How did kodak end up where it is?

DREW WILEY · Aug 29, 2012

Silverglow - I deal a lot with mfg corps and I certainly don't know any that are run by what you describe as liberal-socialist think tanks. Quite the opposite. The trend nowadays is utter CEO totalitarianism. Then that guy stacks the office with MBA's who know even less than he does about
the business, just to make himself look good. Ever watch, "Rodney Dangerfield goes back to School?"
Just like that. 75 and hundred year old mfg concerns which has weathered just about every storm
imaginable don't seem to last more than 6 months to a couple years with a jerk at the helm.

Sirius Glass · Aug 29, 2012

In 2004 Kodak sold its Civilian and Government Systems to ITT to fund the home printer market expansion. C&GS earned over 3% of the net profit with less than 0.01% of the employees. With logic like that the writing was on the wall.

DREW WILEY · Aug 29, 2012

Yeah, and it would be ironic if Kodak sells off their consumer film division just to see someone else make a real profit at it, simply because it becomes their primary business rather than just another cog in the wheel unsuccessfully trying to flatter the stock market.

wblynch · Aug 29, 2012

DREW WILEY said:
Yeah, and it would be ironic if Kodak sells off their consumer film division just to see someone else make a real profit at it, simply because it becomes their primary business rather than just another cog in the wheel unsuccessfully trying to flatter the stock market.

I have personally experienced a company shut down an entire division rather than accept a generous outside offer on the assumption that the buyer might make it successful and "embarrass" the sellers.

Photo Engineer · Aug 29, 2012

I've found that EK middle management and VPs to be reasonable normal people. I've found the top 3 or 4 people 9with one or two exceptions) to be brusque and somewhat dictatorial people. They had an aristocratic mien.

PE

Felinik · Aug 30, 2012

wblynch said:
I have personally experienced a company shut down an entire division rather than accept a generous outside offer on the assumption that the buyer might make it successful and "embarrass" the sellers.

Crazy!!

These kind of stupidities goes all the way back to small companies too, I've been working the last 7-8 years as a consultant for companies with 3-10 people, and sometimes it makes me wonder how things can go so wrong with so few people....

RalphLambrecht · Aug 30, 2012

they enses up where they are, because that's where they wanted to be, out of the analog business.unfortunately, they missed to be inthe digital business in the meantime.

Steve Smith · Aug 30, 2012

Felinik said:
These kind of stupidities goes all the way back to small companies too

Most small business owners struggle on for years thinking that success is just around the corner.

Steve.

SilverGlow · Aug 30, 2012

DREW WILEY said:
Silverglow - I deal a lot with mfg corps and I certainly don't know any that are run by what you describe as liberal-socialist think tanks. Quite the opposite. The trend nowadays is utter CEO totalitarianism. Then that guy stacks the office with MBA's who know even less than he does about
the business, just to make himself look good. Ever watch, "Rodney Dangerfield goes back to School?"
Just like that. 75 and hundred year old mfg concerns which has weathered just about every storm
imaginable don't seem to last more than 6 months to a couple years with a jerk at the helm.

The trick is to get a good "jerk" at the helm...Steve Jobs was a jerk, but a good jerk ;-)

But I hear you...having a strong dictator is really bad when that person is stupid.

Felinik · Aug 30, 2012

Steve Smith said:
Most small business owners struggle on for years thinking that success is just around the corner.

Steve.

Yep, and most of the ones I've been working with are dreaming about becoming filthy rich, so much that they somewhat forget what the core values of what they do _actually_ are and stand for...

DREW WILEY · Aug 30, 2012

Silverglow - Indeed, the quality of the CEO has a lot to do with the sucess of the company. When
choosing what manufacturers to represent, an interview with the CEO is often paramount to the
choices. A good one is not a jerk. He will want to hear issues from potential distributors like me, will
have a good handle on the quality control chain, and above all, will LISTEN to his own experienced staff. Those kinds are in a distinct minority. A CEO who thinks he is God and terrorizes his own people is an almost certain sign of a company about to get into deep trouble. Unfortunately, these types gravitate toward publicly traded companies and their golden-parachute contracts. That's why, whenever possible, I deal will privately-held manufacturers! And some very big sucessful corporations are privately held. Analogies like Steve Jobs are rather unrealistic in most mfg scenarios. Better to have level heads who have worked their way up thru the system and know the
ropes. Cutting-edge electronics tech is a little different game, and a damn risky bar fight for Kodak
to get into unless they carefully sustained their existing income base. They obviously didn't.

SilverGlow · Aug 30, 2012

DREW WILEY said:
Silverglow - Indeed, the quality of the CEO has a lot to do with the sucess of the company. When
choosing what manufacturers to represent, an interview with the CEO is often paramount to the
choices. A good one is not a jerk. He will want to hear issues from potential distributors like me, will
have a good handle on the quality control chain, and above all, will LISTEN to his own experienced staff. Those kinds are in a distinct minority. A CEO who thinks he is God and terrorizes his own people is an almost certain sign of a company about to get into deep trouble. Unfortunately, these types gravitate toward publicly traded companies and their golden-parachute contracts. That's why, whenever possible, I deal will privately-held manufacturers! And some very big sucessful corporations are privately held. Analogies like Steve Jobs are rather unrealistic in most mfg scenarios. Better to have level heads who have worked their way up thru the system and know the
ropes. Cutting-edge electronics tech is a little different game, and a damn risky bar fight for Kodak
to get into unless they carefully sustained their existing income base. They obviously didn't.

