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How to Stay Business Relevant in the Face of a Technological Revolution?

 

Source | Linkedin.com  |  BY:CEO & Co-founder Jigsaw Academy

What do DisneyCoca colaMcDonalds, and Kodak have in common?

They were all in the list of top 5 most valuable brands in the US in 1996. While 3 of these brands have continued to thrive, one of them filed for bankruptcy in 2012. No prizes for guessing which one. It was, of course, Kodak.

So what happened to the company that held over 90% of the market at one time and then went bankrupt in less than 15 years after that? Most people attribute the fall of Kodak to the emergence of digital photography.

Well, digital photography came and the demand for films (the market that Kodak dominated) shrunk significantly and so Kodak had to go because the product they were so good at making was no longer in demand. Seems straightforward, doesn’t it?

Let’s look at a few more facts though, before we jump to a conclusion. Did you know that Kodak actually invented digital photography?

Hmmm….

And did you know that Kodak created the first digital camera in 1975? Sony came up with its first digital camera more than 5 years later in 1981. But digital photography took another 20 years to become popular.

So Kodak dominated the film industry. Their research team invented the next big thing i.e. digital photography. And the new technology actually took a fair bit of time to catch people’s fancy so Kodak had a couple of decades to prepare for it.

Yet, they could not. Or did not.

So why have Disney and McDonalds continued to survive and thrive while Kodak has perished? What sets a winning company apart from the losers?

There are many factors leading to the demise of a behemoth like Kodak. However, at the risk of gross over simplification, I believe the biggest reason for their fall is the fact that they focused too much on the product and not enough on the value the customer gets from their product.

Kodak’s value to a customer is the ability to ‘capture the moment’. Yet they focused on the product – the film. They were so wary of losing their market dominance that their first reaction to their own digital camera was “it’s cute but let’s not tell anyone about it”.

Kodak survived the bankruptcy and they continue to exist albeit in a limited manner. There are now looked upon as the poster boy of how quickly fortunes can change, of what not to do when you are the market leader.

Readon….

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