How did Fuji survive the shift to digital?

My latest article from Substack on Navigating Uncertainty

One of my big business heroes is a guy called Minoru Onishi. He was President & CEO of Fujifilm for a remarkable 23 years. And he set them on an upward success curve that continues to this day.

When he took the helm of Fuji in 1980, though, things didn’t look good. The price of silver had skyrocketed thanks to some dodgy dealings on Wall Street and, with silver a key ingredient in photographic film, this had a terrible impact on the market. Fuji wasn’t the only company in trouble: the price hike impacted the rest of the industry: including Kodak, the dominant company with 90% US market share.

Luckily the silver crisis was short lived, and the price returned to normal. Most film companies, including Kodak, breathed a sigh of relief and just returned to business as usual.

Fuji gets future ready

But Fuji didnt return to normal. Onishi, like many of us in senior positions, liked to be in control. He realised that, if something as unexpected as a stock market battle could impact sales so disastrously, other random events might do the same. He didn’t want to be caught off guard like that again. He decided he needed to change the way Fuji did business. To prepare them for any disruptions that might occur. It took a few years but he succeeded.

When digital film launched in the early 1990s, it devastated the traditional film industry. Kodak was so badly unprepared it was unable to survive the trend, and ended up filing for bankruptcy. Not Fuji. Thanks to Onishi, the company was able to successfully transition to the new medium. It doubled its market share, tripled its profits and set off on an upward trajectory that continues decades on.

So, what was it that Onishi did that was so effective? I believe his approach should be studied by anyone trying to prepare themselves for an uncertain future. It offers a blueprint for company culture and organisation in our volatile new world.

Fuji was open to change

The first thing Onishi did was to make Fuji more open to change. Like many companies today, Fuji back then traditionally saw change as a negative. A threat not an opportunity. Onishi changed this, putting systems in place that encouraged employees and managers to see volatility in a more positive light and embrace it. As a result, when digital hit, company employees weren’t a brake on change, they were an accelerator, enabling a smoother transition to digital than for any other company in the industry.

Creating a change-friendly culture is not an easy task. It’s not enough to just add a few buzzwords to the annual report. Companies need to shift their metrics for success: making an ability to change a core competence. This means incentivising and rewarding flexibility and risk. Ensuring people are assessed for promotion and bonuses based as much on their innovative skills as their ability to reach targets. We can take some of the tricks we’ve learned from change management programmes and upscale and embed them deeply enough in company culture, they don’t just get forgotten at the next quarterly earnings meeting.

The process requires a new approach to leadership too. As Microsoft’s Satya Nadella says, management will need to transition from know-it-all leaders to learn-it-all ones. They’ll also have to get used to creating open-ended, adaptive strategy: one goal but multiple, optional routes. It’s not easy, of course.Being vulnerable and open to advice is quite an ask for leaders who’ve been trained to be strong and unwavering. But it’ll be key to success in this new world. According to McKinsey, companies with an open leadership approach are twice as likely to succeed financially in a time of uncertainty.

Getting ready for anything

The next thing Onishi did was to get the company ready. He built a future scanning function into the company, to monitor developments in technology and the economy. He also put systems in place designed to identify and develop new revenue streams from any opportunities they discovered.

Like Fuji, companies that want to be “ready for anything”, need to maintain both an Alert system and a Response system. The alert system monitors developments in both the outside world (what’s the latest technology, where might the next geopolitical flashpoint be) and customer needs. In chaos, the latter is especially important, providing a North Star, a direction for strategy when everything else is uncertain. The alert system will also benefit from practising Upside Risk Management. Focusing the Risk function as much, if not more, on seeking opportunities as on avoiding threats. And building a closer relationship between the Risk and Insight/Foresight teams.

It’s vital to know what’s coming, but on its own it’s not enough. Companies also need to be ready to act on whatever is discovered. In a future-ready company, when an alert system identifies a new opportunity, the response system kicks in. They have a team ready to analyse it, check its viability for your company against core strengths. Others to identify, prototype and trial new products or services based upon it.

A smart response system also requires speedy decision-making. This is best achieved through decentralisation: flatter hierarchies, shorter decision-making trees, fewer silos, more semi-autonomous teams. Empowering front-line management to make high-stakes decisions without having to wait for three levels of committee approval. According to one poll, efficient decentralisation can reduce product launch and development times by an average of 30%.

Netflix offers a good example of a decision-diverse organisation. They have an anti-rules philosophy that champions “freedom and responsibility.” Removing traditional bureaucratic barriers, helps the employee on the ground navigate quickly and safely through changing market dynamics. It was a policy that enabled them to transition successfully from DVD rentals to streaming and then content production. Some banks, like Barclays and ING, have also built a more autonomous, team-based structure into their organisation.

Daring to diversify

The final part of Fuji’s make-over was diversification. The company was almost entirely focused on camera film, but in-depth studies identified an adjacent sector that might work for them: healthcare. X Ray and CAT scan production was a good fit for the company’s core skills. Their move into this area meant that when digital hit, the company had alternative revenues that kept them solvent during their transition to digital.

The need to diversify is a lesson that was made brutally clear during Covid. In a volatile environment, you need a second string to your bow. If Disney and Uber hadn’t diversified, Covid could have destroyed them both. Luckily, Uber had UberEats and Disney had Disney+. So when travel restrictions decimated the number of taxi hires and theme park visits, the subsequent demand for take away food and great home entertainment helped them survive.

In volatile times, it’s important to diversify outside of products too. Obviously, in such a volatile geopolitical climate, it’s important to diversify both supply chains and types of materials. The workforce should be considered here too. In an environment where economic boom or bust can arrive with little warning, it’s also worth diversifying hiring practices. Employing a greater proportion of freelance, contract and consulting staff means that, if times are lean, you can downsize without requiring a raft of employee layoffs. That way you build what I call a Concertina Company: that can contract or expand based on economic movement. Plus, in a time when you’re constantly on the lookout for new markets to shore up the potential loss of traditional ones, a diverse range of employees is a valuable tool. That way, if you need input on a new market, you’ll likely already have some senior staff familiar with them.

Amazon’s launch of Amazon Web Services and Apple’s transition from pure hardware to software and subscriptions like Apple Pay, iCloud and Apple TV are great examples of future-proof diversification. So too is General Motors, whose experience working on electric cars has helped them shift into two entirely non-core sectors: industrial energy storage and household solar batteries.

ORD-er out of chaos

Onishi’s three-step approach was the reason Fuji survived the shift to digital when many of its peers did not. But it did more. It also helped them sail successfully into the future, safely navigating the other disruptions that came their way. It’s in no small part thanks to Onishi that Fuji is so successful today. In fact, 2025 was the company’s most profitable year ever.

The approach can also provide a blueprint for any company trying to navigate an uncertain, disruptive world. Those feeling a little disorientated should look at creating a version of Onishi’s plan that works for their own company. It’s not a quick fix – it’ll take time, effort, trial and error – but it’s a great foundation to start building a truly future-ready organisation.

If we’re to succeed in tomorrow’s increasingly chaotic world, we need to remember Onishi and be ORDered: Open, Ready and Diverse