Friday, May 22, 2020

Employee Participation Performance - Free Essay Example

Sample details Pages: 8 Words: 2529 Downloads: 2 Date added: 2017/06/26 Category Management Essay Type Review Level High school Did you like this example? Employee Participation Performance In the first instance is necessary to define both employee participation as well as what is meant by performance. Employee participation may be defined as the process by which employees are involved in the decision making process of a business rather than merely being expect to following instructions (Times 2009) and as such this forms what is referred to in HR as empowerment. Performance on the other hand can be considered from two perspectives, firstly there is the performance of the individual in question and how their personal performance is affected by the concept of employee participation. Don’t waste time! Our writers will create an original "Employee Participation Performance" essay for you Create order Secondly there is the performance of the organisation as a whole to consider and how this will change with varying degrees of employee participation. As such the essay will analyse performance from these two perspectives before drawing a conclusion as to the perceived benefits for both parties. Approaches to employee participation: Traditional views of the organisation and approaches to management have seen a clear distinction between the tasks of managers and those of the grass roots level employee. Advocates of this view such F W Taylor (1911) and others within the scientific management school of thought sought to increase productivity and thus performance by deskilling the workforce and breaking tasks down into the most minuet component jobs so as to take advantage of specialisation of labour. The policies implemented by such advocates may be seen as the exact opposite of those who support the theory of employee participation as the scientific school of management sought to centralise power and control into the hands of managers rather than devolve it to the workforce. From a performance perspective the introduction of scientific management techniques saw significant dividends yielded to those who employed them for instance production at the Bethlehem steelworks was maintained with a reduction of lab our from 500 to 140 (ACCEL 2009) meaning that performance per employee had increased significantly. However these early developments in management theory previous to the conception of employee participation should not be used to discredit the theory due to a number of special considerations. In the first instance such theories were applied to manufacturing operations and heavy industry and whilst these operations still form a large part of the economy today there has since been a large shift towards service industries requiring differing management styles and techniques. In addition at least part of the success of the scientific management may be associated with the technological developments of the day such as the introduction of the production line as highlighted by Fords success at the River Rouge plant in Detroit. At the other end of the scale the self-directed work team as defined by (Williams 1995) may be seen as the ultimate exercise in employee participation and has been implemented by companies such as 3M. Under this system teams are essentially left to fulfil the role of both the managers and employees of an operation with a significant input in production techniques, scheduling and improvement initiatives. Advocates of this approach to employee engagement highlight that were the theory has been put into practise productivity has increased between 30 and 50% (IIE 1996). However on the other side of the spectrum such a high level of employee engagement may have negative consequences including lack of strategic focus as individual teams become ever more productive in their own areas of expertise but forget to consider how their individual team fits into the wider context. The lack of direct leadership can also be seen as providing an opportunity for accountability to be lost and thus falling performance, Bruce (2005) indicates that it is often the accountability of a leader which drives the particular individual to spur on a team or grou p to the successful completion of a task. Finally as indicated by Robbins (2003) teams have a tendency to self-reinforce behaviour, were the general attitude of a self-directing work team is generally positive this will increase the performance of both individuals and the organisation as a whole. On the other hand were the initial attitude and performance of the team is poor in the first instance and with no intervention from outside this can lead to a downward spiral of performance both for the individual and the team as a whole. However not all approaches to employee participation may be seen as quite so radical in their nature. A more frequent approach may be seen as involving employees to a greater degree without taking such a radical devolvement of control as in the self-directing work team approach. For instance Toyota may be seen as one of the leading companies in developing employee participation, Toyotas commitment to employee participation goes so far as to be for mally a part of the companys code of conduct (Toyota 2006). Strategies which may be seen as falling under the umbrella of employee engagement pursued by such companies include Kaizen the practise of including employees in quality improvement initiatives such as quality circles and other forms of consultation directly related to their area of work (Shimizu 