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The Interview
Jim Continenza, Kodak CEO: Reinventing a brand
00:22:59
Kodak CEO Jim Continenza on giving the fallen photography giant a new identity
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- [00:00]
Advertiser/Commercial Voice
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Liana Byrne
Hello, I'm Liana Byrne and this is the interview from the BBC World Service. The best conversations coming out of the BBC. People shaping our world from all over the world.
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Jim Continenza
I want to get freedom. I like that, freedom.
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Liana Byrne
A gender equal world would be a better world for men too. We need a ceasefire, we need healing, we need trust. These companies don't really, they don't care what governments do.
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Jim Continenza
This is a war. The first thing that we want is the war to end.
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Liana Byrne
At its height, Kodak dominated the photography industry and became one of the world's most recognizable brands. But the rise of digital photography helped trigger one of the most dramatic corporate collapses of its era, and Kodak filed for bankruptcy in 2012. Jim Continenza, now the company's chief executive, joined Kodak's board in April 2013. During the bankruptcy process, he had built his career as a turnaround specialist, serving on more than 30 boards and often stepping in when businesses were struggling and needed reconstructing. Jim tells me how he helped reinvent the iconic company as an industrial manufacturer and what it took to bring the business back from the brink.
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Jim Continenza
When I got here, I think I was doing about 60 million and losing $48 million. I mean, I was losing a lot of money. It was broken. They didn't put money in capex, it didn't update the machinery. They weren't investing. They're letting it run down. We're doing 5x what we're doing then and you know, we doubled just in the last couple years.
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Liana Byrne
Welcome to the interview from the BBC World Service with Jim Continanza.
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Jim Continenza
So I kind of learned how to take a company going through a bankruptcy, which I never wanted to learn. I started sitting on other boards that distress companies. And I've been on approximately 30 plus boards, either as chairman, CEO, director, and almost every single one distressed. And that's why I was put on Kodak when they were in the bankruptcy. I was asked to join the board as they were guiding their way out by the dip lenders, the debtor and possession lenders. And then when Kodak came out, I stayed on as chairman. Kodak went some different directions. And in 2019, February 22, 8 o' clock that hard. I was asked to step in as executive chair and take over the operations. And we were just, we were kind of losing our way. They tried some different things. They didn't work. But that's okay. If they would have worked. The geniuses, right. So you know, you know, I don't ever judge anybody because you don't know what they were going through at that time. I just care about what's in front of me. And we were losing about 160 million a year. We burned through our cash and we had to make some changes and so stepped into the role changed. The majority of the leadership team and from different guys have also been around and ladies around restructurings and going through. Not really. I call it restructuring. When I, when I, when I said I mean a financial restructuring, I mean transformation of the business. It's a skill in an art. When you walk into a company want to have to turn it around. And it's not just everyone here, right. Doesn't know what they're doing. And everyone you brought in doesn't know what they're doing. Or this person's smarter than the other. It's still just one team. And I can say that today we act as just truly one team. But you have to walk in and take a look at the business and say what do they do today? And I asked that question. I asked what does Kodak do today? And I couldn't get an answer. One person said, well, we're doing the 50th anniversary of the moon. I don't even know what that means. And I thought that was really interesting. And we had to get our identity back. And we had multiple divisions, multiple decision makers, multiple products. We had to get refocused. So the team you see is a lot of us have been together a lot of years, but I've also been around most of the kodak folks since 2012. So it wasn't like I was new to the, to the team either. So it was, it was, it was great. And we had a, you know, pick our paths around what are core competencies, what are our skills, what do we do? That's kind of the path we went down. And I'm happy to say, you know,
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Liana Byrne
it's, it's worked out two things I've observed from what you said, first of all, that you didn't necessarily want to learn how to run a company that was going into bankruptcy. But a lot of people would think for a CEO, that's one of the most important things to learn. Because to pull a company out of that, I mean, that's invaluable, right?
