January 2012

Personal Effectiveness

Planet of the Apes

. Putting up this comic snippet shared by a  friend that gives an interesting perspective into organizational inertia – how it is difficult to change the prevailing norms, values, beliefs and accepted patterns of  behaviour.        More often than not, people who try to change the existing culture are deemed as misfits within an organization and are pulled down by the others.          Organizations that have been successful in doing things in a particular way, often tend to stick to the same way of working even after it becomes obsolete, since they are accustomed to it and so they resist changes that might help them to compete better.   At times it is perceived to be easier to change employees than to change their culture. -Contributed by Shalini Verma

Strategy

Kodak – Image Blurred

On 19th Jan, 2012, investors woke up to the news of Kodak’s filing for Chapter 11 bankruptcy protection in US Bankruptcy Court in Lower Manhattan. This gives the company an automatic stay for 6 months during which it has protection from creditors and the time to reorganise itself. Founded in 1880, by George Eastman, Kodak became one of America’s most notable companies that established the market for camera film and then dominated the field. Neil Armstrong used a Kodak camera to take pictures on the Moon in 1969. Eighty films that have won Best Picture Oscars were shot on Kodak film and the phrase “Kodak moment” captured people’s imagination. Analysts feel that the firm’s late entry into the digital market is a key factor in its recent troubles. Although Kodak was one of the original inventors of digital photography in the mid 70s, it did not commercially begin to manufacture digital cameras for the next two decades due to the fear of the cannibalisation of film. As a result Kodak failed to keep pace with developments in the market and competitors steadily eroded its share of the market. Since the late 1990s, the sales of photographic film declined and the revenue…

Mixed Bag

What’s in a name?

“A rose by any other name would smell as sweet” quoted William Shakespeare in Romeo and Juliet; thereby implying that names do not really matter. This could not be farther from truth in the present times, when strategic acquisitions are made with a view to acquire a brand name. Chatting over a cup of coffee yesterday, a friend brought up the topic of SBC Communication’s acquisition of AT&T in 2005, followed by changing its name to AT&T Inc. SBC CEO Edward Whitacre had mentioned that they had factored the great name of AT&T & its strong worldwide brand in the acquisition decision. When a company is sold, it seeks to obtain a value over and beyond that of its tangible assets. This is referred to as `goodwill’ and can be thought of as a “premium” for buying a business over and above the fair value of the net tangible assets acquired. Firms sometimes pay large premiums for acquiring firms with valuable brand names because they believe that these brand names can be used for expansion into new markets. Conventionally the value of a brand has been regarded as part of goodwill, which arises only when a business is sold. As…

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