The Need for Organisational Resilience - Chapter 2
Kodak’s top management never fully grasped how the world around them was changing.
They hung on to now obsolete assumptions about who took pictures, why and when.”
(Munir 2016).
Recent generations of Kodak manager were too wedded to the past business model to take
the radical steps needed to reposition their company as a digital leader.
Limitations in Forecasting
Forecasting is a management process that attempts to make predictions based on past and
present events, patterns or trends. The selection of a forecasting method, such as the Delphi
method, depends on factors such as the availability of historical data, or the time horizon to
which predictions are needed. And there lies the problem: the availability and accuracy of
historical data. The past has much to tell us about how we might manage future events but it
is never a template for the future. What is certain is that the future will be different from the
past. The longer the planning horizon, the worse is the past’s accuracy in predicting future
outcomes. Long-term planning is a leap of faith, assuming that the world will not change at
all or will only change as predicted. In the case of Kodak, the introduction of an iPhone was
a one-time event, unlike any in the past, that changed consumer attitudes in a very short
period of time.
Limitations in Control
Given that, in the long term, organisations have considerable difficulty in predicting the
future, there will be events that, even if predicted, remain uncontrollable. A Linear Strategy
should mean that an organisation is sufficiently robust to withstand changes in the
environment. Kodak believed that its current strategy would weather the change in
technology and consumer attitudes. Their optimistic bias towards – now redundant − ways of
taking pictures prevailed for too long; when they eventually realised that their organisation
was in a downward spiral, it was already too late.
In principle, a linear strategy may well drive – as we see in a range of organisations – an
illusion of certainty and controllability, working towards a pseudo-future, reinforcing
assumptions such as ‘Uncertainty will not happen to me!’ and/or ‘Uncertainty, if it happens,
will not affect me.’ (see following textbox).
[Text Box starts] Battle of Kursk
The winter of 1942 saw the defeat of the 6th Army at Stalingrad. With it, the German Army lost
considerable resources in men and materials. It was also the first time since the start of WWII on 1 st
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