Lessons from Blockbuster


(Spectrumbot) #1

It is the year 2000. You are a member of the leadership team for a large video rental company called Blockbuster and have no idea that the company’s ultimate demise will be sealed by what you unwittingly vote today. You feel a deep sense of pride in how this team has taken a fledgling company from its tenuous beginnings fifteen years ago to become a sprawling giant.

One morning, at precisely 9:00 a.m., Blockbuster’s CEO, John Antioco calls a leadership meeting to order.

Reed Hastings, the head of a startup called Netflix, has asked to make a short presentation and is invited in around 11:30. Hastings briefs everyone on their operations. Unlike Blockbuster, they have a very different business model. Netflix has no brick and mortar stores. All videos are now sent by mail but they plan on transitioning to online streaming soon.

Hastings, a visionary, has carefully analyzed societal trends and the latest technology. He offers to sell Netflix to Blockbuster for $50 million. Netflix would handle online rentals and Blockbuster would operate the stores.1

Antioco, who views Netflix as a minimal threat, responds that an adjustment like that would upend Blockbuster’s whole operation and cost hundreds of millions. Hastings is voted down and practically laughed out of the room.2

Blockbuster continues to expand. By 2004 it employs 84,300 people worldwide, 58,500 of those in the United States, and operates 9,094 stores.3 It dominates the industry.

The problem is that the public is rapidly choosing the Netflix model over Blockbuster. By the time Blockbuster comes to its senses, it is too late to catch up.4 Some ill-conceived corporate decisions follow that are made in desperation. In 2010, Blockbuster files for bankruptcy.

By contrast, Netflix adjusts to the times and thrives. Market value in March 2018 equals $130 billion, putting it within shouting distance of Disney. As of October 2018 it has 137 million subscribers worldwide.5

The Seventh-day Adventist Church is currently acting too much like Blockbuster and has its own Netflix to contend with. Like Blockbuster, the leadership doesn’t seem particularly alarmed at present. There has not been any obvious willingness to meet the threat by making major changes. Meanwhile, the danger is growing and intensifying. The tithing system, the financial lifeblood of the church, is particularly vulnerable.

The name of the threat is “Modern Generations.” To be more accurate, it is the Millennials and every generation thereafter. Not everyone, or course, but a rapidly increasing number. The danger is that these generations harbor a very different worldview, or model, from people like my father who served in World War II with the “Greatest Generation.”

My dad’s generation has what might be called, “INSTITUTIONAL LOYALTY.” For them, institutions generally were a good thing, a trusted segment of society. The Federal Government had brought them out of the Great Depression, won the world war, and fostered the prosperity of the 1950s.

Largely because of institutional loyalty, my dad always purchased Chevy cars. To do otherwise would be “disloyal.” He always put his money in the Cape Cod Bank and Trust whether it had the best service and interest rates or not.

Seventh-day Adventists from that generation went to Sabbath School because that was what the denomination said they ought to do. They also gladly sent their tithe to the local conference without grumbling or second-guessing because that was both their perceived privilege and obligation.

In stark contrast, many people from my generation and younger reject institutional loyalty. They are deeply distrustful of institutions, which, in too many cases, have been riddled with political machinations and corruption. Their generation has endured Vietnam, Watergate, Enron, trillion dollar bailouts for profit hungry mega-banks, etc.

The loyalty of these newer generations is to VALUE. For instance, I may purchase from a different automaker each year depending on where I can get the best bang for my buck. If an online bank offers a higher interest rate, I’ll yank my funds out of the Florida Bank and Trust as quickly as I can click “Send.”

Seventh-day Adventists from this younger generation will simply stay home if Sabbath School is not perceived as worthwhile. “Ought to” is not even on the radar.

