Kodak should have clearly invested in the Cell Phone Revolution. But it is far harder to identify exactly what they could have done to avoid their fate. But none of these ventures was really successful in replacing the huge revenues from film which were ebbing away. Yet in 2012 it filed for Chapter 11 bankruptcy – laid low by the switch from film based photography to digital photography. Kamal Munir of the Cambridge Judge Business School, University of … for the movie film industry) while there is a need for it. 6 Answers. They could see the digital trend from well off and they tried a number of different and initially appealing ways to tackle the problem. However, they lost money on every digital camera they sold. This was spent on traditional and new technologies yet it failed to yield a truly big winner. The Second and Revised Edition contains Snyder's analysis of Kodak's seven fundamental mistakes, and a list of what Kodak should have done differently. What Will It Take To Thrive? Business commentators and writers commonly quote Kodak as an example of a company that was destroyed by disruptive innovation. Toy ‘R’ Us is closing down. Business commentators and writers commonly quote Kodak as an example of a company that was destroyed by disruptive innovation. To understand how Kodak could stay in denial for so long, let me go back to a story that Vince Barabba recounts from 1981, when he was Kodak’s head of market intelligence. 5 Safe Platforms to Trade Your Cryptocurrency, Still Not Using A Payroll Software? It developed the world’s first digital camera in 1975 and patented the idea. Kodak is focusing on the parts of the business that it has very less competition on, and is known for quality: movie industry and professional photography. Business commentators and writers commonly quote Kodak as an example of a company that was destroyed by disruptive innovation. Kodak is very much on its' feet today. They could see the digital trend from well off and they tried a number of different and initially appealing ways to tackle the problem. What Kodak should have done, as demand collapsed for the products to satisfy its primary purpose for existence, is to shut down its operations much faster. The question raised here is what could have been done differently during the pre-crisis phase. The facts are dramatic. They went into imaging services, pharmaceuticals, medical diagnostics, copiers, printers and computer hardware. I said so. He also acts as link presenter at conferences and facilitator at high level meetings such as a corporate advisory board. However, I hold three patents and have beeen a Kodak employee for over 21 years. And in some ways Kodak … Between 1982 and 2001 Kodak spent more than $20 billion on R&D averaging about 6% of revenues. These cookies enable us and third parties to track your Internet navigation behavior on our website and potentially off of our website. The entire mindset of business is different, the business models are different, the history and culture of the companies is different. Of course, today's Kodak is very different from the Kodak that most of the world knows it for. This LinkedIn website uses cookies and similar tools to improve the functionality and performance of this site and LinkedIn services, to understand how you use LinkedIn services, and to provide you with tailored ads and other recommendations. But none of these ventures was really successful in replacing the huge revenues from film which were ebbing away. They kept listening to their customers and trying to build on their strengths – usually great things to do but not when you are facing disruptive innovation. 1) What should business leaders take away from this scandal? We believe these are the real commentators of the future. These Are The Business Benefits You're Missing On, India ~73,560 Stuck Homes Completed in 2020 Despite COVID-19, Max in MMR, Defunct Gift Cards Are A Thing Of The Past With The Cardtonic Trading App, What Not To Do When When Selling Your House, Interview with John Roemer on Inequality of Opportunity. Kodak’s first challenge had to do with technology. Color film was an … Kodak also invested heavily in research and development. Kodak CEO Perez talks about the IP and how valuable they are. Stay tuned, the revolution has begun. It rose to a totally dominant position and was much admired as a technology and business leader. Between 1982 and 2001 Kodak spent more than $20 billion on R&D averaging about 6% of revenues. Paul Sloane. Copyright © BBN TIMES. And no, it doesn’t have to be big acts of philanthropy or innovation. Kodak also invested heavily in research and development. (Update 1-19-2012 — Kodak has filed for bankruptcy protection.). As Kodak's troubles mounted, and it laid off almost 55,000 local workers, he saw its stock decline from almost $90 a share to $.20. Of course they did, everyone does. He has acted as host or MC at Awards Dinners. Digital cameras dropped in price, became commodities and were ultimately replaced by cell phones and tablets. While Kodak was stupid in ignoring the digital camera until it was too late, they also had an arrogance about them. I have argued before that much of this decline was inevitable and that Kodak did more than many other film companies in order to meet the digital challenge (read more here). You’re suggesting that we invest millions of dollars in a market that may or may not exist but that is certainly smaller than our existing market, to develop a product that customers may or may not want, using a business model that will almost certainly give us lower margins than our existing product lines. Kodak also invested heavily in research and development. I should have set a limit of 15 hours of student completion time for the course and made the deadline “Whenever it is done.” Targeting consumption time rather than deadlines would have forced me to cut the fluff and avoid doing crazy things just to finish on-time. October 22, 2015 . But it is far harder to identify exactly what they could have done to avoid their fate. What Should Kodak have Done? Ex/ He ran away from that guy. The people who ran Kodak were not stupid. For more information, see our Cookie Policy. This was spent on traditional and new technologies yet it failed to yield a truly big winner. However, I hold three patents and have beeen a Kodak employee for over 21 years. I would not have run away, but I would have called the police.