This paper seeks to analyze blockbuster bankruptcy. It also seeks to analyze the management issues in a business prospect and what mangers can learn from blockbuster bankruptcy.

Blockbuster is a casualty due to the world technology that is moving fast. The dilemma in this prospect is that if the movies are provided to homes at lower costs, there will be fewer rentals and this will create a mentality of buying a movie. The big question is why the blockbuster did not grasp this fact in order to avoid the huge dept. This is a wake-up call for all the movie providers in the movie industry. It is clear that this bankruptcy will affect a lot of people in the movie field. This includes blockbuster stores and employees from these stores which are very unfortunate (Paceli, 2011).

Management issue is a very important part of project management. Issue management needs to be set up properly in order to avoid or prevent compromising and undermining the risk management. It is important to note that an issue becomes a problem at hand or a problem today but a risk is a problem in the future. Many organizations do not understand the difference between an issue and a risk and thus end up undermining their risk management. The point of confusion arises when the risks require urgent action (Gandel, 2010). This may result in duplication of risk concerns and issue concerns which may need urgent review in order to avoid information overload. Every organization must therefore consider the risks while dealing with the issues in order to achieve the desired results and avoid undermining their risk management. Many analysts have argued about the precise point when the issues become a risk. Well, there is no definite answer except that an issue occurs when a risk can no longer be stopped or contained.

In this regard, it is important to get the balance right. This is only possible if the management deals with the urgent things first and avoid destructions of the same (Michael, 2008).

What can managers and other companies learn from blockbuster bankruptcy.

Managers and businessmen can learn many lessons from blockbuster bankruptcy. The first lesson that managers and businesses can learn is to be sensitive to the market place and the market trends. For example, Kodak managers ignored the market trends and new technologies. This is very unfortunate because it ended up tragically (New York Media, 1997). This can happen if the particular manager or business owner thinks he/she knows what is best for the company and fails to listen to the market voices and trends. By the time blockbuster bankruptcy became an issue, it was already too late to repair the damage. The other lessons that managers can learn from blockbuster bankruptcy are the following: (Howell, 1995)

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  • They should be quick and nimble. The managers should realize that change is not only necessary but inevitable. Managers should not be afraid to cannibalize their businesses or allow other competitive companies to erode the best market shares.
  • Managers should also realize that competition is not when they think they are on the surface. The managers should focus and target these competing companies as a big threat to their businesses (New York, 1995).
  • The most important lesson the managers can learn is to listen. Listening is very easy yet so difficult at the same time. There is no beauty in silence and it ends up tragically when the managers do not listen to the market trends (Beverly Hills Bar Association, 1993).
  • Managers must never buy their competitor until they invest in the future of the business. Blockbuster did not respond to the weak areas in their sectors, instead, they tried buying their competition. This simply means that blockbuster focused on getting many new outlets as opposed to investing in the future prospects of the business.
  • The managers must act fast with commitment. Notice that the point is not simply to act but it is to act fast in order to achieve the desired results.
  • The managers should learn to talk to their consumers and customers. In this way, the managers will identify what the consumers want as opposed to what the company is offering them.
  • The managers must also recognize that they are not in the common business they have always thought they were in. This is one of the mistakes that slowed down blockbuster (McGeorge School of law, 1983).

Could bankruptcy have been avoided?

Bankruptcy is where the debtor gets the chance to clear its debts. Bankruptcy should be avoided because it affects the credit of the business badly, the managers and business owners may end up losing their property, it may only eliminate some debts but not all debts, it may have serious effects on the financial aspect of the company, the company may never qualify for new credit and it may affect the retirement plans in the company among many others. In this regards, managers should avoid bankruptcy at ever cost by: (Dobuzinskis, 2010).

  • Settling the debts. This is possible through a debt reduction programme where the managers may negotiate with the creditors to reduce the debts
  • Debt consolidation programmes. This is where the managers consolidate their monthly payments in order to comfortably manage their bills.
  • Debt management helps to reduce penalties and interest rates.
  • A do-it-yourself plan. In this plan, the managers get out of the debt themselves without involving professional help (White, 2011).


This paper has looked into and discussed all the attributes that are related to blockbuster bankruptcy. It has also touched on the basic lessons that managers can learn for the same. The paper has outlined all the necessary steps that a company should take in order to avoid bankruptcy.

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