Netflix

MBAA 609R. Nakatsu

Netflix vs. Blockbuster

What does a typical Netflix customer value?

How does this differ from a typical Blockbuster customer who goes to a physical storefront to rent videos?

Discovery-Driven, Emergent Strategies Over Time

Identify discoveries that Netflix encountered and discuss how they led to changes in Netflix’s strategies.What was the initial business model what discovery led Netflix to abandon it?What other discoveries led Netflix to change?

Achieving Operational Excellence

What did Netflix do to achieve operational excellence in the following areas?

Inventory management Logistics/shipping Customer service operations

How does Netflix use IT to support these operational areas?

Frameworks to Analyze Netflix

Porter’s Five Forces Model Four strategies for countering the

competitive forces Sustaining vs. Disruptive Innovation

The Competitive Landscape Today

Is VOD a sustaining or disruptive technology

What competitive threats does Netflix face? What should Netflix do to respond to the competitive challenges?

What is Netflix doing today to stay competitive?

Main Takeaways

Understand the differences in the business models of Netflix and Blockbuster.

Recognize that the formulation of strategy is an evolving, and sometimes discovery-driven process.

Understand how Netflix uses IT to achieve operational excellence.

Identify the actions that Netflix can take to respond to the competitive challenges that it faces.

Practice using the frameworks discussed in class (e.g., Five Forces Model, Sustaining vs. Disruptive Innovation) to analyze the Netflix Case.