Case Application 1: Curtain Fall

Curtain Fall

In what has been called the “the greatest debacle in the history of entertainment”, “The Tonight Show” host Jay Leno started his own talk show “the Jay Leno show” after NBC decided to cut costs.

It all started when the executives at NBC decided to save money by give Jay comedy-variety talk show, with guests and performers and in-show ads. But the decision was not welcomed by the star himself, which resulted in declined ratings and reduced popularity. Things worsened when “the tonight show” started losing viewers too, Leno’s replacement Conan O’Brien failing to keep up the stellar reputation.

The decision was taken because the format of Leno’s new show was cheaper to shoot than the customized video bites produced for his earlier show. The managers at NBC did not have any concrete evidence that this could work, but they based all their research on the probability that people will watch the same format all throughout the year. These kind of touch-and-go decisions are often made, and have equal chances of success and failure, and in this case, it failed.

After two years of a very public fiasco full of controversy and disgruntled advertisers and audience alike, Conan left the show for a deal of $40 million, and Leno returned to his rightful place. This is the story of a decision gone wrong every way it could.

Discuss Questions:

  1. Explain the type of problem and decision making styles used here.
  2. What criteria were chosen to make the decision? Justify its feasibility.
  3. Would have produced different outcomes. Which one would have been better?
  4. Describe how using:
    1. Rationality
    2. Bounded rationality
    3. Intuition
    4. EBMgt

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