...meanwhile we will stay the course
Introduction
The featured organization faced several forces that bypassed the corporation’s ability to adapt, plan and engage in futuring. In 2004 the successful corporation had a market value of 5.9 billion dollars with a strong global presence and a staff above 80,000 people (Harress, 2015).
The organization is Blockbuster.
Blockbuster, a well-known name that offered movie and video game rental services to millions of people was unable to combat, “competition from online streaming and on-demand rental sites (Harress, 2015).
Resisting the Force
The forces that influenced the downfall of Blockbuster will be taken from the STEEPLE model. This well-known strategic analytical model that lists Social, Technological, Economic, Environmental, Political, Legal and Ethical external factors. These factors or forces can influence a business’s success model (George and Creately, 2024).
Two of the external factors or forces I will focus on related to Blockbuster are the Social and Technological Elements.
Social Forces
George and Creately neatly sums up Social Factors as demographics, lifestyle transformations and evolving social values fueled by sustainability, social justice, diversity and ethical consumption (2024).
Blockbuster clients that realized that media was digitally available contributed to the trend for this form of entertainment to explode. Harress reports that Blockbuster did not change its physical rental model when digital media was in its infancy, neither did it purchase Netflix for $50 million in 2000 when an offer was made (2015), showing a lack of strategic prowess.
Technological Forces
Technological Forces are described as considerations of the innovation ecosystem, such as AI, quantum computers, biotechnology and other emerging technologies. Digital Transformation and the ability to embrace AI, IoT technologies, cybersecurity and cloud computing. Research and development which underscores Technological forces with investments, patents, identification of disruptive innovations and collaborative research ecosystems (George and Creately, 2024).
Between 2005-2007 Blockbuster made a crucial error by not embracing digital transformation. Harress states that decisions inclusive of “ditching the total access online service in favor of continuing the in-store, retail-orientated model “ (2015) proved to be a big mistake and placed the company’s technology stance behind its rivals.
Summary
Forbes reports that Blockbuster lost 75% of market value between 2003 to 2005 (2010). The company lost its shares partially due to social forces like changing entertainment values and technological forces such as the inability to explore emerging technologies, envision the future of digital transformation or understand the serious nature of disruptive innovations.
In an increasingly digitized society, survival requires constant review of forces and intelligence backed bravery to, not stay the course. Blockbuster is a perfect case study in what happens when Social and Technological forces are ignored.
References
Forbes. (2010, May 18). (A timeline: the blockbuster life cycle. https://www.forbes.com/2010/05/18/blockbuster-netflix-coinstar-markets-bankruptcy-coinstar_slide.html
George, C., & Creately. (2024, November 29). What is a STEEPLE Analysis? Understanding its Elements and How to Create One. Creately. https://creately.com/guides/steeple-analysis/
Harress, C. (2015, December 5). Blockbuster RIP: The Video-Rental Empire is Dead. International Business Times. https://www.ibtimes.com/sad-end-blockbuster-video-onetime-5-billion-company-being-liquidated-competition-online-giants
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