Director, Solutions at Agility Research & Strategy
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When I discuss business development with clients, I usually use a mnemonic that I got from one of my mentors: STEEP. (Now don't be a little disheartened by the word itself.)
Socio-cultural. Take into consideration the social factors that could affect the development of your video games company. There are a number of studies available on the internet where you can probably take a glimpse of the cultural diversity that exists in Asia. There is no "one solid definition" of an Asian, I believe. The Philippines, for example, is quite "Americanized" in its values with a tinge of Spanish - and to a certain extent, they love entertainment and the youth's entertainment options are beginning to expand significantly and their expectations of traditional media such as TV and radio are being transferred to new things such as games. Singapore is quite liberal in its views due to its being very economically developed, though they put a premium on education and success. This I think is the first step: How will your company play out against these socio-cultural undercurrents and forces? How will the games attract these consumers?
Technological. I am assuming that your product line will encompass both PC, 'wired', and streamed/online games. If this assumption is true, then a technology audit is necessary. Again, a rough estimate of Asian internet penetration would put it at say 10% and perhaps PC ownership at say 20%. However, that varies across. Knowing in-home PC penetration AND actual access to the internet across Asia is critical. In developing countries such as Vietnam, Thailand, and the Philippines, there is low in-home PC penetration, low in-home internet penetration, and low broadband connection, however, internet cafes are a big thing. How can your business model accommodate that? Should it even be a part of your business model?
Economic. Of course, economic power needs to be understood. This could well be in the usual form of GDP per capita (at PPP). However, note that this is rather misleading: in some developing countries, there is a wide gap between the rich and the poor. You will have to look at GDP per capita on a per-city basis, rather than on a national basis. Difficult to look for data, but not impossible.
Environmental. Are there environmental factors that you need to consider? I am not sure if this is relevant in your case.
Political. As a video games company, you will be creating intellectual properties that can (and will) be pirated and copied and distributed. It will put a drain on your revenue potentials. You need to know the political landscape on this regard. You also need to understand the intricacies of each market: Given the continue popularity of internet cafes and gaming cafes, for example, governments - national, regional, and local might start putting a tab on licenses for internet/gaming cafes, as well as a tab on the type of content you are offering.
I believe that if you looked at these initial factors, you will be able to see what are the barriers, and from these, infer what you can consider as key success factors.
A few other points (and I apologize for taking so much space): Your business model - will it take into considering the emerging digital marketing communications landscape in Asia? South Korea, Taiwan, Singapore, and pretty soon, Urban China, Urban India, and Urban SEA will be big on "branded in-game experiences". Can this be incorporated in your business model?
I have always found Kepner-Tregoe's rational decision-making and critical opportunity/threat identification processes interesting. If you have their book on rational management, that might be a good starting point to start drafting your first key success factors.
Hope this helps.
posted March 15, 2007...