Your company is making decisions that make sense… Right?
Interesting article in Time Magazine this week about Blockbuster, the video rental company. Here are a few excerpts….
When talking about Blockbuster’s innovation in the 1980’s, “Customers would pick an empty title case off a shelf and wait while a clerk hunted in a backroom to see if there were any copies left. Cook (the founder of Blockbuster) programmed computers to keep track of inventory and give him a daily report of what customers were renting. … That allowed Blockbuster to optimize its movie selection. Today it’s Retailing 101, but back then it was a revelation”
The article goes on to discuss decisions made by Blockbuster management that has led the company to bankruptcy. To summarize the situation, Stephen Gandel – the article’s author – quoted Clayton Christensen, a Harvard expert on change. Christensen noted, “Decisions that in other circumstances would have made sense, instead drove the company into the ground.”
Innovation can help create a billion dollar company; lack of innovation can move you toward bankruptcy. Yes, your company has survived… but you have limited resources. You can start changing your business processes today, or wait until 2011 or 2012. It’s your decision, but you never know when it may be too late.