Category Archives: Business

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The Real Lesson of Kodak

KodakIt is hard not to feel at least somewhat sentimental watching Kodak exit the world’s business stage in such a sad state after such a storied run. You have to feel sorry for the employees, especially those likely to lose retirement benefits after long careers of loyal service. It is also hard to feel sorry for the company, particularly its management. Kodak had the solution to its own ills and chose to submarine it. The lesson: if you don’t cannibalize your own business, count on a competitor to do it for you.

A timeline of “Kodak’s Key Moments” recently appeared in the Wall Street Journal, and what is too easily forgotten is that Kodak developed the first digital camera as early as 1975, but chose not to bring it to market for fear of cannibalizing its hugely popular film business. That’s an easy enough Monday morning quarterback call, but how many companies right now know they are on a path to their own obsolescence, have a pretty good idea what the long-term answer to their ills may be, but are ceding alternative paths to their competitors for fear of short-term pain or possibly looking stupid? The answer: more than you think.

In a subsequent article entitled Avoiding Innovation’s Terrible Toll, the Journal further noted that in a study of more than six million firms, only a tiny fraction made it to the ripe old age of 40. The authors of that report, Charles I. Stubbart and Michael B. Knight, reflect that “…despite their size, their vast financial and human resources, average large firms do not ‘live’ as long as ordinary Americans.” We have just seen this of late with the beloved Borders Books, and now we are watching Barnes and Noble try to pull off a comeback around its initiatives with Nook. Other companies like Apple, Johnson & Johnson, IBM, and General Electric have steered their ships across longer journeys. It is possible to go the distance, but it requires an openness to change that is so uncommon in business, you almost have to shake people physically to get them to see how to save themselves. Generally speaking, corporate people don’t like to be shaken, even if it’s good for them.

Creative destruction as most commonly defined by Joseph Schumpeter is real and unavoidable. It is also reasonably easy to argue that despite the pain it causes in transition, it is a positive force of social evolution that drives us forward and replaces inefficient procedures with new technology, updated methodology, and even new financial opportunities for investment and return. My dear friend Kermet Apio, a wonderfully successful standup comedian, captures the essence of Creative Destruction in a 90 second bit where he compares the joy and simplicity today of clicking on a song you might want to hear versus trying to find it on a cassette tape, which might take you so long you’d almost certainly abandon the task unfinished, or worse, try using your pinkie on the internal reels to queue up the precise starting spot. There’s a touch of nostalgia here, and we do find ourselves laughing very hard at what was our norm not so long ago. Click on the link above to see how Kermet tells the tale, the chuckle makes the point.

But no one is laughing at Kodak’s headquarters in Rochester, and no one should be. Kodak had the first digital camera in 1975, and while admittedly neither they nor anyone else knew what to make of this at the time, they had a much more important mandate on their mind: Protect Film. Kodachrome was not only iconic, it was hugely profitable. So was motion picture film processing. So were all their other traditional film developing technologies, not to mention the sale of retail supplies, equipment repairs, and patent licensing. Kodak was a beloved company and a global brand that made the same wrong decision so many other short-life companies make—they worried too much about cannibalism, and not enough about what happens if they don’t cannibalize their own markets.

It doesn’t get any easier to understand than this—if you don’t cannibalize your own markets, someone will do it for you. The choice is that simple: do it to yourself for your own good, or be the victim of outside attack. No form of technology is forever, and any trend you’re surfing is going to break flat on the beach. In Kermet’s bit, he talks about the Sony Walkman. Everyone had one. It was great. Then came the CD, Sony had a piece of that technology, so far so good. Then came Apple with the iPod, not the inventor of portable digital music playback, but the “perfector.” By the time Sony responded, they were on defense instead of offense. Too late. The cannibal is here, it came from elsewhere and did what you feared it would. You knew it would happen, you couldn’t stop it, but you could have been it. That’s the choice. Not will it come, but from where will it come.

That is the real lesson of Kodak: no one can stop the march of innovation because it is inconvenient or upsetting. No company can duck cannibalism by refusing to acknowledge that current markets have to be sacrificed for new markets to be built. If you’re young and just getting into business, get used to this, and get used to your bosses telling you all the reasons why they have to protect what you have today, that the hit to earnings to attack your own hugely successful lines of business with nascent replacement ventures is just too painful. If you’ve been doing this a few decades, remember back on all those long and awful bureaucratic meetings where you wished someone would have pounded the table and screamed, “To Hell with cannibalism, we’re doing this—keep the cannibal in the family!” There were meetings where that happened. Those are the companies with the 100 year brands.

