Tuesday, May 26, 2009

Lessons from Eastman Kodak in the Great Depression

by Michael H. Brill, Datacolor

We know 1931 as the birth-year of the ISCC and of the CIE Standard Observer, but others associate that year with the Great Depression. Color science seems to have matured and thrived during the Depression years, and in particular we can learn many things….

Great wine thrives in a dry season, and great color science has thrived in times of economic downturn. Eastman Kodak thrived twice in this way before most of us were born. The first time was in the 1890s, when the panic was about redeeming securities for gold (of which there was not enough). In Rochester, a backwater with no particular natural resources, Kodak produced its Brownie and Folding Pocket cameras. Photography took off.

Then, in the Great Depression of the 1930s (whose circumstances are more familiar to us), color photography took off. The ingredients were present well in advance: Invention of the subtractive technique by Cros and Ducos du Hauron (1869), and CMY color separations that required three separate shots for one picture (or three beam-split images in register). Rudolf Fischer’s discovery of dye-coupling (1912) was critical, but lay in hibernation until, in 1935, Mannes and Godowsky at Kodak (locally known as “Man and God”) invented three-layer subtractive-color film that enabled a full color photo in a single shot. At that point Kodachrome film was born [1]. There followed in 1937 and 1938 a number of top-notch color-photography articles [e.g., J. A. C. Yule, J. Opt. Soc. Am. 28, 419-426 (1938); D. L. MacAdam, J. Opt. Soc. Am. 28, 466-480 (1938); D. L. MacAdam, J. Opt. Soc. Am. 28, 399-418 (1938); A.C. Hardy and F. L. Wurzburg, J. Opt. Soc Am. 27, 227-240 (1937).]

Credit is of course due to the inventors of Kodachrome and to the authors of these articles, but also credit belongs to the direction of the Kodak laboratories by C. E. K. Mees, author of many books on organization management as well as on photography. Much constructive incubation was happening during the bad years. Together with a keen sense of what is needed to “prime the pump” during such years, Mees had a perspective of science and technology as being in a reciprocal relationship. Martin Scott [2] has said, “Paraphrasing Mees: ‘Science has been good to Photography, and Photography should be good to Science.’ Guided by that motto, he made many special films and emulsions for scientists with no regard for profitability.”

Credit for Kodak’s success accrues to an even higher managerial level. It must not be forgotten that, in 1931, Kodak and 13 other companies fostered what was known as the Rochester plan [3]---a system of unemployment insurance that came some years before Roosevelt’s national plan. Because only 14 companies participated, the plan lasted only a few years, but it managed to cushion the blow to unemployed workers from 1933 to 1935, and Kodak didn’t need it by 1936. (Presumably Kodachrome helped here.) Notable in the implementation of the Rochester plan was a curious confluence of pragmatism and compassion: “Just before implementation of the Rochester Plan, corporate executives at Kodak let plant managers know that they would be held accountable for future unemployment and that it would not reflect favorably upon them if benefit payments were too high.“ [3] Big bonuses were not linked with layoffs...then. Another difference from our recent experiences nationally: Kodak stockpiled inventory and redirected people to increase this inventory during lean times. This is the exact opposite of “just-in-time” delivery, and helped decrease the need for seasonal layoffs (and perhaps longer-term effects as well).

Of course, part of the credit for Kodak’s success during the 1930s belongs to circumstance. During other economic downturns, Kodak learned how to stockpile inventory, respect research, and reward employee retention. Part of the circumstance was the extreme profitability of photographic film---which has lately become somewhat obsolete.

What can we learn for today from Kodak’s Depression experience? Do our lean inventories and draconian logistics destabilize our corporate survivability? Do AIG-style bonuses de-incentivize economic prudence? Does “just-in-time” research undermine longer-term goals? Maybe we should just leave this alone and paraphrase Freud: Sometimes a roll of film is just a roll of film.

I would like to adopt Martin Scott’s positive note that may inform other answers: “Five hundred years of letterpress; fifty years of lithography; and now, how many years of the new technologies? If I've learned anything, it is not to predict, and especially don't presume to know the rate of change.”

Michael H. Brill

[1] Beaumont Newhall, The History of Photography,” Museum of Modern Art, New York, 1964, p. 193.

[2] Martin L Scott, “Introduction: Images for Science,” Images from Science 2, June 2008, http://www.rit.edu/cias/ritphoto/ifs-2008/about_IFS.html

[3] Richard E. Noll, “Marion B. Folsom and the Rochester Plan of 1931,” Rochester History (Vol. 61, 1999), Ed. Ruth Rosenberg Naparsteck.