Peloton was the darling of Wall Street at the beginning of the pandemic, the stock was riding high, people were willing to pay the high asking price for their products and the company kept growing as they doubled their workforce during the first year of the pandemic. Their situation has taken a recent dramatic turn. Within the last month, they laid off 20% of their workforce or 2800 people, fired their co-founder CEO and have seen their stock drop dramatically. Investors are now encouraging the company to sell out to a bigger company like Amazon, Nike or Apple. Applying the dynamic capabilities and answer the following:

• When things were riding high they became static in their response to the external environment. What did they overestimate back in 2020 that they failed to adjust until it was too late?
• How did problems with the supply chain contribute to their current issues?
• What is one strategic recommendation you would make to the new CEO that could help turn things around?