Issue 34: When Industries Disappear: What Kodak Missed
AI won't just change how companies operate. It will change what customers consider necessary.
For those who prefer to listen, below is the companion podcast from Elemental AI: The Briefing
In 1999, I was class mom for my then twin first-graders, planning what I thought would be the perfect field trip. I called Thomas Bros. Maps in Irvine to schedule a tour of their facility.
For those too young to remember, Thomas Bros. Maps was how we navigated life before GPS. Their spiral-bound street guides lived in every California glove compartment. You’d pull over, flip through the grid index, find your destination on page 47-C3, trace your route with your finger, and hope you remembered the turns. Getting lost meant finding a gas station and asking directions.
It was analog, inefficient, and absolutely essential.
As class mom, you have a road map (pun intended!) to follow. The tour had happened the year before, so I called to arrange it again for my class. I was surprised to learn that in just a year, the Company had ‘gone digital’ - no tours available. The whole operation had transformed.
I was disappointed. The first-graders would have loved seeing how maps were made.
What I didn't realize at the time was that what I ran into that day wasn't just a company modernizing. It was something quieter and harder to see while it's happening: an industry transition. A business can be early, competent, and even innovative... and still end up a niche solution, because the world ceases to approach the problem the way it used to.
What Actually Happened at Thomas Bros.
Thomas Bros. Maps started in 1915 in Oakland, founded by cartographer George Coupland Thomas and his brothers. For decades, they were THE definitive source for California street maps - first Northern California, eventually expanding to LA, Orange County, San Diego, and beyond.
In 1962, Warren B. Wilson, the company’s attorney, acquired Thomas Bros. from the founding family. Wilson saw the future coming. In 1980, he moved the headquarters to Irvine and spent heavily converting from manual cartography to computerized mapping. Through the 1980s and 1990s, Thomas Bros. built digital databases, created CD-ROM products, and sold map data to utilities, cities, and municipalities.
They recognized digital was the future, they invested in the technology, and they diversified revenue streams beyond print.
When I called Thomas Bros. in 1999, they were mid-transformation. By 2009, it was effectively over.
That year, Rand McNally, which had acquired Thomas Bros. in early 1999, shuttered the Irvine headquarters. The company that had pioneered California street mapping ceased to exist as a California-based mapmaking operation. After that, printed guides were scaled back and updated only “as needed.”
Today? The Thomas Guide brand still exists…barely. The 57th edition of the LA/Orange County guide came out in 2025, serving a niche market of contractors, delivery drivers, and nostalgic locals who prefer paper. San Diego gets updated too. Everything else is gone.
Meanwhile, Google Maps launched in 2005 and completely redefined navigation. Turn-by-turn directions. Real-time traffic. Constant updates.
Free.
Here’s what Thomas Bros. missed: Google didn’t just digitize their product. Google made the question Thomas Bros. was solving irrelevant.
Thomas Bros. asked: ‘How do we make better maps using computers?’
Google asked: ‘What if nobody had to figure out the route themselves?
Nobody needs to find themselves on a grid anymore, trace a route with their finger, or memorize turn sequences. They just need to get where they’re going. Google solved that problem with a completely different approach—voice-guided, real-time, adaptive, integrated with search, reviews, and traffic patterns.
Thomas Bros. had invested in digital mapping a decade before Google Maps existed. They had the data, the technology, and the brand recognition. But they were optimizing the map while Google was eliminating the work of reading one.
Thomas Bros. ended up as a boutique legacy product. Google, Apple, and Waze captured the entire navigation market.
Sound familiar?
The Kodak Moment
Everyone knows the Kodak story - or thinks they do. In 1975, Kodak engineer Steve Sasson built the first digital camera. Management’s response: “Nice - but don’t tell anyone about it.”
This gets misunderstood constantly. People think Kodak was blind to digital photography, but they weren’t. They understood exactly what Sasson had invented. They understood it so well that they suppressed it.