2009). Potential benefits: One must now go on to identify the general potential benefits of employee participation both to the employee and the organisation. One of the key arguments for employee participation is that a every organisation contains a significant amount of knowledge, information and know how that is often present in grass roots level employees as much as in those occupying management positions (Adair 1989 p32-34). By encouraging employees to participate in the decision making process advocates argue that the organisation performs better as it is now making decisions based upon a much wider range of knowledge that would have been unavailable if decisions were solely made at the management level. As such the process of involving employees in the decision making process may be seen as to a large extent associated with the function of communications. Good communications are by definition a two way process (McLaren 2000 p3) which encompasses not only the sending and receiving of messages down a hierarchy but also the sending and receiving of messages back up the hierarchy and in horizontal communications. Despite the benefits of such employee participation which may be attributed to the need for an effective communication channel commentators such as Leigh (2009 p15-29) indicate that organisations are often relatively poor at the embracing the two way nature of communications leading to poor listening skills at an organisational level and thus a missed opportunity for improved performance. Another potential area for increased performance at the organisational level is that of reduced costs owing to lower labour turnover. As to the question of whether or not employee participation helps to reduce labour turnover is a debating point and depends which school of management thought is applied. On the one hand the classical schools of management theory such as those of F W Taylor would suggest that employee participation is not the most important factor in labour tur nover since the most important factor in maintaining staff loyalty was how much money they earned. On the other hand others such as Maslow argued that people do not go to work simply to earn money as in the Taylorite model but that there are several other reasons which are can be seen in the pyramid of needs: Under Maslows theory employees are not simply motivated by the need to earn money which represents only the first and possibly second stages of the pyramid. Maslow also highlights the fact that people after securing the basic needs which are provided for in the form of a salary then have additional aspirations. Using Maslows pyramid as a basis for evaluating employee motivation levels one could argue that the specific practises of employee participation constitute various stages of the pyramid beyond that of the first two stages which is considered under the classical view of management. For instance one way in which an organisation may choose to implement employee par ticipation is in the form of focus groups with reference to a specific issue such as production line down time. In this case previous to the focus group one may view the average assembly line worker as having the first two needs met owing to receiving a regular monthly salary. However once a focus group has been set up to consider a specific issue such as that mentioned it is conceivable that the next two steps of the pyramid are fulfilled as the line worker now becomes part of a team fulfilling the third need and also is given some status as the organisation by the very act of asking for their opinion is giving them a status within the organisation as someone with technical knowledge and thus a valid opinion. In theory one could argue that as an increasing number of the employees needs are met this will lead to increased motivation and morale and thus reduce the possibility of the individual wanting to leave the organisation. Costs associated with labour turn over can repr esent a considerable expense for organisations under two headings. In the first instance there is the financial cost to an organisation which includes costs associated with re-recruitment as well as any lost revenue associated directly with the loss of an employee. Secondly there is the cost to the business in disruption and lost knowledge. Research suggests that the average cost of replacing an employee is around  £3,546 which rises to around  £5,206 for more highly skilled employees (Thornton 2000). From a scale perspective the CBI (1997) estimates that in the UK labour turnover stands at 16% which rises to 25% in part time workers leaving significant room for improvement and thus a significant opportunity for cost savings especially in the part time sector. As such one can see that by reducing staff turnover by even a small amount this can deliver significantly higher financial performance for an organisation. Method: Finally having considered the potential benefits and drawbacks of employee participation one must consider the methods used in order to undertake employee participation. In many instances the benefits an organisation can gain from employee participation come from extracting knowledge from the workforce which already exists. As such many of the methods which need to be considered are issues in communications since the knowledge and information already exists but is often not being extracted and used by those higher up the corporate structure. One key method highlighted by Adiar (1989 p32-34) is that of consultation, consultation may be interpreted as any genuine attempt to gain the knowledge, feelings and opinions of the workforce