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Jim Continenza
You know, it's funny you said that. I agree. I, I even, even for my management team, not even CEO, I love people that have gone through distress, right? Any, anyone. Most people can sail in beautiful winds and calm waters. It's the storm that makes a difference. And you know, as you saw the world, especially the last seven, eight years, to just be candid, right? It's global wars, it's been pandemics, it's been shipping, logistics, inflation, it's been crazy politics. I mean it's been really interesting, right? That's all happened in like five year span. That's a lifetime for a lot of folks. And you know, with my team, we don't really work worry about how bad it gets because we just know that we're going to manage through it. We're used to that news, you know, because it doesn't scare you. And it's funny, it's a great question you asked. On the first bankruptcy, when I went through intelligent, I never knew what was going to come off the other end. But once you go through them, you learn that it's okay. It's all okay, right? Talk to your shareholders, talk to your board, rely on your lenders, you know, just be up front, you know, rely on your people and understand, you know, who really runs a company. And I guess, you know the best way to put it in a, in a distressed situation, hr, legal and finance kind of run the business till they come out. The problem is a lot of companies keep those groups running the businesses. That isn't their job. You got to become a manufacturer or seller. You have to sell your way out. You can't just cut your way out a business. And that's what you learn by going through these distress, different businesses, you don't worry, you move on. When the pandemic came, the first thing we did, we sat in a room and say, look at the world's changed forever. How are we going to change? That's literally, and how can we help on things you have to do. But you're right, I like people have gone through the, the toughness and the distress because they learned that it's not you're in trouble, it's what decision did you make once you got into trouble and that's kind of a skill set that I really see in my leadership team.
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Liana Byrne
Well that was another thing that I observed is that it's not just the gym show. You seem to take people along with you. So do you think that you could have made these, these big moves without taking people along to various different companies?
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Jim Continenza
No, I gotta tell you, no. It's straight up, no. Not even, it's not even me thinking about it. We work great as a, as a, as a team. We understand what direction we're going. You know when I, when I come into like these businesses, I didn't learn even what Kodak did. We just do what we know works. We change the entire systems out. They shouldn't change. Many years ago process from, from their, from Salesforce SAP we gutted everything servers around the world. We streamlined the business. We've taken 260 plus million dollars of cost out of the business and yet we're more efficient today than we've ever been. You can't do that by yourself. And if anyone thinks they can, they're crazy. It's, it's not, it's not. And it's not just them. They have good people below them. We, we're big on, on trust and loyalty and taking that on. But we're very hands on. I spend my time going to see customers and I spend my time in the factories. When capex has to be spent, I go visit the guys who are working on the equipment. A lot of times I want to know do we really need this and why and how will it benefit them? You know, you got to really rely on the ones that actually drive your business. They're the ones that make your products and we're here to support them and our customers.
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Liana Byrne
Now you mentioned that you, when you took over you initially went in and said what does Kodak do? So I'm going to ask you the same question. What does Kodak do?
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Jim Continenza
Oh, that is so easy. I love you. I can make it easy. We do film, right, which is one of our core pieces. It sits inside of a group that we form called Advanced materials and Chemicals. And what film is, is layering and coating. It's very complex. I get it. Most people can never do it. And when I look at that business, I love it. But there's different types of film too. We're doing, you know, NDT film which is like X ray film. We're doing other types of films, not just Hollywood films or still films. It's layering and coating that got us into battery. That's an amc. We also have now built out our first pharma group to start working on heavy water, working on salines, working on reagents. That's all kind of the same network of what we do in layering and coating and chemicals and chemistry. So that's one group and the other group is our print group. And the print group is our largest part of our business. But AMC is catching up finally, which is great. But that is in our print group. Right. We make the plates that go on large print printers, process, replace. I say they're the best out there. We also make the ctps that write on those plates. We also give you the service. We also do the pre software, and we have two of the world's fastest digital machines. So we also cover that print business, you know, cradle to grave, I call it, with great service. So we do print and advanced materials and chemicals. That's it. That's what we do.
