IS THIS A "KODAK MOMENT?" OK. How much worse can it get? This morning (January 6), Eastman Kodak stock opened at $0.42 per share giving it a market cap of not much more than $113 million (that’s million, not billion). The strategy of selling a valuable patent portfolio for billions has not yet worked. To make matters even bleaker, Moody’s Investors Service downgraded Kodak’s credit rating, citing the “probability” of bankruptcy. A few weeks ago, Kodak flew a group of analysts (including yours truly) to Rapid City, South Dakota to tour a truly unique commercial print facility. The event was an eye opener for me. First, it was one of the largest commercial print facilities I’ve seen. It was by far the cleanest. You could eat off the floors. It was virtually all digital, with the major exception of a Heidelberg six-color analog press. Even that press had been fitted with an inkjet head to print variable addresses at full system speed. The “star” of the show was Kodak’s Prosper 5000 XL digital press running super high quality images using ink with Stream technology on high gloss paper to produce millions of pages per month at A4 speeds of more than 1,000 PPM. The company began as a letterpress shop, converting to digital technology using Xerox production systems. These were gradually replaced with Kodak presses including Versamark and Prosper systems until today’s configuration is all Kodak color. Millions of pages per month. Ink is drawn from 50 gallon barrels!! AH HA!! In the words of Steve Martin (The Jerk), “I get it. It’s a profit scheme!” At least in this market, Kodak gets it. The data stream comes from the printer’s proprietary database through Kodak controllers to Kodak presses. They do not care where the data comes from or how it gets there. The focus is on creating the images. How many times do we need to say it? It’s the images! It’s sad that Kodak couldn’t implement that strategy in the core parts of their business. It’s not the camera. It’s not the film (horrors). It’s the images! On-line services, mini-labs, kiosks, etc. – all generating images that should be using Kodak consumables. Focus on images with little regard to hardware, other than as a means to print. In the production print arena, for example, Kodak can upgrade models in place, without the “forklift upgrade” required by vendors such as Océ and Xerox. Yes, unit sales will be lower, but images will be up. The profit is in the images – to paraphrase Carl Sagan, “billions and billions” of images. Gallons and gallons of ink are flowing into those presses. Given Kodak’s demonstrated superiority in the graphics (production print) market, one can only wonder if they can raise the capital needed to leverage those advantages. I’m rooting for them. Surely, there is a lesson here for all of us. Kodak is clearly a victim of a market revolution that caught them unprepared to compete. What about our own market? Have we adjusted to the new dynamics for survival in a market where pages are more important than hardware? This goes well beyond the pedantic MPS programs we see everywhere. The focus is not on the pages, but the work processes that generate those pages. The new market forces us to create digital value in the pages generated, just as our commercial printer was able to create value in their shop. After our South Dakota meeting, we were treated to a tour of Mount Rushmore. It was breathtaking. More than anything, I was struck by the vision of the artist who could visualize that carving when looking at a blank mountain. The creation could have been anything. It wasn’t just anything. Take the lesson. Look at your own business. Visualize what it might be. Begin carving now, while you can afford the change. Don’t wait like our friends at Kodak. No matter what you become I can promise you this – it won’t be what it was. Will it be better? It’s your call. Andy Slawetsky is President of Industry Analysts, Inc., a marketing and management consulting firm for the office automation industry. Much of the company’s research and testing results can be viewed on their website www.industryanalysts.com.