Hi! Manager: Thoughts on Kodak's bankruptcy

The fall of Kodak is dramatic; there is a great lesson to be learned on how vital “change and speed” are to corporate success.
Eastman Kodak, once an American blue-chip company, was founded in 1880. Kodak was the leader in photography film products for several decades. It was widely accepted that Kodak films and its photo-processing technology were the best. In 1975, Steven Sasson, a Kodak engineer, invented the first digital still camera but the company’s executives lacked the vision for technological change and a sense of urgency. They decided to focus on the original core business of photographic film. In the end, the seemingly invincible photography giant has been brought down by the digital and smart-phone revolution.
Kodak’s demise has cemented what I was taught by my Japanese bosses in my early years in the Isuzu business – that we could not rest on our laurels as past successes might not be relevant in the current market situation. We have to embrace changes on time so as to survive the cut-throat competition in the rapidly changing market environment. Executives who resist changes will finally bury their businesses in the graveyard.
In the past, printed photos gave people memories to cherish. The widespread popularity of smart phones and social network has changed people’s lifestyles. Digital technology has made taking photos with smart phones a common way of our daily life. It has also made film photography obsolete. Social networking enables people to instantly share their experiences online by posting photos at anytime and anywhere. Sharing their photos on the Web is what most people do today. Technological innovation changes the world, so businesses must always be dynamic to cope with these changes. The “wait and see” or “play safe” attitude of executives to go on with the strategies that worked well in the past makes it too late for business diversification to facilitate the changes. There will be no room for them to stay in the fast-changing marketplace when they finally realise the necessity to go into the game as technological changes do not wait for them to catch up.
Almost all businesses are in the so-called “buyers’ market”. Trying to safeguard the existence of outdated products that once were the signature strengths and turning a deaf ear to changing customer needs is equal to committing suicide. It is tragic that Kodak, which first invented the digital camera but decided to protect its film photography business instead, finally got killed by the digital revolution.
Kodak’s downfall reaffirms the fact that long-time profitable core business may become a barrier to the innovative spirit and that the formidable foe may not be the one you used to compete with for years. Fujifilm, the Japanese multinational photography and imaging company that could erode Kodak’s market shares in the past years, is not the biggest threat in this digital era. Smart phones and social networks that the Kodak executives overlooked are responsible for the collapse of the iconic photography pioneer.
Kodak’s bankruptcy is an affirmation that nothing stays as it was in the business world. If you keep on implementing the same business strategies, worse outcomes can be expected. A wrong decision by business executives could be so costly that there will be nothing left even for a corporate giant like Kodak after over a century of leadership.
In filing for bankruptcy protection, Eastman Kodak’s chief executive said that it was a step in their transformation in order to build the strongest possible foundation for the Kodak of the future. As bankruptcy is not always the end of the business, if Kodak can successfully bounce back, there will be great and more lessons for us to learn from their downfall and rebound.

Panatda Chennavasin is the vice president for corporate strategies and corporate relations of Tri Petch Isuzu Sales as well as the senior vice president for overseas marketing of Isuzu Operations (Thailand).  Her column is published every third Wednesday of the month.