Charitable donations are a whole different ballgame as well. Because of their loyalty to value, Millennials et al, are very unlikely to blindly ship their precious dollars off to a denominational entity and hope they use them wisely.6 The Philanthropy News Digest concludes, “Millennials — young men and women born between 1979 and 1994 — passionately support causes rather than the institutions working to address them.”7

Modern Generations want to make their own decisions about how every penny is utilized and will only give if they can see direct, tangible results. They don’t perceive such a stance as being disloyal in any way. They are simply being good stewards of that which God has entrusted to them.8 We cannot assume that members of the Modern Generations aren’t generous just because they don’t label donations as tithe and send them through traditional channels.9

It may take ten to twenty more years for the Tsunami of financial disruption to manifest itself in substantial ways. But it is certainly coming, and the denominational leadership will either make the necessary changes now in a planned, orderly way, or it will defensively stay the course and guarantee eventual upheaval. Why will it be so consequential? Because the entire tithing system is largely built on “Institutional Loyalty.”

So what can be done? Here are a few preliminary thoughts:

1. Learn the lessons from Blockbuster. Corporate analysts offer some important insights:

“Blockbuster was stuck in the past and increasingly ignorant of the way the world was changing around it. They became a dinosaur, with size and lack of speed stopping them from keeping up. Keeping up with Netflix would have meant some hard choices.”10

“Blockbuster is a great example of a business that failed to identify that they were being disrupted — and failed to act in time as a result.”11

“The real reason why Blockbuster lost their HUGE customer base over the years was one thing: Pride. Put simply: when the whirlwinds of change swept through the movie and video industry, Blockbuster Video stuck to their guns.”12

“Blockbuster lost their customers from the greatest form of executive negligence there is: Fear of change.”13

2. Recognize the problem and treat it with the urgency and seriousness that it deserves. We are already years behind.

3. Call laymen who are visionaries down from their seats in the nosebleed section and get them together with other laymen who are strategic planners in the corporate world. Ask them to sketch out options, under the guidance of the Holy Spirit and scripture, for a much more effective, efficient, fair system of denominational finance.

4. Understand that the needs of third world countries cannot be the first consideration when it comes to finances. First priority must be given to the health of the local churches in North America. They are the goose that laid the proverbial golden financial egg. The more robust the local congregation, the more mission fields will benefit. Those who care the most about overseas missions will care the most about the health of the local church in the United States and Canada.

5. Recognize that the deck is currently stacked against the local church budget. Tithe occupies a preeminent place in Adventism. It gets top billing while local offerings play only a supporting role. The higher organization’s portion is portrayed as mandatory while the local congregation’s portion is labeled voluntary. Not paying tithe is portrayed as robbing God while local giving is an individual choice. Use of such imbalanced language inevitably short-changes the local church, which can further alienate Modern Generations who view it as grossly unfair.

6. Stop saying that syphoning off such a large percentage from local churches is not a problem because of the many members who are “potential givers.” Churches cannot spend “potential.”

7. Stop trying to justify the tremendous denominational overhead that employs far too many people in multiple layers of church administration. Such inefficient use of tithe will never find support among those who choose value over blind obedience.

8. Don’t accept the naïve idea that church organizations are immune from societal or generational changes. Churches are made up of people, and people are inevitably influenced by the times in which they live.

9. Develop a clear, compelling vision of what a powerful, dynamic force the church unleashed can become if it is clear-eyed and courageous and let that vision sustain and guide you as the denomination faces some of the most consequential decisions in its history.

Notes & References:

Kim Johnson retired in 2014 as the Undertreasurer of the Florida Conference. He and his wife Ann live in Maitland, Florida. Kim has written a number of articles for SDA journals plus three books published by Pacific Press: The Gift, The Morning, and The Team. He has also written three sets of small group lessons for churches that can be viewed at www.transformyourchurch.com. He is also the author of eight "Life Guides" on CREATION Health.

Image credit: Wikimedia Commons / Public Domain

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This is a companion discussion topic for the original entry at http://spectrummagazine.org/node/9250

#2

Blockbuster, Netflix, Red Box…vs a weekly 20-45 minute not fat dry milk typical topical superficial, smooth, shallow, irrelevant, soft sell ,sugar coated sermon loaded with palliatives.


