APPENDIX A
UNIVERSITI TUNKU ABDUL RAHMAN FACULTY OF ACCOUNTANCY AND MANAGEMENT MANAGEMENT ACADEMIC YEAR: 2014/2015 OCTOBER 2014 TRIMESTER UKMM1011 SUN ZI’S ART OF WAR & BUSINESS STRATEGIES
ASSIGNMENT COVER SHEET
Subject Code: UKMM1011 Subject Title : SUN ZI’S ZI’S ART OF WAR & BUSINESS STRATEGIES Lecture Group:
FIVE (5)
Assi Assi gnment gnment Detai Detai ls:
Company
:
SUPERCELL
Product
:
CLASH OF CLANS (MOBILE GAME)
Word Counts
:
(19 PAGES)
Due Date
:
WEEK 7, DURING LECTURE
Student’s Name
Student ID No.
Course
Year/Sem.
1. Chang Hui Yi
13UEB03218
AR
Y1/S2
2. Lee Wai Yoong
14UEB02342
AR
Y1/S2
3. Lim Chyi Bing
13UEB05627
AR
Y1/S2
4. Lim Jia Xuan
13UEB02765
AR
Y1/S2
5. Loh Shi Qian
13UEB03707
AR
Y1/S2
6. Steven Tham Qi Wei
13UEB03343
AR
Y1/S2
7. Tan Ying Kuan
13UEB04620
AR
Y1/S2
Assignment Overall Marks:
Marks
APPENDIX B UNIVERSITI TUNKU ABDUL RAHMAN FACULTY OF ACCOUNTANCY AND MANAGEMENT MANAGEMENT ACADEMIC YEAR: 2014/2015 OCTOBER 2014 TRIMESTER UKMM1011 SUN ZI’S ART OF WAR & BUSINESS STRATEGIES MARKING SCHEME FOR GROUP ASSIGNMENT Assignment Assessment Assessment
Note: Students must must only use information and facts from year 2008 onwards.
Marks Allocation
Marks Awarded
Section A: Introduction
Brief introduction of the company. Identify company’s industry, competitors and market segmentation.
10 marks
Section B: Applications Identify 4 Sun Zi’s philosophies which have been used by this
company and provide facts or evidences to support your findings. - You have to indicate specifically, which topic of Sun Zi’s philosophies and which verse verse in that particular topic you are referring to when you quote your evidences.
24 marks
Section C: SWOT Analysis
Identify and explain strengths, weaknesses, opportunities and threats of the company (4 elaborated points for each segment)
32 marks
Section D: Findings and recommendations
Based on the findings from the SWOT analysis recommend 3 strategies that the company company should adopt to improve its current current businesses - You are r equired equired to link the strategies with Sun Zi’s philosophies as well.
Section E. Conclusion
Summarize what you have learnt from this assignment.
Section F. Quality of the written assignment
Grammar, language, in-text citation and references.
TOTAL MARKS
21 marks
5 marks 8 marks 100 marks
( - ) Minus (Non-compliance to structure/formats/instructions structure/formats/instructions as stated in the unit plan)
NOTE: A total of 24 24 marks can be deducted from from this part. Marks should be deducted from the total marks of the assignment.
(24)
MARK AFTER DEDUCTION OF NON-COMPLIANCES
Comments: Name of marker: MS CHEAH LEE FONG
(Lecturer‟s name)
Signature of marker: ___________________________________ Date: _________________
ii
APPENDIX C
UKMM1011 Sun Zi’s Art of War and Business Strate gies (OCTOBER 2014)
DECLARATION
We hereby declare that: 1. We have read through, understand and comply with all the requirements as stated in the unit plan for October 2014 semester before we submit the assignment. 2. This assignment is the end result of our own work and that due acknowledgement has been given in the preferences to ALL sources of information be they printed, electronic, or personal. 3. Equal contribution has been made by each group member in completing the assignment.
Student’s Name
Student ID No.