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Liana Byrne
Well, this might be a harder question because when people Hear Kodak in five or 10 years time, what do you want them to associate it with? And is there anything that you want them to stop associating it with?
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Jim Continenza
Oh, great question. Wow. You know what? I think one of our goals from day one was create jobs for the next generation. I was very clear my very first meeting, last in film, last in plates. And I think they will see that we're committed to that art and our heritage. A lot of people run from who they were or who they are. When they get into these bankruptcies, they try to do things they shouldn't do or restructuring. And that isn't what you should do. What is your core competence? And that's part of our heritage. And that led us into other things. So when you look at Kodak down the road, we're an industrial manufacturer and we're damn good at it. Our layering and coding technology is greater than anyone in the world, literally. And it drove us into other businesses. So Kodak is a company that you want to work for. You have a job for the next generation. We left it better than when we got here. And we brought, you know, value to our shareholders. And that's kind of been our motto for the business. So Kodak is, you know, an industrial manufacturer that has expertise in layering and coding and chemical and science. That's what they should think of as Kodak as the company now.
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Liana Byrne
I mean, this turnout around has been huge. But I just want to take you back to when it went bankrupt. I mean, despite having pioneered digital Photography. It did go bankrupt, didn't it? But from your perspective, what was the single biggest mistake, if there is one that comes to your mind? And then also my other question would be, did bankruptcy actually ultimately make the company easier to fix?
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Jim Continenza
Interesting. It's hard for me to answer both of those and I'll tell you why I wasn't here. And, and I, and I really don't look backwards and I'm not trying to dodge your question. I, I just don't, I don't spend time dwindling on. Look at, it's easy to sit after the game. You know, I'll give you an example. They just had a college national championships here in the U in the US Right Seconds ago, the quarterback threw an interception. Boy, they should have ran the ball. I mean, it's easy to second guess right after the fact. So I'm not going to, I'm, I'm not going to judge. You don't know what's going on. And you know, when you start getting distressed, here's what happens. It happens years before you go into bankruptcy and then you start doing things to protect shareholder value because that's your job. And when you start doing that, it looks like, oh my God, why are they doing that? Well, that's how they're trying to protect their shareholder value. You work for shareholders, so that's, that's just kind of what you see. So it's hard to challenge it. Oh boy, they made some really bad decisions. You don't know why they made those decisions.
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Liana Byrne
I guess I just want to get into your head and just understand what kind of situation you took over at Kodak. Like what were you thinking when you went home at night in those early months and were like maybe tearing out your hair?
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Jim Continenza
You know, what skill sets do you need that you just can't possess and how quickly can you get that skill set? So that's, that's what kept me up at night. And you know, the balance sheet, the balance sheet was really broken. You know that we are heavily levered and losing a lot of money. And I did three different financing rounds I had. The balance sheet has to match where you are in the stage of your business. And it wasn't covenant you're button up to and you start doing things for covenants. I don't do things for covenants. You know, talk to your lenders, make sure your balance sheet matches the direction you're going to. That's what kept me up at night and can I get there? And I've been blessed to have really good shareholders and good investors. They've come along and they've been very supportive.
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Liana Byrne
Did you ever want to scrap the film side of the business? Would that have made your life easier?
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Jim Continenza
I got to tell you, you asked really good questions. Let's not say scrap it. I want to understand it. It was losing. When I got here, I think I was doing about 60 million, losing $48 million. I mean, it was losing a lot of money. It was broken. They didn't put money in capex. It didn't update the machinery. They weren't investing. They're letting it run down. Acetate's a primary ingredient for film. And they got rid of the factory. I mean, it was interesting and it was on the decline heavily. And I'm not sure if I wouldn't say shut it down or stay or go. It was probably on the path to, to wind down it. We're, we're doing 5x what we're doing then. And you know, we doubled just in the last couple years, so. But to answer that question, and boy, Chris is gonna hate this. I actually got a call from Christopher Nolan. I'm not a name dropper. And I had a great conversation.