(Kim Green) #3

Always the Beacon Of Light! At least your “messaging” is consistent. :laughing:


(Thomas J Zwemer) #4

An excellent analogy. One could use Sears. Vrs Amazon.

Adventism breeds on fear and lives on pride and duty. Grace and love are left in the cradle room.


(EdZirkwitz) #5

Being connected in church settings and the larger community is very important. The BLockbuster example is apt in showing that being blind to cultural changes has consequences. However, it has limited relevance to spirital matters. Church folks are not flocking to live streaming in droves as options to attending at a meeting place. In North America 67 % of SDA churches are in decline. As long as members see the church as relevant, growing, meeting spiritual needs, non-conflictual, safe, just and moral the loyalty will be there. Human interaction in person is very important. Society is recognizating that social media, texting, messaging, video cannot not replace being physically close. Jesus came to earth in person. The church is made of persons.


(Pierre-Paul Legault) #6

Herein lies the paradox in my mind. If the SdA Church truly is the “Remnant Church ™”, it will not fail. If the future of the SdA church in North America is dependent upon the use of the latest marketing and business management techniques to out-compete other churches and out-compete secular entertainment, it is not the church of God, and we’d be better off finding some other Saturday morning activity like playing soccer or hockey with friends and neighbours.


(Eugene Borg) #7

Kim Johnson thank you so very much for such a gripping and powerful analogy of what is facing the GC and the Adventist membership today! Add to that the GC’s iron grip on upholding tradition bound services compared to the fresh breezes of creativity and flexibility in worship styles and rhythms. I am reminded of another potent analogy from WWI and WWII, whereby WWI had ended up becoming a war of Trenches. So at the end of WWI the French government decided that to protect themselves from a future war they needed to build themselves a “Super Trench” which was called their Maginot Line.

By contrast, the Germans took a fresh look at WWI and decided that speed and mobility was the best way to start WWII, so they built fast moving Tanks and developed the mobility doctrine of Blitzkrieg.

In the same way, it appears to me that the GC has decided to throw all of it’s weight and resources into digging a mighty Super Trench of permanently fixed and loyalty demanded 28 Fundamental Beliefs and hard fisted Compliance Committees. Meanwhile, the Holy Spirit in unfettered response will continue to blow wherever it wills in an unstoppable wind of mobility and freedom.

And when the “WWII of Revival” breaks out upon the world, those tradition bound and rigid Adventists who decide to hunker down in their hardened underground bunkers will find that the mighty and unstoppable Holy Spirit will simply blow above and around them, bringing the Freedom of Grace and the GOOD NEWS of the Gospel to those wandering saints on the surface. Let those who have ears, let them hear.


(Carlo Schroeder) #8

Did we miss the word, Pride!!! When we forget that we need to learn from the mistakes and success of others, so that we can by the guidance of the HS make the best choice. I will give an example. A few years ago my conference planned a health expo, but it needed something that could draw people, because a previous health expo failed. So my partner decided to add a veterinarian stall, and it wouldn’t cost the conference any thing, because she is an veterinarian. She had over 150 patients who passed through her stall, which meant over 200 contacts. Do you know what the president of the conference said after the expo, they don’t need to heal sick animals, but people. See the mind set, animals have the church access to poeple, yet they didn’t see that.


(Kim Green) #9

Ed, you made some good points. However, Millennials and the Gen Zs have different “needs” when it comes to how things are presented and represented. This is very different than previous generations such as the Baby Boomers. The way that Millenials and Gen Zs see and experience “spirituality” may not be so “church-centric” - so the usual church services and programs will not suffice without change.

The author made some really good points that need to be taken very seriously, otherwise the younger generations will continue to “bleed-out” of the SDA church. If their POVs and needs are not seriously considered…the church may as well shutter up more churches and schools. The Adventist churches may continue with older methods of “doing church” but it will not appeal to a younger generation. I don’t see that it will do so and may have already sung it’s “Swan Song” in the NAD (aka Purse of the Church).