You see, Kodak wasn’t actually in the camera business. They were in the film, chemical, and paper business. Cameras were the delivery mechanism for their actual product - the high-margin, recurring revenue from every roll of film and every print.
Sasson’s digital camera threatened to make that entire ecosystem obsolete.
Six years later, in 1981, Kodak’s head of market intelligence, Vince Barabba, delivered a comprehensive study to the board. With full CEO support, he had analyzed digital photography’s adoption curves, cost trajectories, and quality improvements. The conclusion: digital will replace film. The timeline: roughly ten years to prepare.
The study was remarkably accurate. Kodak had a decade of warning.
They spent that decade using digital technology to prop up the film business.
By January 2012: Bankruptcy.
The Governance Problem Nobody Saw
So, why are we talking about this in an AI Governance article? Here’s where this moves from a “Kodak Moment” to an “AI Moment”: Neither Kodak’s nor Thomas Bros.’ failure was about technology or market intelligence. It was pure governance.
Kodak had the invention, accurate intelligence (ten-year warning), technical superiority (1,000+ digital imaging patents), financial resources ($28 billion market cap), and multiple CEO transitions.
Thomas Bros. had early digital adoption, revenue diversification, geographic dominance, and a decade lead on Google Maps.
What both lacked was a governance framework that could force the fundamental business model conversation.
Let me be specific about what that means using Kodak, since their governance failure is better documented:
The board knew film was dying. Management knew it. The engineers definitely knew it. But the governance structure couldn’t bridge the gap between “we know this is coming” and “we’re going to kill our profitable business to prepare for it.”
Every CEO who came in promised digital transformation. Every one failed to execute it. The board kept changing the CEO without changing the accountability framework.
In 1989 Kodak’s CEO, Colby Chandler, retired. At this point the board had narrowed down its choices for his predecessor to two individuals, Phil Samper and Kay Whitmore. Phil Samper understood digital - he’d later go on to become president of Sun Microsystems and CEO of Cray Research. Kay Whitmore promised to “stay closer to core businesses in film and photographic chemicals.”
The board chose Whitmore.
That choice revealed everything about what they were willing to govern versus what they were willing to protect.
By 1996, Kodak had spent over $500 million developing the Advantix Preview system. It was a digital camera - you could preview shots and select which to print. But it still used film, and it still required chemical processing.
Why would anyone buy a digital camera that still needs film?
Nobody did and it flopped.
Between 2003 and 2012 Kodak endured a slow collapse. Each new CEO declared they’d finally transform to digital. Each one got mired in protecting the legacy business. By the time smartphones made standalone cameras mostly obsolete, Kodak was already irrelevant.
Why Experienced Boards Struggle With Transformation
Kodak’s board had deep industry expertise. Thomas Bros.’ leadership understood their markets intimately.
That expertise became the constraint.
When your mental model is built on “film is photography” or “maps are printed books,” governing a transition where those formats become irrelevant requires fundamentally redefining the business. You can monitor disruption. You can acknowledge it. You can discuss it in board meetings.
But you can’t govern what you can’t conceive.
The Question They Weren’t Asking
Both companies asked: “How do we use digital technology to improve our product?”
They needed to ask: “What if digital technology makes our product obsolete - what problem are we actually solving for customers?”
Thomas Bros. computerized cartography. Incremental.
Google eliminated the need for cartography in daily use. Transformative.
Kodak used digital sensors to enhance film cameras. Incremental.
Smartphones integrated cameras into communication devices and made photo-sharing instant and social. Transformative.
The Governance Trap
The boards approved strategies that said ‘we’re going digital’ while approving budgets that protected legacy revenue. Nobody forced the question: which strategy was real?
Kodak monitored digital photography as a competitive threat within the photography industry. They needed to govern it as an existential business model risk requiring complete transformation.
Thomas Bros. invested in digital mapping technology but never reconceived themselves as a platform company or real-time navigation provider. They remained a map publisher - one that happened to use computers.
