Zynga Inc Strategic Plan - Case Study Example

?Zynga Inc Strategic Plan Harvard Business School Introduction Zynga Inc. is among the world’s leading providers of online games in the United States and the rest of the world entertaining a large number of online social games. The company was founded in 2007 and has her headquarters in San Francisco, California. Being originally known as Zynga Game Network Inc., the company changed her name in November, 2010 to Zynga Inc. Zynga specializes in simulating virtual games as live services on the internet, social networking sites such as Facebook, and on mobile platforms. Today, Zynga provides a wide variety of games under the names; The Firm Ville, City Ville, Firm Ville 2, Chef Ville, castle Ville, Zynga Poker, Words With Friends, Scramble With Friends, draw Something, Bubble Safari, Mafia Wars, Ayakashi, Horn, and Respawnables. All these games are provided on Facebook, mobile platforms and other social networking sites. The games are also present on Zynga.Com, Google+, Tencent, Apple iOS and Google Android (Raice, 2012). The company has registered great success in the recent past with a total customer base of about 83, million monthly active users from all over the earth in the year 2010. Her collaboration with the most popular social networks in the world today has been the main reason behind the success of in her business. Zynga remains top among the most proffered internet games providers among many users from all over the world despite the numerous challenges that has been facing her in the near past. The company is as well among the leading employers in the region and in the world in general. As per February 25th report on the company’s employee database, the company was employing a total of 3,058 persons from across the world. Zynga has put down measures to boost her network and consequently her income earnings across the world following the tremendous drop registered in her performance in the year 2012. The company is operating on a five- fold strategic mode which includes; 1) the company is looking forward to expanding her global user community by exploiting regions which have not been fully accessed by the services offered here. This expansion aims at reaching out to all customers from all locations over the earth’s surface, especially focusing on the less penetrated geographical locations such as Brazil, Germany, India, Japan, Russia, and South Korea. Growing the user number is the company’s key strategic mission. 2) The company has also embarked on building other great products to increase global engagement in the gaming systems. This will include the key components of the company including; the company advisers, the product users, product developers and other company stakeholders. This is to be gained by improving the quality of key products on the social media and networking sites such as timeline and ticker besides enabling new network applications and integrating the existing websites. 3) The company looks forward to providing users with the most compelling and outstanding experience during their gaming missions. This is aimed at improving customer experience and increase participation across the world via the social networking sites. 4) Alongside all these the company is making investments to help her build a more engaging mobile experience as the most upcoming and lucrative capital system for current and future exploitation. This is key as the company has realized the increasing use of mobile platforms for online gaming and access channels across the globe. Internet access through mobile, platforms has outgrown the use of computers over time. This has become a lucrative site for reaching as many customers as possible over time and space. 5) Lastly, the company aims at creating a suitable environment for her developers to build great social products using the Facebook platform. Facebook has grown to become the worlds most cherished and used social site wing almost everyone in the world having full time access to her valuable products. Billions of people visit their Facebook accounts daily and are likely to closely interact with and play Zynga games hence the need to properly invest in it. Company mission statement and objectives Zynga Inc.’s mission statement is one of the most outstanding considering her area of specialization. She has strived a great deal to keep in line with her mission across the domain. Operating in a mission stated as ‘To connect the world through gaming’ Zynga has greatly strived to accomplish this mission by trying to provide internet connectivity through online gaming to a wide array of her customers from across the globe. Today, Zynga boasts of over 300 million daily active users from all over the earth’s surface. In order to achieve this connectivity, the company has embarked on providing her services by considering to a great extent her collaborative network systems with the various social networking sites and current ventures in mobile technologies. Among the key strategies the company has put in place to help modify her performance is to make use of mobile gaming as mobile phones become the most widely used applications in the world today compared to computers. Zynga decided to explore this opportunity upon realizing that the use of mobile phones especially smart phones and tablets for internet access is speedily and steadily surpassing that of computers. By almost every mobile phone, even the cheapest of all, fitted with internet application softwares, it is a very viable business opportunity for investors in the present world. Investing in mobile gaming has proved lucrative as seen in our performance in the year 2012 when the company’s total income earnings from mobile gaming totaled to 12.3 billion dollar sales in 2012 and expected to rise to about 15 billion dollars by 2015 following the promising trends