'Buggy whips, apples and shaving cream'

Eastman Kodak declared bankruptcy recently.

Now, you may well ask, who cares?

In the 1950s and 60s, Kodak was considered the Apple of its time. It was innovative, created great products, and was the type of company every young college graduate wanted to work for. It was part of the popular culture, feted in songs ("Kodachrome" by Paul Simon), and its stock rode high on Wall Street. Its film was used to capture all the iconic images of the day.

We've all heard the expression "If it's not broke, don't fix it." That's what the people at Kodak thought. So when something like digital cameras and technology came along, they did not embrace it. They fought it tooth and nail.

They maintained their reliance on film, and watched as the company went down the tubes.

By the way, do you know who invented digital photography?

An engineer at Kodak.

At the same time that Kodak was struggling, their chief competitor, Fujifilm, was also in the thick of the battle for survival. They chose a different approach. They chose to use their expertise and technology in chemicals to expand their business outside of the traditional area of film. They moved into medicine and LCD displays. They realised that the same properties that kept photos from fading on paper could also be used to stop skin from discolouring.

By reinvesting and refocusing, the company survived the onslaught of digital photography and is now achieving record high sales and profits.

What was the difference between the two companies? It may have been how they defined themselves.

Let's talk about Gillette for a second. Gillette was founded in 1895. For the first 60 years of its existence it thought of itself as "The Razor Blade Company". All it made was razor blades. In the late 1950s, it redefined itself as the "Men's Shaving Company" and introduced for the first time ever, shaving cream! Can you believe that it took Gillette 60 years to realise it could sell shaving cream? It then redefined itself as the "Men's Grooming Company" and introduced after-shave lotion, shampoo, and deodorant.

How companies define themselves determines how they perceive themselves and how they grow. For years, Starbucks Coffee would not sell any other product other than coffee. No tea, and certainly no food items. Gradually they realised they were more than just a coffee company, and in a recent logo redesign, have now taken the word "Coffee" away. It's just "Starbucks".

Apple Computer followed a similar path. The company was founded as "Apple Computer" and it wasn't until 30 years later that the name was changed to "Apple" in recognition that the company was much more than a computer manufacturer.

How companies define themselves determines their future. The same is true of individuals. Do you define yourself as a "financial person" (accountant, CFO, etc?) Then those are the jobs you are going to get. Or do you define yourself as a "problem solver", using numbers to create positive futures? Now you will get exciting jobs in operations and management.

The buggy whip manufacturers when faced with the approach of the horseless carriage did nothing to forestall their fate. Kodak did nothing when digital approached, and is now paying the consequences. Starbucks, Apple, Gillette (eventually) and Fuji, all rolled with the times, adapted, survived, and flourished.

What will your company do?

What will you do? If it's not broken, break it.

Eric Rosenkranz (www.ethree-asia.com) assists both existing companies as well as start-ups to develop their long term strategy and achieve success in their business.

Follow his "Creating Success" series in this HI! Managers column every fourth Friday of the month.