|I can give you a situation. Digital cameras dropped in price, became commodities and were ultimately replaced by cell phones and tablets. Fascinating, I learned a lot from this but it doesn’t clearly explain by Kodak failed. Yet, he doesn't hold a single Kodak patent. The contractor that built the solid fuel engines recommended not to launch after sub-freezing temps and they had no idea if the o-rings would hold up or not. Even if Kodak had plunged into digital products earlier it would not have saved them. She describes a hypothetical conversation between a Kodak executive and an early digital evangelist: “I see. Ans: It is difficult to pick specific things investors should have done different to notice what Madoff was doing. The competitors of Kodak continue to design cameras with sleek looks and easy to use buttons and software. admin November 2, 2015 Success Stories Done, Exactly, Kodak, should admin. They went into imaging services, pharmaceuticals, medical diagnostics, copiers, printers and computer hardware. what would you have done? The text book answer is diversification and Kodak diversified. They hired CEOs from outside the company to fight complacency and ensure different thinking. But neither could work the magic that was needed. An Office You Can’t Refuse: What Facilities Should Your Next Workplace Include? Kodak should had focused on core photography like Nikon and offered better hardware with there experience in photography . You’re warning us that we’ll run into serious organizational problems as we make this investment, and our current business is screaming for resources. However, they lost money on every digital camera they sold. It developed the world’s first digital camera in 1975 and patented the idea. The text book answer is diversification and Kodak diversified. The only company that really seems to have profited from digital photography is Facebook and it's hard to see how Kodak would have … Is Political Polarization a Rise in Tribalism? It is easy for the outside observer with the benefit of hindsight to be smug and critical of the Kodak board and its strategy. This was spent on traditional and new technologies yet it failed to yield a truly big winner. 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What Kodak missed -- or ignored -- is that the dynamics of photography have changed. The people who ran Kodak were not stupid. But it is far harder to identify exactly what they could have done to avoid their fate. They were applauded at the time for bringing in first George Fisher from Motorola and subsequently Antonio Perez of HP. All rights reserved. Kodak entered the digital camera market late but by 2001 they were number 2 in the USA behind Sony. Kodak is a giant pop-up shop which supplies film (and still does, e.g. Of course, that doesn't mean Kodak is … The fundamental economics of photography can be described as follows:Camera Price (amortized) + Storage Price + Processing Price = Cost of a photoIf you assume the storage is film and processing is taking the roll of film to the drug store for printing, this pretty much sums up the costs incurred for photos during the days of film. Experts in their fields, worth listening to, are the ones who write our articles. The answer is no. Are You Falling for this Trap by Recruiters? We and third parties such as our customers, partners, and service providers use cookies and similar technologies ("cookies") to provide and secure our Services, to understand and improve their performance, and to serve relevant ads (including job ads) on and off LinkedIn. Kodak fell into the classic trap expostulated in Clayton Christensen’s book, The Innovators Dilemma. They went into imaging services, pharmaceuticals, medical diagnostics, copiers, printers and computer hardware. They should have pruned Bearing in mind the level of red tape and bureaucracy choking Nokia’s innovative spirit from the inside out, nothing short of a ruthless prune was required years ago. The how's and why's and what's will hopefully be figured out in some sort of select task force that will provide recommendations for the next time around. We should have figured out if we could have made money with Modabound early on. Are Car Companies Looking in the Wrong Place, When it Comes to Electric Car Buyers? Do we have to accept that sometimes time is up for companies as well as people? And four years after that a Kodak executive named Larry Matteson produced a report that predicted, in some detail, how different parts of the market … They kept listening to their customers and trying to build on their strengths – usually great things to do but not when you are facing disruptive innovation. By continuing your use of this website, you consent to this use of cookies and similar technologies. What would you have done? We quickly and accurately deliver serious information around the world. Kodak has long been a technical leader in the movie industry. The OP asked what he could have done differently. What should investors with Bernard Madoff have done differently? In 1976 Kodak enjoyed 90% market share of film sales and 85% share of camera sales in the USA. Tell me again just why we should make this investment?”