NEW YORK (TheStreet) -- Blockbuster's (BBI) bankruptcy filing and search for a new CEO are the latest examples of how companies are struggling to find effective leaders and how some boards of directors wait too long to make needed changes.Opportunities for improving the bottom line are being lost and value left on the table because the upper echelons of management and boards of directors are either unwilling or not insightful enough to make tough, timely decisions. As a result, companies in a wide variety of industries are suffering from the effects of five critical business mistakes, including: 1. Failing to recognize and respond to a changing environment: Blockbuster sat on its hands as Netflix ( NFLX - Get Report), Redbox and cable companies made aggressive inroads into the movie rental business. Business experts and consumers have long realized that technology changes would require business-model changes for this industry. How did Blockbuster's board and the CEO miss this message? 2. Not paying adequate attention to customer experience: In this regard, Toys"R"Us (Toys"R"Us, Babies"R"Us) has two key problems: First, its main stores provide an overwhelming array of merchandise, making selection difficult for people who are in a hurry and may not know what they want. The retailer may be trying to address this with "pop-up" stores, but that doesn't address the second, systemic issue: it can be difficult to find things. Complaints about the baby registry, for one, persist. It may be broken or, if working, may not show where items can be found or whether they are in stock. Even the item name on the registry may be different from the name on the item, itself. Departmental signage is often either lacking or hard to see. Even salespeople sometimes have trouble locating products. The results? Lost sales because customers' time is wasted and excessive labor costs because employees must answer questions that improved software and greater attention to store layout and signage could handle. 3. Failing to develop a cost-effective, customer-centric infrastructure: Sears' ( SHLD) hodge-podge of trained service technicians, substandard software systems, and inadequate training of customer service reps are diluting its brand. For example, complaints abound about the system for obtaining and installing replacement parts for appliances. Such issues suggest problems with inventory systems and, like Toys"R"Us, the outcome is almost surely lost sales and excess personnel costs. 4. Using inadequate hiring practices: Since 2005, Borders ( BGP) has had four CEOs. Its board either failed to understand the skills required, to recognize which candidate had those skills, or to give the CEO authority to make needed changes. Faced with unprecedented industry upheaval, Borders lost valuable time and advantage.
5. Not implementing a system to ensure accountability: The poster child for this problem is BP ( BP - Get Report). After the fact, investigators discovered that authority and responsibility on the rig weren't clear. BP owned the well; Transocean ( RIG) owned the rig. Which company's manager was responsible for rig safety? Unclear. Critical parts used for the well violated BP's guidelines, and its engineers warned about the violations in writing. Who was responsible for proceeding in spite of the warnings? Unclear. The lesson: Failing to clearly define authority and responsibility can be deadly. Companies' boards are ultimately responsible for setting standards and steering the ship, but often they are too far removed from reality. They look at the numbers but forget to find out what it's like to be a customer. To meet their fiduciary duties to shareholders, boards must be vigilant and willing to demand change when needed.