Bankrupt Kodak seeks to pay $13.5 million in bonuses.

[Chris_Brown]

Eastman Kodak Co. is seeking permission to pay about 300 executives and other employees a total of $13.5 million in bonuses to persuade them to stay with the company as it reorganizes under bankruptcy-law protection.

The Rochester-based photography company said the targeted employees have knowledge and skills critical to help the business emerge from Chapter 11 and would be difficult to replace if they left to pursue other offers. They include 119 middle managers who would share $8.5 million of the sum. The request for bonuses was included in an employee continuity plan outlined by Kodak in a U.S. Bankruptcy Court filing in New York this past week.

It isn't much in today's world of bank executive bonuses, but it still appears odd and improper. If it helps retain those who will guide Kodak out of bankruptcy is one thing, but will it help revive Kodak to a strong company is the real question.

[ckimmerle]

So, they want to pay bonuses to keep executives who, through sheer ignorance and lack of foresight, ran into the ground a once well-respected and prosperous company. Genius.

[Rob C]

So, they want to pay bonuses to keep executives who, through sheer ignorance and lack of foresight, ran into the ground a once well-respected and prosperous company. Genius.

It's the New Age, Chuck, the way of the modern. Succeed and you get a bonus; fail and you get one too. Just like some educational changes going on in the UK where everybody leaves school with a piece of paper called a certificate. Though I don't think that I've seen it referred to as such, I suspect it's part of our new Human Rights philosophy.

Some universities are having to introduce special classes for their new students in order to bring them up to speed with reading and writing... imagine a time like now, where you can actually get a university place without basic communications skills. It could never happen!

Rob C

[Robert Roaldi]

It isn't much in today's world of bank executive bonuses, but it still appears odd and improper. If it helps retain those who will guide Kodak out of bankruptcy is one thing, but will it help revive Kodak to a strong company is the real question.

Don't worry, the free market will fix this.   

[Justan]

It isn't much in today's world of bank executive bonuses, but it still appears odd and improper.

I don't understand why you find it improper. Do you suggest they show everyone the door? Do you think that experience is  valuable?

If it helps retain those who will guide Kodak out of bankruptcy is one thing, but will it help revive Kodak to a strong company is the real question.

Both of your suppositions amount to good questions. I’ve seen some groups who fire all top and mid management and the results are chaos. It costs a lot to not have to re-create the wheel, so to speak.

Finding a direction to go after bankruptcy is a different subject, but that too requires experienced people at nearly every level.

[Chris_Brown]

Finding a direction to go after bankruptcy is a different subject, but that too requires experienced people at nearly every level.

I wonder what Kodak will attempt. About a year ago they wanted to re-label themselves as a "printer-based" company, whatever that meant. I visited their Rochester plant in 1989 and the film operations were in full swing. It was a huge operation, with their own paper plant, chemical plant, three fire stations and a landfill that caused them major grief. Even though they saw the change to digital coming, they never substantially transformed the company. It will be interesting to see what their management proposes.

[Justan]

Thanks for the link, it was an interesting read. I knew that Kodak did a lot of chemical processing but had no idea how toxic and destructive their processing facilities are. It appears that bad design was part of their corporate ethos for some time. I bet the costs of the clean-up, combined with a market that declined faster than a building being pushed off a cliff, contributed towards their bankruptcy. I have to wonder how much of the clean-up they are escaping through the bankruptcy process.

That aside the article points to a roughly 50% processing production decline over a 5 year period ending in 2008. We all know that the rate of migration did not slow since 2008. That infers the story pretty well.

> I wonder what Kodak will attempt

I don’t know what they will do but hopefully they will employ a small army of independent consultants along with a newly formed board and oversite by the bankruptcy court, and assemble a plan.

For the fun of speculating a little, certainly a lot of consumers would embrace the idea of Kodak printer paper. That would probably be a hit on the consumer and maybe some corporate markets.

I don’t know if there are enough users of their traditional photo films and chemistries for them to produce all aspects, or if they will outsource the production as they continue to farm this group of patented assets.

If they were to make printers (and ink carts) they could probably carve out a market share if they went after the consumer market. But most consumer printers are pretty inexpensive so it is a very competitive field. The corporate market for printers would be more difficult for them to get a foot hold.