1. Chang Hui Yi
13UEB03218
2. Lee Wai Yoong
14UEB02342
3. Lim Chyi Bing
13UEB05627
4. Lim Jia Xuan
13UEB02765
5. Loh Shi Qian
13UEB03707
6. Steven Tham Qi Wei
13UEB03343
7. Tan Ying Kuan
13UEB04620
Date: 27 November 2014
iii
Signature
TABLE OF CONTENTS Section A:
Introduction ........................................................................................................1
Brief Introduction ................................................................................................. 1 Competitors ..........................................................................................................2 Market Segmentation ............................................................................................ 3 Section B:
Applications .........................................................................................................4
“3 principles for Great General” – Strategic Attack (chapter 3) ..........................4 “Victories can be created” – Weaknesses and Strengths (chapter 6) ................... 5 “Trade off in Maneuvering” – Military Maneuvers (chapter 7) ........................... 6 “Momentum and timing” – Force (chapter 5) ...................................................... 7 Section C:
SWOT Analysis ................................................................................................... 9
Strength ................................................................................................................. 9 Weaknesses .........................................................................................................10 Opportunities ......................................................................................................11 Threats ................................................................................................................ 12 Section D:
Findings and Recommendations ..................................................................... 15
Creating wider platform ...................................................................................... 15 Involving in various industries ........................................................................... 16 New gaming system ............................................................................................ 17 Section E:
Conclusion .........................................................................................................19
References ...............................................................................................................................20 Appendices ..............................................................................................................................22
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SECTION A: INTRODUCTION
Fi gure 1 Company logo of Supercell
Brief Introduction
Supercell is a leading developer of free-2-play games for mobile and tablet devices, and is based in Helsinki during June 2010. The CEO of the company is Ilkka Paananen. Gunshine.net was the company’s debut game and then it was known as Zombie Online . In 2011, Supercell started to develop games for smartphone and it started by releasing three games which is Clash of Clans, Hay Day, and Boom Beach. It is one of the fastest growing games companies of all time. Clash of Clans and Hay Day are freemium games. They were created by teams of only half a dozen developers each. There is no inept hierarchy or bureaucracy in them, just extraordinary talented and great people with lots of freedom to go after their creative vision. The games have been very successful for Supercell. They averagely generate revenue of $2.4 million in a day on 2013. Battle Buddies was taken down from the market due to poor monetization, although it was getting positive reviews from critics. In 2011, Accel Partners had invested $12 million in Supercell. In October 2013, Supercell announced that the Japanese company, GungHo Online Entertainment and its parent, SoftBank had obtained 51% of the company for a reported $2.1 billion. In 2014, Supercell released a new game (Boom Beach) on iOS and Android. Boom Beach started to become popular due to wide-ranging of advertising. It has been incredibly successful not just in western markets, but also in Asia, where the market is much more mature and competitive.
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Competitors
Supercell as a gaming company, have to compete with a lot of top companies to maximize their market share. Seattle, Stockholm, Phoenix Age, EA Popcap, Imangi is some of the competitors for them. Di agram 1 above shows the market share of Supercell and its competitors in year
2013. Clash of Clans which is from Supercell is only one that keeps growing from the starting and did not drop or maintain. Increasing of the market share allows the company to achieve better scale in its operation and improve profitability.
Phoenix Age
Supercell
Seatle Based Indie Gaming
Stockholm Diagram 1
EA pop-game
Imangi Market Share of Supercell and its Competitors in Year 2013
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1% 17%
5% 10% 7% 1% 16%
43%
Diagr am 2
Female 51-65 Female 36-50 Female 21-35 Female 10-20 Male 51-65 Male 36-50 Male 21-35 Male 10-20
Users of Clash of Clans according Age and Gender
Market Segmentation Diagram 2 shows the percentage of Clash of Clans players in different age and
gender. Clash of Clans players are mostly male which up to 77%. More than half of the Clash of Clans players fall into the category of 21-35 ages with only 23% of players which over the age of 35. There are three types of gamer, core gamer, mid core gamer and casual. Core gamer which able to spend a lot money and time and between the age of 21-35 are the targeted market by Supercell. Players were given to play the games for free but can choose to pay for additional premium features which equate to in-game rewards.
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SECTION B: APPLICATIONS “3 principles for Great General” – Strategic Attack (chapter 3)
“Hence to fight and conquer in all your battles is not supreme excellence; supreme excellence consists in breaking the enemy's resistance without fighting.” (Giles, 500 B.C.E. /1910, line 3.02)
3 Principles for Great General by Sun Zi would be one of the strategy or philosophy that could be applying on the Supercell. The 3 principle for great general stated that “conquer the enemy without having to fight through the skilful strategizing”. This strategy could be applying in the Supercell. For example, Supercell’s games only
serve for smartphones and tablets which they focus on small devices. Their game does not serve on mature device, such as computer. This may help to protect the game’s value. Besides, the “freemium” game distribution strategy had been strongly applied on the games
of Supercell. Supercell provides a free download service in their games in order to attract more players. Then, it only required the user or player to pay for extra feature service. This strategy had leaded the games of Supercell to become much more popular and rank at the top 10 most grossing games on iOS. In contrast, Rovio had sold Angry Bird games for a couple of bucks for each download. Due to the reason of this, Angry Bird games couldn’t be squeeze into the top 50 of most grossing games in iOS server (Heiskanen & Viita, 2013). Besides, it may also cause the less popularity of the games toward to the market or society. Rovio would be mainly focusing on the revenue rather than its popularity. There is different for the Supercell, the “freemium” game distribution strategy had lead their games popular to the market and make more profit and revenue than the rest of mobile gaming companies. Therefore, this strategy used by Supercell would be a very good example on representing the Sun Zi’s philosophy.
