Companies that killed technical progress

January 23, 2012 13:30

Kodak and other companies that were not able to make out time to new technologies

Pioneer photo industry company Eastman Kodak Co. filed for bankruptcy. Over the past year, Kodak shares depreciated by 90%, the company is mired in debt, closes dozens of laboratories and conducts thousands of cuts. After passage of bankruptcy Kodak expects to seriously restructure its business.

Kodak made a fortune in the manufacture and sale of photographic equipment widely available to her photographs — film, paper, etc. The history of Kodak had several peak moments when he became a pioneer of the market through the introduction of innovative solutions. In particular, it is Kodak invented the first color film. But the company fell victim to the most revolutionary cataclysm in the business — the dissemination of digital photography.

Kodak faced a classic "innovators dilemma". This term was coined by American professor Clayton Christensen to describe a situation where a successful industry leader refuses to recognize a young technology, as it is contrary to its current business model and does not meet the immediate needs of its customers. As a result, over time, the technology is "subversive", destroying the entire business in the bud.

Kodak is not the first healthy company, which could not survive the appearance of more advanced technology. How was the death of Kodak and other companies which suffered a similar fate?

Kodak: creator of digital technology, which was his undoing

Kodak is an irony in the fact that first digital camera was developed in 1975 by his engineer — Stephen Sassoon. As he later recounted in The New York Times, the invention strongly dislikes leadership Kodak. "They told me, Oh, that's nice, but not necessary to share with anyone," — says Sassoon. Top management of Kodak irritated idea that the camera did not need Sassoon film — it was selling it to generate profits.

In the 1980s, Kodak commissioned its analytical division a lot of research to find out how much digital photography threatens his business. Analysts concluded that the revolution is inevitable. However, they have been and "good news": the dramatic changes will begin no earlier than ten years and, therefore, Kodak may be in time to prepare for them.

Kodak made a study of interesting conclusions. One of the employees in his book says that the company spent the next decade than the development of a detailed plan for survival in which the film is no longer relevant, and to explore ways to use technology to improve digital film cameras. So, the company spent $ 500 million to develop and launch the camera Advantix. It allowed to take digital pictures, but only in order to then capture the image on film.

Thus, when Kodak finally decided to take a digital photograph, it was too late — the company has lagged far behind its rivals and was never able to catch up.

Digital Equipment Corporation, does not believe in a "microcomputers"

In the 1980s, Digital Equipment Corporation (DEC) respected as one of the most innovative and well-managed companies in the computer industry. Experts praised her management, and journalists DEC compared with high-speed train, which rushes through the railroad, destroying competitors. It was believed that even IBM can not feel safe. Within a few years the situation has changed dramatically. Market for mini-computers (both formerly known as computers the size of a wardrobe) quickly began to contract under the influence of emerging microcomputer (modern PC).

DEC until recently refused to bet on the new network. Guide giant believed that PC, yielding mini-computers in power, are not able to interest customers in the corporate sector. The situation worsens low margin PC market, making it much less attractive in the eyes of management. However, the PC became more powerful, and in a few years destroyed mini-computers as a class. By the last decade of the XX century from the old DEC profit was gone. Attempts to produce PC failed, and in 1998 bought the remnants of DEC Compaq.

Polaroid and its hybrid camera and printer

Famous Polaroid camera that can produce immediately after shooting finished picture. For shutter clicks followed a loud hum, and a few seconds of camera TRAVEL square picture. Tucked the camera does not film, and a special cassette containing paper and all the necessary reagents for the chemical reaction. The first such devices began to appear shortly after the Second World War, but failed to blow up the market for Polaroid in 1970-1980's.

Digital photography has given people the opportunity to instantly watch the captured footage, making the idea of Polaroid snapshots are much less attractive. Polaroid was unable to prepare for the changes, and in 2001 started the procedure of technical bankruptcy. As a result, most of the assets of the company was sold. C since Polaroid suffered another bankruptcy and the period of production of household appliances.

In 2008, the company attempted to modernize the idea that made her famous: it began producing digital cameras with built-in printer. The experiment can not be called a success: people just do not really need paper photos. Now resumed production of the classic Polaroid film cameras, which use low demand among the young and trendy.

Facit, unduly profession

By the 1960s, the Swedish company Facit was one of the market leaders in mechanical calculators of the company, located in more than 100 countries around the world. Device the size of a typewriter could produce all the basic math operations: multiply, add, divide and subtract. There was even a separate profession people who believe in such calculators.

Facit business came to an end when the U.S. and Europe have started flooding the cheap, basic-to-use and compact electronic calculators from Japan. Already in 1973 Facit was sold to Electrolux.

Western Union, I will not believe in your phone

At the end of XIX century, Western Union was one of the most powerful companies in the U.S.. She actually monopolized the only one at that time means of communication over long distances — the telegraph. In 1876, the president of The Bell Company Gardiner Hubbard offered Western Union purchased for $ 100,000 package of patents developed by founder Alexander Graham Bell device — the phone. Western Union leadership has refused, arguing invention Bell meaningless. Subsequently, it will be one of the worst decisions in the history of business.

Western Union, quickly realizing his mistake, in a few years will still providing telephone services. However, the company will be forced out of business, losing Bella patent war. Implications for Western Union will not fatal. Telegraph services for a long time will be required, but the power of Western Union gradually melted. As a result, in the 1980s, Western Union actually leaves the communications business, taking up money orders.

The fate of The Bell Company will be totally different. The company is renamed AT & T and from the telephone monopoly turn into the largest provider of cellular communications in the United States. Now AT & T capitalization exceeds $ 180 billion

Memorex and the problem of large disks

Memorex has been one of the most successful independent companies in 1960-1970-s flooded the market with floppy disks. In the early 1970s, Memorex engineers have developed one of the first 8-inch wheels, which are then widely used in mini-computers. However Memorex late to go into 5?-Inch floppy drives, time does not realize the potential of word processors (machines intended solely for typing) and began appearing PC. Already in the early 1980s, Memorex has been sold.

Memorex story is representative of many other third-party disks that have not been integrated into larger companies. The constant change of the dominant format and the inability to understand the future changes of business left on the side of more than a dozen companies.

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