Strategic Management Lessons from COVID-19: The Zoom Boom and Quibi's Quick Demise

Now, more than ever, strategic management decisions can make or break a company's success. The following are two striking examples of both ends of the spectrum, notably with Zoom and Quibi. Both companies faced the same global pandemic, yet their fates were drastically different. Why? Let's take a closer look.

Zoom: Seizing the Moment

When the COVID-19 pandemic swept across the globe, forcing millions to work and learn from home, the demand for video conferencing software skyrocketed. Zoom, a relatively smaller player before the pandemic, emerged as a global leader. The company's strategic management decisions played a pivotal role in this success.

Zoom had always prided itself on being user-friendly, ensuring people of all ages and tech skills could use it. As schools shifted to remote learning, Zoom lifted the 40-minute limit for K-12 schools, greatly expanding its user base. Such customer-centric decisions allowed the platform to become an essential tool for remote work and education. The company reported a 326% year-over-year increase in its 2021 fiscal revenue, reaching over $2.6 billion.

Lesson: Flexibility and adaptability in strategy can help businesses thrive in uncertain situations. Being customer-centric and understanding user needs can provide a competitive advantage.

Quibi: A Big Bet That Didn't Pay Off

Meanwhile, Quibi, a mobile-focused streaming platform, had a much less fortunate journey. Launched in April 2020 with the concept of providing "quick bites" of content for on-the-go consumption, Quibi shut down just six months later at a loss of almost $2 billion dollars!

Several factors contributed to Quibi's downfall. The timing of the launch coincided with the start of the pandemic when people were no longer commuting or waiting in line—essentially, the scenarios Quibi had banked on. It also faced stiff competition from established streaming platforms. But perhaps the most significant factor was its lack of compelling content. Despite a hefty investment in high-profile talent, Quibi lacked the must-watch shows necessary to drive subscriptions.

Lesson: Understanding market trends and customer behavior is critical to strategic success. A unique product must be supported by a strong value proposition and effective execution.

The stark contrast between Zoom and Quibi's fortunes underscores the critical role strategic management plays in a company's success. A strategy should be adaptable, customer-centric, and grounded in a keen understanding of the market. As we continue to navigate an ever-changing business landscape, these lessons are worth remembering.