A) The analytical framework I have chosen to use is PEST. Pest stands for Political, Economic, Social and Technological and are all factors of a PEST analysis. These are intellectual tools which are created in order to help a researcher to collect, sort, prioritise and interpret a variety of existing data and information about the subject or context that has to be analysed. When changes happen within a business or organisation the company will use a PEST analysis to view each factor in the changing process, in this case we will be looking at the changes of Alphabet Games.
Political forces include regulatory requirements, legal concerns, and any impact from the current political climate of the country or region where the business operates. The changes in the political factor could effect Alphabet Games considerably as they would have to sell games or consoles at a higher cost if the taxations in the gaming industry increased in order for the company to earn a stable profit.
Economic Factors –
Any change in the economy that impacts the supply or demand for a company’s products and services fits into this category. Sometimes they have a positive impact, like when a country’s gross domestic product (GDP) increases more than expected. Other times economic forces can hurt a business, like when consumer confidence drops and potential customers spend less and save more.Alphabet Games may need to pay more or less for the resources they need depending on where they purchase these from. As more companies are forming within the industry and all purchasing from the same supplier then the costs may decrease as they will be taking in more money, and this could decrease the price of games and consoles.
Social Factors –
Social factors are those that reflect the preferences, fads, and trends in society. Media companies are very sensitive to social trends as their business model is to produce content that reflects society’s interests. A social factor which relates to the case study is the force of change within Alphabet Games. Alphabet Games will have to constantly keep up to date with with upcoming and new trends so that they can work towards these. By checking quantifiable statistics Alphabet Games will be able to see if the community offers a population with the demographic traits necessary to support the business.
Technological Factors –
Advancement in technology has had a dramatic impact on the business world over the last two centuries, and especially over the last 30 years. Anticipating changes in technology and capitalizing on those changes can become a competitive advantage and so Alphabet Games could be affected by this. Alphabet games will have to be able to change their patterns by creating new games, software and consoles in order to increase sales and marketing.
Close working relationships that exist between the partners
Multi-million pound business at the cutting edge of the games development market
Custom built facility that houses research, development and production Wide range of corporate and individual customers
World known reputation for excellence, quality and innovation
They offer software solutions as well as games
Passion for software within the company is still as strong as when it established
Competition between the small businesses and larger companies
Recent growth in demand for flash games
Some of their recent clients include NHS, Pepsi, Virgin Media and other small businesses
The software can draw potential customers to companies websites providing a competitive marketplace
Due to their experience they are a lot faster than most rivalry’s at developing new software
The challenge for small companies like Alphabet Games to stay in the market for long term and reap in potential benefits
Production costs have tripled in recent years with the introduction of next generation consoles
Sales and revenues have increased at a fraction
Technology costs have risen which means large investment in staff and equipment
CSWOT analysis guidelines
In order to carry out an effective SWOT Analysis all information used must be current and relevant to the firm. A SWOT Analysis is a general technique which can be applied across diverse functions and activities used by managers. Using a SWOT Analysis can provide benefits such as a framework for identifying and analysing strengths, weaknesses, opportunity’s and threats in relation to particular tasks or objectives or a stimulus participation in a group experience as well as many others.
Below are a set of guidelines to follow that will enable them to carry out an effective SWOT Analysis.
GATHER A TEAM
The first step to take when conducting a SWOT analysis is to gather a team who have experience when conducting a SWOT analysis. By gathering a team that have experience they will be able to define the objectives which are relevant and accurate to the firm.
PARTICIPATING IN THE SWOT ANALYSIS
For best results invite contributors to participate in the swot analysis but by giving them enough time to prepare and conduct their own SWOT in advance. By providing a draft SWOT with brief descriptions of what they think is being seen as strengths, weaknesses, opportunity’s and threats.
Once the group has assembled the process and established ground rules should be explained. The process of documenting strengths, weaknesses, opportunity’s and threats should be explained prioritising these lists and using the information as part of the strategic, business marketing plans. Explain that the SWOT process is a cooperative exercise aimed at organisational improvement and not about allocating blame and assure all participations that their input will be respected.
Ground rules include –
Everyone’s ideas are important
Every idea is a good one
No-ones idea is better than the other
Suggesting an idea does not mean that you will be expected to carry it out if it is respected Except in the case of an emergency, participants commit to remaining on task until completion
The group assembled should list their lists of strengths identified before continuing to the workshop. They should be invited to the form in pairs and develop one combined list. The pairs then combine to form fours, and the process is repeated. Set of four then combine to form eight, and then again the process is repeated, each sets of eight then presents its list. The list of strengths is developed incorporating all contributions. The list should then be finalised by asking participants to reword any descriptions or include any additional strengths that may have been considered during the process.
In order to identify weaknesses a repeat process for strengths should be generated reflecting on the participants contributions. The list will provide a useful indication of growth over a period. When you review the list in a year’s time you may notice that most of the identified weaknesses have disappeared. Even though other weaknesses will be identified, the disappearance of previous ones is an indicator of successful progress.
In order to list the opportunities and threats the process for which was used for strengths and weaknesses should be repeated. The focus now becomes external, as opposed to internal for strengths and weaknesses. Make sure that opportunities and threats are not absolute – one person’s threat can be another’s opportunity, however the same item won’t appear on both lists.
When the process has been completed there will be four lists developed from everyone’s input. Ideally these lists should be displayed so that participants have an accurate and succinct picture of everyone’s views of the current situation. The list should then be narrowed down showing top priorities. Clarity of objectives is key to this process as evaluation and elimination will be necessary to cull the wheat from the chaff. With the lists compiled a clear picture should at this stage start to emerge in response to the objectives.
CARRY YOUR FINDINGS
Make sure that the SWOT analysis is used in subsequent planning. Revisit your findings at suitable time internals to check they are still valid and use lists to identify issues that are crucial to achieving the stated purpose of the business in which the company is involved. It is likely that you will be able to identify specific themes across all four lists. Try to restrict the number of themes if possible.