How Netflix Corrected Its Mistake Called Qwikster
TL;DR
Netflix detected error through multiple signal channels simultaneously
Analysis of Netflix's rapid course correction - sensing customer feedback signals through sentiment tracking, cancellation rates, and stock price, then reversing the Qwikster decision within weeks. Illustrates organizational chemotaxis under pressure: the ability to detect you're moving away from food (customer value) and tumble/reorient.
The contrast with Kodak is instructive: both companies sensed environmental signals clearly. Netflix acted in 60 days; Kodak took 36 years. The difference was signal transduction, not sensing.
Key Findings from Talky (2021)
- Netflix detected error through multiple signal channels simultaneously
- Course correction took weeks, not months or years
- Sentiment tracking, cancellation rates, and stock price all signaled the same thing
- Demonstrates organizational chemotaxis - tumble and reorient when moving wrong direction