It was far from a picture perfect moment for Eastman Kodak when it filed for bankruptcy in January of this year. A company widely respected for its innovation and quality, it dominated the film and photography industry for much of its 123-year history. It was a company which as early as 1975 had developed one of the first digital cameras and as recently as 2005 led digital camera sales in the U.S. But there it stood 10 months ago, filing for Chapter 11 protection so that it could restructure.
I’ve followed the fortunes of this company closely over the past few years and have been intrigued by what various business commentators and pundits opined were the reasons for the hard times this once great company now faces. And there were lots of opinions shared. Kodak was, after all, an iconic American company that was not only an industry leader, but a shaper of culture and society—it didn’t ignore or neglect to innovate but anticipated the digital age and was actually a leader in it.
One commentator summed it up especially well, quoting a Kodak insider:
[Kodak’s] strategic mistake…was not ignoring change but trying new things with familiar capabilities at the exact moment Kodak needed to be hungrier to do truly new, unfamiliar things.*
What a powerful statement and a challenge for us as leaders. It’s true for credit unions today as much as it was for Kodak then. We tend to tread in the water that we know. You know what I’m talking about—think about the energy your credit union spends on branching strategies, a new payment option on a mortgage, or yet another type of chequing account. Tweaks. Adjustments. Safe waters to swim in. But nothing that’s disruptive or will cause a real wave.
The truth is, if we’re not doing the truly new and unfamiliar, someone else is—and sooner or later we must come to grips with how it impacts us. I like what Seth Godin says in his book Poke the Box: “Without the ability to instigate and experiment, you are stuck adrift, waiting to be shoved.”**
At First West, and hopefully at your credit union or business, we’ve been asking ourselves some hard questions over the past two years, like:
- Are we focused on the short-term win rather than long-term victory, when it comes to our business planning?
- Have we been downplaying the changes in our members’ behaviours or have we been listening, responding and anticipating them?
- What do we need to start doing (or stop doing!) to radically grow our customer base in a sustainable manner?
- A telecom company looks very different today than it did in 1947 (the year we were founded). By comparison, we haven’t changed to a similar degree during the same period of time. Why is that? What could we look like, what should we look like?
- Are we willing to make the tough decisions on the direction of our core business so that we thrive in business for another generation?
I’m often asked what weighs most heavily on my mind. It’s not credit decisions, liquidity, regulatory changes, board governance. It’s simply this: relevance.
With 1,400 employees and 165,000 members trusting this organization for their financial well being, I don’t want to wake up one day and realize that we’re having our very own Kodak moment.
The example of Kodak and others before them shows that we can’t afford to be comfortable—it’s simply too risky. The good news is it’s not too late for us. Whether as an individual credit union or as a collective system, let’s strive to get uncomfortable, happy in knowing that a promising future lies in unfamiliar territory.
I’d love to hear from you on this. Let me know what you think—leave me a comment below or connect with me through one of the social channels noted above.
*Harvey Schachter, “Lessons learned from Kodak’s collapse,” theglobeandmail.com http://www.theglobeandmail.com/report-on-business/careers/management/les... January 29, 2012.
**Seth Godin, Poke the Box, pg. 4.