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“Victories can be created” – Weaknesses and Strengths (chapter 6)
“Although the enemy may have much larger and stronger force, he can be prevented from engaging me.” (Giles, 500 B.C.E. /1910, line 6.45)
Scale and volume couldn’t be a judgment of victories, the good planning and
strategies would be the major impact of winner. Supercell would be a very good exam ple on reflecting and representing this Sun Zi’s Philosophy in the actual experiences. Supercell was trying to limit the expanding rate of its company to maintain on the low or small group of work of people. Instead of using lot more of people of a number of team in a same job, the company hire those who are really talented developer and provide them with the totally freedom to do the extra things as they want. By the way, there will be more benefits in manage for a small group of people. For example, the mobile games of Clash of Clans had made millions of dollar and achieves with the top grossing games on the iOS server. This popular and amazing game was been done by a group of 5 people in six months’ time (Mykkänen, 2014). This shows how the super team was
actually work and done. In fact, the major factor need to be concern on achieving success would be the planning and the strategy. The total number of the headcount of Supercell was only around 100 people until today, even though the 2013 run rate for the revenue of this company is about 800 million dollar. Supercell does not want the company to be expanded. The only things they want are the good quality of team and people. “It doesn‟t make any sense to me that some companies are bragging about how big they are in terms of employee count. Our strategy is completely the opposite. We actually want to stay as small as we can.” said by
Paananen (Mckenzie, 2013). This had shown how actually the philosophy or the theory of Sun Zi been work on the world today.
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“Trade off in Maneuvering” – Military Maneuvers (chapter 7)
“Thus, if you order your men to roll up their buff -coats, and make forced marches without halting day or night, covering double the usual distance at a stretch, doing a hundred LI in order to wrest an advantage, the leaders of all your three divisions will fall into the hands of the enemy.” (Giles, 500 B.C.E. /1910, line 7.07)
Well preparation and analysis may improve the chance of winning and victory in the war or a competition. This philosophy describes the strategy of preparing and collecting the information before enters to the war. A good preparation and the opportunity on study the competitor may help to shorten the period of war or the period of competition. The first game of the Supercell was “Gunshine”, a game that design ed for playing on Facebook. However, the gaming market was dominant by Zynga during that time. Supercell decided to shut down the game of “Gunshine” after they fail to achieve with the number of users in this particular game. Then, they decided to develop this game on the tablet as well as other mobile devices. “We decided to focus solely on tablet and mobile, and that‟s probably the best decision we‟ve ever made.” said by Paananen (Chapple, 2013). This decision had
brought Supercell into the peak since it was founded. By the way, there will still be having some challenge for this fresh and new company for entering to the new market. After doing the analysis on the existing mobile games, Supercell decided to serve their game with a freeto-play concept which is different with other top grossing mobile game. This had created attractiveness for user to download and trying to play with the new game. Revenue will be gain from users when they purchase extra features on the game. This psychological strategy had successfully worked and creates a good result for the Supercell. Besides, Supercell does to discover with the social strategy of others gaming company. For instance, Zynga was relying on the variety of social sharing to helps on distribute and promoting it games to the social. Whereas, Supercell had took the different approach to the social. They had chosen to use the strategy of “Join to challenge” to attract people join the game (Mckenzie, 2013). This helps to improve the interaction with other players and do improve with the playing experiences. The analysis by Supercell had led it
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successfully penetrate into the mobile gaming market with an excellent result. Preparation and analysis may help to shorten the journey; by the way it might provide a path way to success.
“Momentum and timing” – Force (chapter 5)
“The onset of troops is like the rush of a torrent which will even roll stones along in its course. The quality of decision is like the well-timed swoop of a falcon which enables it to strike and destroy its victim.” (Giles, 500 B.C.E. /1910, line 5.12, 5.13)
Sun Zi stressed on both timing and momentum of decision in a battle. According to him, a good decision is characterized as a powerful and well-timed judgment, to make a good decision, it is crucial to have ability of manipulated space and time for the accurate moment to attack to exact greatest damage. This philosophy is tantamount with the decision making style of Supercell. One of the secrets of achievement for them is the foresight on future of tablet gaming and their strong determination on implementing “Tablet first” strategy. After the failure of their first product, “Gunshine”, Supercell figured out the factors of
failure and how could they overcome it. Supercell grasped the opportunity brought by the launch of iPad and the gaming market effect brought by the achievement of Rovio’s “Angry Bird”, and decided to reposition their company’s direction to the new developed gaming
platform – tablet. In fact, Supercell was fortunate that it was just getting started when the iPad was introduced to the world (Mckenzie, 2013), however, their achievement will never come true without the ability of predicting the future. Supercell believes that mobile gaming will replace traditional platform such as Facebook. Thus, they chose to transform and this risk taking changing action makes them fruitfully celebrate huge profits generated with only two games.
