A few days ago, Eastman Kodak filed for bankruptcy in the United States. Dr Kamal Munir, explains the reasons behind Kodak’s demise
Five years ago, Dr Kamal Munir, Reader in Strategy & Policy, Cambridge Judge Business School, who has followed the fortune of the American company Eastman Kodak for more than a decade, warned the company which filed for bankruptcy protection in the United States a few days ago, that unless it realised that the world had changed and came up with a new strategy for the digital age (as Apple had done with the iPod and iPhone), its bits-and-pieces business model would not be able to save it.
“What Kodak should have done long ago was to completely separate out the Digital Imaging Division.”
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During his research of the company that created the famous ‘Kodak Moment’, Dr Munir found that the Digital Imaging Division was pawn to the powerful Consumer Imaging Division where it was viewed as ‘cannibalising’ Kodak’s operational strategy.
“They should have taken this business (the Digital Imaging Division) to Silicon Valley, separated it completely from their existing business and given it a free rein. They could have invested in 10 different companies run by teenagers or ‘twenty-somethings’ and today they could have owned the likes of Facebook today or Flickr.”
Dr Munir adds that if Kodak had encouraged investment on shoestring budgets to start-up businesses which had ‘something’ to do with pictures then the Kodak story would have been very different.
“The best way forward for them was to reinvent themselves, but they were completely entrenched in a mindset which was ‘people take pictures to preserve memories’. People change their behaviour all the time. They don’t take pictures any more to preserve memories. They take pictures to share experiences.”
Dr Kamal Munir has has been teaching at Cambridge Judge Business School since 2000. Dr Munir’s research focuses on social change and stability, as well as innovation and technological shifts in society. His research also spans the competitive advantage of nations.