Kodak is one of the renowned companies in the photography and camera industry. From 1992 to 2012 was a very challenging time for Kodak. This is because by this time Kodak developed several strategies to gain sustainable competitive advantages in the market, but it failed to adapt its strategy in the market. The key mistake of Kodak was that Kodak was not ready for digital photography. In addition, the digital camera market was rapidly growing in the US market since the 2000s that dramatically declined the sales of Kodak.
In this situation, Kodak could do more effective research and development and could bring more innovative products to the market to beat the competitors. Additionally, Kodak could develop growth strategies in both the local market and the international market. From the experiences of Kodak, other companies like Sony can learn a lot. They should focus on more innovation, creativity, in their products. Additionally, they should do more research and development in changing markets and customer demand. Finally, they should practice more dynamic leadership by focusing on new external environment threats like technological disruption, severe completion, turbulence, and social factors.
Table of Contents
2.0 What was Kodak’s digital imaging strategy from 1992-2012?.
2.1 Reviewing Kodak Strategic Purpose.
3.4 Business Life Cycle.
2.5 The BCG growth-share matrix.
2.6 Porter Value Chain analysis.
3.0 Why did the strategy of Kodak fail?.
3.1 PEST Analysis of Kodak.
3.2 Porter’s Five Forces.
3.3 SWOT Analysis of Kodak.
3.4 Lewin’s Force Field Analysis.
4.0 Was there a better alternative to the strategy of Kodak?
4.1 Identifying key success factors.
4.2 Internal and External growth strategy.
4.3 Porter’s Generic Business strategy on Kodak.
4.4 Blue Ocean Strategy.
5.0 What can other companies facing disruptive change in their core business (e.g. Microsoft, Sony, and Walt Disney) learn from the experience of Eastman Kodak?.
5.1 National competitive advantages.
5.2 Foreign Entry Strategies.
5.3 The new external environment of business.
Eastman Kodak is running its business activities as Kodak. Kodak is a multinational company of films, photofinishing, and photography equipment. This company launched its business activities in 1880 (Kodak, 2012). Kodak was considered as a film company before the year 2011. But additionally; this company offers various digital cameras and related photography equipment to the customers (Gavetti, 2011).
2.0 What was Kodak’s digital imaging strategy from 1992-2012?
2.1 Reviewing Kodak Strategic Purpose
Firstly; in this section, the Vision, Mission, and Corporate statement of Kodak are mentioned below (Kodak, 2012).
|Vision||Our future is to be the World Leader in Imaging (Kodak, 2012)|
|· To establish the firm in the global world and ensure the top position|
· To ensure better customers services by helping them to capture, store and communicate pictures as memories anywhere and anytime
· To ensure the world-class quality of products and services
· To develop world-class skills of the employees to sustain in the global market. (Kodak, 2012).
|Corporate statement||The prime corporate statement of Kodak is to engage employees, shareholders, and other constituencies globally. (Kodak, 2012).|
|Kodak Value||Kodak’s value consists of the dignity of the individual, uncompromising integrity, trust, credibility, continuous improvement and personal renewal, and recognition and celebration. (Kodak, 2012).|
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According to the above figure; it has found that Kodak is trying to establish the firm in the global world and ensure the top position (Newsmax, 2012). In addition; Kodak is trying to develop world-class skills of the employees to sustain in the global market (Daneman, 2014).
3.4 Business Life Cycle
According to Freeman (2010), Business Lifecycle is defined as the phases of the life of a business. The following figure is shown the development of the life cycle of Kodak.
According to the above business life cycle of Kodak, it has seen that Kodak has to develop a new strategy in the growth stage and it is very important to prove that new strategies are needed in the growth stage for running the business in the right track to the stakeholders of Kodak (Daneman, 2014).
2.5 The BCG growth-share matrix
Boston Consulting Group has developed a growth−share matrix to measure the competitive and strategic condition of an organization in the market (Lynch, 2009). According to this matrix; the business firms’ competitive advantages are measured on the basis of two dimensions. One is the market growth rate and another is relative market share. In addition, the growth-share matrix has four quadrants including question marks, stars, cash cows, and dogs (Kotler et al., 2014).
Figure: The BCG growth-share matrix Source: (Kotler et al., 2014)
Firstly, Kodak was considered as a photography industry. The common people were known Kodak as “Big Yellow” due to the film packages. Up to 2000, the main earning source of Kodak was the film section but not on the digital camera (Waters, 2012). In the following figure; the strategy of Kodak’s strategy and the successful history of strategy on the various product lines are shown:
The sales opportunities of the products of Kodak according to based on the growth-share matrix are summarized below:
- Kodak film: In 2003, Kodak gained recorded cash cow (about $8billion) of its film (Mui, 2012)
- Kodak digital cameras: Kodak digital cameras are also considered a good earning source. Kodak was selling its digital cameras for about $1 billion in 2003. After that; the growth of sales were increased by 30% in 2006.
- Kodak printers: Kodak printers are also considered as an earning source of Kodak. Kodak was produced more than 82 percent of digital prints in 2003 that were considered as stars in the BCG growth-share matrix (Stevens, 2012).
- Kodak self-service kiosks in retail outlets: In 2003, the growth of self-service kiosks of Kodak was 1% of the total market in printed pictures (Beth, 2013).
2.6 Porter Value Chain analysis
According to Hunger (2016), Porter’s Value Chain is an important weapon to find the important and non-important functions of an organization that affects the firm success and competitive advantages or not. Porter mentioned nine tools. Among them, five functions are considered as ‘primary functions and the remaining four are considered as support activities. These are shown in the following figure:
Kodak Firm Structure: Normally; the structure of Kodak was vertical. This company has given importance to its print imaging business (Kodak Annual Report, 2012).
HR management: The employees’ number of Kodak is normally in a decreasing trend. Kodak was reduced its number of employees from 64,000 to 17,000 due to various reasons including the use of technology and dissatisfaction of the employees (Kodak Annual Report, 2012).