Innovate or Die: How These 5 Companies Failed?

The only constant thing in today’s rapidly transforming world is change. Failure to innovate can be dangerous. Here are 5 companies that failed in recent years due to lack of innovation.

1. Blockbuster (1985-2010)

Founded in 1985, Blockbuster provided home movie and video game rental services. Unable to transition towards a digital mode, Blockbuster filed for bankruptcy in 2010. In 2000, Blockbuster had rejected Netflix’s offer to sell their company to Blockbuster for USD50 million. Why? Because it was seen as a “very small niche business” and was losing money at that time. As of July 2017, Netflix had 103.95 million subscribers worldwide and a revenue of USD8.8 billion.

2. Polaroid (1937-2001)

Founded in 1937, Polaroid instant film and cameras successfully captured a market that had few competitors. However, Polaroid was unable to anticipate the impact that digital cameras would have on its film business. Falling into the ‘success trap’ by exploiting only their business activities, Polaroid neglected the need to explore new territory and enhance their long-term viability. The original Polaroid Corporation was declared bankrupt in 2001 and its brand and assets were sold off.

3. Toy “R” Us (1948-2017)

Amazon began to allow other toy vendors to sell on its site in spite of the contract with Toy “R” Us. As a result, Toy “R” Us sued Amazon to end the agreement in 2004 and therefore missed the opportunity to develop its own e-commerce presence early on.

4. Kodak (1889-2012)

Kodak could not keep up with the digital revolution. They hesitated to fully embrace the transition to digital which led to its demise. For example, Kodak invested billions of dollars into developing technology for taking pictures using mobile phones and other digital devices. However, it held back from developing digital cameras as it was afraid of eradicating its all-important film business. Kodak filed for bankruptcy in 2012 and re-emerged in 2013 as a much smaller, consolidated company focused on serving commercial customers.

5. General Motors (1908-2009)

General Motors was one of the most important car manufacturers for more than 100 years. Failure to innovate and blatantly ignoring competition were key to the company’s demise. As GM focused predominantly on profiting from finance, the business neglected to improve the quality of its product, failed to adapt GM to changes in customer needs and did not invest in new technologies.

Through a major bailout from the US government, the current company, General Motors Company ("new GM"), was formed in 2009 and purchased the majority of the assets of the old GM, including the brand "General Motors".

Many companies or even individuals love to stick with the methods or models which once brought them huge returns. Making significant changes could be difficult but companies that don’t respond to changing markets or fail to acknowledge trends, may miss out on opportunities and put their businesses at risk.

Reference:

1. Frances Goh, 10 Companies That Failed To Innovate, Resulting In Business Failure www.collectivecampus.io/

2. Bianca Miller Cole, Innovate Or Die: How A Lack Of Innovation Can Cause Business Failure www.forbes.com