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Supercell just launched five games since it is founded in 2010. Unlike other company, Supercell chooses to use focusing strategy in their business instead of infinitely creating new products. Concentration strategy is even implemented in their “battle ground” – Supercell primarily concerns on iOS devices as their gaming platform over Android and Windows. “We are keeping a close eye on all relevant platforms,” says Paananen (Rose, n.d.). Their
concentration strategy was continuing until they invade Android market in 2014. This strategy is in line with Sun Zi’s idea of momentum in decision making. Supercell put all the resources on single “battle ground”, as per their “Tablet first” strategy (“About Supercell,”
n.d.), provides strong momentum for them towards accomplishment of creating new empire of mobile gaming.
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SECTION C: SWOT ANALYSIS
Strategic management is the key process in every organization’s efforts to gain and
sustain a competitive advantage. Strategic management can be defined as the art and science of formulating, implementing and evaluating cross-functional decisions that enable an organization to achieve its objectives. It is essential for both small companies and large organizations.
Strength
Strength is the skills and capabilities that gave the organization special competencies and competitive advantages in executing strategies in pursuing of its mission. Strengths can be found internally in a company and can be used to the company’s advantage.
(S1) M onetary assistance is provided : Accel Partners invested $12 million to
Supercell in the year of 2011. In October 2013, it was announced that Japanese company GungHo Online Entertainment and its parent, SoftBank had acquired 51% of the company for a reported $2.1 billion. Thus, it can be seen that Supercell has wealth of financial aids by its partnerships in the business career. (S2) Supercell’s games are free of charge: There are 3 games developed by
Supercell which are Hay Day, Clash of Clans and Boom Beach. All the games are free-to play games, which mean there will be nothing to lose when they download the game either from Android or Appstore. This able to expand the reach of their games and gets their games into hands of more people. For instance, Clash of Clans has reached at the 1st ranking in iOS and Android Top Grossing Games 2014 (refer to F igure 2 and F igure 3 in appendices). While playing the games, players can use real money to purchase in games power-ups or extra items to increase their level in the games. (S3) Culture in Supercell provides a positive working environment for the employees: Supercell does not support dedicating individual game designers in developing
specific parts of the game. The company employs a scattering of teams which consists of 4 to 6 person a group (StereotypicalBlonde, 2014). The developers work as a team and everybody 9
in the team is responsible for the end-user experience. Within this structure, an employee can voice his or her opinion in any part of the developing process regardless of their position in the company. Supercell is an extremely flat organization and has minimum amount of bureaucracy and processes. Working spaces are opened as no one has dedicated office space, and teams are given free hands to operate independently. (S4) Vast experience of the management and developers in the organization:
Paananen believes that the most important aspect which must take into consideration in building a next generation game developing company is finding the right people for the job (LeGrand, 2013, p. 38). Thus, most of the Supercell’s employees have over 10 years of experience when it comes to creating and selling commercial games. There will be somehow facing difficulties when looking for the right and suitable person for specific project. However, Supercell is willing to suffer when waiting for quality personnel to emerge.
Weaknesses
Weakness is the internal factors that will directly influence the operations of a company and keep it from achieving its objective. After doing the analysis, we found that there are some weaknesses in Supercell.
(W1) Small mar ket size: Supercell had launched three major online games which are
Clash of Clans, Hay Day and Boom Beach. At first, the game only available for Apple’s
Apps likes iPhone and iPad (Edge, 2013). This will reduce the game players especially for those with Android and minimize the market size. Supercell also just soft launched their games in Canada to test and refine them before launching globally. Moreover, Supercell just begins to wide release their three major games on Google Play internationally in 2014. This strategy will give disadvantage for them to compete with other competitors that present in the market such as Angry Bird, Candy Crush and Farm Ville. (W2) I neff ective M anagement of H uman Resour ces: In Supercell’s structure, the
employees can pick what game they would like to work on. But, this autonomous cell environment for creating games will waste the human resources on projects that will never succeed. In the year when Clash of Clans was launched, Supercell has competed 4 games. 10
The employees work in five or more persons in one team, working from day until night to create a new game. The cell format for the team works will allow a small group of employees to have direct creative control and can produce impressive successes like Clash of Clans, this company structure will reduce working efficiency because the employees will focus whole day in the same project and also has team works round the clock on projects that will lead to failure. (W3) Poor M onetization: One of Supercell’s game, named Battle Buddies which is
launched in 2013 also is pulled out from the market due to their poor monetization (Edge, 2013). Monetization means convert an asset or establish something as money or legal tender such as to get revenue from the sales of virtual items for players to advance the game. (W4) Not fl exi ble in managing products: Supercell has limited range of products and
weak advertisement of their games. We seldom see advertisement of Supercell games. Supercell does not have many ways of making money or publicizing their games unlike Rovio Company, they had built Angry Bird into entertainment brand, movie and theme park (Mckenzie, 2013).
