they were not in position to enter into that digital platform and social gaming. EA was known for their resources because they had the human, physical, intangible, structural/cultural, and financial assets to develop produce and deliver to their customers.
They seemed to have all the resources needed when they had their competitive advantage but Electronics Arts did not prepare themselves for the changes in the behavior of consumers and retailers or trends which is now causing them to loose their competitive advantage. What they were producing had value but was not rare enough and could be exploited by other companies who were willing to take them on. From the perspective of guerilla view EA’s competitive advantage was definitely temporary.
They lacked the ability to change and radically surprise competitors with strategic actions and as a company their focus of analysis both external and internal was failing. EA was not able to continue their before track record of disrupting current situations that would aide in helping them to maintain their competitive advantage. Yes, EA does exhibits the critical factors for the new business context. They now have a new CEO who is on board and is brining back the discipline needed in order to stay on top.
Their new CEO has found out what caused them to give up their “status” and is implementing it. They are starting back at square one of having designers identify the creative center of a game, understanding their customers by using small focus groups, and sharing best practices and technologies through their intranet library. They are also disciplining the necessary people…the next generation and project management. The resource EA appears to have are the human resources, intangible assets, structural/cultural assets, and finances.
I feel that the human resources is a unique thing to have because it is hard to acquire people who have the experience, characteristics, knowledge, judgment, wisdom, skills, abilities, and competencies needed to achieve the company goal. Also although their financial status is not what it used to be they still have enough money to invest and be innovative again. The only ethical and social responsibility issues I can see them dealing with possibly replicating another companies digital platform.
The only way to handle that is by coming up with their own and patenting it or even by just expanding their already owned brand names patents and databases. EA has to learn how to be creative again. The only stakeholders EA might have to be concerned with are the groups or individuals who can influence their company’s decisions, which at some point can possibly be their competitors which will directly affect them. References Coulter, M. (2013). Strategic management in action. (6th ed. ). Upper Saddle River, N. J. : Pearson Education, Inc.