Introduction

Technology has changed at a rapid rate, and so does the popular media.  Briefly, the movie industry has had strong viewership within the theaters after the release of better formats. Later, movie industry moved from theaters to digital optic storages, DVD’s, and from blue ray to online streaming.  An example of an online streaming service as the latest transformation is Netflix. Netflix company was founded in the year 1997 by Reed Hastings and a software developers-Marc Randolph. The company was introduced during the era of DVD and took advantage of a widely available ideal of video rentals. Netflix Inc. started with an algorithmic idea to offer customers service to rent DVD in any place. An innovative approach to movie rentals made the company become more than a market fad, causing the local storefront close for losing revenues. After opening up of internet commerce, Netflix took the opportunity to meet the demands of customers in a better efficient way, concerning entertainment. The company started streaming videos directly into homes of clients as a way to allow exciting experience when watching directly on the home televisions. However, the company has had challenges along its delivery system as the innovation gets implemented.

Major Challenges that Netflix Faces

One of the significant challenges faced by Netflix company is stiff competition from other movie streaming businesses like Amazon.com, as they allow customers to stream movies at no charge. According to () “Amazon amplifies competition with Netflix by offering its prime members ability to stream videos at no extra charge.” The two companies strive to dominate a digital delivery of films and television shows. Second, Netflix is challenged by fostering the deployment of technology that is user-friendly and allows easy access to streaming services. The company experience this challenge as it enters into deals with television manufacturers to include software that can provide access to streaming services. The third challenge involves striking initiatives of the Netflix company to get into original programming. Lastly, the company is challenged by fees charged by the studio for Netflix to access contents.

The challenge I see most challenging to address is paying an increased fee to the studio to access contents. When studio charge the company high amount to access contents, significantly is could mean incurring an extra cost to Netflix, which could be propagated to customer’s expense. The company may be forced to charge customers amount slightly higher than the normal, and this could mean losing potential clients with the competition in the market. The easiest challenge to address is on how to deploy technology that can enable access to streaming services and be user-friendly. The challenge may be easy because Netflix has already made deals with manufacturers to integrate this move; thus the company is in a better position to continue with that direction.

How Netflix challenges relate to the managerial challenges

The above challenges faced by Netflix company refer to the managerial hardship of dealing with ethics, diversity, and globalization as they entail dealing with individuals and societal trends. To compete in the global market, it may require globalizing firm’s operations, and this is not an easy task for the managers to keep up with evolving trends. Changing market have varying cultural differences and inherent sensitivities. Many times, managers are challenged by leading a diverse workforce with issues concerning individual differences like age, social status, culture or religion. In the managerial practices, leaders are encouraged to exercise ethics, integrity, and such a decision may be difficult to implement when dealing with an institution of diverse stakeholders.  Globalization, ethics, and ability to manage diversity are linked to the challenges faced by Netflix company, for instance, deploying technology involve manufacturers around the world. Competition in the market is global as well as developing original programming with media companies. Incurred fee on Netflix covers the contents in the entire globe irrespective of where they are produced.

How Netflix Can Convert Challenges into Opportunities

An example of a positive move by Netflix to turn challenges into opportunities is its effort to address technology deployment. For instance, according to (,,) “ the companies largest and expanding the base of streaming devices are Microsoft’s Xbox 360, Sony’s PS# consoles, Blu ray disc players, home theatres, televisions and Apple products.” Netflix is thus supposed to move in this direction to see many customers on demand for its products. As a strategy to meet the competition gap, the company can develop plans to attract and retain customers. For example, just like Amazon.com, Netflix can start allowing its members seasonal free streaming. Also, newly customers can be awarded a free period of testing the streaming services and pay later. Also, Netflix should perhaps stop the pursuit of original programming to enable managers to concentrate on the distribution of digital media instead of stretching to other operations. Such a decision could help the company repair relationship with prospect studios and agree on considerable fee charges.

Recommendations to Reed Hastings Concerning Pushbacks

I would advise Reed Hastings to concentrate on the core competence of the business- distributing the digital media. In this way, the manager can focus on repairing relationships with customers, stakeholders or suppliers via optimum acquisition and appending people’s feedback. Fixing the damaged relationship between Netflix company and content suppliers is vital in sustaining favorable running costs which may not affect consumers. Otherwise, with the broken relationship, the company will run at a loss and try to avoid the expense through charging its customers high prices.  Another approach as a piece of advice to Hastings regarding the pushbacks is advocating strong culture. The managers should build a team-oriented to pursue challenges in an environment full of competitions. Hastings should put in place decentralized developments and product pipeline which would allow Netflix to operate more semi-interdependent entertainment organizations, whose outputs are distributable by a single service. As a leader, one ought to recognize that change is vital especially in a competitive climate, action plans must be revised well, and new technologies need to be adopted.

Additionally, I would advise the executive to find ways to target and retain young demographic as the diversity with the strong presence. Better customer profiles need to be developed and enhanced with quality data sources. For example, Netflix could link up with social platforms like Facebook, Google and Twitter account where it could access and exchange data that would unveil personalized details. In that way, the company can leverage the obtained information to improve its services or features which targets potential young consumers with the right and quality content.

Conclusion

In conclusion, for Netflix to fix its market leadership issues in the digital streaming world, it has to concentrate on the core competence in information technology. The company can leverage customer relationship as a way of allowing content providers have a great insight into the consumption of licensed contents, thus incentivizing strong partnership. The company may opt to integrate a competitive, intelligent application to alert leaders of the upcoming technological devices before developing and releasing. In that way, it would ensure maximum Netflix adoption in the device population.

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