Feb 16, 2012 | Change, Innovation, Social Media
The world is full of paradoxes.
Apple, the ultimate closed system is now again, the worlds most valuable company, but was started by two blokes, one of whom was, and remains an advocate of open systems, Steve Wozniak, and the other, Steve Jobs, a passionate and demanding driver of closed systems, with commercial windows. It will be enlightening to hear the analysis of market share and profitability as Googles open Android enabled devices pull away from Apple’s closed version in mobile devices
IBM almost went broke trying to hold everything inside its business model, then opened up, completely revised their business model, and emerged from its near death as a much stronger business. Wikipedia 1.0 was tried as a closed system, but succeeded only when Jimmy Wales relinquished enormous amounts of power to the crowd. Similarly, Linux was started on the bulletin boards of the early web, by a small group led by Linux Thorvaldsen who simply wanted to get away from the control, then exerted by that early, and still, proponent of closed systems, Microsoft.
So what are the lessons in all this?
- Simply that there is no one cookie cutter model that can be applied, that differing models suit different circumstances, and times.
- Nothing lasts forever, the next iteration will call into question all the assumptions of the previous model
- The model is evolving all the time, trying to lock it in is a bit like Canute’s efforts with the tide.
Feb 3, 2012 | Branding, Innovation, Marketing
So Kodak is broke, chapter 11 which protects a company from its creditors whilst it radically restructures in order to survive and pay back creditors.
It is only a few years ago Kodak was one of the most valuable brands in the world. In the mid 90’s it was in the top 5 of Interbrands list of the most valuable brands, in 2001, it was down to number 27, worth $11 Billion, 2007, number 82, worth $4 billion, the last time it troubled the scorers.
The common wisdom is that Kodak failed to keep up with digital photographic technology, but they invented the digital camera, they should have understood the implications, they just failed to make an impression on the market.
However, they did try, and try hard, so an alternative reason for failure should be considered. Maybe it is just that the Kodak brand was so strong, it said Film, it was film, that the leapto digital could not be made by the consumers.
Perhaps what they really needed was another brand?.
Would you buy a kitchen appliance if it was branded “Hoover” or an orange juice branded “Coca-Cola”? Probably not, simply because the brand is such a powerful expression of the one product. I think Kodak suffered from the same malady, and they failed to recognise it.
Some late news on Kodak post the Chapter11. I guess you could say they have gone back to their knitting.
P.S. march 2015, this post from those terrific storytellers at Digital Tonto bring us this analysis of Kodak’s burning platform of chemical photography.
PPSS. July 2016. This HBR post by Scott Anthony delivers another perspective on the ever interesting story of Kodak and Innovation.
Jan 29, 2012 | Innovation, Personal Rant, Uncategorized
In the December 2011 quarter, Apple made $13 billion in profits, an extraordinary figure, 3 billion more than the revenue of Google in the quarter. Apple is an innovation machine, making it so is the legacy of Steve Jobs.
However, there is usually a flip side to the stories of huge success, Jobs was not the nicest person around, brilliant, magnetic, but a real genuine article prick, according to his biographer, and the woes of Apple contract manufacturers in China are well known.
But, who has heard of the mineral Tantalum? Apple uses it, as does every other producer of our electronic gadgets.
Talison, a company headquartered in Perth used to mine tantalum in Australia, a mineral extracted from an ore called Coltan, short for Columbite-tantalite, but no longer due to competitive price pressure coming from African supplies. Pity we lost another market.
Coltan is now one of the minerals being mined in West Africa, using primitive tools, and kids paid slave wages, sold so we can have the latest gadget, and the nasties in charge can buy more guns and anti-personnel mines, and fill their Swiss bank accounts.
This blog is usually about marketing, management, and the stuff that hopefully scratches my readers brains to facilitate improvement. However, from time to time, we need to think about the ethical base of what we do.
This almost unknown story of Coltan ore, and its derivatives should be on our agenda.
Jan 11, 2012 | Change, Customers, Innovation, Marketing, Strategy
Kodak used to “own” photography, having a massive share of the film market, end to end.
No more, Kodak is virtually broke, subject to continuous take-over speculation.
The really interesting thing is that one of the assets that makes Kodak valuable to an aggressor is its bank of patents that relate to the technology that drives the product innovation in the digital space.
The failure for Kodak is therefore not in being unable to develop the science, for individuals in the labs to see a different path, and to imagine the next iteration but to do something about it in the marketplace, disrupt themselves before somebody else does it.
Coming in parallel, but I have not seen it really considered before is the fundamental change in the way people think about photography, a complete disruption in behavior that has gone unnoticed.
Photographs used to be used to preserve memories. No more, at least, not much.
They are now used as a foundation piece of the individual communication process.
What are we doing now, who we are seeing, where we are, an expression of ourselves are now the motivations to take a photo on whatever device happens to be in our hand at the time. Creating a record for our kids is a useful by-product of these activities, although I am not sure how the current 20 year old will react to their children in 20 years seeing photos of them pissed at a party 20 years before, so perhaps creating some records will be problematic in the long term.
The photographic market has been totally disrupted, not just by the development of digital technology, but in the way consumers behave. For a marketer, being able to build a corporate mind-set that enables the science, and at the same time embraces the ambiguity and uncertainty of consumer behavior changes is the challenge that keeps life interesting.
Jan 4, 2012 | Change, Communication, Innovation, Operations, Social Media, Strategy
In the communication revolution going on currently, the infrastructure to carry it all is vital, but how relevant will the 2010 infrastructure be to the world that greets it when it is finally completed roll-out in, when?, what was the last projection? ever?. The world is changing almost daily, the NBN as conceived by our political masters will be obsolete before it is 10% implemented.
In the October issue of “Wired” magazine is a fascinating analysis of the “Tech War” going on between Apple, Google, Amazon, and Facebook. It is a must read for anyone in business, it puts a competitive context around the maneuvering we all see happening, but do not necessarily connect the dots.
We, the Australian taxpayers, are making a multi-generational investment in the NBN, billions of dollars spent by those well known, fast moving, tech savvy innovators in Canberra. Lets hope they know what is going on outside the cocooned environment of the “bush Capital that are all so pleased to live in.
Somehow I doubt they have any idea, and that is truly scary, and there will be a whole lot more of this sort of failure, and the accompanying spin before anyone in Canberra admits to a huge boo boo.
Dec 12, 2011 | Innovation, Marketing, Strategy
From bricks and mortar, to the web, and now to mobile apps. What is next for retailing?
There was a blue last week between the current and previous MD of David Jones, about who wore the blame for DJ’s being slow into e-selling, billionaire Gerry Harvey is often bitching about the unfair competition from e-tailers, and Australian post is gearing up to deliver parcels, as their snail-mail service is on its deathbed, certainly unable to support the infrastructure built for another age. Now the just released Productivity Commission report on retailing has recommended that the threshold for the application of GST on imported parcels drop from the current $1000, as soon as it is cost effective to do so.
It seems to me that there is a resurgence of alternative retail, new business models that leverage the changing environment, Harris Farm, Aussie Farmers direct, Kogan, and many others. By looking backwards to set the regulatory framework, we run the risk of compromising the emerging foundations of the future, and stamping on the wrong hat.
