Actualizing business analytics for organizational transformation: A case study of Rovio Entertainment

https://doi.org/10.1016/j.ejor.2018.11.074Get rights and content

Highlights

  • Case study of analytics-driven transformation at Rovio Entertainment.

  • Value creation from analytics is a multi-staged process.

  • Establish leadership team for initial exploration and continuous support.

  • Transform existing processes to accommodate the integration of analytics.

  • Analytics experts should work closely with domain experts in hybrid teams.

Abstract

Increased access to data and affordable technologies today has made business analytics within the reach of most organizations. However, many organizations are unsure of how to translate their analytics use into organizational value. While the area of business analytics value creation has become a popular point of discussion amongst practitioners, much research is needed to provide insights into the effective use of business analytics. The objective of this paper is to deepen understanding in the effective implementation of analytics within organizations. Specifically, we performed an in-depth case study at Rovio Entertainment to investigate how a pioneer in mobile games initiated an analytics-driven transformation. This study contributes to the theory and practice of business analytics in two ways. First, drawing on the perspective of technology affordances, this study sheds light on the varying affordances of business analytics. Second, this study presents empirically-informed insights on how these affordances could be effectively actualized for an analytics-driven transformation in an organization. Collectively, this study opens up the black-box of effective implementation of business analytics for organizational value creation.

Introduction

Businesses today are becoming increasingly intrigued by the possibilities of business analytics (hereafter BA) to create value (Chen et al., 2012, Ransbotham et al., 2015). While many organizations recognize the power of BA (LaValle, Lesser, Shockley, Hopkins, & Kruschwitz, 2011), many are overwhelmed by the far-reaching changes required to transform into a data-driven organization (Brydon and Gemino, 2008, Ransbotham et al., 2015, Vidgen et al., 2017). To date, there is insufficient empirical research about how organizations could translate their BA use into organizational value (Fink et al., 2017, Hindle and Vidgen, 2018, Vidgen et al., 2017). The objective of this paper is to improve the understanding of how BA can be effectively implemented and actioned in an organization for value creation.

We have performed an in-depth case study of Rovio Entertainment to investigate an organization that has recently completed a BA-driven transformation. As with other industries, a wave of BA adoption is emerging in the gaming industry, driven by the availability of massive user data and analytics technologies, as well as the rise of the freemium business model (Voigt & Hinz, 2016). In response to these environmental changes, Rovio Entertainment, a company that has seen incredible success with its Angry Birds game franchise, initiated a transformation towards becoming a more data-driven organization.

We adopt the technology affordances perspective (Majchrzak & Markus, 2012) as our theoretical lens to uncover the underlying mechanisms of Rovio's successful implementation of BA. The technology affordances perspective serves as a lens for researchers to identify the important potentials of a technology, and to theorize the actions required to effectively actualize those potentials to achieve desirable outcomes (Majchrzak and Markus, 2012, Strong et al., 2014). By conducting an in-depth qualitative exploration using this theoretical perspective, we are able to develop insights on how the affordances of BA can be effectively actualized for value creation.

Collectively, our findings contribute to both the theory and practice of BA by revealing the mechanisms by which BA are actualized for organizational value creation. Theoretically, our findings open up the black-box of effective implementation of BA through identifying the varying technological and organizational features that drive the actualization of BA affordances. This conceptualization contributes insights to an emerging literature that aims to understand analytics-driven value creation in organizations (Fink et al., 2017, Hindle and Vidgen, 2018, Vidgen et al., 2017). For practitioners, our findings make explicit the goals, expertise and organizational arrangements required to actualize the affordances of BA to create organizational value. These insights provide necessary guidance for practitioners to derive value from their increasing investment in BA (Ransbotham et al., 2015, Ransbotham et al., 2016, Vidgen et al., 2017).

The rest of this paper is organised as follows. In Section 2, we present a review of the literature on BA use for organizational value creation. We then discuss the emerging use of BA in the gaming industry to provide a foundation for this research. In Section 3, we discuss the theoretical underpinnings of this study and outline how the perspective of technology affordances is particularly suited for our investigation. In Section 4, we discuss our research design. In Section 5, we provide a case description of Rovio's analytics-driven transformation. In Section 6, we present the rich description of our analysis, and in Section 7, we discuss our empirically-grounded findings. We conclude with a discussion of the theoretical and practical contributions of the paper in Section 8.

Section snippets

Literature review: business analytics for organizational value creation

In this section, we first present a review of the literature on BA-enabled value creation. In this discussion, we outline the specific opportunities and challenges faced by organizations in actualizing value from their uses of business analytics. Second, following from the organizational context of our study, we present a review on BA use in the gaming industry. We focus on a recent shift of the dominant business model in this industry (from premium to freemium games) and discuss the role of BA

Theoretical background: technology affordances and actualization

In this study, we adopt the perspective of technology affordances to theorize the organizational uses and implications of BA in the game industry. The concept of affordances originates from Gibson (1979) work in the field of ecological psychology. Gibson (1979) first developed the concept of affordances to explain the possibilities an object affords for action. The concept of technology affordances was then introduced by scholars in the recent decade to capture the action potentials of

Research design and case selection

We started this research with an aim to understand how organizations adopt BA to create value. Given the exploratory nature of our research topic, we chose the qualitative case study (Pan and Tan, 2011, Walsham, 1995) and an interpretive approach (Klein and Myers, 1999, Walsham, 1995) to develop a rich theoretical understanding of the phenomenon and to answer our research question. We provide a summary of our research design and key methodological considerations in Table 1.

Data collection

Interviews were our

Case description: envisioning a BA-enabled transformation at Rovio Entertainment corporation

Rovio Entertainment is a Finnish entertainment company founded in 2003 as a mobile game development studio by three students – Niklas Hed, Jarno Väkeväinen, and Kim Dikert. In the 15 years since, Rovio has grown to more than 430 employees, close to €200 million in annual revenue, and created some of the most successful mobile games of all time. The company is best known for its Angry Birds game franchise. The original title in the series, released as Rovio's 52nd game in 2009, has been

Case analysis

Based on the technology affordances perspective, we uncovered four salient affordances of BA that were core to the attainment of Rovio's transformation goals: (1) foundational affordances for improved understanding, (2) functional affordances to improve core operational processes, (3) formative affordances to foster an integrated use of BA, and (4) formalizing affordances to cultivate a data-driven culture. For each affordance, our analysis unveiled the specific technological features of BA, as

Discussion

We developed Fig. 4 as a synthesis of our analysis to illustrate how affordances of BA were actualized to enable value creation. This model proposes four categories of affordances, organized into four stages of analytics-driven transformation. For each affordance, the model highlights three salient dimensions (i.e., technological potentials, organizational actors, and specific organizational arrangements) that are key to effective affordance-actualization. The purpose of conceptualizing

Implications and conclusion

Based on an in-depth case study of Rovio, this paper has developed empirically-grounded insights into the actualization of BA affordances for organizational value creation. First, our analysis uncovered four classes of affordances in supporting the attainment of four value creation goals. Second, for each affordance, we have provided a conceptualization on how the affordance was actualized to achieve the specific goal. Guided by our theoretical lens, our conceptualization highlights both the

Acknowledgement

This work was funded by the National Natural Science Foundation of China, Grant/Award Numbers: 71529001 and 71632003.

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