There was a time, not so long ago, when a “Kodak Moment” was something special, a beautiful occasion to capture and savor in pleasurable contemplation.
Today, the term serves as an ironic reference to the shocking demise of the once-mighty company. It rings like a fire bell in the night, warning executives to guard against brand complacency and urging them to stand up and respond to disruptive forces before they sweep away their markets like a tsunami.
If recent activity is anything to go by, corporate America seems to be having a collective Kodak Moment. Spurred by digital technology, low-growth legacy businesses, investor impatience and an urgency to “unlock value,” there has been a flurry of corporate breakups and restructurings as some of the most iconic and long-established companies search for an alternative future beyond the legacy business that built their fortune.
The list of companies who have taken a scalpel to their businesses in pursuit of growth reads like a roll call of honor. It includes blue chip companies such as IBM, Hewlett-Packard, GE, Johnson & Johnson, Kellogg, NCR and, most recently, 3M.
Oddly, that coldly clinical and unemotional approach to business restructuring does not seem to extend to brand strategy. In some cases, there is a hesitancy, a compromising equivocation that prevents them from entirely letting go of the past. Is it irrational brand sentiment that holds them back or just bad advice? Here are a few examples.
The storied Silicon Valley pioneer, Hewlett-Packard, was a first mover. When it decided to split off its languishing consumer hardware business a few years ago to focus growth on cloud and enterprise markets, the decision to bequeath the HP brand to the legacy business must have practically made itself, emblazoned as it is on millions of personal computers and printers.
But what to call the remaining business? It had a clean slate, a new future to move toward, a bold new agenda to declare. “Hewlett Packard Enterprise” as it became, is a flat if comfortable compromise and one not without its problems. The name is just too long. Hewlett-Packard became HP by default, people can’t resist abbreviating the syllabic pile-up. The result is confusion.
The full name for the company is “Hewlett Packard Enterprise Company,” which drops the hyphen between the “Hewlett” and “Packard” of the former Hewlett-Packard Company. Although sometimes referred to as “Hewlett Packard Enterprise” in full, it is more commonly known by its initials “HPE.” It is incorrectly referred to as “HP Enterprise” and has even been called “HP Enterprises.”
IBM and Kyndryl
Contrast this with the clear-headed decisiveness of IBM, one of HPE’s main competitors in the cloud business. In a mirror image of what happened with Hewlett-Packard, it took a cleaver to the 109-year-old business and cleanly split off its legacy IT infrastructure services unit without a blink of sentiment.
For the 90,000 employees of Kyndryl, the name of the new company, life outside of the IBM mothership was no doubt a wrenching adjustment to begin with, as it is for all separated businesses, but the new enterprise had the courage of its strategic convictions to let go of IBM and define itself on its own terms. This “human element” is a key point I will come back to.
Johnson & Johnson and Kenvue
The 135-year-old Johnson & Johnson took the same unsentimental approach. It spun off its consumer-products division like it was ripping of one of its own branded bandages, the one we all commonly refer to as a Band-Aid®. Famous for other household names — though not lucrative brands — like Tylenol® and Neutrogena®, the new company brand, Kenvue, was launched with the statement “A new view of care.” The more profitable, faster-growing businesses of pharmaceuticals and medical devices were reassembled under a revitalized Johnson & Johnson brand.
Kellogg and Kellanova
The Kellogg Company could not quite muster the same resolve. The 117-year-old company also decided to split itself into two businesses, with its fast-growing global snacking business spun-off as Kellanova — a backward reference to Kellogg. The North American cereal company became WK Kellogg Co, named after founder William Keith Kellogg.
Steve Cahillane, the CEO of Kellanova, said his company’s brand name signals its future ambition while building on the 117-year legacy of the Kellogg Company.
GE Plus Three
This “having-your-cake-and-eating-it-too” brand strategy reached its apotheosis in 2021 when General Electric, the 129-year-old conglomerate that was once the most valuable U.S. corporation and a global symbol of American business power, announced plans to split itself into three public companies, all of which bear the GE name: GE HealthCare, GE Aerospace and GE Vernova.
This intricate brand dance was no doubt closely studied by NCR Corporation, a manufacturer of point-of-sale terminals and automated teller machines. Founded as National Cash Register in 1884, NCR announced its decision in 2022 to split into two independent companies, again in a quest to “unlock value for our shareholders.” In July 2023, NCR unveiled the names for the two companies.
NCR Voyix and NCR Atleos
Its fast-growing digital commerce business will be called NCR Voyix, while the legacy ATM business will be named NCR Atleos. Why this tentative ambivalence with the names?
A clue lies in a press release in which the company stated that “in speaking with thousands of stakeholders to finalize each company’s name, it became clear that ‘NCR’ is a proven badge of experience and service that customers, industry analysts, and employees encouraged NCR to retain.”
Fair enough — but NCR for both businesses? If anything, the stakeholder research should have signaled the enormity of the brand challenge NCR faces in redirecting loyalties and forging independent brand cultures in support of two new companies set on separate business journeys. Life as part of NCR is all stakeholders knew. In the absence of anything else to understand and coalesce around, it was entirely natural they would want to cling to the NCR name.
The End Game
As time moves on, the end game for GE is becoming a little clearer. The GE HealthCare spinoff was finalized in January 2023. GE continues to hold 13.5% of shares and intends to sell the remainder in time. GE’s portfolio of energy businesses will be spun off as GE Vernova in 2024. Market forces will then intervene and determine the eventual fate of both.
The final legal successor of what was Thomas Edison’s fabled General Electric will be GE Aerospace, an aviation-focused company.
In the long run, GE’s strategy might work for GE. Is this a brand model for others to emulate?
NCR is not GE. The NCR brand is immutably associated with the legacy ATM business and it’s hard to see what “Atleos” adds to the NCR name in that business beyond confusion. A comprehensive brand repositioning of NCR, à la Johnson & Johnson, would have done the job more effectively. And, at six syllables long, NCR Atleos does not exactly roll off the tongue.
Meanwhile, NCR Voyix has an urgent task ahead to achieve critical mass as a digital commerce brand in a hugely competitive market. All focus must be on building the credibility of Voyix beyond the legacy of NCR and the ATM business.
A message on the NCR website makes it clear: “NCR has separated into two separate and distinct companies.” The brands need the same clarity and conviction. Instead, they have muddied the situation with joint ownership of the NCR name which neither company fully controls and two new names that must be explained to the market.
The Human Element
All this brings us back to Kyndryl and begs the critical question – why is brand strategy such a critical consideration in a business separation?
According to McKinsey, the management consultancy, research shows that about 70% of the time, transformations beyond the separation context fail, and the human element is a fundamental reason why.
The odds for success dramatically improve when the separated companies build a culture for their specific needs and objectives — not those of the original conglomerate.
“After all,” comments McKinsey, “why be a duplicate when you can be your own best self?”
This is what NCR seems to have missed — a confident, future-focused brand can be a powerful agent in unifying people around a new, compelling business reality. It gives them a reason to let go of the past and embrace the future wholeheartedly.
In Ray Bradbury’s classic work of science fiction “The Martin Chronicles,” he tells the story of the exploration and settlement of Mars and the people who became indigenous Martians. In an interview, Ray explained, “’We’re going to become the Martians when we land there. When we explore and build communities, we become the Martians. That’s a wonderful destiny for all of us.”’
When it comes to corporate branding, keep your eyes focused on the destination, not the past. The only way to survive and thrive on Mars is to become Martians.