Should Netflix do something to gain back market shares? A Business Case Analysis Symptoms In September 2011, CEO Reed Hastings and fellow executives made a decision to increase their rates 60%, which has led to customer dissatisfaction, increase in more competition, and loss of revenue The reports show that after the price increase shares dropped a substantial amount (15%). Customers became dissatisfied because of the price increase and as a result canceled there membership (2.5 million canceled and projected to be over 6.5 million by end of quarter). Competition has increased due to the fact that their prices are no longer competitive and has given blockbuster to come in and collect all the dissatisfied customers as their subscribers. Problems The first actionable problem is the increase in pricing for the service that we provide here at Netflix.
2010) is provided below. 1167872 4 Despite the leading position and the good business results, SWOT shows several sources of potential risks for UST. The company is losing market share against new price-value competitors because of slow innovation and late product introduction and extensions. Historically, UST relied on his leading market position boosting earnings with annual prices increases. But in the meanwhile smaller competitors started to quickly erode market share with prices cut.
Poor sales performance and relatively high cost of sales have contributed to the profit margins to slip to one third of other hand tool manufacturers. It also comes clear that Robertson’s effort to provide products to every market segment lowers the overall efficiency of the company. By cutting non-marginal products from the company’s range of products, cost of sales has a potential of being reduced from 69% to 65% of sales. Further on, in case of an acquisition with Robertson, Monmouth Inc. could reduce Robertson’s sales force by implementing all sales functions into the existing hand tool lines. Sales and administrative expenses are expected to be lowered by 3 per cent (from 22% to 19%) if any duplications were removed.
The main problem in a declining industry is that falling demand for products lead to the emergence of excess capacity. In trying to use this capacity, GE began to cut prices, thus sparking a price war and diminishing the profit. GE was also suffering from low productivity growth (1%-2%) as well as a lack of new innovations. Another issue facing Welch as he took control was that the company was still organized as it had been when GE was founded near the turn of the century. GE was suffering from a lack of strong leadership and the existence of to much bureaucracy.
The company had stores on every corner, which resulted in high costs. Once the industry started evolving with new technologies, these stores became sunk costs for the retailer. Online-only retailers who enjoyed much lower costs than the brick and mortar stores were able to profitably charge customers a lower rate; however, at the same time, Blockbuster Video was saddled with the high costs of labor as well as the physical stores. It was not long before Blockbuster’s costs became too much for the retailer, as they were forced into bankruptcy. Today’s market landscape looks much differently than it did when Blockbuster Video was at its peak.
After missing earnings commitments, the Company's stock declined dramatically, resulting in a loss of nearly $50 billion in market capitalization.” (P&G Revolutionizes Collaboration with Cisco, 2008) Without this revolutionary approach Procter and Gamble’s growth would have become stagnant, allowing other consumer product companies to capitalize on the reduced competition, ultimately resulting in lost market share. P&G employees constantly need mobility, whether they are working from home, on their mobile phones, or traveling. Being able communicate to stay
Introduction The troubles facing the Green Mountain resort are to do with staffing issues /concerns and the problem with turnover. Although the location of the resort is not ideal (located in the poorest area of the state), the management had attracted a group of hard working employees. Yet due to lack of promotion and advancement at the resort, the excellent members of the staff have moved onto other resorts leaving behind the novices and poorer workers. This is where the underlying problem arises, as the staff turnover rate was so high due to new employees having to be hired, that the added training for the variety of assignments staff would undertake was crippling management. This sort the management to find a solution to fix their high turnover rate.
But this irreprehensible customer service does not come easily. It requires very dedicated employees that go above and beyond to ‘wow’ the customers. Ironically, the same elements that enabled Nordstrom’s success are responsible for its current misfortune. The controversial Sales Per Hour System (SPH), the decentralized management structure, and the not very clear distinction between working hours and non-working hours, have had very damaging consequences for Nordstrom. This firm’s significant earnings growth came to an end in the late 80’s when employee complaints, union allegations, law suits and regulatory orders began to arise.
1. The main similarities and differences between the approaches to people management at Café Co before and after the review From the case, the chief executive’s review of human resources found a high level of staff turnover, due to the minimum wage offered and the high percentage of international employees who tended to be employed on short-term contracts. The recent loss of market share and high employee turnover had led to low morale amongst remaining staff, as they felt Café Co’s bars were dated and the range of coffees limited. Then the chief executive decided to relaunch Café Co’s business strategy with a new vision: ‘To be the number one coffee house of choice across the globe’ and identified the following mission: ‘Experience Café Co, we don’t just sell coffee, we provide customers with an unforgettable experience’. The success of coffee bars lay not just in selling coffee as a product, but in selling the ‘coffee house’ experience.
Even though the effects of the financial crisis were negative, and caused many people to lose their jobs, CEOs are still receiving a large salary, which portrays a negative image on their company. This essay explains the effects of businesses responsibility to the environment, that profits are not the only measure that should be applied to corporate success and CEO’s salaries applied to businesses responsibilities. There has been a great deal of controversy in the media over whether businesses have a social responsibility. Businesses already have a responsibility to follow ethical standards and the law. However recent media coverage has demanded that large business should also have a social responsibility.