Finally, strategy has to be dynamic and iterative. Customer reaction to any change in a company’s value proposition is difficult to know a priori, even with the best market research. Having the agility to change your choices when new information comes to light is essential to strategy success. This type of agility, no matter what mistakes Netflix made, may save the company in the end. In fact, Netflix announced in January that in its latest quarter it had already replaced three-fourths of the subscribers who left last fall. Likewise, the stock has recovered much of the loss it sustained during the backlash.
- Ken Favaro is a senior partner with Booz & Company based in New York. He leads the firm’s work in enterprise strategy and finance.
- Kasturi Rangan is a principal with Booz & Company in Cleveland. He focuses on corporate and business unit growth strategies for automotive and other industrial companies.