which may then be used in the decision making process. As such the methods used may be broad in range from quality circles and focus groups through to town hall style meetings or suggest box schemes. However to qualify as true consultation each of th ese acts must take place before decisions are made. It is often felt by many that consultation takes place after decisions have already been made by those in senior management positions. In these cases performance may actually decrease as the workforce perceives a lack of commitment from the management within the organisation, were consultation is undertake after decisions have already truly been made this may also be seen as a misallocation of resources by the company. Another consideration of employee participation is that of employee reward. There are many options for encouraging employees to take a greater level of responsibility for their actions and thus increasing their overall level of participation. Such considerations may include share schemes, bonuses or additional annual leave related to certain performance levels. Regardless of the method employed the mechanism may be seen as a function of agency theory in which the interest of the employee and organisation can be harmonised thus increasing performance. By linking the employees personal performance to the ability for the employee as an individual to benefit the belief is that performance will increase as the employee peruses a personal opportunity. Conclusion: One conclusion would be that increased employee participation has the potential to create significant increases in performance for both the individual and the organisation as a whole. From the organisational perspective there may be significant increases in financial performance as the high costs of labour turnover are reduced as part of the increase in participation. Secondly the organisation is likely to experience a significant increase in performance with regard to its competitive advantage as the organisation will now be using its labour in potentially a more efficient way in the form of a strategic resource as opposed to a simple cash for labour transaction. From the individual perspective increased participation can lead to increases in performance as firstly an improved attitude to work increases output and secondly the benefits of the individual being able to organise their work in the way they see best contributes to work being organised in a more efficient way. However whist it is acknowledged that increased employee participation can contribute significantly to increased performance it is by no means either a panacea for all organisational ills nor is it a necessity for improving performance in all instances. One should remember that whist some companies such as Toyota have adopted a positive attitude towards employee participation there are still many successful companies which maintain a tradition approach towards the division of management and employee tasks. Furthermore companies operating such traditional approaches to the management of their employees are not limited the manufacturing sector with call centres being a prime example of were the service sector has failed to embrace increased employee participation choosing alternative methods to improve performance. Bibliography ACCEL. 2009. Historical perspective on productivity and improvement. Available online at: https://www.accel-team.com/scientific/scientific_02.html [Accessed on 14/11/09]. Adair, J. 1989. The effective communicator. London: The industry society. Bruce, W, E. 2005 March 22nd. Towards a new understanding of the leader accountability: Defining a critical construct. Journal of leadership and organisational studies. Available online at: https://www.allbusiness.com/human-resources/employee-development-leadership/417985-1.html [Accessed on 14/07/09]. CBI. 1997. Benchmarking turnover. Available online at: https://www.cbi.org.uk/ndbs/PositionDoc.nsf/fb66d262805fa2f58025673a0058587b/03c2ba268bc9171580256731005664ee/$FILE/BenchMarkingTurnover.pdf [Accessed on 14/11/09]. IIE. 1996. Sustaining high performance through self-managed work teams. Journal of industrial management. Available online at: https://www.entrepreneur.com/tradejournals/article/18648441.html [Accessed on 14/0 7/09] Leigh, A. 2009. The secrets of success in management. Harlow: Pearson Education. McLaren, I, R. 2000. Communication excellence using NLP to supercharge your business skills. Carmarthen: Crown House Publishing. Robbins, S, P. 2003. Organisational behaviour. 10th ed. New Jersey: FT Prentice Hall. Shimizu, K. 2009. Transforming kaizen at Toyota. Okayama University. Available online at: https://www.e.okayama-u.ac.jp/~kshimizu/downloads/iir.pdf [Accessed on 14/11/09]. Taylor, F, W. 1911. The principals of scientific management. New York: Norton Library. Thornton, J. 2000 Oct 25th. Costs of staff turnover surge to an all-time record high. The Independent. Available online at: https://www.independent.co.uk/news/business/news/costs-of-staff-turnover-surge-to-an-alltime-record-high-635784.html [Accessed online 27/07/09]. Times. 2009. Employee participation. The Times Newspaper. Available online at: https://www.thetimes100.co.uk/theory/theoryemployee-participation 310.php [Accessed on 14/12/09]. Toyota. 2006. Toyota code of conduct. Available online at: https://www.toyota.dk/Images/ToyotaCodeOfConduct_tcm200-635681.pdf [Accessed on 14/11/09]. Williams, R. 1995, Dec. Self-directed work teams: A competitive advantage. Quality digest. Available online at: https://www.qualitydigest.com/nov95/html/self-dir.html [Accessed on 14/07/09].

