Introduction
Kodak was among the greatest entrepreneurial success stories of the last century in photography. The company was founded in 1888 by Eastman George. It only took eight years to skyrocket its revenue to over $10 billion, becoming the global commander in the photography and film industry. (Melvin, 2018). In the three decades that followed, the company failed to hold on to its glory by succumbing to poor leadership. Kodak serves as an example of companies that fell from a pinnacle of success due to the inability of its leaders to revitalize the company when it mattered the most.
On the other hand, Apple is a success story vested in excellent leadership. Apple is headquartered in Cupertino in California, and was founded in 1976 by Steve Wozniak and Steve Jobs. The company manufactures electronics like computers, iPhones, iPods, and wearables. iPhone made the company the first to reach $1 trillion in 2018, a figure that doubled in 2020 (Giachetti, 2018). The paper compares the success story of Apple and the failure of Kodak by examining factors like management styles, culture, business strategies and communication styles.
Organization structure and culture for Apple and Kodak
Apple’s success is attributed to a unique and effective organizational structure cultivated by Steve Jobs (the founder). The organization uses a hierarchical structure that aims at channelling efforts to innovation as dictated by the company vision (Kim, 2020). When Tom Cook took over in 2011 after the death of Jobs, he injected decentralization of decision-making processes to stimulate creativity and enhance innovation in various departments. Its operations are grouped based on products. They include iPad, Mac, iPhone, and services like ApplePay and iCloud. The structure has enabled tremendous success because of tight control by the senior management in all dockets.
On the contrary, Kodak’s company’s management system sabotaged the development of the new products (Kim, 2018). The company relied on its functional structure for its photography. The functional design tends to obstruct instead of facilitate the development of new products. The structure works best when a single product line is used. However, if the system involves more than one product line, such a structure forms bottlenecks instead of fueling success (Yuzawa, 2018). It emphasizes the current line as it sidelines the new entities. The company’s slippery slope can be attributed to the failure of Chandler to come up with a new vision that could act as the future for Kodak company.
Organizational culture plays a vital role in ensuring the alignment of goals towards success. Kodak was characterized by a lack of impetus and desire to embrace change. The inherent culture at Kodak discouraged trying new products that required extensive risks and innovation (Casey et al., 2019). The executives viewed such a venture as painful, while the middle managers considered the innovation a knife to their jobs. The research and development team considered the innovation as non-profitable. The leadership over-valued their traditional legacy film and emotionally attached it. This explains why the company was reluctant to try Matteson’s industry prediction.
In comparison, Apple’s organizational culture is founded on its mission of embracing innovation (Al-Daaja, 2017). It attracts and maintains creative mindsets and can challenge standards and conventions. Coupled with high levels of secrecy, Apple has commanded the market share due to rapid innovations.
Mode of communication adopted in the two organizations
Apple’s mode of communication depends on four fundamental principles. They are compliance, honesty, confidentiality and respect (Li, 2021). Its hierarchical structure ensures uniformity by spreading powerful messages across all departments. Kodak had closed communication amongst leaders with little communication trickling down to employees. Apple employees interact with each other from time to time. Teamwork is embraced in the company, especially at departmental levels. They also hold a three-hour meeting weekly to discuss progress, challenges and expectations. They also trust each other and maintain secrecy which has helped the company evade innovation theft. At Kodak, employees lacked a cementing relationship. When Matterson predicted that as of 2010, the mass market would be dominated by digital technology as opposed to film, he never received the attention that he deserved. Other companies were using social media platforms with a more extensive base of users. However, Kodak used its website named Ofoto in doing its promotions. The website had a limited number of users. Also, it could not fetch potential customers using such a channel
Leadership and management styles
Apple founder relied on the autocratic leadership style where Job micro-managed a vast range of its business activities. However, the style changed in 2011 when Tim Cook assumed the role of CEO. Currently, the company embraces a democratic leadership style. Cook relies on consensus from the top management and the New Product Development Team (Kim, 2020). The team has been given the autonomy to showcase their maximum abilities. Kodak, on the other hand, preferred autocratic leadership that also suffocated innovation and maintained the old ways of doing things (Stanwick, P. & Stanwick, S., n.d). It filed for bankruptcy protection in 2012 after registering a loss of $ 1.77 billion from 2009 to 2012.