Opportunities
Opportunities are external factors that the project could exploit to its advantages and bring positive impact to the company. In Supercell, we had identified several interesting opportunities including Asian market, mobile era, partnership with Japan's Softbank Corp and GungHo Entertainment even also talent workers.
(O1) Ex pansion of busin ess to Asian mar ket: According to Paananen (2013), one of
the aspirations of Supercell is to become the first truly global games company, which is not only strong in Europe and North America, but also can be focusing in Asian market including Japan, South Korea and China. If Supercell able to invade into Asian market, it is possible that Supercell becomes a game's company that people from all over the world will look back in 30 years and talk about all the great games that they developed as well as the impact Supercell had on people live.
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(O2) New techn ologi es: Nowadays, mobile era of the Internet is different with the
first era of the Internet, which ended at the same time as the death of Web 2.0 (Mckenzie, 2013). Mobile era forms and creates a new world order in gaming. New market in gaming will be easily accessible to billions of consumers more people than ever before in the history of games due to the great combination of electrical devices, such as, tablets, mobile and it is all in the free-to-play business model (Paananen, 2013). Thus, mobile era truly create a new era of gaming which had opened up exciting opportunities for new kinds of company as well as Supercell. (O3) Great business partners: Supercell has a great partnership with Japan's
SoftBank Corp and GungHo Entertainment. Both of them gave an extreme big endorsement for the future of mobile game industry with their 51% purchase of Supercell share for $1.5 billion (Sarle, 2013). This partnership has dominated the top grossing ranks for up to one year at $3 billion. Such deal brings great opportunity that free-to-play mobile gaming company values are getting raising rapidly. Hence, the partnership between SoftBank and Supercell is an ideal fit bringing two companies together with grand visions in future. (O4) Possi bil it y of mobil e adver ti sin g networ k: Previously Supercell had organized a
campaign to increase their app downloads in Greece using top-tier publishers' platforms, all parts of premium mobile advertising network. In order to deliver a clear message to all campaign viewers, Supercell used different visuals that exhibited the app experience, look and feel. The objective of app download is delivery of an interactive and one-click action campaign leading users to iTunes. The campaign was targeted to iOS users, and was based on Warply's platform data and innovative features (“Case Study: Supercell Games Increases "clash Of Clans" App Downloads,” n.d.).
Threats
Threats include any unfavourable situation, trend or impending change in an organizations environment that is currently or potentially damaging or threatening to its ability to compete. (T1) I ncr ease of hi gh l evel of global competi tion : On social gaming platform, Rovio
that launches the successful Angry Bird and Zynga that received high attention of their
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“FarmVille” had poses the greatest competitive threat to Supercell. They are coming up and
they are likely to gain more widespread consumer acceptance because their game are went public on Facebook. Most of the teenagers have their Facebook accounts and active on it. However, Supercell’s games are only can be download and play on Android and IOS
operating system. With the strength of Facebook, people are willing to play game on big screen instead of smartphone or tablet. So it will be a negative impact for Supercell that has high dependence on iOS and Android. (T2) H i gh degree of r evenu e concentr ation among top games: A number of players
on Supercell’s platform are largely casual players. They are not often play on a regular basis.
