Corporate Strategy: Where To Compete And Business Success

Corporate Strategy Addresses Whereto Compete And Business Strategy A

Corporate strategy addresses "where to compete" and business strategy addresses "how to compete" (Rothaermel, 2021, p. 313). Choose one business in chapters 7 and 8 and describe one aspect of this business where you see a failure of management. In other words, what is one thing the strategic managers of this firm should have or could have done differently to help move the company forward. Be sure and include in your discussion how this firm addresses "where" to compete and how this firm addresses "how" to compete.

Is there a failure in the "where" to compete or is there a failure in 'how" to compete? Analyze that failure and offer a solution that you as the strategic manager would have implemented. This case may be based on your opinion. However, you must back up your opinion with sound research and fact.

Paper For Above instruction

In analyzing the strategic failures within a company, it is imperative to examine both the decisions related to "where" to compete and "how" to compete. An illustrative case can be drawn from the recent challenges faced by Blockbuster, a once-dominant player in the home video rental industry. While their failure to adapt their "how" to compete primarily contributed to their downfall, aspects of their "where" to compete also played a role. This paper discusses the strategic missteps of Blockbuster, analyzes whether the failure lay more in "where" or "how," and offers strategic recommendations to rectify these issues from a managerial perspective.

Blockbuster's primary "where" to compete was in the physical home video rental market, targeting suburban and urban consumers desiring convenience in renting movies. Their geographic and demographic focus was initially successful but became a liability as market dynamics shifted. The company’s "how" to compete involved providing a broad selection of titles, in-store customer service, and late fee revenue models. However, their failure to innovate their distribution channels and customer experience profoundly undermined their competitive advantage.

One glaring management failure was in their "how" to compete—particularly their underestimation of digital transformation and the rise of internet streaming services. Blockbuster's management was overly committed to their brick-and-mortar business model, failing to pivot towards digital delivery. This resistance to change exemplifies a failure in adapting "how" to compete—a crucial aspect when market conditions shift rapidly. Despite emerging streaming services such as Netflix, Blockbuster continued to rely heavily on physical stores and late fees, neglecting the importance of online platforms and subscription models that consumers increasingly favored.

While their "where" to compete was initially appropriate, their reluctance to evolve their "how" represented a strategic failure. The company missed an optimal opportunity to transition into digital by not investing sufficiently in online services and digital distribution mechanisms. This oversight was compounded by their late attempt at launching their own DVD-by-mail service and digital streaming, which arrived too late to reclaim lost market share. Consequently, competitors who had proactively embraced digital transformation, such as Netflix, captured the market, rendering Blockbuster obsolete.

As a strategic manager, the corrective action involves a comprehensive shift in both "where" and "how." While the "where" might have remained in physical rentals temporarily, the critical focus should have been on innovating the delivery approach—embracing online streaming and digital rentals early on. A proactive investment in digital infrastructure, creating a user-friendly online platform, and adopting a subscription-based model could have sustained their market position. Furthermore, strategic alliances with content providers would have been essential to expand their service offerings and keep pace with technological advancements.

Particularly, management should have recognized the disruptive potential of internet streaming much earlier. Implementing a phased transition from physical to digital rentals, coupled with aggressive marketing of the new digital services, would have positioned Blockbuster as a competitive entity in the digital space. Additionally, exploring strategic collaborations rather than direct competition could have mitigated the risk of obsolescence, allowing them to leverage the strengths of newer firms while gradually repositioning their brand.

This case study underscores the importance of balancing "where" to compete with "how" to compete and adapting to technological shifts. Failure to do so results in strategic irrelevance, as evidenced by Blockbuster's decline. Proactive adaptation, embracing innovation, and strategic agility are imperative for survival in a dynamic marketplace. As a hypothetical strategic manager, prioritizing early digital transition, customer-centric innovations, and strategic alliances would be key measures to avoid a similar downfall and ensure sustainable competitive advantage.

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