Asiasports: Hockey Night in Hong Kong
Determining the Future Business Strategy of Asiasports Limited In March of 1999 the primary decision makers of Asiasports found themselves at a crossroads. “Barnes, Weir, and Gribble had to make decisions about whether the company should promote hockey outside of Hong Kong and its choice of sports properties. An implementation plan also had to be developed for the chosen strategy” (Delios 1). Although every one of their sports properties was profitable except for the World Ice Hockey 5’s event, Asiasports still experienced a loss in 1998 operations. Therefore Barnes and the primary shareholders of Asiasports were faced with a difficult question regarding the direction of their future business strategy. Should they continue to focus on developing their existing sports properties and working towards Barnes goal of bringing hockey to Asia, or should they explore options related to geographic and product diversification? Firm Analysis Asiasports was started as a sports management company to develop the growth of hockey in Hong Kong. Asiasports managed leagues and events in relation to hockey, as well as other sports such as softball and golf. The company is privately held, and “it was a young entrepreneurial company that had the financial and human resources constraints typically face by such companies” (Delios 13). A SWOT analysis and a look at the firm’s resource competitive advantages and financials provide insights into Asiasports as a company. SWOT Analysis: Appendix 1 A SWOT analysis shows that Asiasports primary strengths are its sport properties and experience in running tournaments in Hong Kong, while its greatest weaknesses are its lack of financial and HR resources. In addition, the firm is not demonstrating profitability. Opportunities include the growing popularity of hockey in Hong Kong, and the strength of local consumers. Direct threats from competition in the arena of hockey are not present now, but they could arise in the future, and other more popular sports present threats as well. Resource Competitive Advantages: Appendix 2 A resourced based analysis of Asiasports helps to demonstrate what resources they possess which provide them with a competitive advantage. In order to constitute a sustained competitive advantage a resource must be valuable, rare, difficult to imitate, and without substitutes. Appendix 2 shows the tangible resources, intangible resources, and organizational capabilities of Asiasports, and they do in fact possess resources that provide them with competitive advantages. As an example their sports properties are a resource that provides them with a sustained competitive advantage in the Hong Kong hockey landscape. In addition, their employees’ knowledge and experience, and the ability to leverage this with their existing properties in innovative ways appear to provide a temporary competitive advantage. This is not a definite sustainable competitive advantage because it is possible that another sports marketing firm could learn from their practices and duplicate their efforts. Asiasports is still a small company in the entrepreneurial stages of development, and it is likely that a company with greater resources could enter the market and develop the same level of expertise. Therefore, the main takeaway from a resource based analysis of Asiasports is that they do not possess a great deal of valuable resources, and moreover they do not possess many resources that provide them with a sustainable competitive advantage over possible future competitors. Financial Analysis Since Asiasports is a privately held company detailed financial information is not available, however their sources of revenue are available, as is detailed information regarding the revenues and expenses for the 1999 World Ice Hockey 5’s Tournament. “As a sports
management company, Asiasports derived its revenues from a variety of sources. Its two primary sources of revenues were...
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