In 2008, Netflix's distribution system went down in a big way for three days. (This was the DVD arm of Netflix, which was closed in 2023.)
Getting videos to its customers was the largest chunk of what it does, so not being able to do this was a big problem. They stood to lose a few customers and had to pay some refunds to affected customers. What was worse, they stood to lose a lot more if the hiccup went on much longer, which is why they were “working feverishly” to fix the problem.
This is the nature of business. A business needs to retain its profitable customers. It does this by constantly giving those profitable customers better reasons to stick around. In other words, the customer is always asking: “What have you done for me lately?”
Netflix was good at keeping its customers happy, and it was only on very rare occasions that big problems like this occurred at Netflix. “Working feverishly” to fix the problem and to make amends with its affected customers was exactly what it needed to do.
Where is the urgency?
People can weather a crisis, but extended crises are recipes for flameout. Once the distribution system was back up, things went back to normal.
There's also a lesser danger that “normal” becomes complacent.
Nor do many of us work feverishly all the time to save for college, save up an emergency fund, save for retirement. There are times to be in financial crisis mode, like when you're facing foreclosure or when you need to reduce your debt.
It's in the good times that we might do well to save with more urgency, since prevention is rarely urgent. That's because financial goals are important, but not urgent.
As expenses crop up, as a job loss happens, as illness affects a family member, though, the ability to important things without urgency gives way to taking care of urgent matters just to stay afloat. Then one has to work feverishly.
This might not convince you of the need to work feverishly to meet your financial goals, but what about these:
- Do you have goals? As in dollar amounts, by a certain time? If not, it's not surprising that you're not working feverishly toward goals that don't exist. (How often do you get to see a sentence with a quadruple negative?)
- Do you know what you're facing? Do you know what your tax rates will be when you retire? What will a dollar buy you? How much will a gallon of gas cost? Will you be able to draw on the Social Security you contributed to all of those years?
- Are your spending patterns consistent with your goals and what you'll be facing? If not, are you motivated to fix that?
- Are you ready to ask yourself, “What have I done for me lately?” Looking at yourself as a business with at least one customer (maybe other loved ones, too) might bring a little more urgency to what you do every day. No one will care about what happens to you more than you do, and most won't care at all what happens to you.
Perhaps it's not wise to go through life on the verge of an ulcer, but it's probably wise to have a healthy fear of outliving one's money.
(May 2025: Updated since Netflix no longer ships DVDs)
Even folks who are careful with their budget when money is tight have a tendency to relax when they have a windfall or extra income and spend it. I agree that this is the moment to bear down and put those extra funds to work for you, not into more "stuff."
I think I am a fan of quick bursts of intensity to fix problems. I think some people call it Gazelle intensity (especially when referring to getting rid of debt), but I think it applies to a lot of things – even positive financial goals. By focusing on fixing something or improving something with a lot of intensity for a short period of time you can get a lot done and then ride out the benefits until you have enough energy or desire to improve it more later.
Thanks for the prodding. I'm supposed to be contributing $500 monthly to my taxable retirement account (on top of the 15% to 401k and fully-funded IRA), so i will do that today. thanks again!
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Steward, thanks for writing. When it comes to saving, I've never been able to sustain a gazelle-like intensity for more than four to five months at a time, after which I go a little stir crazy and splurge on things like dinner at my favorite upscale restaurant and a hundred dollars' worth of books and CDs at Barnes & Noble. My splurges never last more than a week or so and never cost me more than about $300 total, and they've never come between me and my monthly goal of $1000.00 savings minimum, but I used to feel terribly guilty about them. Over time, I've come to regard them as a much-needed pressure valve, and I try not too beat myself up too much over them. As long as I'm meeting my 1K monthly quota, I figure I'm okay. Focusing on a goal for short bursts of intensity does indeed get you to goal, as long as you continue to experience those short bursts over the long term.
Excellent comparison. People do tend to react financially during tough times. Being more progressive about money can certainly relieve the stressors of the tough times/emergency situations.
With so many options avilable for consumers to save money, it's important people understand the need for savings. We did an article about one of the options that you can read here http://www.savingstoolbox.com/2008/08/18/should-y… . It's also important to remember to start teaching principles of savings to the young in order to instill the importance of saving money early.
Thanks for a great article!