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May 22Doug Smith

Kodak: A Followup

May 22Doug Smith

Last week, I published an article in my blog about Kodak, drawn from an article in the HBS Working Knowledge Blog. I thought I would share an interesting comment on the HBS blog article from Walter Blass, a Visiting Professor of Management at the Grenoble Graduate School of Business.

“Perhaps because of loyalty to his former employer, Professor Shih has not spoken of the elephant in the middle of this competitiveness issue: Corporate Leadership. I’ve been teaching the HBS Kodak case about film vs. digital imaging for years. When push comes to shove, you have to look at the CEO, and beyond him to the Board which selected her or him. Kodak went through 5 CEOs in 30 years, none of whom were able to change the corporate culture, the isolation of Kodak in a one-company town, the refusal to change. Even George Fischer, imported from Motorola pandered to the culture by stating that “digital would not cannibalize film.”

“I had a similar experience at AT&T when an ingrown management would not change despite strong signals going back to 1968, from monopoly to competitor, from wireline to broadband and cellular. Unlike IBM who brought in a rank outsider Lou Gerstner who fired 1/3 of the employees and reoriented the company, AT&T never saw the light.

“The fault, dear Brutus, in not in our stars but in ourselves.” The appeal to Government – our stars – will be useless if corporate leadership in the U.S. doesn’t grasp what Professor Clay Christensen is trying to teach with ‘Disruptive Technology.’”

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