How to Spot Disruption and Adapt Before It’s Too Late. I Thought Kodak Was Untouchable.
Growing up, Kodak was the name in photography. Every family holiday, every school trip, every birthday, there was always a Kodak moment. I still remember the satisfying click of winding on the film roll and the excitement of waiting for the prints to come back. Back then, Kodak wasn’t just a brand; it was a symbol of innovation. It was a cultural icon. They didn’t just dominate the market; they were the market.
So you can imagine my surprise when I later discovered that Kodak didn’t just participate in the digital revolution, they started it. In 1975, one of their engineers created the very first digital camera. That’s right. Long before Instagram, iPhones or DSLRs, Kodak had the keys to the future in their hands… and they locked the door. Why?
Because embracing digital meant risking the collapse of their billion-dollar film business. So instead of adapting, they protected the past. They clung to what was familiar, what was profitable, even as the world moved on.
And that’s where the lesson lies.
As small business owners, we don’t have Kodak’s resources or global footprint, but we do share one thing: the temptation to stick with what’s working right now, even when we know the market is changing. We tell ourselves we’ll deal with it later. We assume our customers will keep buying what we’re selling. We wait. But markets don’t wait.
Kodak’s fall isn’t just a corporate cautionary tale. It’s a wake-up call for anyone running a business today, especially those of us in competitive or mature industries. The danger isn’t just that we’ll miss out on new opportunities. The real risk is that we’ll be left behind, clinging to a model that no longer works.
So in this blog, I want to explore what really went wrong at Kodak, and more importantly, what we as small business owners can learn from it. Because if it can happen to a giant like Kodak, it can happen to any of us… unless we learn to plan, adapt, and rethink the business we’re really in.
1. Kodak Didn’t Fail from Lack of Innovation – It Failed from Lack of Vision.
Most people assume Kodak fell behind because it failed to innovate. But that’s not true. Kodak invented the digital camera. In 1975, Steve Sasson, a Kodak engineer, built the first prototype, a toaster-sized device that recorded black-and-white images to a cassette tape. Instead of seeing this breakthrough as the future, senior leadership saw it as a threat.
The logic? Their existing business model, selling cheap cameras and profiting from film and processing, was wildly profitable. Digital disrupted that. It removed film entirely from the equation. Kodak’s leaders feared cannibalising their own market. So they shelved the digital project, even as the world began to shift. This wasn’t a failure of R&D. It was a failure of strategic foresight.
What killed Kodak wasn’t the lack of new technology; it was the refusal to embrace a new business model. Innovation happened, but planning didn’t. That’s the key difference. They failed to ask the tough questions:
- How will this shift impact our customers?
- What will our competitors do with this tech?
- How can we lead the change instead of reacting to it?
And that’s exactly where the lesson hits home for small business owners like us.
It’s easy to assume that change happens to “big companies.” But every business, from a local café to a digital agency, will eventually face disruption. It might be technology. It might be consumer habits. It might be a new competitor offering a faster, cheaper, or easier alternative. When that time comes, will you be ready?
The small business version of Kodak’s mistake is sticking rigidly to how you’ve always done things, refusing to update your offer, your pricing, your operations, or your marketing strategy, because “it’s working for now.” But “now” isn’t a strategy. It’s a moment.
True innovation isn’t just about creating something new. It’s about planning how to respond to what’s next, even if it challenges your current success.
2. The Danger of Legacy Thinking in Small Business.
I’ve worked with countless small business owners over the years, and there’s one pattern I’ve seen again and again: success breeds stagnation.
When something works, a product, a service, a pricing model, a way of marketing, we cling to it like a life raft. And why wouldn’t we? It feels safe. Predictable. Proven. But legacy thinking, no matter how well-intentioned, is often the first step toward decline.
Kodak is the textbook example of this. They didn’t want to let go of their highly profitable film-based business, so they ignored the very technology they invented. They were so emotionally and financially invested in their legacy model that they couldn’t see what was coming, or worse, they did see it and looked the other way.
Small businesses fall into the same trap all the time, just on a different scale.
Here are a few common signs of legacy thinking I see in small businesses:
- Still relying on word-of-mouth, but wondering why leads are drying up.
- Refusing to raise prices because “that’s what we’ve always charged.”
- Offering services that no longer meet current customer needs.
- Avoiding new technologies or platforms due to fear or lack of time.
Legacy thinking often masquerades as “playing it safe,” but it’s actually one of the riskiest positions to hold, because it blinds you to changing customer behaviours, market demands, and competitive threats.
Kodak had the resources, the tech, and the brand reputation to lead the digital photography revolution. They could have been what Apple is to mobile photography today. But their unwillingness to question their model and adapt their thinking left them behind.
As small business owners, we may not have Kodak’s budget, but we do have something they lost: agility.
We can shift faster. Test quicker. Try things without layers of corporate approval. But only if we’re willing to challenge our own assumptions, especially the comfortable ones.
3. How Kodak’s Story Applies to Your Business Plan.
When I first heard the story of Kodak’s failure, how a company that literally invented the digital camera let the opportunity slip away, it shook me. Not because it was about a giant corporation falling apart, but because I saw traces of that same mistake in so many small businesses, including my own, in the early days.
The problem wasn’t that Kodak didn’t plan. They had plans. Big ones. But they were built around the wrong assumptions, namely, that film would always be king and their traditional model would remain relevant forever. The lesson?