How the organizational culture, structure, and management style relates to the success and failure of the organizations
Leadership is a pivotal component that determines the success of any given organization through its cause-and-effect dynamics. Successful organizations like Samsung, Netflix, and Apple owe their success to good leadership (Turner, 2019). Leadership is a broad aspect that involves making sound decisions, articulating the organizational vision, structuring achievable goals, and offering the necessary tools and knowledge to the members to achieve such goals. Apple’s success is vested in the company’s innovative culture that is also supposed by a democratic leadership that allow free sharing of ideas (Kim, 2018). The weekly meeting strategy also helps the company monitor progress and address any bottlenecks in the projects. The same parameters also define why Kodak succumbed after failing to navigate the digital terrain. The organizational culture that ran in the company’s veins forged a comforting belief that the company was to avoid hasty actions in adopting innovations. The functional structure that Kodak used works best when a single product line is used (Yuzawa, 2018). However, if the system involves more than one product line, such a structure forms bottlenecks instead of fueling success.
HR strategic planning, recruitment and selection strategy, performance /talent management strategy
The strategic plan of Apple emphasizes product differentiation and easy product accessibility. Its products are expensive based on their quality and customer loyalty. Apple Inc. company understands the importance of innovation in the digital world. The company has a policy of hiring the best talents in the market, even poaching (Giachetti, 2018). Employees who fail to meet expectations are shown the door, and the most competent ones are recruited instead.
The top-notch mentality has made the company comprise the among best software engineers in the world. In terms of performance, every employee is challenged to prove their worth. The best performers are handsomely rewarded via reward programs. The company renumerates the employees well and uses the lean approach of determining the productivity profit of every employee. Kodak, on the other hand, recruited individuals who could fit in the comfort zone of traditional film-based photography. Their strategic planning leaned on film-based photography to avoid sacrificing their expansive investment with digital upgrades. This is why it introduced innovation at a slower pace, giving competitors like Fuji and Sony a chance to creep into their territory.
Recommendations
- In the case of Kodak, digital photography was a disruptive innovation that required the top leaders to convince the entire workforce to adopt a change to enable the organization to move in the right direction. As for Apple, it should continue with its culture of innovation to ensure that it manufactures products that meet the varied needs of the customers.
- Also, Kodak should have empowered employees to realize their potential. When Steven Sasson invented the first digital camera for the company, the company should have embraced the idea and channelled resources to succeed. The success story of Apple’s iPhone should inspire the company to continue supporting the New Product Team to engage in research to continue differentiating themselves in the market.
- Like Apple, Kodak should have structured its management on democratic principles, especially decision-making processes. This could have helped the company consider Lawrence Matterson, 1975 report on the need for digital transformation.
- Kodak should have adopted a communication style like that of Apple, allowing the free sharing of ideas and remedies.
- Kodak should not have assumed the competitors. Learning what others are doing to avoid being left behind is essential. Apple needs to continue monitoring its competitors to maintain its competitive advantage.
References
Al-Daaja, Y. (2017). Leadership and management of strategic change. SEA–Practical Application of Science, (14), 237-245.
Casey, E., Ribaux, O., & Roux, C. (2019). The Kodak syndrome: risks and opportunities created by decentralization of forensic capabilities. Journal of forensic sciences, 64(1), 127-136.
Giachetti, C. (2018). Explaining Apple’s iPhone success in the mobile phone industry: The creation of a new market space. In Smartphone Start-ups (pp. 9-48). Palgrave Macmillan, Cham.
Kim, H. (2020). Comparison of Strategic Leadership: Steve Jobs and Tim Cook. Business and Management Studies, 6(3), 17-25.
Kim, P. (2018). Integration of Management and Culture: The Culture of Dedication in Samsung Electronics and Apple Inc
Li, Y. (2021). Apple Inc. Analysis and Forecast Evaluation. Proceedings of Business and Economic Studies, 4(4), 71-78.
Melvin, W. S. (2018). Anatomy of change: a Kodak moment. Surgery, 163(3), 485-487.
Stanwick, P. A., & Stanwick, S. D. The Rise and Fall of Eastman Kodak: Looking Through Kodachrome Colored Glasses.
Turner, P. (2019). The Role of Leaders: The Importance of Leadership. In Leadership in Healthcare (pp. 45-74). Palgrave Macmillan, Cham.
Yuzawa, T. (2018). The digital revolution and business behaviour: the case of Kodak versus Fujifilm. Entreprises et histoire, (1), 37-50.
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