Globalizing NCsoft's operations

[Admin]

This has been a really insightful forum so far - thank you to everyone for contributing and providing your insights!! The diversification thread was very informative, and helped me improve my understanding of the challenges and opportunities that exist for NCsoft in that area. I want to dedicate this thread to the topic of globalization, and how it will impact the company going forward. I have a pretty general understanding of globalization with regards to NCsoft's existing endeavors, but I don't have a great understanding of cultural differences internationally that they will have to consider. I can talk about the company's existing endeavors, but I would love if someone else could jump in to talk about cultural differences and some ideas they could implement moving forward.

NCsoft already has a solidified international presence. According to 2007 projections, the company will receive 41% of their revenue from international division and ventures. This is a substantial portion of the company's operations, and as a result they have invested heavily in making sure they understand the different cultures in the various regions, while still establishing their brand and what their games and company stand for in these markets. The company has operations in China, Europe, Japan, North America (predominantly the United States), the Philippines, Taiwan, Thailand, and obviously their home country of South Korea. While the majority of these relationships have been through establishing subsidiaries or acquiring companies in those international regions, some were established through joint ventures. Japan, Taiwan and Thailand were the three JV's established, due to the company lacking in sufficient resources in their early days and not having enough international brand recognition. However, they have addressed these JV's by adding subsidiaries in these countries, and separating the JV and subsidiary in terms of development and service. The company has done this in order to strengthen the quality of each, and so far it has worked well. 

Now, can someone else talk more specifically about the cultural differences in some of the different international regions, and how that might affect their continued foray into globalized gaming?

[AMERICANGAMER100]

Absolutely, I can talk a bit about some of the cultural differences in the United States, and how that might affect NCsoft's efforts here.

As Americans, we tend to be very individualistic. What do I mean by this? Well, the value systems in place in our society emphasizes individual achievement, and as a result the standing we have in our society is rooted in our performance in their setting, not the setting itself. This can have an impact, positive and negative, on NCsoft both in terms of establishing a subsidiary and establishing a strong gaming community/experience.

In terms of subsidiaries, the American culture can be a boon to innovation and productivity. This individualistic culture spurs entrepreneurship, and the desire to always be better and make improvements. This meshes perfectly with NCsoft's existing culture of perfection. Employees here want to achieve great things, and they will work to get it done. On the flip side, though, the individualism in American culture can have a grave negative impact too on maintaining a strong subsidiary and culture. There is a high degree of managerial mobility for Americans, as we like to move from company to company to continue to achieve more, and pad our credentials. However, this obviously hurts companies (like NCsoft) trying to establish a strong subsidiary, due to the fact that solidarity will be very hard to achieve if people are moving all the time.

This also ties into the games themselves. On the positive side, individualism and the strong desire for achievement motivates us to work very hard in our games, and invest significant amounts of both time and money into the game, which could significantly increase the profitably of the company if they produce a game that is well-tailored to our collective gaming needs. However, on the negative side, the same mobility factor mentioned earlier plays a factor. We are more inclined to move on to new games to achieve success in a different realm and to elevate our status in the gaming community. As a result, it could be hard for NCsoft to both keep and add customers when developing new games, without cannibalizing their existing base.

[GAMER1]

From a Japanese perspective, we are definitely very different from the culture AmericanGamer100 described. However, we also aren't entirely like our fellow Asian countries, so we fall into our own category more or less.

With regards to Hofstede's six cultural dimensions, we are closer to a collectivistic society, especially compared to our American counterparts. Compared to our Asian counterparts, we fall more into an individualistic society. As a result, some of the factors our American friend talked about above don't entirely relate to our society. We are a much more loyal society than the Americans, as we stay with our companies longer, and are not very concentrated on managerial mobility. This helps NCsoft on both a subsidiary and gaming level for the opposite reasons that it hurts in the American market - we will stay with the company for a long time, and we will stay in our game for a long time.

In terms of the masculinity dimension, which indicates whether a society is more driven by competition, achievement and success, or through caring for others and quality of life. We as a Japanese people rate incredibly high on the masculinity side, indicating a strong drive to be the best. But, as I said earlier, we are slightly collective as a society, so we are not driven to beat one another to achieve individual success. Instead, we are more focused on beating other groups while in a group setting, and are incredibly motivated in these settings. This is perfect in a corporate setting, because we are motivated to work extremely hard to put the best product out there (known to us as monodukuri). On a more personal level for NCsoft, this is right up its alley in terms of its game lineup. It has made its main success in games that are very group and team-oriented (Lineage and Lineage II), and applying this knowledge of the Japanese culture and its affinity for group success could make their next MMORPG bigger, better, and a bigger hit internationally.

[Admin]

Wow, it's definitely very cool to hear the insights of people actually in both markets!! I think I now have a better understanding of some of the significant cultural differences that exist across the international markets. However, with that in mind, I think that there are some things that NCsoft can do to ensure that they can produce games that will attract a wide international base, and not limit themselves to certain markets.

After conducting some research, I found that they have problems internationally before. Namely, Lineage had a tough time succeeding in North America. This was due to the fact that the design of the characters were cute, beautiful, and elegant, yet held swords and were violent. This was a problem for them, as they felt muscular or rough-looking characters would have been more appropriate for the game. This ties into the cultural differences between the countries, as Japan did not enjoy the American-designed Guild Wars, with character designs that were much more Americanized.

How can the cultural differences be addressed? Well, I have two ideas:

1) Within new games, there should be different "worlds" or "quests". Within these, there will be slight differences to account for the cultural differences of the different global locations, such as character design and appearance. On top of this, worlds could also be more individual-centric (trying to beat certain individual goals or achievements), or team-centric (working collectively to beat other teams). This would tie in effectively with the Hofstede analysis of an individualistic America, and a masculine Japan that is much more driven by team than individual success.

2) Heavily invest in playNC. Now, you might not think this directly relates to globalization, but bear with me everyone. Some regions have much more loyalty (ex. Japan). Others, such as the United States and, to a lesser extent, China, are much more focused on mobility. As a result, investing and developing a platform on playNC full of a variety of different styles of online games, whether they are different MMORPG's or more casual games, is imperative for controlling mobility. Instead of leaving one of NCsoft's games to play elsewhere when they want to achieve a higher level of success, they can stay on the playNC platform in a different capacity, allowing NCsoft to retain these traditionally mobile customers and keep them as a revenue stream, legitimizing their international plans. 

Thanks again to everyone for contributing - these discussions have been incredibly stimulating for me!!

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