In Review

Kodak exec talks social change amid industry turmoil                      

(Sept. 30, 2011) - Eastman Kodak Co. is on the far end of a staggering decade of change that has forever altered the company’s once-massive manufacturing and customer bases. To shed light on how Kodak has survived and adapted with a lean focus, the Center for Operational Excellence at Ohio State University’s Fisher College of Business kicked off its largest quarterly professional development seminar yet on Sept. 30, 2011, with a presentation from Charlie Brown, Kodak’s retired senior vice president and director of global manufacturing and logistics.

Brown highlighted major changes in Rochester, N.Y.-based Eastman Kodak’s culture that have put the company on stronger footing but painted an unvarnished picture of the company’s evolution in the past decade. Amid the rise of digital photography, Kodak has gone from a profitable corporation to a money-losing one; its work force has dropped nearly 80 percent; and its once-mighty manufacturing arm has winnowed drastically.

As changes in the industry began taking hold, Brown said Kodak’s work force “really had an entitlement mentality that had grown out of the success of the corporation.” That, he said, was complicated a constant worry over downsizings, which had been taking place for nearly two decades leading up to 2000.

“Kodak manufacturing people were closed to new ideas … and as a result had a low level of civility,” he said.

Facing a need to improve – and do it quickly – Brown said Kodak turned to lean and rolled out the customer-focused “Kodak Operating System.” Driving the changes, he said, wasn’t just a focus on technology and process but a realization that the social system at the company was in need of major change.  

“Getting an organization that was technologically top-heavy to focus on the social system was a major change,” he said. “It was here we identified and ultimately launched what we called our winning and inclusive culture.”

To create that culture, Brown said Kodak rolled out a number of steps, including stepped-up enforcement of a zero-tolerance policy and a wide-ranging assessment of the company’s culture. The company’s “riskiest and boldest move,” he said, was an effort to strengthen leadership that saw some departures and open the door for new executives. Kodak also trained 300 “cultural change advocates” that Brown said became “blackbelts for cultural change.”

That focus from 2000 to 2002, Brown said, helped cut internal quality incidents and on-hand inventory while raising the level of productivity at Kodak. By the time he retired in 2006, the cash-flow cycle in the company’s supply chain dropped from 150 days to 65, more than halfway toward a goal of 21 days.

Even with improvements coming into view, Brown said such jarring change wasn’t always easy to digest.

“I was a career Kodak employee at the time,” he said. I had grown up in this culture and now was hearing things I couldn’t believe … But there was truth in there and we had to do something about what was going on.”

Read a recap of COE's afternoon seminar, featuring Harley-Davidson CEO Keith Wandell, here.