in its use. Besides, the company has also ventured into real money gambling business which has as well proved lucrative and promising for future exploitation. Since the beginning of her engagement in the gambling business, the company has realized a sharp shoot in her income earned in America with her Poker and Casino games. Objective statements Zynga, just like any of other company and organization in the world is guided by certain key objectives which she aims at achieving to arrive to self satisfaction. The company has a two set objectives upon which her operations are aligned and pegged. To begin with the company’s first objective is focused on retaining and motivating her talented, entrepreneurial executive leadership team. To achieve this, the company has resolved to source people/ employee experts from various parts of the world to satisfy her innovative and entrepreneurial base. The employees are well paid and, a more conducive environment suitable for innovative working is created for them, to ensure that they deliver their best in line with the company’s mission and vision statements. The company, being profit based has focused on the need to expand her customer base in order to generate as much income as possible from the world online gamers. This requires the connection and proper management of the company in conjunction with the rest of the world in order to reach as many people as possible. The innovative and entrepreneurial capabilities of her employees and experts are thus of great desire in achieving this. Proper leadership qualities and packages are therefore of key importance in order to enable the employees to work with passion for the success of the company in a competitive global business scene. Secondly, the company has in her objectives the need for aligning her executive pay structure with company performance-based incentives. The main aim of the company being the retention of her employees and promoting specialization and development of skills in her employees, she has embarked on providing suitable working conditions for her employees by providing incentives based on the employees’ performance. This is in line with her strategic plan aimed at building value for her stockholders. External Analysis of the competitive and general environment In the analysis of the external environment of the company, we will look at the competition from the rest of the world which has continued to affect and dwindle Zynga’s customer base and consequently her income base. The external environment of a company besides is comprised of the political systems and influence, the external social conditions affecting the operations of the business, the level of technological development in the world networking capabilities as well as the economic backgrounds of the prospective customers which highly affect their level of participation in the development of the company. To begin with, it is normal that no company can exist alone in the line of business. It is bound to face competition from the other companies which offer the same products to the same customers as her. Zynga is not an exception to this fate. Online gaming is not a pioneering field for Zynga and in the same way, not a reserve for her. Other companies have been transacting businesses on the same line and the customer base for all is the world population which Zynga as well pursues. Zynga faces stiff competition from the world’s leading service providers which she has to outdo in order to achieve the best out of the little that is available. This calls for innovative aspect of her perspective employees and a good eye on the existing market opportunities. Among the most active/ stiff competitors on the global scene are other outstanding companies such as Google, Microsoft, and Twitter. The three also offer online gaming activities and are the most popular social networking sites common with millions of people around the world on a daily basis. This means Zynga has to offer more recent and interesting gaming activities to her customers besides engaging in additional activities for maximum income earning to sustain her huge capital requirement. Other key competitors include other mobile companies and smaller internet providing companies which offer similar products and services as does Zynga. Zynga uses Facebook as her key social networking site where she meets most of her customers. Facebook is the leading world social network today as thus many companies are striving to reach out to their customers through it. Competition on the use of Facebook as a marketing site for various companies is as well a great ordeal that Zynga has to battle out with other companies offering the dame products to the global markets as Zynga does. Other competitors in the business include the traditional and online media businesses from across the globe which competes with Zynga over the advertising budgets. Many companies are as well coming up in the market to offer the same services to the global populations. Such include Google+ which offers gaming activities in different countries in the world for instance Cyworld based in Korea, Mixi based in Japan, Orkut (though a Google gaming site) based in Brazil and India, and vKontakte based in Russia. Some of these competitors such as Google have strong financial bases and can outdo Zynga over a short span if not well designed strategies are put in place to curb this. The Chinese market is among the fastest growing markets in the world and is as well captured by the Chinese companies such as Renren, Sina and Tencent (Thompson, 2013). These companies make the world’s biggest market base quite inaccessible to Zynga given the wide array of gaming activities they offer. This presents the present as well as a future challenge to the company calling for newer strategies to help exploit further this large market. To add to this