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The risky business of shunning change.
Much can be learned from the demise of Kodak’s photographic film business. Once a thriving industry leader, Kodak fell victim to its inability to embrace change through the introduction of modern technology. Today Kodak is a shadow of its former self.
In 1975, the digital camera was invented by Kodak employee, Steven Sasson. At the time, Kodak enjoyed a monopoly over the photographic film industry and lucrative profit margins. Save to say, the digital camera was not well received by Kodak executives and it was this short sighted thinking that would eventually lead to the company’s loss of value and the sale of many of its patents, in order for the company to survive.
The photographic film industry was on the cusp of a revolution. In years to come, due to digitisation there would be no business in photographic film and if Kodak were to remain relevant, they would need to be innovative. The innovation and opportunity was right in front of Kodak in 1975. Yet, rather than embracing the change and opportunity, Kodak chose to ignore it and continue doing what they had always done – sell photographic film.
Over the last decade, a similar story has played out in the legal industry. Many factors have contributed to the evolution of the industry - the rise of alternative models, shrinking legal spend and technology disruption, to name a few. As a consequence, we have witnessed many premium brands disappear from the legal market.
We have also seen many law firms reluctant to embrace technology and the opportunities it brings. While many have invested heavily in technology, some have opted to mirror old processes in new systems, rather than adopting new ways and realising the true benefits of the new technology.
Further, the risk averse nature of law firms means that these organisations prefer to ‘play it safe’ by doing what they have always done, or opting to follow the path of other firms. Consequently, opportunities for competitive advantage are often missed or worse, firms begin to wither.
From our perspective, the key take home messages from the story of Kodak are clear. Businesses must be revolutionary in their thinking, opening up new opportunities for improvement, competitive advantage and growth. To make the most of these opportunities, law firms in particular must be willing to embrace change and new ways of working. The story of Kodak tells us that law firms should consider the evolving legal landscape as an opportunity to embrace a culture of change and ensure their existence into the future.
Amanda Harriss, Partner and Lauren Bartlett, Consultant