STRATEGY FORMATION IN THE MOTION PICTURE INDUSTRY IN SOUTH AFRICA

Abstract

Context The evolution and institutionalisation of technology, together with the significant changes in consumer trends has altered the motion picture industry structure significantly. The traditional static motion picture industry has transformed to become one of the most dynamic industries globally. There appears to be little published research on strategy formation processes within companies in the motion picture industry in South Africa. Statement of the problem This research report investigates the strategy formation processes of companies in the motion picture industry in South Africa and how the motion picture industry structure affects these processes. Method of Data Collection A mixed-method methodology was used to conduct the research. Qualitative results were obtained through 21 interviews, of which 20 were personal face-to-face interviews and 1 was telephonic. The respondents included senior level management of incumbent organisations throughout the motion picture industry value chain. Quantitative results were obtained from 4 different sources, after which the data was collated to form the statistical data used to complement the qualitative study. The key findings It was clear that organisations within the motion picture industry all implemented overarching intended strategies, but only some allowed for continuous emergent strategies to materialise and to affect the overarching strategies. Furthermore, it was found that there was no significant application of academic literature and strategy formation models within the motion picture industry in South Africa. It was also found that the underlying industry structures of each of the segments of the motion picture industry value chain had a significant impact on the organisations strategy formation processes. The statistical analysis proved the hypothesis that Box-Office performance significantly impacts on the performance of the motion pictures in the subsequent windows. It also confirmed that the current strategy formulation processes within the motion picture industry are adequate to a certain extent. The Key Message The motion picture industry in South Africa has many internal and external complexities that influence the incumbent organisations on a daily basis. These complexities create an extremely dynamic environment, which impacts significantly on the organisations to successfully formulate strategies that will assist them in sustaining a competitive advantage within the industry. It can be argued that the lack of strategic academic literature’s application within the industry is due to the dynamic environment, which makes it increasingly difficult for the incumbent organisations to apply strategy formation processes presented by the academic literature. However, the academic literature should not be disregarded in its entirety as it might assist strategists in identifying underlying industry changes more easily, which will provide the organisation with the opportunities to proactively respond to industry changes.