the political scene has also been suppressed in Zynga’s performance in some countries. Given that Zynga does many of her advertisements on Facebook and other social networking sites (with Facebook as the leading platform), some of these social networks have been banned in some countries for instance the Chinese government just banned the use of Facebook in her country in the year 2010. This has presented a big blow to Zynga since China has almost one of the largest markets in the world. Besides, the Chinese economy is among the fastest growing in the world presenting yet another important challenge to capital and financial gain. Other countries such as North Korea, Iran, and Syria have as well restricted the use of Facebook in their countries on the basis that it presents a grave political threat and insecurity in the countries. The decision by these governments to restrict or censor the contents of these social network sites in their countries is a great hindrance to effective performance of Zynga in these regions. Moreover, Zynga’s performance and expansion of her businesses in the global markets arises from her strong financial base which is provided by her customer base in the global market. Even though the company has been doing adequately well in the global scene with regard to financial gains, stiff competition from her rival companies has seen her failure and diminished capital base in the global scene. The performance of Zynga since her founding in 2007 has however been pleasing/ gaining an upward trend in the global market as shown in the graphs below (BBC News, 2012) Considering the rise and development in the world technological applications over time and space, the company has been facing numerous technologically related threats such as the prevalence of malware, computer viruses, hacking and phishing attacks on the company’s site by unauthorized or malicious users. It is very difficult for the company to tame these attacks due to her vulnerability to the numerous global users. Besides, the social networking sites which she makes good use of, is the key site where most malicious users hide. Internet use and application is becoming widespread with billions of users on a daily basis, this makes it very difficult to monitor the operations of the various users once logged in hence the vulnerability of the company’s network systems to numerous attacks from outside. Zynga operates her businesses in the stiffly competitive environment and malicious intentions are among the downplaying techniques some companies may employ to curb their domination. The analysis of the external environment will however not be complete without actually carrying gout the SWOT analysis of the company with respect to the rest of the world. With regard to this the strengths and threats of the company carry the day in the analysis. While some of the threats are as mentioned in the earlier sections of the this paper including competitions, government censorship of the social networking sites affecting the global income among others, the company has also portrayed an array of strengths which makes her overcome most of the challenges facing her operations in the global sphere. To overcome the challenges of competition from related companies, Zynga has settled on the following as the key strategies to go about them. For instance the company has laid out strategies to help her improve her performance in the global arena besides putting up strategies to adopt alternative measures should the existing ones fail to bear much fruit. A team of innovative and entrepreneurial experts has been put in place to help curb any counter effect. Internal Analysis As part of the internal analysis, we will focus on the internal operation of the company with respect to her line of business. We will look at the internal organization of the company and the mode of operations that the company is employing in order to improve her performance both locally and internationally. To begin with, the company has embarked on hiring talented and gifted employees adding to her employee data base people with experience and knowledge in their areas of specialization. This is aimed at creating an innovative and entrepreneurial environment whereby the employees are able to come up with more recent and innovative developments suitable for the expansion of her business in the global market. Among the strategies that the company seeks to work on is the need to promote and empower her employees to cope well in the innovative and competitive world. It is therefore very significant for Zynga to focus on employee retention and development. This key requirement has seen Zynga looking for gifted employees from all over the globe. Today she has become one of the biggest employers in the United States with the best pay for her employees being the prime motivating factor for the retention capabilities. Besides, the company has also seen the need to acquire likeminded companies for the prospects of her business in the global sphere. In this connection, Zynga has acquired companies such as OMGPOP which has seen her through the capital market to improve her capital base over just a short span. To this extent, the company has gained an increased number of daily active users from all over the earth making her one of the biggest online games providers in America and the rest of the world. Featuring on Facebook and other commonly used social networks in the world Zynga has gained worldwide fame and preference among many users around the globe. The company expects to expand her total income earned based on these recent expansions and acquisitions over the next few years in line with her strategic plans. Customer satisfaction is the key agenda in the whole affair and so Zynga has been looking forward to achieving the best results for her customers around the globe making sure that