Kodak - Change in Organisations

In todays’ volatile business environments, change is the only constant that keeps an organisation moving towards success. Usually, changes within an organisation occur when external or internal factors are tipped off balance. This results in management taking the necessary steps to steer the organisation back to better positioning and stability via the changes implemented. Was Kodak, the company once worth $31 billion be filed for bankruptcy, under chapter 11 (Merced) be solely because of its refusal of going through organisational change?

With the slogan "you press the button, we do the rest," George Eastman introduce the first camera into the hands of a world of consumers during the year 1888. By doing so, he made a complicated process, so simple to use, to nearly everyone. Kodak the world's largest producer and marketer of imaging products (Yu 1-3) had a strong branding and was one of the most respected brand name around the world that celebrated many remarkable milestones.

By looking at change as process with specific stages, organization can prepare itself for what is about to knock on it’s door and make a plan to manage the transition – looking before you leap, so to speak. Usually organisations go into change and make decisions blindly, causing much unnecessary turmoil and chaos or in the worst case scenario of needing to shut down. One of the cornerstone models for understanding organizational change; Lewin’s Panned change model was developed in 1940 by Kurt Lewin. Through this model, he describes how change goes through three-stage process “unfreeze – change – refreeze” (Organization Development & Change 21-23).

The first stage also known as the ‘Unfreeze stage’ is about preparing everyone in the organization before the change. The ‘unfreeze’ stage involves getting to a point of understanding that change is necessary, and that it is time to move away from the current comfort zone. Second stage regarded as the ‘change stage’ according to Lewin is where intended change is executed: action is taken, changes are made and people are involved. Support and communication is crucial here, it can come in the form of coaching, training and mistakes are encouraged and expected to occur as part of the process. During the ‘Refreeze stage’ change is adopted permanently, establishing new ways of how things are supposed to be done and there after it is incorporated into everyday business. At this stage it is important to celebrate success or reward to let employees feel appreciated and assured that their hard work is truly valued and has been paid off.

Steve Sasson, an engineer of Kodak created the first prototype of a digital camera. It was the size of a toaster, captured an image in 20 seconds and was required to be connected to a television to view the images that were taken. Kodak may have invented the technology. But by investing in it and further developing the idea it could have achieved another milestone, but unfortunately they didn’t invest in it. Furthermore, Sasson told The New York Times (Deutsch -) that management’s response to his creation was “that’s cute – but don’t tell anyone about it.” This first prototype of a digital camera had massive disruptive potential, but it overseen just like that.

Applying this to Lewin’s change model, at the ‘Unfreeze’ stage, Kodak was determining the change. From the above article it could be inferred that upper management was not keen in Sasson’s creation. Change is a two-way approach it works both top down and bottom up. The ‘unfreeze’ stage is not strong, as the digital camera proposed had no strong support from the upper management. At the ‘change’ stage only minimal can be done as there is no action plan developed, and even if so the green light and proceeding ahead has to be approved from the management before being executed. Since there was no strong support to drive the change, there is no change to be anchored. Thus Kodak continues to function the same way at the “refreezing’ stage. It is important for an organization to welcomes and embraces new ideas proposed, failure to get support from upper management could be one reason for Kodak’s fall.

The nature of business keeps on changing so the revolution in the market place and evolution of the strategy of the company to meet the expectation should constantly match. Kodak knew that consumers’ preferences are ever changing, but they failed to embrace it. Relying on their strengths ("Eastman Kodak"), they believe they would continue to do well, resulting in not favoring the idea of going from film to digital. Kodak believed that consumers would never part with hard prints and valued film- based photos because of its high quality (Munir). But Kodak was proven wrong, when digital cameras started dominating, as consumers found it more convenient. Besides, consumers didn’t feel the need to hard print their photos as they could easily save a soft copy and use it for multiple purposes.

Kodak was known to have performed frequent Research and Development (R&D). What it may have failed to do during the ‘unfreeze’ stage is to survey to understand the current state of why change has to take place and what exactly consumers were demanding and are willing to pay for. Kodak believed they will continue to do well and that in one way or another consumer will definitely come to them for hard prints. This may have resulted in them not being able to have strong supporting evidence or statistics to explain the benefit during the ‘change’ stage. Due to this mindset, Kodak might have also not exactly found a need for change to take place. Thus when it goes through ‘refreezing’ not all employees will be supportive due to the fear of uncertainty and lack of confidence in the decision that has been made by Kodak. The key stumbling block of being ignorant and believing they would never be replace, resulted in its inability to convert its technical