How does success turn into failure? This is something that every business should think about even though it is hard to predict, unless you have a crystal ball.
To highlight my thoughts, I have decided to talk about a famous worldwide company: Kodak. I believe you all know about the film photography company that had a tremendous success back in the 1970’s. Kodak owned 85% of the US market share at that time, and at the same time the company developed a new breakthrough, which was the digital camera. However, Kodak decided that it was way too soon to launch its new product since they believe that film photography was still a major worldwide item. Meanwhile Kodak’s competitors, Fujifilm and Sony, developed their own products and launched them, in the early 1990’s. At that time, Kodak was still thinking that film photography was as profitable as it used to be, and the company did not anticipate the shift from film photography to digital cameras.
Can you guess what happened?
Fujifilm, Sony, and other companies decided to launch their own digital cameras and in a couple of years those products were taking over film photography sales. Kodak realized its mistake and launched its products a couple of years later, but it was too late. They totally missed the shift from film photography to digital camera. The worst part is that the company was the first one to develop that product, back in the 1970’s. Indeed, Kodak had to lay off thousands of workers worldwide, to close stores, to restructure the whole company, which is still paying for its mistake 20 years ago, especially now, and currently developing a new business strategy to avoid bankruptcy.
My point here is that whether you are a small business like us, or a worldwide company like Kodak, you have to be able to develop an efficient business strategy that includes launching your products/services at the right moment and to do so, you need to know your customers’ needs. One day you are in good shape, and on another, you are struggling with serious financial issues because you made the wrong decision. Launching a brand new product, either too soon or too late, can seriously damage your company and allow your competitors to take large market shares. In that particular case, Kodak was right by keeping in storage its digital camera idea, in the mid 1970’s. However, it was definitely not a good idea to wait until the mid 1990’s to launch their product. Their competitors had enough time to develop a new product, to launch it, and to gain market share.
I have to admit that it is easier said than done but, at least we can all learn from Kodak’s mistake