If you are at CES this week wandering the endless aisles of new stuff and you see something that could eat your lunch, ask yourself, why didn’t we think of that? And if we did, would we have had the courage to launch it? Let’s hope this lesson gets easier to recite so we don’t see loyal employees lose their benefits because political correctness forced a gag order or management failed to act when time was on their side. Manage the product life cycle, but don’t be afraid to leave a little money on the table. Get the new products out there before someone does it for you. The real money is in longevity, which means innovation, which means playing offense against yourself.

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Do Books Matter Less?

The pre-Socratic Greek philosopher Heraclitus was an early observer of the ever-occurring change in our universe. About the same time in the 5th Century BC, Parmenides pondered the notion of permanence, what we could presume in nature to be essential. Between the two of them, we have a thesis and an antithesis that have yet to reveal a synthesis beyond argument some 2500 years later. We see change all around us in almost unfathomable complexity, while we wonder what we can hold onto as firm. For me, it’s a good problem to have, as contemplation of the unsettled forces us to chew harder and argue better.

Then there are books.

In a recent Wall Street Journal piece with the header “Books That Are Never Done Being Written,” Nicholas Carr contemplates the far-ranging impact of digital distribution on long-established but fluid notions of traditional publishing:

An e-book, I realized, is far different from an old-fashioned printed one. The words in the latter stay put. In the former, the words can keep changing, at the whim of the author or anyone else with access to the source file. The endless malleability of digital writing promises to overturn a whole lot of our assumptions about publishing.

The realization that books are no more permanent than this year’s understanding of medical treatment is hardly shocking. The very paradigm of printing on paper and binding a work has throughout its history adopted the notion of editions and revisions. Where would the school textbook industry be without an excuse to update a classroom volume rather than allow you to feel comfortable buying a dog-eared half price two-year old version? If we only needed one unabridged edition of the Complete Works of William Shakespeare, think of how many academic preface summaries we would have been denied annotating discovered corrections in the core text.

Yet in the worlds of literature and even political theory, we do seem to maintain an expectation that the version we read of Charles Dickens or John Stuart Mill is largely the same as the draft the author called final. “A Tale of Two Cities” even when presented in its initial serialization was eventually finished, as was the essay “On Liberty,” and when we buy a copy of one of these today, either in paperback or download, we do believe in the authenticity of replication representing if not a fully steady state, a pretty firm slice of life. That is helpful not only in getting us all on the same page for discussion and critique; it also offers us grounding in history and social evolution, the ceaseless churn emerging from deliberately placed bricks in the wall.

I have a hard time thinking today is much different, and no matter the short attention span theater that victimizes so much of our patience, my sense is our books have never been more important — no matter the brevity of their life-cycle, no matter their imposed truncation or expansion, no matter their delivery format or storage means on a wooden shelf or cloud server. Our books will change as they must, but their timeliness and meditation as a collective might be the primary permanence we retain, even if it is more spiritual and metaphorical than natural or physical. The means of delivering the book does not define the book; it is largely irrelevant, a timely convenience worthy of disruption. The material of delivery is subordinated to the material of substance. It is the content that matters, not the media. The Platonic Form is the ideal, and that cannot be taken from us by technology.

However we acknowledge its consumption mechanism, the book as ideal is a bridge among scattered coordinates. We learn to read an organized set of drawn thoughts to see what is meant by change, and those who have the gift and discipline to construct a book add to the global library of permanence by carrying the torch that challenges all that came before. Historic observation is clear and consistent: the buildings decay, the land can be conquered and utilized anew after wars and governments are gone, but the ideas underlying arts remain for examination. The composed book is the codification of the idea however it is presented — that does not change.

My amazing wife, who is also an amazing teacher, enters her classroom on the first day with a simple statement:

“Our books are our treasures.”

Her specialty is English as a Second Language, and whether she is teaching adults or children, this mantra is always the same. Books are precious. If you look around our house, you might see why this is our chorus. Books are everywhere. That is what we want to be surrounded by. We also have a Kindle and an iPad.  They are filled with books as well.

Another recent story in the Wall Street Journal discussed how the price of e-books was sometimes dropping below the price of “real” books, which I guess means paper books. To me, one is no less real than the other. The broader question is whether the great majority of people should still find the time for long-form written expression in a world cluttered with half-baked tidbit social media posts like this one. The answer has to be yes, because if we are going to allow character count to trump in-depth inquiry, we condemn our more severe concerns to being adequately addressed by less than substantial narrative. Our pace of change is only becoming more frantic, and the hope for some form of understandable permanence is all the more desirable in addressing unending anxieties. Committed writing and reading get us a good deal of the way there, because the acts of reading and writing might be one of the few forms of permanence we can share.

