The Eastman Kodak Company, arguably the photography industry’s market leader throughout the 20th century, made one of the most well-known strategic business mistakes in the past 50 years. They neglected to embrace the breakthrough technology of digital photography in the latter part of the century within consumer markets – allowing competitors to catch up, and surpass them, in the digital transformation age of the 1990’s and early 2000’s.
The company did not bring to market their first digital camera, the DC40, until 1995. And even though Kodak had invested extensively in the technology for decades, their corporate philosophy was still steeped in traditional film.
Despite Kodak’s significant head start and familiarity with the technology, their strategy that de-emphasized digital photography allowed latecomers Fujifilm, Nikon, Sony, Canon and others to not only gain precious market share within the segment, but allowed them to become innovative, trend-setting industry leaders.
The irony of all of this is when you realize Kodak was the company that invented digital photography in the first place. Yep, way back in 1975 Kodak engineer Steve Sasson created the world’s first digital camera.
But Kodak’s entire business strategy was aligned with film and print, and leadership missed the potential market opportunities for digital photography, and have paid a steep price since for this lack of foresight as the market all but transitioned to digital by the 2010’s.
In 2012, the 131-year-old company filed for Chapter 11 bankruptcy protection.
Strategic Tech Trends
Kodak’s hesitation to accept emerging tech core to its business is certainly a lesson. While Kodak was reluctant to embrace a technology core to its business, it’s also true that embracing technologies that make your business function more efficiently are equally as important. In our increasingly connected world where IT solutions have not only become ubiquitous, but in many cases, necessary for everyday living, digital change is all around us and will require even more flexible and versatile business models and strategies to compensate for such rapid technology evolution.
Leading technology research firm Gartner defines a strategic technology trend as, “One with substantial disruptive potential that is beginning to break out of an emerging state into broader impact and use, or which are rapidly growing trends with a high degree of volatility reaching tipping points over the next five years.”[i]
These trends often emerge from the “intelligent digital mesh,” which coalesce various emerging technologies into new opportunities.
“For example, artificial intelligence (AI) in the form of automated things and augmented intelligence is being used together with IoT, edge computing and digital twins to deliver highly integrated smart spaces.”
Technology-driven companies, and those that leverage technology to conduct business, must keep their eyes and ears on these trends as they look for ways to continue to optimize and grow their businesses. A few trends stand out on Gartner’s most recent list of strategic technology trends for 2019 and beyond.
Up until now, deep data analytics has mostly been within the specialized purview of data scientists and other data engineers, out of reach to your typical business decision maker in a company. The notion that these powerful tools will become more pervasive within industry, especially within common ERP and CRM tools only further accentuates the need to not only adapt to incorporate this strategic technology within one’s business framework, but embrace it. Organizations that adapt augmented analytics within their critical infrastructure tools will no doubt be in a much better position than competitors to quickly and effectively make productive decisions.
AI-driven development has the potential to jumpstart immense growth in new technological applications and solutions because it has the potential to give an accessible toolset to non-professional developers to create ideas previously unreachable. Learning complex programming languages is an extensive endeavor often requiring years of training. Eliminating this specialization by bridging the gap via AI-driven dev tools will drive a massive leap forward in innovation.
“Ultimately, highly advanced AI-powered development environments automating both functional and nonfunctional aspects of applications will give rise to a new age of the ‘citizen application developer’ where nonprofessionals will be able to use AI-driven tools to automatically generate new solutions. Tools that enable nonprofessionals to generate applications without coding are not new, but we expect that AI-powered systems will drive a new level of flexibility,” -David Cearley, Gartner Fellow
The world of streaming content, in devices like Amazon’s Alexa, Roku devices, and even high powered gaming consoles, is still in its relatively nascent broadband stages, but the proliferation of the empowered edge concept – endpoint devices used by people or embedded in the world around us – and business processes to optimize them will lead to much more sophisticated content delivery and processing systems. All of these devices, and many others including IoT devices and apps, will only increase in power and as data networks become even more robust (i.e. 5G), the possibilities and advantages of pushing computing further and further to the edge will become more clear.
One of the most potentially disruptive and effective technologies to be utilized in the next five years is blockchain. Despite its relatively shaky reputation as simply a digital currency (i.e. Bitcoin, etc.) technology organizations, and the public in general, will begin to see the vast benefits and efficiencies found in the more general concept (not just financial) of an open, immutable, distributed ledger of data – especially more advanced smart contract-based blockchain ecosystems such at Ethereum. As security and trust in the digital space become more and more critical in all industries and government, solutions that can navigate the quagmire of digital obfuscation and malicious activity will be paramount. Facebook’s recent announcement of their foray into blockchain via the digital currency Libra only further legitimizes the technology’s potential in the broader marketplace.
Digital Ethics and Privacy
Though not technology per se, data privacy and ethics concerns are vitally important for tech leaders and administrators to seriously consider as well. With the advent of so much tech and the inevitable influx of a massive data they will incur, it isn’t an option anymore to just consider data privacy and ethics – it is imperative, if not required as is the case of almost every government, financial, or health-related information system domestically and abroad. Think NIST-800 in the U.S., GDPR in Europe, and POPI in South Africa to name just a few. Cybersecurity concerns aside, technology decision makers must integrate these data privacy concerns within any solution paradigm their company employs, especially with strategic technologies that have yet to fully saturate the greater markets.
Kodak’s failure to recognize the digital photography’s potential and reticence to modify their existing business model in the name of progress and innovation is guidance not only for technology-based companies, but all companies.
It’s said that when Kodak executives evaluated Mr. Sasson’s digital camera technology in the mid-70’s they had asked him when he thought digital photography could compete with film. Referencing Moore’s Law, he said in 15 to 20 years the megapixel equivalent would be on par with film[ii]. Kodak released their first consumer camera 18 years later. They waited too long and it proved to be too little, too late.
Today and in the coming years it will be more important than ever for organizations to not only consider integrating emerging technologies within their current business models, but enthusiastically embrace them in some cases.
Perhaps the Kodak executives deserve a modicum of forgiveness; it’s near impossible to have an accurate concept of what markets and demand will look like 15-20 years in the future.
But today’s emerging technologies no longer take decades, or even years, to mature enough to become market consumable. It’s a matter of just months now.
Respond tepidly to innovation at your own peril.
 Despite Kodak’s apprehension to embrace digital photography within consumer markets, their early investments in the technology paid off handsomely into the mid 2000’s as their primary asset in the space became intellectual property – valued at over $2 billion.
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