Blockbuster Busted with a Stategy

The current strategic orientation of the firm is comprised of various goals directed to a select product/market group accomplished through the company's various core activities combined to create Blockbuster's main value proposition. The company's goals include, but are not limited to, providing excellent customer service, maintaining a large distribution channel that cannot be matched, and to cut costs while shifting focus on to profit centers that are more in tune with the current environment. These goals serve to accommodate a broad differentiation strategy. With their large distribution channels, they are able to deliver their wide variety of products to their broad customer base in a convenient manner. By using this type of strategy, Blockbuster hopes to be able to keep up with the current competitors in the market. The value proposition that Blockbuster offers comes from the wide range of products that are easily accessible through many different mediums. Along with this, Blockbuster really differentiates themselves by being the first to offer new releases in the video rental market. By doing this, they ensure that they have a continued competitive advantage over their competitors in the industry.

Blockbuster is in a crisis situation due to their low operating performance coupled with their low organizational health. Blockbuster's Financial position is obviously in disarray. The decisions to take on large amounts of debt in the previous years, along with several other poor management decisions, has led Blockbuster to file voluntarily for Chapter 11 bankruptcy on September 23, 2010. This was done in order to allow Blockbuster to restructure their debt in hopes that they will emerge as a much leaner and more efficient firm. The firm is currently maneuvering its way through bankruptcy court. While doing so they are cutting back on costs and striving to become a more efficient firm.