I say this as someone who just spent the better part of a year writing my first book, which is now in first draft and undergoing edit. I haven’t talked much about the book, and won’t until we get closer to publication, but let me say that whether anyone reads it or it sells a single copy, it will remain one of my proudest achievements. Right now it is a long book. It will get shorter to accommodate marketing concerns, but hopefully it will still be a substantial book. I couldn’t have said all I needed to say in a blog post or I would have. Believe me, I would have!

In our world of constant and increasing hyper flux, books can be thought of as a noble but flawed exercise in establishing some sense of the enduring. Now that digital publishing allows current authors easy access to further disturbing permanence, any foothold in establishing the concrete may remain even more illusive, but the stepping-stones of thought that bridge us from there to here can certainly maintain significance if we view thought as continuum, a timeline. In that regard, as a roadmap or even a set of breadcrumbs, books for me have never been more relevant, nor the mission of authors any less permanent. Some books are good and some are bad, some certainly more ephemeral than others, but the connectivity of books is ongoing. Apps or facings, that is as it should be, as long as I can read.

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Photo: Pixabay

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A Little More, A Little Less

To help bring in the New Year, here is a quick punch list of what I would like to see a little more of and a little less of in 2012.  These are not meant to be far-reaching or prophetic ideals, just small steps we can choose to make concrete in and out of business to “advance the brand” ever so slightly each day.  Please feel free to stretch the list and add your “asks” in the comments section.

For starters…

A little more focus on sustainable job creation with decent paying gigs for those who want to work; a little less badgering of the unemployed who are nobly trying to spring themselves back into action.

A little more attention to world-class customer service that shows true respect for those who pay the bills; a little less maneuvering in the shadows to squeeze unwarranted improvements in margin by taking advantage of customer patience and goodwill with hidden garbage.

A little more good theater onstage; a little less awful theater everywhere else.

A little more listening to creative thinking before blurting out that it won’t work; a little less condemnation of those who are carrying the bag before questioning their character.

A little more pay down of available credit by all borrowers; a little less concern with things we don’t have and might like, but can live without no problem.

A little more conservation of the Earth’s precious and limited resources; a little less right to entitlement via purchase power.

A little more earnings from growth and investment in the enterprise; a little less cap on hiring while stockpiling cash reserves.

A little more commitment to making broad education a national priority; a little less earthquake type each time a professional athlete signs a seven-figure contract.

And then…

A little less spotlight on celebrities and their personal dramas; a little more celebration of everyday unsung heroes who quietly make our world better just doing what they do.

A little less fireworks around award shows for mediocre creative work; a little more visionary creative work worth celebrating.

A little less self-aggrandized noise and plotted invective in media placement; a little more interesting dialogue and engaging discussion in the public square.

A little less “them” where rhetoric is an intentional tactic of divisiveness; a little more “us” where national pride and humility are shared values.

A little less last-minute antics in Congress where critical deadlines loom; a little more thoughtful strategic planning around long-term solutions demanded by voters.

A little less concern around titles and press releases; a little more measurable goal achievement and personal job satisfaction.

A little less built to flip and business as usual; a little more built to last and Think Different.

A little less criticism of people who look, talk, and behave differently from our routine; a little more tolerance of diversity that opens the door to understanding — on that last one, maybe a lot more.

Okay, that’s my zapping of the spark plugs.  What’s yours?

Thank you for welcoming Corporate Intelligence Radio in its first year and all your great comments (private as well as public) in our shared exploration of how to make work matter more.  Together we can make 2012 a turning point.  Why not?

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What to Give Your Boss as a Holiday Gift

Office gift exchange can be a nightmare, especially when it’s your boss.  Believe me, I know, it’s as hard to give as it is to receive.  The ritual is uncomfortable, filled with anxiety and trepidation.  Most everyone wishes it would just go away — let work be work, gifts are for the kids, right?

Let me share with you a personal anecdote, and then an unlikely bit of advice about what I think your current boss really wants from you on the gift list.  Then I will share an idea about how to make the holidays even more satisfying with one of my personal favorite “work things” to do this time of year.

Somewhere along the way I acquired more than a passing interest in wine, and as people with a passion for something have a tendency to do, I talk about it from time to time.  I will try not to bore you with the details, but when we lived in Northern California we ventured to Napa and Sonoma on weekend drives, and that is where I began to discover the creative process behind wine is like art, poetry, and storytelling blended metaphysically with supply chain economics, agriculture, and marketing.  With my obsession around the marriage of technology and media (show + business + bits + capital), the real world metaphor of wine was a perfect diversion for me, a subject of endless study.  The more I studied every aspect of the vineyard, the more I talked about it.