Sunday, May 10, 2020

Watergate - 670 Words

Very few American’s over the age of 20 do not know about Watergate. They have seen the plots in movies, history books, TV shows, and Made for TV movies. Some of the media plots are real and some not so much. Contrary to popular belief â€Å"Forest Gump† was not the person to crack open Watergate [ (Groom, 1994) ]. That honor goes to a simple security guard at the Watergate Complex, Frank Wills [ (AHC, 2012) ]. Mr. Willis was making his rounds when he became aware of tape covering the locks on the doors to several different stairways. This allowed the doors to close but not lock. Mr. Wills removed the take and went on his way. Later on when Mr. Wills was once again on his rounds, he found that the tape was back. This time Wills called the†¦show more content†¦When asked to turn over the tapes, initially the President refused, his reasoning was that the Constitutional principle of executive privilege extends to the tapes. He also stated that it could compromise National Security [ (Miller Center University of Virginia, 2003) ]. Eventually Nixon relented but after reviewing the tapes there was an 18  ½ minute gap in the recordings. President’s Nixon’s secretary, Rose Mary Woods claimed that while transcribing the tapes she had accidently hit record and recorded over five minutes of the tapes. Nevertheless, she insisted she was not responsible for the additional 12 minutes of lost information. The Notes taken during the time of the lost information showed one of the topics discussed was the arrest at the Watergate Hotel [ (Miller Center University of Virginia, 2003) ]. Nixon was the first to launch an investigation on how the tapes were erased though nothing came of it. To this day, exactly what was on the tapes is unknown and as of now cannot be recovered [ (Collins, 2003) ]. Reference AHC. (2012, July 19). Watergate Scandal Timeline. Retrieved from AHC: http://www.authentichistory.com/1961-1974/6-nixon/3-watergate/timeline/ Cam, S. (2013, November 14). What Was the Watergate Scandal? Retrieved from WiseGeek: http://www.wisegeek.com/what-was-the-watergate-scandal.htm Collins, D. (2003, July 27). Watergate Tape Gap Still A Mystery . Retrieved from CBS News:Show MoreRelatedWatergate Of The Watergate Scandal1135 Words   |  5 PagesWatergate Scandal The Watergate Scandal happened almost 43 years ago; the event will never be forgotten. The Watergate scandal defined, perhaps for the first time, that a president of the United States could be portrayed as untrustworthy. Richard Nixon ran for a second term in 1972, in which he won by a huge margin. The Democratic Party had their headquarters at the high-end Watergate hotel. The break-in happened on June 17th, 1972, in which a security guard noticed the tape on the door lockRead MoreWatergate643 Words   |  3 PagesWatergate Student’s Name Professor Course Institution Date The Watergate Scandal was considered one of the most of disturbing political scandals in the history of America. This Scandal brought down a President and his administration, also made the American public distrust the government which still goes on today. In 1972 there were two break-ins at the headquarters of the Democratic National Committee, located in the Watergate office and apartment complex located in WashingtonRead MoreWatergate740 Words   |  3 PagesWatergate Lucia San Nicolas HIS/145 October 19, 2011 Marciano Flores Watergate The Watergate scandal shocked millions of Americans when it was revealed in 1972. The president at that time was Richard M. Nixon, who himself was involved within the scandal. The Watergate scandal took place in 1972 when a group of five men broke into the offices of the Democratic National Committee in the Watergate office complex in Washington. The five men involved in this burglary were eventuallyRead MoreWatergate637 Words   |  3 PagesWatergate Scandal Ever since the beginning of time, scandals have occurred. But one of the biggest and infamous scandals is the Watergate. Approximately forty years ago from date, a Watergate protector found a small portion of tape attached on the lock of on the National Democratic Headquarters door. Then it all began. The Watergate’s attempted break in was a part of a bigger operation by President Nixon. The rumor was Nixon’s supporters and people involved in the scandal wanted to tarnish theRead MoreWatergate722 Words   |  3 Pagesstory of Watergate is both historically and politically interesting. It began to occur from the Pentagon Papers, in which Daniel Ellsberg handed over to the press. The Pentagon Papers contained secret documents outlining the history of U.S. involvement in Vietnam (p.848).These secret documents would bring to light the deception of the the morning of June 17, 1972, at 2:30 a.m. 5 burglars were arrested inside the office of the Democratic National Committee, located inside of the Watergate buildingRead MoreWatergate3095 Words   |  13 PagesRunning head: WATERGATE 1 WATERGATE DEVRY UNIVERSITY ONLINE. OCTOBER 20, 2014 WATERGATE 2 INTRODUCTION Watergate is a word that will forever be connected to the 37th President, Richard