Business thrives on stability. However, stability is a commodity that the world is currently lacking.
Last Thursday, Netflix announced that 300 employees, or 3% of its workforce, would be laid off. As the streaming giant's revenue growth has slowed, it needs to cut costs.
All of these have been documented for some time. In the first quarter, Netflix reported a slight decrease in subscribers and warned of a larger decline in the second quarter. Too much competition is to blame. The list of competitors appears endless: Disney+, HBO Max, Apple TV+, Amazon Prime Video, Peacock, Discovery+, and Paramount+.
In other words, Netflix's problem is not the decline of online streaming. In fact, this trend has been accelerating. Its rapid acceleration is responsible for the forceful responses from Disney, Apple, and Warner Bros. And so, Netflix loses its uniqueness. It is no longer the only game in town.
In the midst of a turbulent environment, it is difficult to see what lies ahead. From a business perspective, however, many of the latest development are merely about deep trends that have gone accelerated. Real trends don't get tossed up overnight. Knowing this is helpful. Because you now understand where to persist and strengthen your previous commitment.
Here is yet another trend that is suddenly on everyone's mind.
Even if you remove politics, the corporation has been pressured to embrace the individuality of its employees. It makes sense for companies to support the best talent, regardless of their identity, so that they can perform their best work for the company. And compensation must resonate with those who have the greatest need.
Last week, a variety of tech companies, large banks, and consumer brands pledged to cover travel expenses for women who must travel out of state to obtain an abortion. The Supreme Court of the United States has overturned Roe v. Wade. This eliminates the constitutional right to abortion. It is up to companies to create an attractive workplace environment for all employees. Uber and Lyft went even further. They stated that they will cover legal fees for their drivers if they are sued under Texas or Oklahoma laws that penalize anyone who assists a woman in obtaining an abortion.
This escalation of social pressure is another accelerated trend corporations are experiencing. The good news is that we are aware of what must be done. There are solutions available. Or at least the door is now open for discussion.
The problem is that, as quickly as companies are moving, many are moving too slowly. Here is a summary of companies striving to become future-ready:
- We all have opinions about Elon Musk. However, Tesla’s pursuit of vertical integration has enabled the company to venture into areas that other traditional carmakers have avoided. Meanwhile, BYD is expanding its semiconductor manufacturing and is already self-sufficient in chipset supplies. Unlike big carmakers who hedged their bets, these pure-electric plays have benefited from venturing into areas that others shunned. Read the South China Morning Post commentary on how Tesla and BYD have surpassed their competitors.
- Microsoft's previous developer conference centered on developer tools, cloud services, and training. In this BBC News interview, I discuss what distinguishes Microsoft from other tech giants; how strategic partnerships allowed them to introduce cutting-edge technology to the market; and how focusing on the developer community allowed them to open a new horizon.
- The last few years have been a stress test, exposing which companies are future-ready and which are not. Here is a summary of our quantitative approach for determining a composite score for industry players in the automotive, finance, technology, and fashion areas.
Thanks for reading and stay well,