Environmental Complexity – Arizona Coyotes

Arizona Coyotes – Environmental Complexity

First, I want to know generally (like an introduction):

How turbulent is your company’s environment and how well do you believe that they adapt to it?

The Arizona Coyotes are turbulent is a few areas, as their success is based on the team’s year to year performance. They do not have the ability to predict how the season will go as many different things can factor into a team’s performance. They have been very successful at adapting year to year and balancing out the organization to keep it rolling when times are good, and keep it afloat when times are not.

#1: List out as many elements affecting your company as you can for each of the sectors below.

Industry (Competitors, industry size, competitiveness, related industries)

Significant competitors:

  • Arizona Cardinals, Arizona Diamondbacks, Phoenix Suns, Arizona State University Athletics, University of Arizona Athletics, all 29 other NHL teams

Industry size:

  • Large Fan base and followed sports teams like the New York Yankees, Dallas Cowboys and the Chicago Blackhawks are a very large and demanding industry.
  • The Arizona Coyotes would fall under the category below them as their fan base and worldwide followers are much lower, but still enough to be a household name worldwide.
  • $101 million revenue in 2016
  • $60 million in player expenses in 2016
  • Gate Receipts: $20 million

Source: (Ozanian et al., 2017)

Competitiveness:

  • Arizona Coyotes offer its products on the NHL store, Amazon, Local Department Stores and their Team Store located in their home arena.
  • Their tickets can be bought on Ticketmaster, Stub hub, and through their team website.
  • Their low-priced tickets gives them a competitive advantage, but their team merchandise is monitored by the National Hockey League, making al team apparel the same price.

Raw Materials (Suppliers, manufacturers, real estate, services):

Suppliers:

  • Amazon, NHL Shop, Jobing.com team store and local department stores sell Arizona Coyotes team apparel (Jerseys, clothing, labeled household items etc.)

Real Estate:

  • com is the home arena of the Arizona Coyotes, which is located downtown Glendale, Arizona. This is where their home games are played, along with their team store location.
  • They have a practice facility also located in Glendale where the team trains and practices.

Services:

  • They offer the highest level of Hockey available in the world. They provide entertainment for hockey fans during 82 games in a season.
  • They are role models and idols for aspiring young kids who wish to be hockey players, or even just sports fans.

Human Resources (Labor market, employment agencies, universities, unions):

Labor market:

  • Player contracts, coaching contracts, athletic training roles, management roles, leadership roles, retail, marketing and sales.

Employment agencies:

  • They have their staff and departments listed on their website (Coyotes, 2017)

Financial Resources (Stock markets, banks, private investors):

Stock markets & Banks:

  • They are not publicly traded and have no banks.

Private investors:

  • Team owner Andrew Borroway paid $305 million for the team in 2014.

Market (Customers, clients, potential users):

Customers:

  • The fans are the paying customers. They are the ones purchasing the merchandise and the tickets, along with food and beverages during the games.

Potential users:

  • Sports fans in Arizona or visiting Arizona would be potential targets for the Arizona Coyotes.

Technology (Techniques of productions, computers, information technology, e-commerce):

Techniques of productions:

  • Arizona Coyotes use many social media websites to market their team and keep them up to date with the latest information and results.
  • They have commercials, and television rights that allow them to be easily seen in the state of Arizona.
  • They have their players involved in many community engagement activities, which allow fans to have a personal connection with the players while sharing these pictures and events on social media.

E-Commerce:

  • The tickets and merchandise online are easily accessible and have an easy process of purchase and payment.
  • Their 60-day return policy allows its customers to have full satisfaction or their money back.

Economic conditions (Recession, unemployment rate, inflation rate, growth):

Recession:

  • The Arizona Coyotes rely on their fans to attend their games and purchase their team merchandise.
  • Without their consumer spending, revenue will automatically hinder the organization.

Unemployment rate:

  • If the customers are unemployed and have no disposable income, they will be spending their money on necessities to survive instead of entertainment.

Growth:

  • With low priced tickets and the team having a bright future, there is a large room for growth as fans are starting to see a positive turnaround for the organization.
  • They have much more room to grow than they do to fall in their current organizational situation.

Government (City, state, and federal laws, regulations, taxes):

City:

  • The Coyotes are in Glendale, but are known as the Arizona Coyotes.

