Kodak and the Digital Camera

In 1975, a 24-year-old Kodak engineer named Steve Sasson built the first digital camera from off-the-shelf parts and a Super 8 housing. It weighed eight pounds and shot a 0.01-megapixel black-and-white image. He showed it to management, and the response was essentially: clever, now put it away. Thirty-seven years later, Kodak filed for bankruptcy in a market it had personally invented, arriving as a follower behind Canon, Sony, and others.

What makes this case sting is that Kodak wasn't blind. Internal research saw the shift coming, executives read the reports, and the company even built digital products. For founders and operators, it sharpens the most uncomfortable kind of strategic decision: what to do about a future you can clearly see but whose arrival threatens the very profits funding you today, when every quarterly incentive points away from the move that would save you.