Innovate or Die
Watching the drop in Eastman Kodak’s stock value is like witnessing death by water torture. The stock has lost 80 percent of its value in 2011 and is hanging on at less than a dollar a share. It’s sad. Kodak was the leader in photographic technology. Thirty years ago, it had an unmatched presence and brand as far away as Africa, Asia and the Middle East.
So why is the Kodak brand dying? Instead of using its resources to evolve and innovate, Kodak denied and stagnated. With devices now acting as cameras, zero-cost e-photos trumping all other forms, and the cloud making our images available anytime and anywhere, the only reason anybody prints photos anymore is for a wedding album. Yet Kodak management insisted that digital was not real and that people would still be taking their photographs to be printed at the local drugstore. As a result, the company not only missed the digital revolution but the smartphone revolution. What happened?
Was everyone asleep in Rochester? Kodak could have been in the center of the digital image revolution. It could have defined the space and owned the platform for photo sharing and apps. It had the talent and technology to innovate, but instead an iconic American brand is on the way to bankruptcy or buyout. The Kodak engineers must have been tearing their hair out at the futility of it all.
Here’s what kills me: I’ll wager that during this slow-motion collapse, the pay of the CEO, Antonio M. Perez, has been unaffected. Now he wants to sell the company’s IP portfolio as part of a turnaround plan in which Kodak says it will turn itself into a player in digital imaging. Seriously? That is the best you can do? Guys, you’re already way behind the real players in digital imaging: Fuji, Canon, Sony and Olympus. And no surprise he announced that when Google picked up Motorola’s IP portfolio. Even in this desperate move, the CEO was not imaginative and adopted the futile ‘me-too’ strategy. I wonder, did he think, Google would pick their’s up too?
Today, Kodak is not even worth its hard assets. It’s soon to be a penny stock. We should study Kodak as one of the iconic failures of our century: A company that did everything right at the start, built a massive brand and reinvigorated an entire city, only to close its eyes, deny reality, and fall.
In the Culture of Disruption, everyone has to participate. If Kodak employees had raised hell over management’s inaction five years ago, there was time to innovate. Now it’s too late. Yet again, I am in awe of exactly ‘what’ the Kodak board has been doing over the last decade. Seriously: Does Kodak even have board meeting? Yikes: I wonder is the CEO also Chairman of the board. Honestly with this one folks I don’t even know where to begin, and I am very sad to see a great brand and icon disappear because of extremely poor leadership…
There’s a lesson here: If you don’t disrupt and can’t innovate, you won’t survive.
- Eastman Kodak Shares Lowest Since Depression (blogs.wsj.com)
Picked up a copy of Provoke yet? You can find it on Amazon. All my best,