The failure of blockbuster is really interesting to me - because so much information is available, it's great to learn from blockbuster is a great example of a business that failed to identify. Was blockbuster really a victim of disruptive innovation or was the problem actually infighting and a failure of leadership to develop an appropriate strategy. Then there's the strategic trap, when a company focuses purely on the marketplace of today and fails to anticipate the future some unlucky companies manage a trifecta and fall into all three traps. Bryn owen was blockbuster's uk chief marketing officer for four years and watched as it went from retail giant to retail casualty he advises brands on how they can avoid a similar fate. Blockbuster's fatal flaw wasn't one of intelligence or capability, but a failure to understand the networks that would determine its fate.
In an era characterized by the widespread availability and accessibility of information and growing concerns over ethical and authentic leadership, business leaders are increasingly required to answer to public concerns about their past and present failures. From blockbuster to kodak, stories abound of corporate inertia it is the ceos' job to inspire their team with a vision and simultaneously read the landscape to capitalise on emerging trends while this is a necessary condition, it is not sufficient. Having the wrong people in leadership positions management must be willing to make the tough decisions to ensure the right individuals are in the right leadership positions the right individuals include those who will advocate for and champion the strategic plan and keep the company on track. Blockbuster's management attempted to address this power and political issues by reforming mission success vs failure 8 statements and core values, and altering the distribution of power within the organization but restructuring, but the companies failure is greatly attributed to the time it took management to act.
Blockbuster, ironically enough, was the product of a tech advance entrepreneur david cook founded the outfit in 1985 a computer programmer, cook noticed that typical movie-rental-store owners had no idea what they had in stock. Strong leadership can build a learning culture—one in which failures large and small are consistently reported and deeply analyzed, and opportunities to experiment are proactively sought. As a teenager growing up in america in the late 1990s/early 2000s, i was a frequent customer of blockbuster - the largest movie rental retail chain with a strong brand and stores across the country.
Senior leadership came up with a viable strategy but couldn't manage the internal forces that derailed it eventually, the team came up with a strategy that began to beat netflix at its own game. Blockbuster, the games and dvd rental chain, is set to enter administration for the second time this year in a move that will put 2,000 jobs at risk the business was one of the most high-profile. From a strategic standpoint, blockbuster suffered from the common failure to achieve continuous disruptive innovation undoubtedly, blockbuster was the best video rental retailer (concepts such as movie gallery / hollywood video struggled to earn their cost of capital.
Why blockbuster's 28-day advantage, additional daily rates (don't call 'em late fees), and stay-the-course ceo may not be enough to save the video rental giant. Companies fail to focus on the right things and leaders don't guide their team in the right direction let's take blockbuster, for instance the video rental store has become the face of extinct. Failure analysis/change strategy 2 business in and were too focused on old business models that no longer worked this paper will examine how the blockbuster corporation lost revenue due to competition from companies like netflix, and redbox and internal power struggles.
The harvard business review article blockbuster's former ceo on sparring with an activist shareholder by john antioco describes his own, first hand, challenging journey of being chief executive. I firmly believe that if our online strategy had not been essentially abandoned, blockbuster online would have 10 million subscribers today, and we'd be rivaling netflix for the leadership. These slides are provided as part of blockbuster's presentation and should be viewed in the context of the presentation and blockbuster's most recent form 10-k, form 10-q and form 8-ks filed with or furnished to the securities and exchange commission (sec), all of which can be found on the.
Blockbuster is a loser of digitalization because it was unable to cope with the changing market environment: it sticked far too long to an outdated strategy and failed to understand market changes that others eagerly exploited. What they don't tell you about the blockbuster story a favorite pundit punching bag is blockbuster the story, as they tell it, is that blockbuster was blind to the threat that netflix represented, subjected its customers to predatory late fees and failed to formulate a strategy to adapt to the digital world. Blockbuster—failure to identify disruption the first blockbuster store opened in 1985 at its peak in 2004, the company operated 10,000 stores and had a market value of $5 billion. Under antioco's leadership, blockbuster refocused on its video rental business, leading to a brief upswing in profits 22 but this success was short-lived, as blockbuster made a series of mistakes regarding new media and new competitors 23 these choices would haunt blockbuster.