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Liana Byrne
That is a big name.
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Jim Continenza
That's a big name. I know. And it had a conversation with him and he. His, his love and understanding of film. And it was a really good conversation. I'm not gonna go into detail, but it was changing for me. And he, he actually one of the guys that convinced me to really get into this and understand it better. He's really clear how this art needs to continue and stay and the differences that film brings. You know, you see things you don't see. He's just, I mean, he's well beyond my intellect on film. But it was, it was just amazing. And so he inspired me to really spend time in that group. And I did. And when I did what I came to the conclusion, if you or I want to start our own film company, we couldn't do it. The complexity.
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Liana Byrne
Yeah.
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Jim Continenza
The cost, right. It's just, it is the barrier to entry. Huge. And the know how. And I looked at that and I went, now I see it. And I do shoot film. And unfortunately, unfortunately I do. And I love sunsets. Right? And you, you push that trigger on that on a camera, when you pull it, it's like everything's perfect when you do it. Right. And I remember, you know, one of the questions Chris asked me, he goes, how many phones pictures do you have on your phone? And believe it or not, it was 90 plus thousand. Pretty sad, but yet I would never do that with film. And it's just interesting. So I, I credit him for getting me to truly focus on it. And he's been a real big supporter. But I would say leave it. My question is, what else can we do with it? Right. We know it's a declining business, we know it'll never be what it was, but what can it be? And what else can we derive from that skill set? So it drove us into doing substrate coating for EV batteries and other things. Very same process as making film. Very. So it just levered other pieces of the business. And I realized there was a lot of fixes we had to do and we fixed them. And obviously, you know, we even built a new spooler and it may mean nothing to you, but couldn't find one they haven't made in 50 years. I'm exaggerating the years, but decades and several million dollars in five years to build something that was built many years ago. And it's very difficult to go backwards. It just is. If you wanted to go build a vcr, it would cost you so much money to be able to do that. And it was so hard to go backwards. And we had to build this machine that its tolerance is 1 and 150 millionth. It's unbelievable. It's got to be literally perfect. And we did it and it doubled our film capacity, you know, so that's a commitment. We. We went hard on film and then Hollywood films, motion picture film, we call it, has really picked up and what they've learned, if you want to look different on digital film, digital looks like digital.
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Liana Byrne
Yeah.
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Jim Continenza
And you know what? Digital tries to look like film. You've never once heard film. Film tries to look like digital. You've never heard of that. And so that really told me that this is something special and I just need to really understand it. And I. Fortunately, Terry Tabor and garage and our team there just, just really, I mean, Terry's brilliant on film, several patents. He's just, he really convinced me that, you know, this needs to stay. We just have to fix how we operate and how we. How we sell it. And that was really the key. So, yeah, to answer your question, the obvious question was yes. And then in reality would have been one of the biggest mistakes if I would have made that decision.
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Liana Byrne
You're listening to the interview from the BBC World Service with me, Leanna Byrne.
- [18:19]
Jim Continenza
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- [18:47]
Liana Byrne
Your way Home Keep your wellness routine going strong all summer. Cachava's new travel packs help you stick to your daily ritual even when you're on the go. Just one packet of Cachava's all in One Nutrition Shake provides complete nutrition wherever you are with 25 grams of protein, 6 grams of fiber, greens, adaptogens and more. Simplify your daily ritual. Go to cachava.com and use code fitness for 15% off. That's K A C H-A V A.com code fitness I spoke to Jim over Zoom back in January and he joined me from Kodak's home in Rochester, New York. It was an audio only interview, so I didn't get to see whether he had a camera beside him, but he did tell me he now shoots on film himself. The thing that struck me about Jim the most was that he was unusually candid for a CEO. Right at the start of the interview he told me, if you're looking for marketing fluff boy, I'm not your guy. And he very much lived up to that. He admitted so many things that film was broken, the balance sheet was really broken, that Kodak has lost his way. But but at the same time, he wasn't actually defensive and he refused to blame previous management. When I asked him about the bankruptcy, I was almost giving him an opportunity to criticize his predecessors, but instead he said things like, I don't ever judge anybody. You don't know what they were going through at the time. It's quite a measured answer and quite reflective. He thinks like an operator too, not a marketer. He was constantly talking to me about the machinery, the factories, the production, the chemistry, and he gives specific examples about the different machines. He tells me about a spooler and I think he spoke to me about that for two minutes. Instead, most CEOs would simply say something like we invested heavily in machinery and he was just genuinely enthusiastic about film, about the factories, about Kodak's base in Rochester. And he clearly enjoys his job in even though it is quite a difficult job turning around a company that's going into bankruptcy. Okay, let's return to my conversation with Jim Continenza Is there something that you want to complete or needs to happen before you can think of ever leaving Kodak?
