Table of ContentExecutive Summary 3I) Introduction: 4II) External Analysis: (see exhibit 1) 4III) Internal Analysis: (see exhibit 2 and 3) 6IV) SWOT Analysis: (see exhibits 1, 2, and 4) 8V) Current Strategic Posture 9VI) Strategic Alternatives and Recommendation 10VII) Implementation: 11VIII) Conclusion 12References 13Exhibits 14Executive SummaryGAMETRONICS (here on called "GT") has currently heard rumors that Sony Corp. is planning to partake in a hostile takeover of GT. The major shareholder of GT, Martin Fueller, will not support this takeover, provided management of GT produces a long-term strategy for the company.GT has many problems within its organization and the external environm ...view middle of the document...
Martin Fueller, the Chairman of GT, has recently notified Mr. Katz that there are rumors within some major financial firms that Sony Corporation was planning a hostile takeover of GT in the near future. Fueller has told Katz that in order for him to remain committed to GT, Katz must come up with a plan for the future of GT. He has been given one week.A P.E.S.T. analysis will be used to analysis the general environment and Porter's 5 Forces will be used for the industry. A functional analysis will be used on the internal environment of GT along with an analysis of the culture, structure, and current strategies employed by GT. This will all be brought together into a S.W.O.T. analysis from which recommendations will come. The implementation of a chosen strategy will then be discussed.II) External Analysis: (see exhibit 1)A) General Environment AnalysisThe current political environment has no impact on the situation of GT. The economic environment, much the same as the political environment, is not currently a factor. The social environment is an opportunity as children are becoming increasingly reliant upon technology for educational and entertainment purposes. However, a movement was beginning to prevent children from playing games that involved graphic violence and other mature content that could possibly present a mild threat in the future. The technological environment presents a great opportunity for GT. Personal computers are becoming more and more common in households. Also, CD technology is becoming the standard for music and other multimedia mediums. The global environment presents a threat to GT as internationalization has lead to increased competition in all sectors of the economy. This internationalization could also present an opportunity for GT in that they will have easier access to foreign markets and producers.B) Task Environment AnalysisFor this analysis, I applied Porter's Five Forces assess competition within the video game design industry. The threat of new entrants is mild. A large capital investment is required for a new company to enter the industry, most of which would need to be applied to access the intellectual capital required to design a successful game. However, many larger technology companies are gaining an interest in the video game industry and are considering branching out into this industry (Sony is an example of this). Other software firms are unable to retaliate against newcomers, as it is the hardware manufacturers that are relied upon for all of the designer's revenues.The power of buyers is strong and therefore, a serious threat. Nintendo and Sega dominate the hardware market, and therefore, dominate the software designers. As the number of hardware manufacturers is increasing, as is the PC game market, these two manufacturers still dominate the market.The threat from substitutes is low and therefore, an opportunity. Children at this time are becoming increasingly reliant upon technological devices for b...