For example, Hay Day that published by Supercell on 2012 is a farming game that need player to take care of the farm with earning coins and experience points. Player might become bored because it is going to take a long time to achieve all the levels (shellmac47 , 2013). They might stop interested of it and seek a new game experience. A sudden drop of the popularity of the game could affect Supercell’s share drastically. With these threats, Supercell might be replaced by other competitors. (T3) Copyri ght in fr in gement: Copyright infringement is the unauthorized copying of
other party’s product protected by a copyright registration. The growth of the Internet
Technology has created not only new opportunities for Supercell, but also poses new threat for them to seek the protection of their intellectual property rights. There are many unauthorized replication of Supercell’s merchandise competes for profits. These dealers are
making profits that have low-cost and direct access to consumers such as online shopping or store. Unauthorized dealers blatantly copy images of Supercell’s products. This seems to be exactly what the “parody” t -shirt makers are doing (Andreea, n.d.). “Hay Day” or “Clash of Clans” versions of toys and t -shirts are already being sold in stores across the world. They would trade off Supercell’s hard earned reputation for quality and population with selling
poor quality of t-shirt, accessories or toy. (T4) Real M oney Gamin g (RM G) i s ver y competi tive: The real money gaming
platform is a very competitive market and faces a lot of regulatory scrutiny on a regular basis as well. Users usually make an in-app purchase in order to access special content or features in an app such as power-ups, virtual money, restricted levels or special characters. Although Supercell’s Clash of Clans is 100% free to download, player has an option to purchase “Gems” with different prices for different levels (“Gems,” n.d.). However, some of the
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leading companies have large and established audiences in their respective platforms. For example, Rovio’s Angry Bird user can purchase the Mighty Eagle one -time that gives
unlimited use. Users are willing to make an in-app purchase one time rather than pay for every level. It will affect the sustainability of Supercell which user may switch to another game.
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SECTION D: FINDINGS AND RECOMMENDATIONS 1.
Creating wider platform
(W1) Small market size (T1)
Increase of high level of global competition
(S2)
Supercell‟s games are free of charge
(O3)
Great business partners
Recommendation: Increase the structure of the company by creating wider platform
on targeting with different market. According to the strategy of Sun Zi’s Art of War chapter 3, he said “He who knows
others side (the enemy) and knows himself will not be defeated in a hundred battles. ”
As been mentioning that, Supercell is concentrating on mobile gaming and iOS will be the first platform they targeted. However, the conservative strategy by Supercell had led to limit the growth of the Company. Besides, it might be easily beating down by other gaming company with this weakness. Although, Supercell do to invented and introduce their game to Google play store (Android Operating System) on the end of 2013. But, the late introduction to the Android platform might cause the low counting of downloading facing by Supercell. According to the Sun Zi’s strategy, Supercell can remains on using the free-download strategy on any platform in order to attract more users. Besides, the existing mobile gaming company would be a threat for them. Thus, Supercell has to take the advantages of it partnership with the Japanese company SoftBank on increasing introduce their games into different country or different platform to squeezing into different market. The strong partners may provide a good opportunity for Supercell to growth and increase their company size. In addition, Supercell can be using the name of their partnership company on creating some event for increase the reputation of their company. As the saying goes, “old is g old”. The use of this strong background banking company may improve the efficiency on increasing the reputation to bring them more popular to society. This action or strategy may help the Supercell on maintain their position on mobile gaming and avoid being attacked by other gaming company.
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2.
Involving in various industries
(W4) Not flexible in managing products (T2) High degree of revenue concentration among top games (S3) Culture in Supercell provides a positive working environment for the employees (O2) New technologies Recommendation: Stabilize the company‟s position by involving itself in multi-
sectors of business.
Sun Zi said, “In battle, there are only two methods of attack – direct and indirect, yet these combinations give rise to an endless series of maneuvers.” In chapter five of The Art of
War, Sun Zi stressed on the importance of flexibility and creativity in making decision. With different combinations of strategy, it will become a brand new possibility. One of the weaknesses of Supercell is they are not being flexible in managing their products even though they have ability to produce outstanding and high quality games. Due to their concentration strategy, since it was founded, Supercell is using most of the resources to defend their leading position in mobile gaming market. Currently they are not planning to enter other business sectors. However, there is a threat of high degree of revenue concentration facing by Supercell, means that there is risk of main users will suddenly go away due to loss of interest or presence of new games. It might be causing heavy losses to Supercell if this backfire is not well-handled. In order to overcome this potential challenge, Supercell is recommended to transform itself to a more flexible company involved in diverse areas of business. This direction of adapting new sectors is highly promising to Supercell as their organizational structure is corresponding to the requirement of flexibility – they are running in “cell” organization that built up by small teams instead of rigid bureaucratic organization. This advantage maximizes their possibility to develop new business sector, as Rovio entering entertainment sector. Moreover, the trend of new developed technology is an opportunity for Supercell to create more distinctive products which go beyond gaming industry. New electronic device such as smart TV provides a good chance for Supercell to expand their empire to new category of industry. 16
3.
New gaming system
(W3) Poor Monetization (T4) Competitive of Real Money Gaming (RMG) (S1) Monetary assistance is provided (O1) Expansion of business to Asia market Recommendation: Create a new gaming system for increasing the company revenue.
According to the strategy of Sun Zi’s Art of War chapter 6, Sun Zi stated that, “Those who arrive first at the battleground will have sufficient time to rest and prepare against the enemy.”