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Jim Continenza
My gosh, you are off.
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Liana Byrne
You're very, very complimentary.
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Jim Continenza
You know, I've never left anything until it was finished. I have an obligation to the people that work here. Look at it. My people that work from the factory all the way through, I don't care. Everyone is important. But it was really important to me. This is important to understand is my folks in the factory, the ones that keep the factories clean, they keep everything going, right? I can do and understand most jobs at the office level, and so can my team. I can't make film, can't make chemicals, can't. I can't do so many things. It's unbelievable. They're the ones I worry about. So, you know, for me, when I know that we are right, and I call it profitable and multiple things, not just one, right? I need. I'd rather get a dime from 20 things and a dollar from one. Right? But things are operating like they should be, and we see the growth in the business. It's important. One of my employees said to me the other day, he goes, my dad worked here, I worked here. Now my son does. His name's James. And I thought it was great, right? He goes, but he used to worry about coming to work in the past, right? And thinking, do I have a job the next day? It's a whole different attitude within that factory. So the culture was a big one. And when I see that change in the culture, it means a lot to me. And we have that change, so that makes me happy. So when I go, right, it has to continue to run whether I'm here or not. And that's how we're building it. This isn't the gym show, and it's not just my leaders, and we're actually working on that next layer. And I'll pull further away, right? Making sure that we have the processes in place that never again will put the company in jeopardy.
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Liana Byrne
Okay, perfect.
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Jim Continenza
Yeah.
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Liana Byrne
I'm sure it's hard because when you're a leader and you're bringing that change, it's almost like you're the person at the start of the marathon, and then you've crossed the finish line, but people are still behind you. I'm sure that's always like, are they going to. They're going to finish the marathon as well, but I'm sure they will.
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Jim Continenza
You know, I say this right, because we've left a lot of companies, we sold a lot of them. Fortunately, they've all worked. I put it this way, I have three children and oh my God, I can't say they're in their 30s and late 20s, okay, I expect them to do better than me. Not financially. They should be a better father, should be a better husband. You should learn from each group, right? You should be better educated, which they are. And at the end of the day, right, you should do more to give back than I did because you should just be a better person. So I expect the same thing here when we leave this next generation, right, that there's that true team camaraderie again. They never go to the multiple divisions when they win by taking from each other versus competing out in the street. And I've really seen that culture change. When I got here, I'd say my first thing I go, you're victims. You're going to be a warrior, not a victim. My parents are immigrants from Italy. You know, I guess what, I was never a victim in my life. You fought, you fight your way through everything. Be a warrior. If you can't do that, this is not a place for you. It just isn't. And I see that culture change and that's when you know you're in good shape. And I just had an all employee meeting and I said, don't you ever. And I say it all the time, let anyone take this company backwards. Even if I'm gone. Stand up, scream, yell. Never let it happen again. Never. You gotta speak up.
- [24:30]
Liana Byrne
Thank you for listening to the interview. You'll find more in depth conversations on the interview wherever you get your BBC podcasts, including conversations with Google's CEO Sundar Pichai, as well as novelist Maggie o' Farrell and many others. Until the next time. Bye for now.
- [24:56]
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Liana Byrne
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- [25:25]
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