Monday, April 19, 2010

Question 15: Service Transformation

There are any number of ways that an organization can transform its service. Identify 4-5 ways that your focal service organization could do so. Select 1 and provide a detailed description of why you think the organization should transform the service in the manner you suggest. Is this a competitive necessity for sustainability or an opportunity to gain market share, etc. What would be the 2-3 most significant barriers to overcome.

Netflix could transform its service in the following ways:
  • Exclusively offer streaming content
  • Move into the video game market
  • Expand into the music market and offer streaming MP3 content
  • Begin to offer in-store delivery machines (similar to RedBox)
I feel that Netflix could best transform its service by offering customers the option to stream every video available on the site either thru their computer or thru their television. By ensuring that all content is streamable, they would be able to differentiate their service even further and gain market share by attracting new customers. Netflix could offer this as a delivery option along with their current standard plans.

The main obstacle, in my opinion, would be restricting the number of videos a customer is able to watch during a given time period. Currently, Netflix offers 1, 2, 3, and 5-DVD at-a-time mail order plans. If a customer chooses to view all their content over the internet, Netflix would have to develop a way to regulate content based on the subscription service the customer pays for.

Additionally, Netflix would have to increase its server capacity to handle the additional storage space necessary to hold hundreds of thousands of hours of video content.