Steve Jobs was a jerk, and despite this fact, his company is the most valuable in the world, and Apple makes the best personal computers, laptops, tablets, and cell phones in the world. Apple is a manufacturing company, by the way, and a highly successful one at that. But Apple is the exception and not the rule.

This is not to say that Jobs had to be a jerk, or any CEO for that matter, to be successful.

I think what killed Kodak (really short answer) was top management's lack of passion, lack of hunger, and being out of touch.

DREW WILEY · Aug 30, 2012

Agreed. Jobs was a pioneer in a whole new industry and maybe a bit of headstrong ego was essential
to that role. I'm certainly no expert on the history of Kodak, but given my own experience would probably not be out of line summarizing the big picture to the effect that ... Kodak mgt made a huge
logistical mistake going off in all kinds of directions without properly securing their existing chicken coop and its eggs. Cumulative debt from just too many misadventures at once caught up to them.
They left the home fort unguarded. They became a jack of all trades and master of none, at least
from a profit perspective. For most recognizable big brand names, it's a huge risk to try to shift your
market emphasis. To this day, I'm not sure who Kodak is. I don't think they know either.

Prof_Pixel · Aug 30, 2012

DREW WILEY said:
Agreed. Jobs was a pioneer in a whole new industry and maybe a bit of headstrong ego was essential
to that role.

Having a 'headstrong ego' can be a plus or a minus - you don't hear about companies who's leader had a 'headstrong ego' and was way off track Such an ego has probably destroyed as many companies as it has saved.

DREW WILEY said:
Kodak mgt made a huge logistical mistake going off in all kinds of directions without properly securing their existing chicken coop and its eggs. Cumulative debt from just too many misadventures at once caught up to them.

Well into the '90s Kodak had HUGH cash reserves that they squandered on things like the APS system

DREW WILEY said:
For most recognizable big brand names, it's a huge risk to try to shift your
market emphasis. To this day, I'm not sure who Kodak is. I don't think they know either.

I certainly would agree with that.

pbromaghin · Aug 30, 2012

DREW WILEY said:
A CEO who thinks he is God and terrorizes his own people is an almost certain sign of a company about to get into deep trouble.

I worked at a company like that back in the 80s. They invented the world's first full-page-view word processor. Incredibly fast growth and then the founder/tyrant made a bull-headed mistake and the whole thing started crashing. Eventually, fantasy sales projections were made up to satisfy wall street. These were then fed into the MRP system and so parts were ordered for goods that had no chance of ever leaving the factory. I bailed out just before the emergency turned in to a catastrophe.

Felinik · Aug 30, 2012

SilverGlow said:
Steve Jobs was a jerk, and despite this fact, his company is the most valuable in the world, and Apple makes the best personal computers, laptops, tablets, and cell phones in the world. Apple is a manufacturing company, by the way, and a highly successful one at that. But Apple is the exception and not the rule.

This is not to say that Jobs had to be a jerk, or any CEO for that matter, to be successful.

I think what killed Kodak (really short answer) was top management's lack of passion, lack of hunger, and being out of touch.

Let's see about Apple when they've been around for another 100 years...

Felinik · Aug 30, 2012

DREW WILEY said:
For most recognizable big brand names, it's a huge risk to try to shift your
market emphasis. To this day, I'm not sure who Kodak is. I don't think they know either.

Positioning is a dangerous game, and if you do wrong, it can take a lot of time to repair, if ever possible. This is what I get a feeling that Kodak is finally understanding, from being "kodak, the company giving the world photography", passing through a long period of "Kodak, hmmm what are they doing today? printers? scanners? batteries? pens? flashlights?", they need to focus on something and stay focused and claim that position to become one of the major players in peoples minds in this field. If they do not succeed, it's most probably over once and forever.

DREW WILEY · Aug 30, 2012

For decades everyone knew exactly what Kodak stood for. Maybe the general public box Brownie
crowd never knew about the extensive industrial scope of products, but cumulatively, there was a
core focus to the whole enterprise, along with a well defined market. This might have needed some
tailoring and gradual shift as newer technologies emerged; but it's not the kind of thing any smart
manager would gamble with while testing newer options. I witnessed several big corporation go down
that wrong path, esp in the 90's when the mantra was to diversify, diversify, diversify in order to have a bigger perceived footprint to potential stock investors. The problem was, some of these
companies diversified into arenas they really didn't understand, and thereby sacrified key finances
that should have gone to upgrading or underpinning their existing base.

lxdude · Aug 30, 2012

All that stuff from Perez about how great their ink-jet printers would do for profits. Right. Going up against Canon, Epson, HP and Lexmark.
Now Lexmark has announced they are getting out of the ink-jet business and will try to sell the division and its patents.

Sirius Glass · Aug 31, 2012

If Steve Jobs had taken over Kodak instead of Perez, we might be shooting film with 8"x10" touch screen tablets!

DREW WILEY · Aug 31, 2012

Exactly! There is still a need for high-end commercial images with good detail and Dick Tracy Secret
Decoder Ring cameras aren't going to fill that need, and current MF digital options are undoubtedly
going to go obsolete, probably before sheet film will. Someone will come up with a real electronic
option for color film itself. In the meantime, I'm going to grow old enjoying my darkroom. There's no
digital option for that! Hands-on for me!

How did kodak end up where it is?

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