Tuesday, January 17, 2012

Why is Kodak near death while Fujifilm is thriving?

Fascinating perspective in The Economist. Here are some quotes:
Fujifilm, too, saw omens of digital doom as early as the 1980s. It developed a three-pronged strategy: to squeeze as much money out of the film business as possible, to prepare for the switch to digital and to develop new business lines.
Kodak had become a complacent monopolist. Fujifilm exposed this weakness by bagging the sponsorship of the 1984 Olympics in Los Angeles while Kodak dithered. The publicity helped Fujifilm’s far cheaper film invade Kodak’s home market.
Another reason why Kodak was slow to change was that its executives “suffered from a mentality of perfect products, rather than the high-tech mindset of make it, launch it, fix it,” says Rosabeth Moss Kanter of Harvard Business School, who has advised the firm.
Hindsight is always 20/20 but that last quote is reminiscent of the difference in business philosophy between Microsoft and Apple. One wonders what Steve Jobs might have said about that. We do know what Bob Lutz (former Vice Chairman of General Motors) thinks about Ivy League business schools and MBA spreadsheet-based business strategies.

Postscript: See the Comments below for additional perspective.


  1. Company which spawned 3 centuries died today .. this will be studied as an example of long living corporations failing to adapt and survive as Monte dei Paschi in Siena, Italy - operating for 5 centuries as bank - am currious about key wrong decisions leading to disaster with residual value in patent portfolio and brand value .. sad story .. Kemal A. Delic

  2. Notable by its absence in The Economist piece is any reference to Fuji Xerox, the partnership between Fuji Photo Film Co. and Xerox Corporation. Fuji Xerox is responsible for the innovation and manufacture of many of the color printing devices sold by Xerox Corp.

  3. Official, this morning: Eastman Kodak Company files for Chapter 11 bankruptcy protection.

    Who invented the digital camera? This device was first created by Eastman Kodak engineer Steven Sasson in 1975.

    The Apple "QuickTake" consumer digital camera was introduced in 1994 and had the Apple logo but it was produced by Kodak.

  4. Side note on the state of US mfg (audio mp3). The Fed tried to put upbeat spin on 2011 US mfg stats b/c offshoring not as financially attractive as it once was but ...

    * Output in 2011 still 10% below pre-recession levels
    * EU accounts for 22% of sales, and we know what that means...
    * Need 2 mil more jobs to get to pre-2007 levels
    * US factories are now 40% more efficient cf. a decade ago, due automation (=> less new jobs)
    * Only 9% of US jobs are in mfg
    * Even if factory jobs grew 2x, not enough to absorb 13 mil unemployed
    * As Mfg jobs goes offshore, badly needed innovation + R&D soon follow

  5. Quoting Kanter of the Harvard Business School: [Kodak executives] “suffered from a mentality of perfect products, rather than the high-tech mindset of make it, launch it, fix it,”

    Case in point: Microsoft Windows 8 B̶e̶t̶a̶... D̶e̶v̶e̶l̶o̶p̶e̶r̶ ̶p̶r̶e̶v̶i̶e̶w̶... Consumer preview. Although batteries are not included, dev tools are.

    Next, we'll be seeing "Fix it yourself."

  6. And the irony continues. Meet the Fuji X-Pro 1 where they claim "the X-Pro1′s sensor 'resolution and low noise will surpass rival 35mm full size sensor[s]'.“

    Australian photographers Christian Fletcher and Michael Coyne have both tested the camera, and conclude:
    "this camera is a worthy replacement for a bulky dslr system. If you have to travel light, this is the camera for you. Physically it is only marginally larger than the x100 so slinging it around your neck for a day is no problem. In fact I am wearing mine right now!, it is a fashion accessory!!"

    In related news, Fujifilm revealed it sold some 100,000 model X100 cameras in 2011.