Quaid-E-Azam University

BS Sociology - 1st Semester (Morning)

Principles Of Management
Assignment #2

Submitted To: Sir Syed Muhammad Abdulllah

Submitted By: Hibah
Reg No: 4322113042
Case Study - Questions & Answers:

Question #1:
How might a SWOT analysis have helped EA assess its slippage in the video
game market?

A SWOT analysis provides in depth knowledge about the strengths, weaknesses,

opportunities and threats that may affect the company. If EA had made one, then they
would have realised the broad opportunities the gaming industry had to offer, the threats
that Activision possessed and the weakness which could overcome EA’s strengths. A SWOT
analysis would have helped EA develop a more effective strategy to avoid the slippage and
strengthen their hold on the market.

Question #2:
How might Porter's generic strategies theory help to explain why EA lost its
leadership in the video game market to Activision?

Porter’s generic strategies consist of three theories:

1. Differentiation: To provide a unique service in an industry which is widely valued by
its customers.
2. Cost-leadership: To increase profits by reducing costs while charging average prices.
3. Focus: To carefully choose an arena to compete in and narrow the scope.

Now, the main reason for EA’s slippage was that it drained out all the potential and
sentiments from a game, leaving behind unhappy fans and an unsuccessful franchise. If EA
had adapted any one of Porter’s strategies, they would have been able to have a more
focused and organised growth strategy which would’ve been effective for a long period. But
EA overused the creativity of a single game until it was no longer relevant or wanted in the
market, which made it fail all three of Porter’s strategies.
On the other hand, Activision gave the game developers creative freedom, seed money and
independence, which allowed them to launch more trendy and successful games. They kept
their staff satisfied which led to a more efficient flow of creativity and that ultimately
allowed them to win the hearts of the gamers and surpas EA.
Questions #3:
Is the concept of Product life cycle relevant to the video game market? Why
or why not?

Yes, the concept of a Product Lifecycle is extremely relevant to the video game market as
the market is constantly being updated with new and innovative games. These days, it’s
becoming harder for developers to engage and interest gamers with creative ideas and
make them fall in love with the game since gamers are exposed to a wide variety of games
from across the world. Due to this, developers start to launch alpha and beta versions of
their game to analyse the market, make changes according to their audience’s demands and
perfect their game in order to have a successful and long product life cycle.