Some technology transitions are extremely difficult to perform for the incumbents. The bankruptcy of Eastman Kodak Company highlighted the difficulties faced when undertaking their core business transition from an analog to a digital world. Color photographic film was extremely difficult to produce – with correspondingly high entry barriers Kodak’s business was made on the sale of a complex product built. For more than a century, developed the complex chem … Read more »

Some technology transitions are extremely difficult to perform for the incumbents. The bankruptcy of Eastman Kodak Company highlighted the difficulties faced when undertaking their core business transition from an analog to a digital world. Color photographic film was extremely difficult to produce – with correspondingly high entry barriers Kodak’s business was made on the sale of a complex product built. For more than a century, the complex chemistry and high-speed coating technologies that roll to coat tiny strip of plastic developed enabled with no less than 24 layers of complex organic dyes and photosensitizers in thousands of square meters per minute. Its color film and paper products including Kodachrome and Kodacolor receive many of the iconic images of the last century. Beginning in the 1990s, the company built a digital photography business, until the year 2012, the company was under renovation and the prognosis was guarded. Kodak faced a particularly difficult analog-to-digital transition, as many companies have faced the waves of creative destruction wrought by technological innovation. Why was an analog-to-digital transition into a company’s core technology is a particular challenge? This note highlights some of the management research on how companies have fared with the technology transitions, and then explains why the conversion of a technology from analog to digital is clearly problematic. The challenge is Kodak faced the same challenge companies like Panasonic and Sony, telecom equipment companies and other industries now that the underlying technology, built by the products and services has changed.
This note describes the technical aspects of the transition from analogue to digital technology and why established companies such as Kodak, Sony, Panasonic and experience such difficulties.
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Willy Shih
11 pages.
Release Date: 13 August 2012. Prod #: 613024-PDF-ENG
Competency-destructive technology Transitions: Why the transition to digital particularly challenging HBR case solution