Question

In: Operations Management

Describe how Netflix was able to adjust their core competencies in order to enhance their competitiveness...

Describe how Netflix was able to adjust their core competencies in order to enhance their competitiveness versus Blockbuster, which ultimately failed. Give another example of a company that has pivoted in order to remain competitive while one or more of its competitors failed.

Solutions

Expert Solution

Blockbuster as a birck and mortar renta chain had an undisputed leadership in the market when Netflix arrived.as a firm. As time progressed while blockbuster had to file for a bankruptcy, the valuation of Netflix grew many fold.

The primary reason can be attributed not keeping up pace with the technological changes. With the dawn of the internet it was important which Netflix exactly did was to focus on their competency of delivering incredible and possibly affordable entertainment to customers. They found out new ways to do so with the dawn of the internet and kept innovating on their core competency. They adopted as preferences of customers changed by changing their marketing channels, simplfying the renting process thus making it more enjoyable for customers. There is always a first mover advantage in the market which Netflix clearly capitalized on thus bringing home entertainment just at the disposal of a few clicks.From deliverig DVD' on rent in an online fashion to on-demand video streaming Netflix had slowly come a long way. They also signed contracts to deliver popular videos to service.

On similar lines Amazon vs Barnes and Noble. Not only B&N could keep pace with Amazon they didint capitalize on their core competency with their DVD and CD sections being unmanned with mismatched merchandizes. They didnt perform in line with their online competition.which led to decrease in sales YoY.


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