Three Structural Failures
The incentive misalignment: Executive compensation rewarded existing business performance. Transformation required risk-taking and short-term margin compression - which the governance structure punished.
The timeframe trap: No one was held accountable for transformation progress. CEOs were measured on quarterly financial performance. Protecting legacy revenue looked like success - until it wasn’t.
The execution paradox: Real transformation requires transitioning profitable businesses while investing in unproven models. That’s difficult to sustain through analyst scrutiny, employee anxiety, and customer resistance.
The Intel Comparison
Let me show you what the alternative looks like.
In 1985, Intel is getting destroyed by Japanese competitors in memory chips which was their core business, their primary revenue.
Andy Grove (CEO) and Gordon Moore (Chairman) have a now-famous conversation:
Grove: “If we got kicked out and the board brought in a new CEO, what do you think he would do?”
Moore: “He would get us out of memories.”
Grove: “Why shouldn’t you and I walk out the door, come back, and do it ourselves?”
They did. Intel exited memory, pivoted to microprocessors and became one of the most valuable companies in the world.
Same situation as Kodak and Thomas Bros. Different approach to governance.
Intel’s board forced the hard conversation. They aligned incentives with transformation. They made the decision from a position of strength, not desperation.
Your AI Version of This
Think about the job your company actually does - not the format you deliver it in.
Thomas Bros. thought they were in the map business. They were actually in the wayfinding business. When wayfinding moved to real-time, voice-guided navigation, static maps became nostalgia items.
Kodak thought they were in the photography business. They were actually in the memory-capture-and-sharing business. When that job moved to digital capture and instant social sharing, film became obsolete.
Now ask: What job are your customers actually hiring you to do?
Financial advisors think clients hire them to “manage portfolios.” Clients are really hiring them to “feel confident about their financial future.” AI-powered planning tools with 24/7 access and instant scenario modeling might deliver that confidence differently than quarterly meetings.
Consulting firms think clients hire them for “analysis and recommendations.” Clients are really hiring them for “confidence in high-stakes decisions.” AI that analyzes every comparable situation and stress-tests scenarios in real-time might provide that confidence faster.
Compliance services think clients hire them to “file accurate reports.” Clients are really hiring them to “avoid regulatory risk.” AI that monitors regulations continuously and flags issues instantly might reduce risk better than annual audits.
Why This Is a Governance Issue
Most boards are asking “how do we use AI to do what we do better?” That’s an operational question. Your executives can handle that with pilots and efficiency initiatives.
The governance question is different: “What if AI enables someone else to solve our customer’s problem in a fundamentally different way - making our current approach irrelevant regardless of how efficient we make it?”
That question requires board-level oversight because it threatens current revenue streams that executives are incentivized to protect. It requires capital reallocation that may harm short-term performance. It demands accountability frameworks that separate transformation progress from operational metrics. And it needs the courage to cannibalize profitable businesses before competitors do it for you.
This is why governance failed at Kodak and Thomas Bros. Both companies asked the operational question -"How do we use digital technology better?" - when they needed to ask the existential one: "What if digital technology makes our format obsolete?"?
Do you have governance frameworks that force the harder conversation? Because somewhere, someone is building an AI-native version of what you do - and they're not asking your permission.
What the Elemental AI Governance Navigator Reveals
The Elemental AI Governance Navigator is a board-level diagnostic that measures AI governance maturity across seven domains and identifies the structural gaps that prevent effective oversight.
It’s not a compliance checklist. It’s a reality check on whether your board has the capability to govern AI - especially when the right decision threatens the current business model.
The assessment spans seven domains, but one of the most revealing questions lives in the Decision & Intelligence domain:
"Does the board maintain a log of AI initiatives rejected to protect legacy business—and review it quarterly for patterns of risk aversion?"
Most boards don’t track the AI initiatives they decline. But those “no” decisions reveal everything about whether you’re governing transformation or protecting the status quo.
