How bad decision making could undermine good innovation


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Right here’s a scary thought for determination makers inside giant organizations grappling with digital transformation. You’ll be able to really be revolutionary and have mechanisms in place to react to disruptive forces, and nonetheless get steamrolled as layers of inside administration flip your artistic concepts into one thing unrecognizable.

Kodak is an organization that’s all the time held up because the poster baby for a company that missed the digital boat as a way to defend its present companies. Tricia Wang, a expertise ethnographer, who research organizational and person conduct, says her analysis reveals a unique narrative. In her view, the large digital concepts weren’t merely rejected by short-sighted Kodak execs. As an alternative, she says, the actual story is way more difficult involving huge firm determination making processes.

It’s clear by now that corporations acknowledge that digital transformation or modernization or no matter you select to name it’s a very actual idea that may assist stave off disruption. Kodak was actually an early sufferer of digital disruption, however Wang says the corporate was not merely passive or unaware.

Somewhat, she sees an organization that couldn’t take that concept and totally perceive the implications of digital transformation. Perhaps it was too quickly to see, nevertheless it was at the least partly as a result of the choice makers needed to construct a digital product within the picture of what got here earlier than as a substitute of what was coming subsequent.

The Kodak digital delusion

The story goes that Kodak’s R&D staff invented the primary digital digicam means again in 1974, then moth-balled it earlier than constructing the primary fashionable digital SLR digicam in 1989. Some of us might need acknowledged the potential of that second discovery, however higher administration rejects it, seeing the brand new system as a direct menace to its core movie and creating enterprise. In consequence they by no means actually take the concept severely and miss out on the digital future that’s simply round there nook.

Eastman Kodak headquarters in Rochester, NY Picture: Brady Dillsworth/Bloomberg through Getty Pictures

This instance illustrates a basic case of disruption as outlined by Clayton Christensen in his seminal ebook The Innovator’s Dilemma. However Wang sees a unique cautionary story right here.

She believes the proof means that, despite the fact that Kodak won’t have understood the total extent of the digital future in entrance of it, neither did it fully forged it apart in a match of blind self-interest.

Wang describes a state of affairs of determination making, which didn’t ignore disruption, however nonetheless resulted in the identical sad final result: chapter and the shrinking of a as soon as nice industrial big.

Discovering the subsequent (unsuitable) concept

It’s truthful to say that Kodak by no means totally embraced the digital digicam. As an alternative, it checked out methods it may one way or the other match digital into its firm world view. Wang factors out that computer-based picture modifying made its debut across the similar time that Kodak invented that fashionable digital digicam. “The primary digital picture modifying software program was launched in 1988, and the Macintosh laptop on which it ran was hinting strongly in the direction of a unique form of future for digital seize and modifying,” she stated.

“The patents that Kodak developed round digital pictures — particularly the 1989 [digital camera] patent — may have given Kodak an enormous leg up in assembly the rising shopper wants round digital pictures.”

But Kodak appears to have missed all of the indicators coming from . “The market was captured by different rivals with out the technological benefit or the IP [that Kodak had] — for instance, the Casio QV-10, which was launched in 1995, really noticed the place the way forward for point-and-shoot digital pictures was going, and pioneered the onboard LCD show that may be seen as a direct precursor to the smartphone, which got here alongside outfitted with cameras as early as 2000,” she defined

They by no means noticed the issue as changing their prospects to a digital world, however somewhat as discovering a method to improve their brick and mortar presence. That ended up taking the type of a kiosk that type of answered a digital person want of printing out laborious copies from the digital system. It wasn’t a horrible concept, nevertheless it fully missed the actual digital mark.

Kodak digital image printing kiosk. Picture: Bloomberg/Getty

“This actually huge concept [the digital camera], bought shoehorned right into a footnote of a footnote of a footnote because it traveled up the chain of command. Kodak found one thing new, however their determination making course of didn’t account for it,” Wang defined. That they had the suitable perception, however the way in which they invested in it had nothing to do with the unique concept of a completely digital world.

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