Kodak Changes its culture and its performance
By Md Rezaul Karim, 2nd Jul 2012 | Follow this author
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Posted in WikinutBusinessAnalysis
It is said that change of culture is pretty difficult in an organization to change, but you can change it if you have the talents.
Kodak Changes
Chuck Trowbridge dramatically reversed their sagging performance of Eastman Kodak’s copy products group by imparting a culture dedicated to excellence – he envisioned becoming a world class manufacturing organization. However, implementing such a culture was not easy. When Trowbridge became the general manger of the newly formed group, sales had recently grown to nearly $1 billion. However, costs were high, profits were negligible, and there were problems nearly everywhere. Changing the culture required the development of many forms of written communication as well as enhancement of face to face communication.
Central to Trowbridge’s efforts was the vital role played by Bob Crandall, head of the group’s engineering and manufacturing operations. To align people with the new direction, Crandall set up several mechanisms; he organized weekly meetings with the twelve managers who reported directly to him; monthly ‘copy product forums’ that included different employees from each of this departments; quarterly meetings with all 100 of the supervisors under him, to discuss recent improvements and new projects for achieving higher performance; and quarterly ‘state of the department’ meetings, in which his managers met with all of the employees in their departments. In addition, Crandall held a meeting each week with his managers and his organization’s largest supplier, the Kodak Apparatus Division. This division supplied one third of the parts used in the design and manufacture of his products.
Trowbridge and Crandall also used many forms of written communication in implementing the new culture. A newsletter, Copy Products Journal, was sent to employees once a month, and a program called ‘Dialog letters’ allowed employees to anonymously ask top executives questions and be guaranteed a reply. Perhaps the most powerful form of written communication consisted of charts that vividly reported measures of quality, cost and delivery for each product against different targets. A prominent chart reporting quality levels and costs for the various work groups was displayed in a main hallway near the cafeteria, and 100 smaller versions were displayed throughout the manufacturing area.
Performance improvements associated with the new organizational culture began to appear within 6 months and continued to increase. Such favorable results helped to make the efforts more credible and increased employees’ commitment to the changes. Viewed over an extended period, the improvements were striking; defects per unit declined from 30 to 0.3- a hundredfold improvement. Also , a over a 3 year period, costs on another product line decreased 24%, on time deliveries increased from 82% to 95%, and productivity measured in units per manufacturing employee doubled.
Comments
2nd Jul 2012 (#)
Quite dramatic changes and results.Thanks for sharing.
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3rd Jul 2012 (#)
Indeed many lessons to learn from the established and grown up firms. Thanks ramalingam.
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3rd Jul 2012 (#)
This is so amazing!! It only takes common sense to realize that communication with the employees can enhance and improve the company's performance. Where my poor husband works it is a nightmare!! It is nothing but a modern day sweat shop. I should write about that but not mention the name of the company!!
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3rd Jul 2012 (#)
I would be delighted to read you Judy. Keep waiting. Thanks for the comment and sharing info.
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3rd Jul 2012 (#)
An interesting read. While the cultural (especially organizational cultural) change may be desired, it is only natural for the employees, especially for the lower and lowest ranked employees to feel insecure about the changes and may even resist it.
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3rd Oct 2012 (#)
Thank you for visiting me and I appreciate your comments.
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3rd Oct 2012 (#)
Very nicely done
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3rd Oct 2012 (#)
Thank you Teila.
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