State:

  • The team is looked upon as a state-wide organization.
  • State taxpayers have helped the organization stay in Glendale and avoid relocation

Taxes:

  • In 2010 and 2011, Arizona tax payers spent $25 million to pay back debt owed to the National Hockey League (Garofalo & Waldron, 2012)

Sociocultural (Age, values, beliefs, education, religion, work ethic, consumer and green movements)

Age:

  • The youngest player on the team is Jacob Chychrun who is 18 years old
  • The oldest player on the team is Shane Doan who is 40 years old (Coyotes, 2017)
  • Fans range from all ages
  • No direct target demographics

Values:

  • Being the only professional hockey team in Arizona, people value the team based on representing the state
  • The players represent the state of Arizona
  • Being professionals and role models for the state of Arizona

Religion:

  • No set religion is followed
  • Players are spread out from 7 different countries across the world (Canada, USA, Sweden, Great Britain, Czech, Deutschland, Russia) (Coyotes, 2017)

Work Ethic:

  • Working for the high salary they are provided
  • Providing excellence for their fans and the state of Arizona

International (Competition from and acquisition by foreign firms, entry into overseas markets, foreign customs, regulations, exchange rate):

Competition from and acquisition by foreign firms:

  • The Arizona Coyotes are publicly owned by the National Hockey League
  • Cannot be bought out as an international organization

Entry into overseas market:

  • Players from overseas countries can play for the team
  • Cannot be relocated overseas
  • Must stay in North America under the National Hockey League

#2: Is the organization internationally diversified? Yes/No

The Arizona Coyotes are not internationally diversified. They are represented in North American under the National Hockey League. Their players are only represented on the international stage during world tournaments and they Olympics, where they represent their respected country. World economy is something that does not affect them as they are based out of North America do not work outside of the continent. They may have online purchasing internationally, with their competitors being other NHL franchises.

#3: How complex and unpredictable is the organization’s environment?

The organization is very unpredictable, as much of their revenue is based on the teams’ year to year success. In the 2012-2013 season, the team generated only $67 million in gross revenue, whereas in the 2015-2016 season they generated $101 million in gross revenue(“Phoenix coyotes revenue 2005-2016 | statistic,” 2016).  If the team is having a successful season, they generate more fans at each game and their merchandise sales skyrockets. They are not a very complex organization, as much or their approach year to year does not change. They must prepare for the team to have success to generate fans, as when they are having a low season there is not much they can do to turn things around for the better.

Which environment does your organization exist in?

The Arizona Coyotes exist in a general environment, as the sectors do not have a direct impact on the company as they may not change them often, but they can indirectly effect the organization over time.

#4: Does your organization’s strategies and goals fit their environment?

Circle one of the types in the following categories that you have found your company to portray: environment, strategy type, and organizational goals.

The Arizona Coyotes fall under category three. They are locally stormy because they are not in a comfortable enough situation where they can sit back and depend on fan loyalty to be there consistently, and they are trying to be an effective organization in terms of success and overall fan contentment.

  Type 1 Type 2 Type 3 Type 4
Environment Calm Varied Locally stormy Turbulent
Strategy types Reactor Defender Prospector Analyzer with/without innovation
Organizational goals Neither Efficiency Effectiveness Efficiency and Effectiveness

 

#5: Did your organization align across environment, strategy type, and organizational goals (i.e., all goals, if not then the correct response is NO)? Yes.

The Coyotes organization aligned across environment, strategy type, and organizational goals. I do not predict any further changes in their environment in the near future. They will like to test the waters with their new general manager being as young as he is, along with trying to keep their organizational high revenue last year of $101 million.

References

Coyotes, A. (2017, February 13). Official Arizona coyotes Website. Retrieved February 14, 2017, from NHL, https://www.nhl.com/coyotes

Garofalo, P., & Waldron, T. (2012). If You Build It, They Might Not Come: The Risky Economics of Sports Stadiums. Retrieved February 1, 2017, from The Atlantic, http://econ2.econ.iastate.edu/classes/crp274/swenson/URP290/Readings/If%20You%20Build%20It,%20They%20Might%20Not%20Come_%20The%20Risky%20Economics%20of%20Sports%20Stadiums%20-%20Business%20-%20The%20Atlantic.pdf

HockeyDB: NHL Attendance. (n.d.). Retrieved February 4, 2017, from (http://www.hockeydb.com/nhl-attendance/att_graph_season.php?lid=NHL1927&sid=2016).

Ozanian, M., Macramalla, E., Mitchell, J., Berg, M., Lee, B. Y., Brown, M., … Groves, D. (2017). Arizona coyotes on the Forbes the business of hockey list. Forbes. Retrieved from http://www.forbes.com/teams/arizona-coyotes/

Phoenix coyotes revenue 2005-2016 | statistic. (2016, October 10). Retrieved February 14, 2017, from statista, https://www.statista.com/statistics/196875/revenue-of-the-phoenix-coyotes/

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One thought on “Environmental Complexity – Arizona Coyotes

  1. Real estate? The consumer base needs to be defined better, and banks are not ones that they own, but which ones they use or how much trust banks have in extending them finances. All of your work needs to be supported by research findings within the text; not just at the end of a section. Some of this reads as your own assumptions, as apposed to information supported by documentation.

    Like

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