Innovation is not enough: Kodak files for chapter 11

Today, Kodak, a 100+ year old brand with a massive worldwide presence, filed for chapter 11.

For me it was a sad day indeed.

Some people look at Kodak and shake their heads, and say things like,”they should have seen digital coming!”.

And this is where they are wrong. Kodak did see digital coming. So much so that Kodak was the first company to invent the digital camera (1986). Kodak had also done massive research on OLED (Organic LED) displays. Both super innovative and cutting edge stuff. Both technologies that would significantly change USER BEHAVIOUR.

So why did Kodak fail in such a spectacular way? The same reason that most companies fail when faced with the threat of extinction. F E A R.

Let’s keep in mind that Kodak had a glorious consumer film business (with the infrastructure to back it). It was a business that they wanted desperately to hold on to. But as with most things, when we hold on too tight, we are at risk of losing everything. Kodak was reticent to “eat it’s young” in moving to digital. Additionally, Kodak had to answer to the demands of retailers who had their pockets lined with a very plush line of revenue from Kodak’s print business. The retailers felt entitled. Never mind that this was a line of business that they never had without Kodak.

So Kodak sat between a rock and a hard place, wanting to please its retailers, its consumers, its stockholders, and themselves. What they didn’t believe was the change in consumer behaviour towards digital. No one wanted to print anything anymore, and even those gorgeous photobooks (I’m biased, I worked on that product) were not enough to turn things around.

So what can we learn from this? Here’s a quick review:
1) consumer behaviour changes – anticipate it
2) what works today may not work tomorrow – be ready to turn your organisation around
3) be brave – you an never please everyone so do the best thing you can for the consumers and your organisation
4) know who your real threats are – and be ready to confront the fact that it might be you
5) don’t sit on your laurels – you will die