In 1993, as the co-founder of photographic library startup, I travelled to Los Angeles to check out one of America’s largest commercial photographic collections. Remarkably they were well under way converting their film stock to Kodak PhotoCD, a proprietary digital format launched the year before. We were impressed with Eastman Kodak because it looked like they were taking digital photography seriously. The shift to digital was really happening. It was an exciting time. So we began to furiously scan our 100,000 images. At the time it seemed that Kodak was riding the digital wave. They were a digital camera pioneer building the first digital camera in 1975. This 110 year old manufacturing giant, however, missed the digital boat. Their share price today is less that what it was for them in the 1950s. So why did Eastman Kodak falter? Why did it take them so long to really adopt a digital approach to their products and services? What held them back?
Ted Turner (founder of CNN) joined his father’s billboard advertising business full-time in his early 20s. His father, Ed Turner, was a child of the depression and his parents almost lost everything during that dark time. This only strengthened Ed’s resolve to succeed and he promised his parents to work hard and one day be a millionaire and own a plantation and a yacht. By the time Ted joined the billboard company his father had all those things and Ted remembers clearly his father taking him aside and saying, “Son, you be sure to set your goals so high that you can’t accomplish them in one lifetime. That way you’ll always have something ahead of you. I made the mistake of setting my goals too low and now I’m having a hard time coming up with new ones.”
Perhaps Kodak reached their goals in the early ‘90s and was struggling to set new ones. Kodak was the predominant force in the photographic industry. It had succeeded through its many advances in chemical processing and manufacturing streamlining. At the same time it was more than aware of the new digital technologies yet profits were coming from its established business lines. In the minds of their leaders they knew how to succeed. They had done it for so long. So don’t fix what’s not broken.
We see this ‘I know what’s right’ mentality in our leadership programs. Just last week Mark was running a leadership program in Sydney and the most senior person in the room approached Mark and said, “I really just wanted to come to see what the troops were learning and keep an eye on things.” He had been with the company for 20 years and believed he’d seen everything and didn’t need to learn anything new. He told himself a story along the following lines: “I’ve been in the business for 20 years now and I have seen it at its best and its worst and I have survived and thrived. So I pretty much know what I’m doing and that it works.”
Our stories, collectively and individually, have a profound affect on what we believe is possible. Therefore the challenge for leaders is to both understand the stories affecting individuals and groups and then know how to define and tell (ideally through wide participation) new stories that set the direction for the company. But that’s not all. The greatest challenge is to help people hear, remember and believe where the company is headed and then inspire people to act in line with that belief.
Whether the leadership team at Kodak had seen the need to redirect towards a digital future in time is hard to say. But even if there was a resolve to go digital, were the leaders equipped with the skills to create the new stories and have them stick in a meaningful way?
Aligning everyone’s actions to the company’s strategy is equivalent of finding the corporate Shangri-la. It can be done. Take IBM’s turnaround for example.
Lou Gerstner arrived as the new CEO in 1993 at a time when IBM was on the endangered species list. Gerster had been CEO at Nabisco and American Express and before that he was a director of McKinsey Consulting. He’d seen hundreds of strategies and knew that most are the same—it’s extremely difficult to have an unique strategy. What makes the difference, however, is executing the strategy. Gerstner set about turning around IBM by telling new stories about their direction such as the new emphasis on services and the growth that will come from software. And of course this wasn’t done by Lou alone. He worked hard to develop a good team who understood the stories and could act in a way that created new stories that reinforced the strategy. I joined IBM in 1999 and experienced the last years of the turnaround. It was an inspiring place to work.
This post is the beginning of a series I have planned that looks at why storytelling is a vital leadership skill. Some of the topics I will cover include how stories are memorable, how they show commitment, how they inspire people to take action, how they reduce anxiety, how they share lessons, how they convey values and how they change minds.
Gerstner, L. V. (2002). Who Says Elephants Can’t Dance? Inside IBM’s Historic Turnaround. New York, Harper Collins.
Turner, T. (2008). Call Me Ted: The Autobiograhy of the Extraordinary Business Leader and Founder of CNN. London, Sphere.
About Shawn Callahan
Shawn, author of Putting Stories to Work, is one the world's leading business storytelling consultants. He helps executive teams find and tell the story of their strategy. When he is not working on strategy communication, Shawn is helping leaders find and tell business stories to engage, to influence and to inspire. Shawn works with Global 1000 companies including Shell, IBM, SAP, Bayer, Microsoft & Danone. Connect with Shawn on: