AFP: In 1975, a young Kodak engineer called Steven Sasson showed his bosses a device he’d cobbled together from a portable digital cassette recorder, a Super-8 movie camera, 16 nickel cadmium-batteries and various other components. The device could capture and display a small black and white image on a TV screen. His bosses weren’t impressed. But they allowed him to keep working on the project, and in 1989 he presented them with a DSLR camera that looked and functioned much like the ones on sale today. Kodak – fearing it would cannibalise its film sales – promptly buried it.
It proved to be a mistake. The company’s film business was swept away by the switch to digital, and its eventual embrace of the new technology came too late for it to avoid bankruptcy in 2012. Kodak’s lack of foresight is a textbook example of what can happen when corporations ignore innovation. And in a world where companies such as Uber, Airbnb and Amazon can disrupt established business models in record time, there’s arguably never been a greater need for large organisations to develop new products and services. But how can a multinational company that potentially employs tens of thousands of people hope to match the agility and entrepreneurism of a Silicon Valley startup?
Tendayi Viki, co-author of The Corporate Startup: How Established Companies Can Develop Successful Innovation Ecosystems, says there are some obvious challenges. Although most corporations were once scrappy startups, as they become successful they move towards protecting their core business and away from the kind of mindset that fosters innovation.
Bureaucracy and traditional management practices tend to stifle out-of-the-box thinking and the corporation’s ability to identify new trends and societal changes, leaving them slow to respond to disruptive business models. But at the same time, they “can’t simply view themselves as startups, because startups don’t have a core successful business to run”.