Nixon. What started out as a botched robbery at the Democratic Reelection headquarters would later become know for bringing down the Presidency. The American public would be able to see and hear firsthand what actually occurred in the Whitehouse behind closed doors, becauseRead MoreThe Watergate Scandal1543 Words   |  7 Pagestrustworthy – or so they thought. Unfortunately, shortly after Nixon was elected to his second term of presidency in 1972, the Watergate Scandal changed America forever by creating a sense of mistrust toward the government for the American people because of The Nixon Administration’s actions. It all began on Sunday, June 18, 1972 when Frank Wills, security guard at the Watergate office complex in Washington, D.C., found a piece of tape that was preventing a door from locking. After removing the pieceRead MoreWatergate Complex After The Watergate1781 Words   |  8 Pagesin the Watergate complex after signs of breaking in were found on the doors. No one at that time knew this subtle crime would lead to the greatest scandal in the US history and the resignation of the current President, Richard Nixon. Evidences later showed that the Watergate Incident was only a mere part of the ugly crimes the Nixon Administration had committed to achieve their ultimate goal of reelection, and Nixon had intentionally attempted a cover up to save his reputation. The Watergate incidentRead MoreThe Watergate Scandal2082 Words   |  9 PagesThe Watergate Scandal Richard Milhous Nixon was the thirty-seventh President of the United States of America from 1969 until 1974. Nixon completed his first term as President in 1973 and was re-elected for the position for the next four years. However, Nixon would have his time in the White House cut short by the series of events that occurred in the twenty-six months that followed the Watergate burglary. On June 17, 1972 five men, one White House employee and four Cubans, broke into the WatergateRead MoreWatergate Scandal2036 Words   |  9 PagesThe Watergate Scandal Essay written by Unknown The Watergate Scandal was a series of crimes committed by the President and his staff, who were found to spied on and harassed political opponents, accepted illegal campaign contributions, and covered up their own misdeeds. On June 17, 1972, The Washington Post published a small story. In this story the reporters stated that five men had been arrested breaking into the headquarters of the Democratic National Commi ttee. The headquarters was located in

Wednesday, May 6, 2020

Video game Free Essays

string(56) " when they were scheduled to be available to customers\." The rise of personal computers in the mid 1980s spurred interest in computer games. This caused a crash in home Video game market. Interest in Video games was rekindled when a number of different companies developed hardware consoles that provided graphics superior to the capabilities of computer games. We will write a custom essay sample on Video game or any similar topic only for you Order Now By 1990, the Nintendo Entertainment System dominated the product category. Sega surpassed Nintendo when it introduced its Genesis System. By 1993, Sega commanded almost 60 per cent of Video game market and was one of the most recognized brand names among the children. Sega’s success was short lived. In 1995, Saturn (a division of General Motors) launched a new 32-bit system. The product was a miserable failure for a number of reasons. Sega was the primary software developer for Saturn and it did not support efforts by outside game developers to design compatible games. In addition, Sega’s games were often delivered quite late to retailers. Finally, the price of the Saturn system was greater than other comparable game consoles. This situation of Saturn’s misstep benefited Nintendo and Sony greatly. Sony’s Play Station was unveiled in 1994 and was available in 70 million homes worldwide by the end of 1999. Its â€Å"Open design† encouraged the efforts of o utside developers, resulting in almost 3,000 different games that were compatible with the PlayStation. It too featured 32-bit graphics that appealed to older audience. As a result, at one time, more than 30 per cent of PlayStation owners were over 30 years old. Nintendo 64 was introduced in 1996 and had eye-popping 64-bit graphics and entered in more than 28 million homes by 1999. Its primary users were between the age of 6 and 13 as a result of Nintendo’s efforts to limit the amount of violent and adult-oriented material featured on games that can be played on its systems. Because the company exercised considerable control over software development, Nintendo 64 had only one-tenth the number of compatible games as Sony’s PlayStation did. By 1999, Sony had captured 56 per cent of the video game market, followed by Nintendo with 42 per cent. Sega’s share had fallen to a low of 1%. Hence, Sega had two options, either to concede defeat or introduce an innovative video machine that would bring in huge sales. And Sega had to do so before either Nintendo or Sony could bring their next-generation console to market. The Sega Dreamcast arrived in stores in September 1999 with an initial price tag of $199. Anxious gamers placed 300,000 advance orders, and initial sales were quite encouraging. A total of 1. 