Supercell is one of top leading mobile gaming companies in the market. The mobile games they had introduced and invented are popular in society and attracting lots of users to play them. Their revenue gained from market is the most convincing evidence of their power and influence. However, this top leading mobile gaming company might also face some problems and issues through their gaming system. As been mentioned on the weaknesses part, “Battle Buddies” by Supercell had been launched in 2013, but it had been pulled out due
to the reason of poor monetization. Supercell might be also facing with the monetize issues with their confidence gaming system. Besides, the treat of competitive Real Money Gaming market might be another issue towards their business market and it might affect their revenue. In line with Art of War, Supercell had the so-called “Early Bird” advantages than those who are late invade to this mobile gaming market. Moreover, with the strong reputation and popularity of the game of Supercell, the attractiveness of their gaming can be still remaining with a minor changing on their game. In order to protect and maintain their revenue, a new gaming system is needed to be inventing and creating. As mentioned on threats in SWOT analysis, some of the mobile games provide an unlimited use features with one-time purchase. This different feature can be taken as reference to transform their purchasing system. Besides, Supercell can also provide some offer for privilege players on the particular game. Since they have advantages on early enters to the battleground. Thus, this minor changing or updating might not affect its popularity. By the way, it might increase the patient and create the attractiveness for user and player. With the partnership with the 17
Japanese company SoftBank, Supercell got the advantage on expanding their business market into Asia Market. This will be a good opportunity for Supercell to create and updating the new gaming system into those existing games. Besides, the strong backup of the SoftBank might be a huge insurance for Supercell. With the support provided by SoftBank, Supercell will be having enough funds to updating their system and software in a short term period. This “win-win strat egy” might increase their revenue through the invention of the new system, at the same time, that was an opportunity for them to defeat their rivals.
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SECTION E: CONCLUSION
As conclusion, Sun Zi’s strategies are good for applying in business marketing. It
improves the system of management and also provides strategies for those newly form company to invade into the market. As the new company like Supercell, strategy of penetrating or invading is important for them to invade into that particular market. By a pplying the Sun Zi’s strategy, Supercell might be able to reduce the rate of challenge and provide a new pathway for them to penetrate into the market. As been mentioned above, Sun Zi’s stated that, “The best offence is a strong defense” . Supercell have to keep maintaining
their own managing strategy on controlling the system and also the operation of the game in order to protect or against with competitors. Supercell is a good example on strategy managing and with a good vision on timing. The introduction of a new system gaming into the mobile gaming platform with a good timing had led to the success of Supercell. The timing and the targeted market had bring a dramatically effect on the result of the gaming. The strategy of maintaining or protecting will be the big consideration for this company at this moment. In addition, Sun Zi’s strategy will be a good reference for other companies or
even other fields of market to take it as a reference and applying in different situations. As the saying goes, “no pain no g ain”. Things might be change if you do to spending some time to learn. After doing this assignment, we had learnt on how to apply Sun Zi’s strategies in different conditions in real life. These strategies are useful for us in various situations that we might be encountered in future especially in business market. A good strategy is important for organization on managing or improving the system of their company. By the way, it can be also known as the “k ey” of success to them. Sun Zi’s strategies are useful for our future
and it is a good weapon for us to fight and overcome challenges.
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REFERENCES
About Supercell. (n.d.). Retrieved from Supercell Official Website:
http://www.supercell.net/about Case Study: Supercell Games Increases "clash Of Clans" App Downloads. (n.d.). Retrieved
from Warply: http://www.warp.ly/case-studies/supercell-games-increases-clash-clansapp-downloads Chapple, C. (12 December, 2013). Supercell: The billion dollar start-up. Retrieved from Develop Online: http://www.develop-online.net/studio-profile/supercell-the-billiondollar-start-up/0187207 Cookson, R., & Thompson, J. (2013 October, 2013). Supercell finds success but questions remain over sustainability. Retrieved from The Financial Times:
http://www.ft.com/intl/cms/s/0/e1ce4066-3606-11e3-b539-00144feab7de.html#slide0 Edge. (17 March, 2013). Studio Profile: Supercell. Retrieved from Edge Online: http://www.edge-online.com/features/studio-profile-supercell/ Giles, L. (1910). The Art of War (Sun Zi, Trans.). Retrieved from Marxist: https://www.marxists.org/reference/archive/sun-tzu/works/art-of-war/index.htm Heiskanen, V., & Viita, K. (17 October, 2013). Supercell Beats „Angry Birds‟ From Obscurity to $3 Billion Value. Retrieved from Bloomberg:
http://www.bloomberg.com/news/2013-10-16/supercell-beats-angry-birds-fromobscurity-to-3-billion-value.html LeGrand, N. (31 May, 2013). The Success Factor of the Finnish Mobile Game Industry: A Strategic Overview. Retrieved from Theseus:
https://publications.theseus.fi/bitstream/handle/10024/62924/Harma_Aleksanteri.pdf? sequence=1 Mckenzie, H. (5 June, 2013). Five key differences between Zynga and Supercell. Retrieved from Pando Daily: http://pando.com/2013/06/05/five-key-differences-between-zyngaand-supercell/
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Mckenzie, H. (15 October, 2013). What Supercell‟s $1.5B deal means for mobile, global gaming, and Finland. Retrieved from Pando Daily.
