The High Cost of Ignoring Strategic Business Analysis: Lessons from Failed Giants

Every day, we make decisions related to our lives based on current information. Life is a constant decision process, even when it comes to companies. Undoubtedly, strategy decisions in organisations must be based on up-to-date information to enrich them and help them progress. The smarter decisions are made, the more benefits are received. Change is a part of this world. Organisations need to align themselves to the changing world. Well-prosperity organisations can only exist with a well-conducted business analysis, which answers market trends and customer expectations. 

But what may happen when we make wrong decisions? What will happen if we abandon invaluable business analysis? 

Below are some short organisational stories that paid a high price for not aligning with the changing world.

Kodak

Kodak was a leader in the photography industry, but it neglected the development of digital photography technology. Based on obsolete technology and habits related to traditional analogue photography, the company needed to invest earlier in digital technology development. It ignored increasing competition, focusing on trends and modern technologies in this industry. As a result, there was a significant delay in market adaptation, ultimately leading to the company’s downfall as an industry leader.

Yahoo

Yahoo had several opportunities to become a leader in the technology industry, but it needed to catch up by relying on an outdated strategy approach. An example is the decision to reject the chance to acquire Google and the ineffective management of the Tumblr acquisition. Changing user preferences on the Internet and the need to be more innovative caused Yahoo to lose its significance in the market.

MySpace

MySpace used to be one of the world’s most popular social networking platforms, surpassing Facebook. However, over several years, it lost its dominance in the market and eventually collapsed. The main reasons for its downfall include neglect of technological innovation, management issues, frequent changes in product vision and issues related to product quality and user experience. Moreover, the company failed some legal battles connected with sexual abuse and copyright infringement cases, which happened via MySpace. 

Blockbuster

This company was once a leader in the video rental market. Still, it ignored the growing importance of online rentals and streaming, relying on outdated data and information about consumer preferences. Missing the opportunity to buy Netflix pushed the company into severe strategic problems. It led to bankruptcy because it did not transform its business model.

Borders

Borders was once a prominent bookstore chain but faltered due to several strategic missteps. The company underestimated the impact of digital transformation in the book industry and failed to promptly develop its online sales and e-book offerings. Instead, Borders outsourced its online book-selling operations to Amazon. This decision significantly weakened Borders’ brand and customer base, as it redirected potential online customers to its direct competitor.

Conclusion

What is the moral of these stories? All the stories mentioned above have something in common – the source of their downfalls lay in the severe gaps or ignoring strategy business analysis. Refrain from repeating those mistakes. Instead, learn from the mistakes of others.

To find out more, you can look over the following websites:

https://startuptalky.com/kodak-bankruptcy-case-study

https://hbr.org/2016/07/kodaks-downfall-wasnt-about-technology

https://www.feedough.com/why-yahoo-failed

https://www.tactyqal.com/blog/why-did-yahoo-fail-the-rise-and-fall-of-yahoo/

https://productmint.com/what-happened-to-myspace/

https://buildd.co/startup/failure-stories/what-happened-to-myspace

https://www.indigo9digital.com/blog/blockbusterfailure

https://time.com/archive/6597696/how-blockbuster-failed-at-failing

https://business.time.com/2011/07/19/5-reasons-borders-went-out-of-business-and-what-will-take-its-place/

https://medium.failfection.com/top-reasons-why-borders-failed-6ad33ca2afee