Mistakes Made on the Road to Innovation

Product innovation is trouble enough for most companies -- so how does an organization go about innovating strategy? Good question, and it is one that is facing Eastman Kodak. The company was in a death spiral a few years ago, as it watched its film business take beating from digital photography. It undertook a radical organizational shift in response, and came back with a slew of digital camera offerings. Problem is however, the company continued to bleed money. The digital camera business was rapidly commoditized, and margins were nothing compared to what Kodak enjoyed in the heyday of the film business.

CEO Perez has a radical idea to pull the company up by its bootstraps -- and it's nothing short of reinventing the company. He wants to remake Eastman Kodak into the Apple of imaging. If he fails, another giant will take a plunge. The odds are against him, with the market already betting that he doesn't have a chance of success. What Perez is trying to get Eastman Kodak to understand is that it isn't in the business of film or cameras, but rather images -- and with that, he is hoping that products and services will start flowing.