Mykkänen, J. (2 July, 2014). That's super! Best practice: What can we learn from Supercell‟s success? Retrieved from Aalto University Executive Education:
http://www.aaltoee.com/blog/thats-super-best-practice-what-can-we-learn-supercellssuccess Paananen, l. (15 October, 2013). One Step Closer. Retrieved from Supercell Offical Website: http://www.supercell.net/blog/view/one-step-closer Rose, M. (n.d.). Supercell's Secret Sauce. Retrieved from Gamasutra: http://www.gamasutra.com/view/feature/183064/supercells_secret_sauce.php?print=1 Rossi, J., Grundberg, S., & Stoll, J. D. (16 October, 2013). Supercell: Zero to $3 Billion in 3 Years. Retrieved from The Wall Street Journal:
http://online.wsj.com/articles/SB10001424052702303376904579136873973130670 Sarle, D. (15 October, 2013). Supercell to Sell 51% of Shares to GungHo And Softbank for $1.5 Billion. Retrieved from Arctic Startup:
http://www.arcticstartup.com/2013/10/15/supercell-to-sell-51-of-shares-to-gunghoand-softbank-for-1-5b Scott, M. (15 October, 2013). SoftBank Buys 51% of Finnish Mobile Game Maker for $1.5 Billion. Retrieved from Deal Book:
http://dealbook.nytimes.com/2013/10/15/softbank-buys-51-of-finnish-gaming-firmfor-1-5-billion/?_r=1 shellmac47 . (30 January, 2013). Hay Day getting boring [Forum Post]. Retrieved from Supercell Forum: http://forum.supercell.net/showthread.php/14728-Hay-Day-getting boring StereotypicalBlonde. (August, 2014). Supercell: Dominating the Mobile App Market [Forum Post]. Retrieved from Reddit:
http://www.reddit.com/r/StonerParadise/comments/2df12i/shays_marketing_paper_ab out_supercell_clash_of/
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APPENDICES
Fi gure 2 Clash of Clans is the Top Grossing Android Apps in Google Play. Retrieve from Google Play:
https://play.google.com/store/apps/collection/topgrossing?hl=en
Fi gure 3 Clash of Clans is the Top Grossing iOS Apps. Retrieve from Think Gaming: http://thinkgaming.com/app-sales-
data/
22
UNIVERSITI TUNU ABDUL RAHMAN
UKMM1011 SUN ZI’S ART OF WAR & BUSINESS STRATEGIES
Lecture Group Company Product
: : :
Student’s Name
FIVE (5) SUPERCELL CLASH OF CLANS (MOBILE GAME) Student ID No.
Course
Year/Sem.
1. Chang Hui Yi
13UEB03218
AR
Y1/S2
2. Lee Wai Yoong
14UEB02342
AR
Y1/S2
3. Lim Chyi Bing
13UEB05627
AR
Y1/S2
4. Lim Jia Xuan
13UEB02765
AR
Y1/S2
5. Loh Shi Qian
13UEB03707
AR
Y1/S2
6. Steven Tham Qi Wei
13UEB03343
AR
Y1/S2
7. Tan Ying Kuan
13UEB04620
AR
Y1/S2
UNIVERSITI TUNKU ABDUL RAHMAN UKMM1011 SUN ZI’S ART OF WAR & BUSINESS STRATEGIES
Lecture Group Company Product Members
FIVE (5) SUPERCELL CLASH OF CLANS (MOBILE GAME) Student’s Name
Chan Hui Yi Lee Wai Yoon Lim Ch i Bin Lim Jia Xuan Loh Shi Qian Steven Tham Qi Wei
Tan Yin Kuan
Student ID 13UEB03218 14UEB02342 13UEB05627 13UEB02765 13UEB03707 13UEB03343 13UEB04620
Course AR AR AR AR AR AR AR
Y/S Y1/S2 Y1/S2 Y1/S2 Y1/S2 Y1/S2 Y1 S2 Y1 S2
ASSIGNMENT REPORT SOFT COPY 1
