The article talks about a British music company, HMV that was leading in the world in the 1990s. It operated in the main street stores where customers used to browse a wide connection and listen to tracks before purchasing a CD. The company runs almost 40% of the Britain market. The company expanded during the 1970s establishing itself as the leading retailer in the music industry. It opened its stores in various countries such as Canada, Ireland, France, Japan, and Germany. As time went by, some employees and analysts became doubtful of the company’s business model, but according to Steve Knott, the managing director believed in the old strategic model hence doubling down. Due to technological advancement, online retailers, downloadable music and supermarket discounting came into play thereby threating the HMV’s market. By the time HMV was updating its technology, it was too late as the other methods were easier to use resulting in a failure of the company.
The article explains that the reasons for doubling down which is mostly referred to as heightening the commitment of employees towards a certain strategy. They include ignorance, expected returns on investment, for individual identification, the power of control, and the anxiety for a finished project. To avoid doubling down, the use of proper decision-making procedures is emphasized, employees are also to be involved in decisions making as they can interpret the market before it’s too late thus helping the company avoid unnecessary losses. Those who object doubling down should be taken into consideration too as they are the only population that is against doubling down. The other alternatives are also a key point to act as options that were available to use rather than doubling down, decision making and advocacy should be separated. Finally, ensuring that a regret anticipation is established to act as punishment for managers who were not of the idea to try out something else.
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Fitbit is a good example of a company that has doubled down on a losing strategy in the past. It is a company that deals with the production of smartwatches. The company faces competitors such as Apple who are now producing watch OS which is by far a more advanced gadget. This left them with a difficult choice to adopt Android Wear and build a practical smartwatch to compete with apple watch or continue to producing their simple fitness devices (Mills, 2017). Trying to compete with Apple would be doubling down which most is likely not going to work out.
References
Mills, C. (2017, August). Fitbit has doubled down on losing strategy. BGR . Retrieved from https://bgr.com/2017/08/29/fitbit-ionic-vs-apple-watch-review-release-date/