“A business plan is only as good as the thinking behind it.”
So how does this apply to your business?
Let me be clear: If your business plan is just a static document gathering digital dust in a folder somewhere, you’re setting yourself up for trouble. That’s not planning, that’s wishful thinking.
A good business plan:
- Reflects the current reality of your market and customer behaviour.
- Builds in room for change, disruption, and innovation.
- It is reviewed regularly, not once a year, but monthly or quarterly.
- Forces you to challenge your assumptions, not just confirm them.
The Kodak story is a reminder that even the most successful businesses can be caught off guard when they mistake the present for the future. If you’re still planning your business based on how things were, or even how they are, without considering how they’re changing, you’re vulnerable.
This is exactly why I built the 365/90 Planning Process, so that business owners like you can not only plan ahead, but also adapt with confidence. It breaks your year into manageable sprints, giving you structure and momentum without locking you into rigid long-term thinking.
Kodak had all the data, all the insight, and even the technology. But they didn’t integrate it into their planning. They stuck to the old playbook and lost everything.
You don’t have to make the same mistake.
4. Planning for Disruption, Not Just Operations.
Most small business owners I meet think of planning as an operational tool, a way to map out marketing, budgets, staffing, and sales. And sure, all of that matters. But here’s the uncomfortable truth: operations rarely kill a business; disruption does.
Kodak’s downfall didn’t come from bad logistics, poor staffing, or a flawed marketing strategy. It came from ignoring a looming shift in technology and customer behaviour. They were brilliant at operations… but blind to disruption.
And this is where I want to challenge you.
If your business plan is focused solely on how you’re going to run the business, but doesn’t account for how your market might change, it’s incomplete.
Disruption doesn’t always come in the form of a new technology; it can be:
- A shift in customer expectations.
- A new competitor with a radically different model.
- Changes in regulations or supply chains.
- Even a global event like a pandemic or economic downturn.
You don’t need to predict the future. But you do need to build a system that regularly prompts you to ask:
“What’s changing in my market, and am I ready for it?”
That’s why I advocate for the 365/90 Planning Framework; it’s not just about breaking your year into quarters. It’s about creating a rhythm of checking in, revisiting assumptions, and adapting before you’re forced to.
Most big business disasters, including Kodak, didn’t happen overnight. There were warning signs. But those signs were ignored because they didn’t fit neatly into the annual plan or the five-year vision. In contrast, businesses that survive and thrive are the ones that:
- Make agility part of their culture.
- Bake disruption into their strategic thinking.
- Train themselves to spot changes early and respond fast.
Planning isn’t about maintaining the status quo. It’s about giving you the clarity, confidence, and courage to change direction, before it’s too late.
5. The Importance of Ongoing Strategic Review.
One of the biggest lessons from Kodak’s failure isn’t just about missed innovation, it’s about missed review.
Kodak didn’t fail because they lacked strategic thinking. They had strategy documents. They had analysts. They even invented the digital camera. The failure came because they didn’t revisit their strategy often enough or challenge their assumptions. And that’s the trap many small business owners fall into.
You build a business plan, file it away, and get back to the daily grind. Before you know it, a year has passed, your market has shifted, competitors have adapted, and your business plan is irrelevant.
“Strategy isn’t a one-off task. It’s a habit.”
The most successful small businesses I’ve worked with share one thing in common: they treat strategy like an ongoing conversation, not a one-time event. They set clear goals, monitor results, and, most importantly, create space to pause, reflect, and adapt.
This is exactly what the 365/90 Planning Process was designed for.
Every 90 days, you:
- Review what’s working and what’s not.
- Reassess market conditions and customer behaviour.
- Realign your goals and actions to stay relevant.
It’s like regularly checking your compass while on a journey. You might not change your destination, but you’re far more likely to avoid getting lost.
In contrast, Kodak built a strategy once and clung to it, even as the world changed around them.
The lesson here for small business owners is clear:
“If you don’t build time to review your strategy, you’re building a plan for obsolescence.”
A living, breathing business plan, one that evolves every quarter, is your greatest asset in a rapidly changing world.
Final Word: Plan for Change, Or Plan to Be Left Behind.
Kodak’s story isn’t just a tale of a big company that missed a trend. It’s a powerful reminder that no one is immune to disruption, not even the inventors of the very thing that disrupted them.
As small business owners, we don’t have the luxury of Kodak’s resources. But we do have something just as powerful: agility.
You can spot change faster. You can adapt quickly. You can shift gears without having to get board-level approval or fight corporate inertia.
But to do that, you must embrace strategic planning as a living process, not a one-time task.
The businesses that thrive aren’t the ones with the perfect plan. They’re the ones that consistently review, learn, and revise based on what’s really happening in the market. Kodak clung to what once worked. You don’t have to.
Your Next Step.
If it’s been more than a few months since you reviewed your business strategy, or if you’ve never put one on paper, now’s the time.
The 365/90 Planning Process was built specifically for small business owners like you. It’s practical, flexible, and designed to help you adapt before disruption knocks on your door.
👉 Join me for a free 1-to-1 GAME Plan Session, and we’ll take the first step together. In just 30 minutes, you’ll walk away with clarity, focus, and a plan you can actually use.
Let’s make sure your business doesn’t become the next Kodak.
Twelve intensive half-day meetings.