(Steve Mga) #10

I would encourage ALL Spectrum readers to read the interview on Adventist Today of
Dan Wysong, former pastor of 750 member SDA church, Chico, Calif. [lost their home
in the Camp Fire].
TITLE: Choosing Orthopraxy over Orthodoxy.
He is a 6th generation SDA. Father pastor, life-long employee of the church.
He left his position at Chico SDA to pastor a United Church of Christ congregation.
He posts: "What I will gratefully walk away WITH – 7 good memories.
He posts: "What I will gratefully walk away FROM – 10 bad memories. Listed below–

  • An institutional need to be better than others.
  • A need to control others.
  • The need for theological certainty and being right. Orthodoxy OVER Orthopraxy. I
    believe Jesus taught that loving well is more important than doctrinal correctness.
  • An eschatology that reinforces a sense of institutional elitism and complacency.
  • A worldview that everything is going to get worse and worse. This perspective often
    thwarts our investment in making the world a better place, which is exactly what Jesus
    told us to do between his first and second coming.
  • An institution that sees uniformity as the source of unity, and resorts to compulsion,
    secrecy, and propaganda to achieve this end.
  • An unwillingness to extend freedom of conscience and speech to members and employees.
  • An unwillingness to include everyone as equals.
  • An unwillingness to trust and give freedom to the local congregations.
  • A distrust of Science. God is the ultimate reality, and Science is a means of describing
    that reality. We do not need to fear it.

(William Noel) #11

A great lesson from business and a very real warning. However, I seriously doubt that much will change in the church until the present leadership is gone, or so many members quit funding the bureaucracy in favor of the local church that the bureaucracy is in serious danger of failing.


(Eugene Borg) #12

Gideonjrn, what kind of sermons would you like to hear? When I was growing up in the SDA church from 1967 to 1975 a typical Adventist sermon was like this:

You need to give more!
You need to pray more!
You need to study more!
You need to evangelize more!
You need to be perfect more!
You need to be vegetarian more!
You need to fight against your sinful self more!
You need to be stricter on Sabbath observance!
You need to stay away from Sunday keepers because they will deceive you!
You need to prepare yourself to be tortured by Catholics during the great Time of Trouble!

I heard these kinds of typical Adventist sermons for about 52 weeks x 7 years, and the cumulative result of these strong “unsugar-coated truths” week after week is it left me feeling discouraged and disheartened. Every time I looked at myself after church it seemed according to all these “straight truth” sermons that however good I thought I had been doing in my spiritual walk –I was never good enough. I always walked away from such Sabbath and Vesper sermons feeling like a failure, even though during those years long ago I was a very conservative Adventist who tried at the young ages of 13 to 20 to keep all EGW’s many rules of conduct.

Eventually by 1974 I ended up just hardening my heart because I could no longer reconcile the cognitive dissonance of the demand for perfection with the sobering reality that I was not perfect at all. Because of my own perceived failures I concluded God couldn’t possibly be pleased with me, but I also believed the only way I was going to be saved is if I stayed a church going member of the “Remnant” SDA church. So I did keep going to Adventist church, but I was dead inside, just going through the empty motions. My only chance of “making it to Heaven” was to keep hoping my volatile SDA God was too busy punishing the Liberal Adventists so that he wouldn’t have time to notice my constantly coming up short of the demand for Perfection.

Are these the kinds of “straight truth” sermons you want to see fill our Adventist pulpits again?


(EdZirkwitz) #13

Kim (Green): Although I am a “boomer” I strongly believe in value and supporting causes. I realize I probably am not a typical boomer. I would suggest that the erosion of tithing has been going on for a few years. The SDA North American Division recently voted in their 2018 set of year end meetings to negotiate with the GC over the next two years to substantionally reduce the amount of tithe it has been passing on to the GC (to parity with the rest of the world). Our local conference has been really pushing tithing because last year they almost faced “financial pains” but those were aleviated in Dec. I rate our local conference administrators to be inadequate and inexperienced and have pointed that out officially with reasons to the Board of Directors. Subsequently I send tithe to a neighbouring conference. Our church manual does not dictate where physically tithe should go and I know of some members who “tithe” to causes. The pioneers of this SDA church original movement were “millennials or Gen Z” so I say let them revitalize the way church is done.


