Failure Analysis/Change Strategy
October 27th, 2014
Professor Timothy De Long
Failure Analysis/Change Strategy
Comparing and contrasting failing and thriving businesses provides insight into best business practices. Examining a failed company, Blockbuster, and a successful company, Intuit, offers an opportunity to learn from managerial mistakes and triumphs.
Failure and Success
Blockbuster Inc. is an example of a failed business. Their updated mission, objectives, and vision were altered too late to keep up with the changing demand for convenient internet streaming videos. The company stated their “mission is to provide our customers with the most convenient ...view middle of the document...
, 2007). This robbed them of market share and forced prices downward (Wooldridge, Matulich, & Riddick Jr., 2007). The very thing the company was built on, its retail stores, became its downfall. They waited too long to move into the new internet streaming market, and instead of being a leader in the industry, they became the follower.
A business that continues to thrive is Intuit. Their mission, objectives, and values are relevant and forward-looking. “Intuit's mission is to improve its customers' financial lives so profoundly, they couldn't imagine going back to the old way” (Executive Profiles, 2014, para. 1). Their objectives, goals, and values are aligned with environmental stewardship making environmental considerations a high priority in decision making and allowing customers to also put the environment first. They also have a commitment to transparency with the stakeholders (Corporate Sustainability, 2014). The company values “integrity without compromise” and operate under the slogan “we care and give back” (Intuit Operating Values, 2014).
In contrast to Blockbuster that appears not to have had a strong emphasis on planning for future changes in the industry, Intuit relies heavily on a six-step forecasting and planning process for business fluctuation which includes the following: “(1) planning and direction, (2) volume forecasting, (3) staff planning, (4) model evaluation, (5) execution of plans, and (6) post mortem” (Ramanujan & Fisher, 2006, p. 12). This emphasis on planning allows Intuit to be efficient, effective, and avoid crises, which in turn allows the company to remain on the leading edge of the industry (Ramanujan & Fisher, 2006). Intuit’s main business is divided into tax software and accounting software. Each is subdivided into personal and business software. “Intuit has cultivated an agile, experimentation culture, despite being a 30-year-old Silicon Valley company. This start-up mindset, combined with the ability to reinvent and transform itself along the way” continues to allow Intuit to remain at the top of the market (Executive Profiles, 2014, para. 2).
Organizational Behavior Theories
One organizational behavior theory that Blockbuster leadership was focused on, was scientific. As a company, Blockbuster placed a great deal of emphasis on how they could become more effective within their brick and mortar business. They did this by redefining the company’s objectives and the direction of the company. The use of the scientific organizational theory failed Blockbuster because of their leadership decisions not to initiate the same level of or a higher focus on the click initiative, such as online rentals, in which the company could not capture the needed force to become competitive. “Scientific organizational theory, also known as scientific management refers to an approach to management based on principles of engineering, it focuses on incentives and other practices empirically shown to...