A recent news story that filled me with nostalgia concerned the demise of Kodak Building 53. This historic factory was demolished in a controlled explosion two weeks ago, becoming the 41st building to be levelled since 2003 at the Eastman Business Park in Rochester, New York.
As I watched the video of the building crashing to the ground, it stirred plenty of emotions and memories.
To me, this was more than just another “Kodak moment” — the phrase everyone remembers from the days when the company dominated the world of photography. Rather, it is a significant symbol of the fall of Kodak Empire. It teaches us an important lesson about how the company that once wowed the world with the first digital camera forgot to reinvent itself over time.
Kodak is one of the most dramatic examples of big companies that got sideswiped by change. More recent examples include the struggling HP and Nokia, now a shadow of its former world-beating self. All three of these companies had managed to successfully reinvent themselves before, so what do you think went wrong?
Reinvention is critical for any business to survive in the long run regardless of what stage of the product or business life cycle you are currently in. However, reinvention is not easy and most of the reinvention that occurs is involuntary — forced on a business as an inevitable result of massive industry disruption. The priority becomes defending one’s position and building hope for the future.
Given the pace of technological and social change today, many commentators say that we are living in a time of great reinvention — or a great time for reinvention, to look at it another way.
Kodak and Nokia are examples of companies that ended up being victims of major market disruption. Their key products and services were being pushed aside by unexpected market entrants — most notably Apple and Samsung — that completely upended the value chain in which the likes of Kodak and Nokia had thrived.
In the case of Kodak, it held on to its film cash cow — the product that earned the company $16 billion at its peak in 1996. It failed to take the opportunity to adjust to the reality of changed market conditions and rival technologies such as digital photography and smartphone cameras.
On the other hand, there are many examples of companies that failed at reinvention as a result of their own internal problems and not because of emerging market disruption. However, what I’d like to emphasise here is that whether you succeed or fail in reinvention, one of the major reasons is because of the leadership, or lack thereof, within the organisation.
For an organisation to be able to truly transform itself and reinvent, it will require visionary leadership that is willing to completely rethink the business — the business model as well as supporting corporate culture — at the right time. When talking about the right time, I’m referring to the time before the organisation gets into trouble, not during, or after, when resources are scarce and fear is contagious.
Still, as a leader myself, I also know that it is truly difficult to decide to cannibalise existing activities at what might appear to be their peak of success. This is partly because success traditionally gives rise to a mindset that prefers a stable environment and is not open to change, but this can potentially paralyse organisations.
Change is hard, but as leaders we need to accept that whatever got us here today will not necessarily make us successful going forward. As a result, we need to constantly remind ourselves to keep the best of the past and change everything else that is necessary in order to move forward and reinvent. We need to fix the roof while the sun is shining because when the storm comes and change happens, whether it is cyclical or structural, it will be at an insanely rapid pace.
My final advice for you leaders out there about incorporating the culture of reinvention into your organisation is to make a commitment to personal reinvention so that you will be role models. As former Avon CEO Andrea Jung once said, “[y]ou cannot reinvent the organisation unless you reinvent yourself first.”
Now, we all know how important reinvention is, particularly when technology makes big jumps and penetrates every aspect of our lives. Reinvention is one of the best defences against failure. However, it is vital to keep in mind that reinvention is not easy; when done badly it can add problems rather than solving them. Thus, the most critical foundation for any organisation that aspires to reinvent is for the leaders to commit to personal reinvention — make the first move and set the trend for your people to follow.
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Arinya Talerngsri is Group Managing Director at APMGroup, Thailand’s leading Organisation and People Development Consultancy. She can be reached by e-mail at arinya_t@apm.co.th or https://www.linkedin.com/pub/arinya-talerngsri/a/81a/53b
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