Since 1980 there have been four periods considered recessions: July 1981- November 1982: 14 months; July 1990-March 1991: 8 months; March 2001-November 2001: 8 months; December 2007-June 2009: 18 months.
None of the prior recessions proved as detrimental to Kodak because the company was maintained by a robust film business. When the demand shifted to digital technology, Kodak was without a strong product to sustain it through the latest recession, as film once did, because there was never any real impetus to seize the opportunity in the digital space.
Economists and even the Business Cycle Dating Committee of the National Bureau of Economic Research agree that this latest recession began in December 2007 and officially ended in June 2009. Kodak filed for bankruptcy a full two and a half years after June 2009. There is no doubt by anyone that the weakened economy severely hurt the company, as it did so many others, but what actually brought down the company was effectively a self-inflicted slit on the wrist.
The leadership at Kodak will point to the economy as the culprit; however, Perez’s tenure at Kodak was nothing short of a reign of terror for the company’s employees and shareholders.
After joining the company in April 2003 as Kodak’s Chairman and Chief Executive Officer, Antonio structured numerous massive layoffs and employee divestments totaling more than 23,000 combined by 2007. In 2009 Kodak announced that it would lay off an additional 4,500 employees.
These massive layoffs weakened the company’s infrastructure, as it lost experienced and talented employee resources. Many employees found themselves scrambling to do patch work to compensate for the loss of colleagues and management who had not only years of experience that they lacked, but also proprietary knowledge that went out of the door right along with the employees.
The falling stock made spending very tight, which left Kodak’s cash-starved digital business with no chance when the economy tanked. These combined events and a slow and feeble effort to act on customer demand for the new technology are what doomed Kodak and Kodak Gallery.