This morning’s Observer column about Kodak’s demise.

A good way of inoculating yourself from the wisdom of hindsight is to read Clayton Christensen’s seminal book, The Innovator’s Dilemma, which is the best explanation we have of why and how successful firms can be undermined by disruptive innovations – even when they appear to be doing everything right: listening to their customers, watching the marketplace, and investing in research and development.The really sobering thought to emerge from Christensen’s book is that good decisions by great managers can still lead to corporate disaster. The reason is that while big companies are often good at fostering “sustaining” innovations – ones that enhance their positions in established markets – they are generally hopeless at dealing with innovations that completely disrupt those markets.So the question that Kodak’s demise raises in my mind is this: would any of us have done any better in 1976 after our R&D guys had come up with an idea that would cannibalise our core business and reduce our margins to near zero?