Stock Research – Eastman Kodak and the power of disruptive technologies

It’s just incredible trying for ten years, the digital revolution, Eastman Kodak that they have been for decades inch Kodak Company, the chemical-based photographic process is dominant. They shoot a movie, then took the role of a developer and physically made a second trip to pick up the finished prints. Their only competition in the industry was the Japanese company Fuji. The parvenu would just chew Kodak market each year, but never a real threat to the dominance of Kodak. Meanwhile, outside the industry invented the Polaroid back in the late 1950s of a camera when the chemical basis was developing images inside the camera. The painting was completed in about 60 seconds. Polaroid has developed a wonderful activity and made a fortune for its shareholders and its creative genius, Dr. Edwin Land. What happened next was a disaster for business, and should have learned from the mistakes of Kodak Polaroid. Mr. Land has proposed a development of the moving image. They poured hundreds of millions of dollars in a system based chemical. It would take the user to moving images. The films will be produced chemically in the camera system, the same as the image is used. What Polaroid has not only failed to predict, but could not even imagine a disruptive technology from another industry, which would in fact destroy the business model Polaroid would be created. Japan is digital photography. The first Japanese VHS and Betamax camera systems are available. Electronic technology is so much more sense that Polaroid chemical-based system. He forced his system products Polaroid film. He also directed the immediate off hundreds of millions of dollars to write (which corresponds billion today), it has never recovered. Now I ask you, Kodak has been in business, we know. They saw what was this new technology overnight Polaroid. If they could not imagine that this could happen to them? The answer is not obvious. The management team at Eastman Kodak was brain dead for at least 20 years. The management team and board of directors would have fired more than a decade for gross incompetence. They took a superb cash generating machine, and left them in a boring, mundane second class to do. They simply chose to ignore what was coming, and what came was a tidal wave that would sweep away the traditional business of Kodak. Kodak has chosen to lead the digital revolution. You can choose to billions of dollars in cash from their traditional chemical-based systems must be generated, and the conversion into the high-end technologies to other companies managed such as digital imaging in the medical industry. No, this is not the choice. The company decided instead to do nothing. Try to maintain the status quo was the order of the day. Now, Kodak is done before a “What do we do now” decision? It’s just a question of how long it takes before the type of chemical treatment Kodak Company () completely evaporated. There are a number of lessons from this example of one of the ancient world-class companies into bankruptcy because a business model will be considered inappropriate. Among them: • Each company must absorb the central thesis of Clayton Christensen two books “The Innovator’s Dilemma and The Innovator’s Solution”. Harvard Professor Christensen has been the person to whom the term is done, disruptive technologies, or if a new innovation comes in and blew a dominant technology company once dominated. • No company has heard the luxury of sitting on his haunches, and the inventory of money to keep it in business forever. • Theodore Levitt, Harvard has always talked about “What are you doing?” You’d better make sure you’re constantly thinking about how the ability to obsolete your own business because your competitors think about him all the time. • Each company should have an internal team apart, separated, and society. The sole function of this team is in order with options for society by developing better products or better yet, is to destroy obsolete technologies, the current state of the art society. Xerox has created decades ago, Xerox PARC (PARC stands for Palo Alto Research Center) in 1970. They purposely put in Palo Alto, California, because they do not want his thought has contaminated the air in Rochester, NY, a ghost town. The same city as the seat by Kodak. You want to talk about success, Xerox PARC came with the mouse that we use on personal computers. They also created the GUI that you were on your PC, and the basic design of the personal computer, Xerox PARC made by Steve Jobs. Xerox did not cash in on any of these creations. The guys from Rochester have been asleep at the switch, and the guy from Kodak. There must be something on the air in Rochester, he weighs a sense of complacency being. • Business needs for small businesses, the creation of innovative technologies that will be put out of business sale. When it comes to wait for technology to challenge a phase, it is too expensive to buy. Examples are Yahoo and Microsoft, which buy both the ability to Google for millions of dollars. Google has a market capitalization of $ U.S. 150 billion and is virtually untouchable. Is it too late to Kodak in order to save? The answer is probably yes. Very rarely, a company can in such a downward spiral in the search for superior talent, and above all, be transformed into internal COURAGE. The current management team is also always interested in its benefits package and pensions are calculated to the hard, tough decisions and necessary to be transformative. Hopefully, other American companies and investors bitter history, Kodak has to teach us to learn. Good luck.