[1] Anecdote.
However, the bottom line is that it would probably have been very difficult for even the most brilliant management to replace the film, photo paper, and chemicals consumables business. That revenue basically doesn't exist in the digital world unless maybe you count inkjet ink--though that's trending down too.
Fujifilm did end up doing OK by, among other things, applying their film making expertise to other industries like medical. But they had a tough run too. [1] The film business fell off a cliff that made CD sales look like a gradual decline.
[1] http://www.economist.com/blogs/schumpeter/2012/01/how-fujifi...
Most people today can't comprehend the scale of American manufacturing as it still was at that time. The Elmgrove plant where I worked (one of a dozen facilities in the Rochester area) has over 14 thousand employees. Our start and end times were staggered in 7 minute increments to manage traffic flow.
That none of that would exist 20 years later was inconceivable at the time. The word "disruption" wasn't in business vocabulary. Nor was the phrase "made in China". Some senior technical managers saw the "digital" writing on the wall. But what could they do? What could anyone do? There was no way to turn that aircraft carrier on a dime.
There was no business model in digital cameras that would employ 100 thousand engineers, managers, factory workers, technicians, and staff.
(That said, Fujifilm provides an existence proof that Kodak could have, however painfully, probably navigated this with better management making better choices.)
I live in Rochester - Kodak was literally one end of the entire city; the scale of the operation was huge.
What I regret was that it was a good place to work, though I was never there. Car dealerships would plan annual sales around bonus time at Kodak, and retirees had health care for the rest of their life, for instance.
I'd say less size than diversity. Conglomerate aren't subject to this and still preserve a lot of the benefits of size (although as GE Capital shows... that can go badly too if not risk-managed).
Another thing they did was carve out a very nice niche for themselves with their X-mount cameras. They've done quite well in part because the in-camera processing engine does a good job of emulating a lot of the old Fuji film stocks (as well as making very nice cameras that offer something different to the canokin mill).
I don't know how much money they make off that line but they've done a nice job of it to the point where I don't use my DSLR very much unless I'm shooting action or need either ultrawide or telephoto lenses.
I believe that photo-chemical prints are better and longer lasting than any inkjet (anything really other than dye transfer and offset printing), but they didnt get digital cameras out there fast enough, and couldn't let go of the film based model.
But I feel like if your business is a mature process based around a singular need, having a future disruption department to keep tabs on the market and feed back into high level management should be de rigueur. Innovating amazing and critical components of digital cameras and then spending $5B to buy a drug company in 1988 deserves to get you some future flak on your corporate leadership's decisions.