Kodak’s board approved “digital transformation” strategies while protecting film revenue. Nobody forced the choice between them.
And that’s what makes this lethal: Kodak had brilliant engineers, serious R&D, and thousands of patents. They scored high on technical capability - and terribly on governance maturity. That gap is what kills companies.
Elemental AI Governance Navigator: Tip of the Week
Here’s one question from the Navigator that exposes the exact gap Kodak never closed:
What percentage of executive compensation is tied to AI-driven transformation milestones versus current-business performance? How is that quantified?
AI isn’t “a tool upgrade.” It’s an industry reshaper. It changes how value is created, how prices are set, who owns distribution, and what customers expect - and it does it faster than most incentive plans can adapt.
So here’s the elemental reality: your strategy is only as real as what you pay for.
If the answer is zero - or close to it - you’re paying leadership to protect today’s business while claiming to build tomorrow’s.
Kodak didn’t fail because smart people couldn’t imagine digital. They failed because the system rewarded the wrong outcome. CEO after CEO promised transformation while compensation stayed anchored to the legacy engine. When you pay executives to optimize the incumbent model, they will … especially when the new model is uncertain, cannibalizes revenue, and takes longer to show up on quarterly dashboards.
The board kept changing the CEO without changing the scoreboard. That isn’t governance. That’s hoping different people make different choices under identical incentives.
Let’s Get Elemental
Your board probably has better information about AI than Kodak had about digital photography in 1981. The technology is moving faster. The competitive threats are more immediate. The timeline is shorter.
So the question isn’t “do you know AI is important?” The question is:
“Can you govern a transformation when it threatens your current business model?”
When I called Thomas Bros. Maps in 1999, they were in the middle of that question. They’d invested in digital. They’d diversified revenue. They knew change was coming.
But they couldn’t redefine themselves from “the company that makes definitive printed maps” to “the company that solves the navigation problem- however that problem evolves.”
Kodak couldn’t make the leap from “the film company” to “the memory-capture company.”
Both had the information. Both had the technology. Neither had the governance structure to force the transformation while they still had the time, the resources and the market position to win.
Before Your Next Meeting
Ask for one slide:
“Where could AI make our current approach unnecessary?”
Not “how we’re using AI.” Not “our AI roadmap.” Not “competitive analysis.”
Just one question. The answers will tell you everything about whether your board is governing transformation - or managing around it.
Because, right now, someone is likely building an AI-native version of what you do.
And they’re not asking your permission.
The Elemental AI Governance Navigator reveals where your organizational structure holds up - and where it won't - when AI changes what your customers need.
Want to see where your gaps are? Visit us on the web at ElementalAI or email me directly at fayeron.elementalai@gmail.com.
About Fayeron Morrison
Fayeron Morrison is the President of Elemental AI, a strategic advisory firm that helps boards and executives navigate the governance challenges of artificial intelligence. She is the creator of the Elemental AI Governance Navigator, a diagnostic tool built to bring clarity and accountability to AI oversight at the highest levels.
A graduate of the Stanford Graduate School of Business Executive Program in AI Leadership, Fayeron is also the author of Elemental AI, a weekly Substack publication focused on AI governance, risk, and boardroom readiness.
Beyond her AI work, Fayeron is a Certified Public Accountant (CPA) and Certified Fraud Examiner (CFE) with a long-standing career advising both public and private companies.
She lives in Newport Beach, California with her husband and their Bernese Mountain Dog, Oakley. She’s the proud mom of three grown sons and, when she’s not writing or advising, she’s likely on a hiking trail with Oakley - where she does some of her best thinking!
This article comes at such a perfect time! It's funny being born in 1999 means I absolutely don't remember Thomas Bros. Maps but your insights on silent industry transitions are so crucial. It’s incredibly relevant for us now trying to teach about the accelerating digital transformation. Thank you for this brilliant piece!