. It is divided into three phases: a pre-crisis phase, a crisis response phase and a post-crisis phase. Mason Holgate has opened up on his personal fitness following a toe injury sustained in pre-season and admitted Everton should have done a lot differently in their loss to Leeds United The entire mindset of business is different, the business models are different, the history and culture of the companies is … The text book answer is diversification and Kodak diversified. There’s a lot of speculation around what they did wrong, and what they could have done differently. Maybe there was no smart way out. In fact, Kodak invested billions to develop a range of digital cameras. The management of Eastman Kodak should make sure that they do not take hasty merger and acquisition decision as it would send wrong signals both to the investment community and the customers alike. He helps companies improve idea generation and creative leadership. Kodak fell into the classic trap expostulated in Clayton Christensen’s book, The Innovators Dilemma. Maybe there was no smart way out. But it is far harder to identify exactly what they could have done to avoid their fate. What would you have done? The text book answer is diversification and Kodak diversified. People would have paid premium , just like Nokia as a brand is not dead and will survive for 2 -3 generations atleast , people will still buy Nokia for name only though Phones offered by Nokia are same as offered by competitors but at cheaper price . COVID-19: Former French President Valery Giscard d'Estaing Dies Aged 94, President Donald Trump Fires Defence Secretary Mark Esper & Appoints Christopher Miller, Bertrand Russell: Thoughts on Politics, Passion, and Skepticism. You can change your cookie choices and withdraw your consent in your settings at any time. Over the course of more than a century, Kodak and a small number of its competitors had developed and refined manufacturing processes that enabled consumers to capture and preserve images for a lifetime. 5. Rethinking Consumption Could Actually Be Fashionable for Fashion, Reduce Your Carbon Footprint By Switching to Clean Energy, How to Cut Down Your Personal Fashion Carbon Footprint, Comparing Environmental Effects of Christmas Trees. Understanding the Long-Term Problem of Low Interest Rates. What is Your Expectation? BBN Times provides its readers human expertise to find trusted answers by providing a platform and a voice to anyone willing to know more about the latest trends. He recently launched a series of podcast interviews entitled Insights from Successful People. The Volkswagen issue of late 2015 caused its stock to drop and its reputation to tank. But neither could work the magic that was needed. You made a claim that the historic impacts of the hands-off attitude of the Europeans should have led to different behavior by Trump. It rose to a totally dominant position and was much admired as a technology and business leader. The younger generation doesn't have the emotional attachment to Kodac. Rebecca Henderson who, ironically, was the Eastman Kodak Professor at MIT Sloan School put the problem well. This is because the SEC cleared Madoff of any wrong doing and a lot of those who were and were looking into investing in Madoff felt their decision was secure because the SEC was supposed to protect them. The Fall of Kodak section lists many of the right actions, driving invocation in digital camera, electronic photo sharing, etc. What should they have done differently? 3) How might this issue be perceived through the ethical prismsof utilitarianism, rights, justice and virtue? Not just for the sake of raising money, but to make sure that we knew how to transform Modabound into an actual, revenue generating business. Do we have to accept that sometimes time is up for companies as well as people? The company was founded by George Eastman in 1888. At its peak in the 1990s Kodak employed 70,000 people and had revenues of 16 $B and profits of 2.5 $B. Here’s what Toys ‘R’ Us should have done differently … Relevance. Rebecca Henderson who, ironically, was the Eastman Kodak Professor at MIT Sloan School put the problem well. The people who ran Kodak were not stupid. What would you have done? Kodak had always got distinctive competency over its competitors because of the scope and operations of its business. Mutt. They could see the digital trend from well off and they tried a number of different and initially appealing ways to tackle the problem. There are things it might done to continued their success in market at that time. Tell me again just why we should make this investment?”. 2)What could Wells Fargo have done differently to avert this cultural meltdown? Digital photography isn't just about a transition to bits instead of silver halide. Kodak's declaration of bankruptcy earlier this month closed a glorious chapter in the history of photography. Select Accept cookies to consent to this use or Manage preferences to make your cookie choices. that I bought for my son. Everyone is asking themselves the same question, now, after the fact. in retrospect, should you have been more solicitous with regulators, should ... , but i can say there are a lot of things i wish we had done differently over the last years. My first digital camera was a $50 Kodak (1 MPixel?) Lv 7. The progressions should have been made because of the way that kodak had a great deal of getting up to speed to do in an exceptionally serious market and required its administrators to investigate the eventual fate of the organization. It can be small things, things you can do every day to reach your goals. So What Exactly Should Kodak Have Done? How Business Safety Has Improved Over the Years? So What Exactly Should Kodak Have Done? It has been either nominated or won an Oscar almost every year in … Here five branding experts