5 million Dreamcast machines were bought within the first four months, and initial reviews were positive. The 128-bit system was capable of generating 3-D visuals, and 40 different games were available within three months of Dream cast’s introduction. By the end of the year, Sega had captured a market share to 15 per cent. But the Dreamcast could not sustain its momentum. Although its game capabilities were impressive, the system did not deliver all the functionality Sega had promised. A 56K modem (which used a home phone line) and a Web browser were meant to allow access to the Internet so that gamers could play each other online, surf the Web, and visit the Dreamcast Network for product information and playing tips. Unfortunately, these features either were not immediately available or were disappointing in their execution. Sega was not the only one in having the strategy of adding functionality beyond games. Sony and Nintendo followed the same approach for their machines introduced in 1999. Both Nintendo’s Neptune and Sony’s PlayStation 2 (PS2) were built on a DVD platform and featured a 128-bit processor. Analysts applauded the move to DVD because it is less expensive to produce and allows more storage than CDs. It also gives buyers the ability to use the machine as CD music player and DVD movie player. As Sony marketing director commented, â€Å"The full entertainment offering from Pl ay Station 2 definitely appeals to a much broader audience. I have friends in their 30s who bought it not only because it’s a gaming system for their kids, but also a DVD for them. † In addition, PlayStation 2 is able to play games developed for its earlier model that was CD-based. This gives the PS2 an enormous advantage in the number of compatible game titles that were immediately available to gamers. Further enhancing the PS2’s appeal is its high-speed modem and allows the user’s easy access to the Internet through digital cable as well as over telephone lines. This gives Sony the ability to distribute movies, music, and games directly to PS2 consoles. We are positioning this as an all-round entertainment player,† commented Ken Kutaragi, the head of Sony Computer Entertainment. However, some prospective customers were put off by the console’s initial price of $360. Shortly after the introduction of Neptune, Nintendo changed its strategies and announced the impending release of its newest game console, The GameCube. However, unlike the Neptune, the GameCube would not run on a DVD platform and also would not initially offer any online capabilities. It would be more attractively priced at $199. A marketing vice president for Nintendo explained the company’s change in direction, â€Å"We are the only com petitor whose business is video games. We want to create the best gaming system. † Nintendo also made the GameCube friendly for outside developers and started adding games that included sports titles to attract an older audience. Best known for its extra ordinary successes with games aimed at the younger set, such as Donkey Kong, Super Mario Bros, and Pokemon, Nintendo sought to attract older users, especially because the average video game player is 28. Youthful Nintendo users were particularly pleased to hear that they could use their handheld Game Boy Advance systems as controllers for the GameCube. Nintendo scrambled to ensure there would be an adequate supply of Game Cubes on the date in November 2001, when they were scheduled to be available to customers. You read "Video game" in category "Essay examples" It also budgeted $450 million to market its new product, as it anticipated stiff competition during the holiday shopping season. With more than 20 million PlayStation 2 sold worldwide, the GameCube as a new entry in the video game market would make the battle for market share even more intense. For almost a decade, the video game industry had only Sega, Nintendo, and Sony; just three players. Because of strong brand loyalty and high product development costs, newcomers faced a daunting task in entering this race and being competitive. In November 2001, Microsoft began selling its new Xbox, just three days before the GameCube made its debut. Some observers felt the Xbox was aimed to rival PlayStation 2, which has similar functions that rival Microsoft’s Web TV system and even some lower level PCs. Like the Sony’s PlayStation 2, Xbox was also built using a DVD platform, but it used an Intel processor in its construction. This open design allowed Microsoft to develop the Xbox in just two years, and gave developers the option of using standard PC tool for creating compatible games. In addition, Microsoft also sought the advice of successful game developers and even incorporated some of their feedback into the design of the console and its controllers. As a result of developers’ efforts, Microsoft had about 20 games ready when the Xbox became available. By contrast, the GameCube had only eight games