the customers get the best and bare key priorities in the company’s affairs. Moreover, alternative measures have been put in place to help deal with uncertainties mover time. Factually, uncertainties are a common occurrence in the business world and the success in curbing them is the key determinant for the success of any company. It is in this respect that Zynga motioned for the establishment of alternative options for the various dealings recorded in the company’s strategic requirements. For instance the company plans to carry out the following if she fails to win Facebook applications in the rest of the world due to its ban or strict censorship in one or more countries of the word, she will shift to using alternative social networks such as Google, Google+, Twitter etc. This will ensure continuity of operations of the company for maximum profit earning in the global competitive market. Most important development recommendations Zynga is a new company amidst strongly established companies in the world that needs to put up strategies to help her cope well in the global market. Several other things need to be put in place in order to ensure that the needs of the company are addressed in an all encompassing manner. To begin with, the company needs to expand her network with respect the development agenda in different regions of the world. Games are leisure activities which most of the people do not find a lot of pleasure in. It therefore becomes very difficult to reach some sections of the society who are not fans of online of computer games across the globe. Besides, there are places that are very remote and have had no proper access to the networking services, hence cannot be reached. A large capital base is therefore lost with this respect. Other than the use of mobile applications which are becoming increasingly applied in internet services and gambling, the company should come up with more related and suitable ways of reaching out to this large customer base lying idle in various parts of the world. This scan be done by providing other services such as simulated learning activities, online updates on various happenings in the world for instance the daily updates on diseases and how to control them, inspirational provisions as well as other related games such as racing. In order to acquire much, the company needs to expand her areal coverage and cater for the needs of all members of the society other than the games lovers alone. Ticking the emotional needs of every person is the key avenue for earning from such persons. Moreover, other than specializing in purely hands- on gaming activities, the company can also embark on the provisions of the watch games such as comedies, jokes and educative teachings on a wide array of topics. This will help the people who cannot play the games more appropriately to attend to the online sites where they need not to jog ether minds so much ‘the sit and watch services’ .Many of the company’s operations are based in the united states with just a little in the rest of the world, I think an expansion of the various parts of the world especially the technologically virgin lands need to be exploited to increase the customer base. This will increase the number of users bringing in more income than before. Implementation Plan The attainment of success in various applications cannot be achieved just shortly by initiating changes on a daily basis, a lot of time has to be focused on the various changes that are to be made and their compatibility with the operations of the company decided and envisioned before these implementations result into failures. In line with the need to increase the customer base this comes largely with the expansion of the company’s fields of specialization. This will demand that the company looks into the near future by observing the trends in the response of the various regions with respect to the existing services. This may take longer and delay the entire process. Observations of human response to a given commodity in the market can be done for duration of about one to two years as the various services are popped into the market one after another. People become more responsive when new services are introduced one after another so that they are left with utter expectations or the next coming services. This will tick the inquisitive nature of human beings, longing to see and find new things and inventions for their use. Consistency in such provisions is key to the development of the customer base. The introduction of various services will as well depend on the level of innovativeness and response of the people to use technology and hence the long time requirements. Moreover the expansion of the company’s network to capture many customers from across the world will require the intensive and extensive development in the social network prong across the globe to ensure that most if not all persons are reached. The development in the local networks is the responsibility of the individual countries is to consider hence the company can play a very limited role in this. Even so to speak, there is a large group that remains inaccessible not due to lack of internetworking but because their interests are not catered for, most innovative perspectives, well informed by proper market research need to be put in place to cater for such needs. This calls for adequate research which as well requires much time and finances for more comprehensive results to be achieved. A large capital is therefore a great requirement for the accomplishment of this task References BBC News. (2012, December 22). "Facebook and Zynga to end close relationship”. BBC . Raice, S. (. (2012, August 12). "Zynga's Rocky Shift to Mobile". The Wall Street Journal , 2- 4. Thompson, M. (2013, January 8th). "The Top 25 Facebook games of January 2013". AppData. Inside Social Games , 5- 11. Read More