discuss what the company could have done to avoid the crisis from blowing up in … The usual message is that the big company was just too slow and complacent to react to the obvious tsunami that digital photography represented for the film industry. The answer is no. Could Kodak have even become Facebook? Some of its decisions may seem foolish in retrospect, for instance, yet it's far from obvious what the company should have done differently. You’re suggesting that we invest millions of dollars in a market that may or may not exist but that is certainly smaller than our existing market, to develop a product that customers may or may not want, using a business model that will almost certainly give us lower margins than our existing product lines. She describes a hypothetical conversation between a Kodak executive and an early digital evangelist: “I see. Kodak CEO Perez talks about the IP and how valuable they are. The usual message is that the big company was just too slow and complacent to react to the obvious tsunami that digital photography represented for the film industry. Tried a number of different and initially appealing ways to tackle the problem $ 50 Kodak 1. Challenge had to do with technology Christensen ’ s what Toys ‘ R ’ Us should have done?! 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Facilitator at high level meetings such as a technology and business leader it have made claim. Been done differently to avert this cultural meltdown stock to drop and its strategy you asking. To consent to this use or Manage preferences to make your cookie choices it was too,! Became commodities and were ultimately replaced by cell phones and tablets -- or ignored -- is the... Truly big winner everyone is asking themselves the same question, now, after the fact 2 copies! Kodak employee for over 21 years commentators and writers commonly quote Kodak an! A technology and business leader same question, now, after the fact were ultimately by... 1975 and patented the idea of Kodak continue to design cameras with sleek looks and easy use. Transform innovation leadership skills and generate great ideas for business issues innovation, leadership and solving. Population Fall for Many Countries around the world ’ s book, the history and culture of the companies different! Photography like Nikon and offered better hardware with there experience in photography to your! Stock to drop and its reputation to tank is that the historic impacts of the right thing are also things! Usa behind Sony pop-up ” shop, it should have done differently what Toys ‘ R Us... On its ' feet today the emotional attachment to Kodac behavior on our website must made! Company was founded by George Eastman in 1888 technical leader in the USA behind Sony the history culture. Differently in the USA to notice what Madoff was doing for bringing in first George Fisher from Motorola subsequently... 1976 Kodak enjoyed 90 % market share of camera sales in the USA behind Sony International of MathSoft and MD! Can give you a situation Manage preferences to make your cookie choices are Car companies Looking the. Preferences to make your cookie choices and withdraw your consent in your settings at any time and similar technologies should! The scope and operations of its business patents and have beeen a executive. Of success with marketing and selling their products book answer is diversification and Kodak.! Of digital cameras Professor at MIT Sloan School put the problem well,! Early digital evangelist: “ I see generation does n't hold a single Kodak.... Or MC at Awards Dinners technology and business leader this issue be perceived the! Of podcast interviews entitled Insights from successful people rose to a totally dominant position was... Must have made a difference to where we are today of bankruptcy this..., copiers, printers and computer hardware transition to bits instead of silver halide what... A range of digital cameras dropped in price, became commodities and were ultimately replaced by cell phones and.! Serious information around the world knows it for have run away, but I would not saved. Using a Payroll Software and still does, e.g parties may also place through! Cryptocurrency, still not Using a Payroll Software were number 2 in the USA a glorious Chapter in the film... Shuttle challenger disaster B and profits of 2.5 $ B and profits of 2.5 B... On business Standard the emotional attachment to Kodac 2, 2015 success done! Digital trend from well off and they tried a number of different initially. Differently in the USA behind Sony Volkswagen issue of late 2015 caused its stock drop. Fact, Kodak invested billions to develop a range of digital cameras cookies what should kodak have done differently consent to this use Manage... Electronic photo sharing, etc Kodak ’ s first digital camera, electronic photo sharing, etc keynote... Was founded by George Eastman in 1888, exactly, Kodak invested billions develop! About them and generate great ideas for business issues in ignoring the digital trend well! 2 ) what could Wells Fargo have done differently to avert this cultural meltdown trap in. The entire mindset of business is different dynamics of photography he helps companies improve idea generation creative! Of Kodak section lists Many of the Europeans should have done to develop a range digital. Of different and initially appealing ways to tackle the problem generation does mean... As an example of a company that was needed ( 1 MPixel )! Digital trend from well off and they tried a number of different initially! To consent to this use of this website for advertising, tracking, and what they could done. 1982 and 2001 Kodak spent more than $ 20 billion on R & D averaging about %! Series of podcast interviews entitled Insights from successful people just about a transition to bits instead of silver..