Oh, those frightened employees!  How pretentious!  How intimidating!  Now we have to spend a week’s pay on a bottle just to avoid a CLM (Career Limiting Move) every holiday season.  Nightmare on Goldstein Street!

Nope, not at all.  Never asked for a bottle, never expected a bottle, and when I would get one, if it was pricey, I would donate the value of the bottle to charity and nicely advise the giver to please lighten the wallet load in the future.

Yet whenever I did get a bottle as a gift from an employee, here is what I would do — I would write his or her name on the label and the date of the gift, then store it in a closet, which eventually evolved into a more formal wine cellar.  There it would sit in the dark (luckily, my chatter reinforced my predisposition for reds, which even if they don’t age well, usually hold up if stored decently).  Then, years later, on random occasions, I retrieve the bottle because I have a taste for it, almost always forgetting who gave it to me.  That’s when I look at the label, smile, enjoy the wine, and I do my very best to find an email address or phone number for the person who gave me that bottle and I get in touch — to thank them again, to tell them the wine was good (it always is), to see how their career is going, to see how their family is doing, just to reconnect.  It’s an excuse to recapture a great slice of life, and that brings the gift full circle.

Some of you reading this have received those calls or emails from me.  Some of you haven’t because I can’t find you, but most of you haven’t because the wine is still down in the cellar and you will — sooner or later, you won’t escape.  That’s what makes the gift unique.

So if someone gives you a bottle of wine, no matter the circumstances, try the same trick, and wait as long as you can before you reach for the stored bottle, let time pass, and then open that bottle as a way to remember that person, and an excuse to reconnect with them.  You will be surprised how much fun this is, how gratifying it is, and what a great sense of continuity it brings in tying together seemingly unrelated chapters of your life as your network of colleagues expands across the globe and lives their lives with all the ups and downs we all experience.

Okay, that was the anecdote, but it was for illustrative purposes only.  This post is not about wine shopping or storage.  Let me tell you now what your boss really wants most from you for the holidays:

A better relationship.

It’s the same thing your boss wants with you all year long.  It’s the same thing you want with your boss.  You don’t need a bottle of wine to get there.  A kind note will do.

Want to know another secret?  If you write your boss a kind note at the holidays solely for the purpose of improving your relationship, your boss is likely to save that note, just like a bottle of wine.  This is not about sucking up, office politics, or any other hallway chatter you are better off avoiding — if you don’t want to do it, you should not, it is not a job requirement.  Of course your boss may not be the shiniest object in the room, perhaps you even think he or she is a nasty freak who is out to get you.  That might be true, but in case you haven’t already figured it out, bosses knows they make mistakes all the time, they worry about it, they feel terribly about it, and most of them wish you didn’t think they were out to get you.  You might prefer to fill a turquoise Tiffany box with treasures you can leave on the boss’s desk to faking a kind note, and if that is the case, you should do neither.  A wrapped gift is only a token of expression, a means to outreach, so if there is no outreach, don’t bother, you’re wasting your money.  You can give a gift, you can not give a gift, honestly I don’t think it will get you off the S-List, nor will it lead you to unwarranted promotion.  Good bosses are smarter than that, and they know the rules.

The holidays are an opportunity for reflection on all fronts.  If you do use this time of reflection to build a relationship, to settle a difficult matter of the past, to ask a candid question about how you could be doing better, to tell your boss what you like about your job, that could be a path to bonding with lasting value — and by lasting, I mean years beyond the job you currently have.  I stay in touch with some employees for decades — not all of them, but surely the ones with whom I built a relationship.  That door is open for you now, you just have to decide if you want to walk through it and have a conversation.  Hierarchies are one directional, no question about that.  Relationships cut two ways.  Hierarchies are determined by corporations with documents on record in the HR department.  Relationships are determined by people, no files at all.

This leads to my final point: What about that former boss, the one you never did give a bottle of wine or a note?  Surprise that person!  Email them as if you opened the bottle of wine and saw his or her name on it.  Tell that old boss what you are doing, how’s the spouse, the kids, the dog, the job, the retirement, the untenable new boss with whom you wish you could have a relationship.  We used to do this with Holiday Cards, and some people still do with photos of the family sitting under a palm tree on their summer vacation in Tahiti.  No one has time to write all those notes anymore — we are a busy, wired, short attention span theater crowd that communicates more efficiently on Facebook, Twitter, and in blog comments.  So just pick one each year, and see what’s there.  You will be surprised.

Whether your long-ago boss or your current one, believe me, he or she doesn’t want you to spend your hard-earned money on them.  They do want to know how you are doing.  That is a gift that is as priceless as it is ageless.

Celebrate the day, keep peace in your heart, wish for a better world and do your best to make it so!