available. Microsoft online strategy was another feature that differentiated of the Xbox from the GameCube. Whereas Nintendo had no immediate plans for Web-based play, the Xbox came equipped with an Ethernet port for broadband access to Internet. Microsoft also announced its own Web-based network on which gamers can come together for online head-to head play and for organised online matches and tournaments. Subscribers to this service were to pay a small monthly fee and must have high-speed access to the Internet. This is a potential drawback considering that a very low percentage of households world over currently have broadband connections. By contrast Sony promoted an open network, which allows software developers to manage their own games, including associated fees charged to users. However, interested players must purchase a network adapter for an additional $39. 99. Although game companies are not keen on the prospect of submitting to the control of a Microsoft-controlled network, it would require a significant investment for them to manage their own service on the Sony-based network. Initially the price of Microsoft’s X box was $299. Prior to the introduction of Xbox, in a competitive move Sony dropped the price of the PlayStation 2 to $299. Nintendo’s GameCube already enjoyed a significant price advantage, as it was selling for $100 less than either Microsoft or Sony products. Gamers eagerly snapped up the new consoles and made 2001 the best year ever for video game sales. For the first time, consumers spent $9. 4 billion on video game equipment, which was more than they did at the box office. By the end of 2001 holiday season, 6. million PlayStation 2 consoles had been sold in North America alone, followed by 1. 5 million Xbox units and 1. 2 million Game Cubes. What ensued was an all out price war. This started when Sony decided to put even more pressure on the Microsoft’s Xbox by cutting the PlayStation 2 price to $199. Microsoft quickly matched that price. Wanting to maintain its low-price status, Nintendo in turn responded by reducing the price of its the GameCube by $50, to $149. By mid 2002, Microsoft Xbox had sold between 3. 5 and 4 million units worldwide. However, Nintendo had surpassed Xbox sales by selling 4. million Game Cubes. Sony had the benefit of healthy head start, and had shipped 32 million PlayStation 2s. However, seven years after the introduction of original PlayStation, it was being sold in retail outlets for a mere $49. It had a significant lead in terms of numbers of units in homes around the world with a 43 per cent share. Nintendo 64 was second with 30 per cent, followed by Sony PlayStation 2 with 14 per cent. The Xbox and GameCube each claimed about 3 per cent of the market, with Sega Dreamcast comprising the last and least market share of 4. 7 per cent. Sega, once an industry leader, announced in 2001 that it had decided to stop producing the Dreamcast and other video game hardware components. The company said it would develop games for its competitors’ consoles. Thus Sega slashed the price of the Dreamcast to just $99 in an effort to liquidate its piled up inventory of more than 2 million units and immediately began developing 11 new games for the Xbox, four for PlayStation 2, and three for Nintendo’s Game Boy Advance. As the prices of video game consoles have dropped, consoles and games have become the equivalent of razors and blades. This means the consoles generate little if any profit, but the games are a highly profitable proposition. The profit margins on games are highly attractive, affected to some degree by whether the content is developed by the console maker (such as Sony) or by an independent game publisher (such as Electronic Arts). Thus, the competition to develop appealing, or perhaps even addictive, games may be even more intense than the battle among players to produce the best console. In particular, Nintendo, Sony, and Microsoft want games that are exclusive to their own systems. With that in mind, they not only rely on large in-house staffs that design games but they also pay added fees to independent publishers for exclusive rights to new games. The sales of video games in 2001 rose to 43 per cent, compared to just 4 per cent increase for computer-based games. But computer game players are believed to be a loyal bunch, as they see many advantages in playing games on their computers rather than consoles. For one thing, they have a big advantage of having access to a mouse and a keyboard that allow them to play far more sophisticated games. In addition, they have been utilizing the Internet for years to receive game updates and modifications and to play each other over the Web. Sony and Microsoft are intent on capturing a portion of the online gaming opportunity. Even Nintendo has decided to make available a modem that will allow GameCube users to play online. As prices continue to fall and technology becomes increasingly more sophisticated, it remains to be seen whether these three companies can keep their names on the industry’s list of â€Å"hig h scorers†. How to cite Video game, Essay examples