Entertaining Strategy

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Statement of the problem

Coming up with a sustainable strategy which can save a company from the intense competition is always challenging. The biggest problem facing Netflix is coming up with an appropriate strategy that can secure its competitive advantage in the entertainment industry.

Analysis and evaluation

The case depicts Netflix as a successful company retaining a huge market share since its establishment in the year 1999. However, within the course of operations, the management has found itself on the wrong side of the strategic decision making. Apparently, to retain a competitive position, Netflix had to ensure that it is responsive enough concerning the changing environment. During its inception, the CEO of Netflix maintained a simple strategy of selling DVDs to its online consumers as this was a direct way of ensuring quick access and convenience to its customers.

Netflix possesses numerous operational advantages that have enables it to build a strong relationship with its customers so far. For example, Netflix is classified among the first entertainment content providers to penetrate the international market. This is advantageous in that the market was not very competitive during its inception in the year 1990s. Besides, Netflix is also favored by the changing lifestyle emanating within the modern societies. Most people who like watching movies have shifted from predominate movies stores to online streaming that presents Netflix with a market niche. However, Netflix does not operate flawlessly. It faces various challenges that have inhibited it from creating a sustainable competitive advantage across the globe. 

The biggest problem facing Netflix, in this case, is lack of strategic plans which are feasible. In his various attempts to improve the company’s popularity, and eventually profitability, Reed Hastings has made some decisions which are not favorable in the industrial setting and the nature of competition in the entertainment industry. According to Bateman, Snell, & Konopaske (2017), the competitive environment provides a business with no room for error when coming up with strategies that can support the corporate business agenda. Based on the core mandate of Netflix, it is clear that customer focus is the primary object that can ensure its success or failure. The case presents a scenario where Hastings made a decision which later raised traction among the customers. With no doubt, making a decision that affects customers in one or...