(Ray Smith) #14

Eugene, reading between the lines you have since discovered grace!


#15

Organizations that can’t change, refuse to change, won’t change, are afraid to change do one thing. They die. We can name the companies (if they are not dead, they are close to it): AOL, Blackberry, Blockbuster, J.C. Penny’s, Sears, CompUSA, Gateway Computers, Radio Shack, TigerDirect and KB Toys. These companies all have two things in common: their thinking is frozen in time and they are enamored with their past successes. These companies believe they can do business as usual. We know where this kind of thinking gets companies, they disappear! The Adventist Church is headed in the same direction because there is a segment of leadership that wants to live in yesterday. They are afraid of change, and they believe that acknowledging change would be an admission that “historic Adventism” has failed (It has by the way). We need new visionary leadership in our church. We need fresh ways of having a conversation about our faith. Even companies like Microsoft had to reinvent themselves because the old Microsoft was getting ready to be no Microsoft. As noted in this article at some point the finances of the church are going to be an issue. Then the church will wake up once the money dries up, but then it will probably be too late.


(James Peterson) #16

You are comparing apples to oranges which is NOT fair to the apples or the oranges. In fact, it is a lazy comparison. Denominations are not business companies seeking to sell merchandise, maximize profit and follow the money. They are motivated, ironically, by decreasing numbers. “Because narrow is the gate and difficult is the way which leads to life, and there are few who find it.” Mat. 7:14

Beyond that, the SDA denomination has proven itself to be very resilient, safe and successful.

  1. In 1980, in the throes of the Desmond Ford challenge, membership was 3.5M. When the dust had settled, and in spite of a mass exodus of 180 pastors over the ensuing 8 years, membership grew spectacularly. Nearly 40 years later, today it stands at just about 21M. That is a 500% increase, each year on average: +10%.

  2. In 1980, tithes received by the denomination amounted to about 400M; whereas as recently as 2016, it stood at over 2 billion US dollars, showing a similar rate of increase as membership.


There is another aspect to this debate over denominational adaptation to societal trends and it is this. The church was NEVER intended to acquiesce to the cravings and ravings of the world in which it found itself, but to change the world, to make it a better place in accordance with the will of God. It is well known that Jesus taught his disciples how to pray: “Our Father in heaven, hallowed be Your name. Your kingdom come. YOUR WILL BE DONE ON EARTH AS IT IS IN HEAVEN.” Mat. 6:9-10

No decent parent would urge their child to begin swearing because swearing is what all his classmates are doing and fitting in is paramount. Rather, it is a proud parent who discovers that his child is willing to say, when teased, bullied and maligned for righteousness, “My parents taught me not to swear and so I don’t.” It is incumbent on leaders to be strong in truth, to be an unwavering light in the darkness, to give courage to those who look to them for guidance.

THE CHURCH IS NOT A BLOCKBUSTER.

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#17

I think you missed the entire point of the message of the writer.


(James Peterson) #18

What was the message of the writer? Is the title of, and details within his article not “Lessons from Blockbuster”?

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(Chris Blake24) #19

James, I believe it is you who is comparing apples and oranges here. Your proof stats trumpet the accessions and gains of the world church. Kim is talking principally about millennials in western countries.

If you have evidence that millennials today in North America, Europe, and Australia are flocking to the institutional Adventist Church in staggering numbers, please share. We are all ears. My experience in working with young people for four decades says otherwise.

In addition, if we really determined that numbers absolutely prove the validity of an approach we probably ought to become Muslims or Roman Catholics.


(James Peterson) #20

The majority of the success is in “North America, Europe, and Australia”. The statistics for the world SDA church is freely available for your perusal on their website. In fact, it is “North America, Europe, and Australia” that support in no slight measure the rest of the world church.

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