THE UPHILL BATTLE AT

EASTMAN KODAK

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Submitted By:

Group-7

14202104 ELSON JENA

14202108 ALIYA SIZRA

14202116 AKASMIKA BISWAL

14202114 SAURAV MISHRA

14202100 DIVYASHREE BHARATI

14202118 PURNENDRA SHRIVASTAVA

Content

• Company Overview

• Product line

• External Factors Analysis

• Internal Factors Analysis

• Kodak Strategy

• Question & Answer

• Conclusion

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Company Overview….

1879: George Eastman invented the dry-plate process

and filed patent for a machine that coated dry

photographic plates

1880: George Eastman established the Eastman Dry

Plate Company, at Rochester N.Y.

1884: Introduced paper roll film

1889: Invented perforated celluloid film

1900: The Brownie box camera went on the market

with a price of $1

1935: Introduced color film

1960: Brought the Instamatic camera to the market

1970: Major sales growth for Kodak. Concentrates on

film and basic cameras

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Company Overview….

Cont…1980: Fuji emerges as a serious competitor

1994: Kodak abandoned its non-imaging health-related

businesses began to invest in digital imaging

products for medical practice

1997: Kodak was a high-cost manufacturer with a

growing portfolio of digital products which was

losing hundreds of millions of dollars annually

1997: Restructuring that eliminated 19,000 jobs and cut

more than $1 billion from annual costs

1999: Kodak entered the digital radiography market

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Kodak Product

• Four distinct sub-product

– Digital cameras

– Home printing

– Online services

– Retail kiosks and mini-labs

External Factors Analysis

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• Huge capital & specialized

• Not relay on any company

Low switching cost

Low price of substitutes

High bargaining power

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• Rapid decline in demand for traditional

photography equipment in developed

economies

• Rapid growth in demand for digital cameras

in developed economies

• Steady decline in demand for film and photo

processing

• Development of new imaging technology

such as photo-enabled wireless telephones

and high-megapixel digital cameras

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Key Success Factors

• Technological capabilities

• Rapid design-to-market cycle times

• Reputation for producing high-quality consumer

electronics

• Reputation for producing high-quality optical

devices (cameras, binoculars, microscopes, medical

equipment)

• Distribution network that includes large electronics

chains and local camera retailers

• Involvement in multiple segments of the industry

value chain—camera production and sales, printing

supplies, professional photo processing

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Internal Factors Analysis

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Value chain pre digital age

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Image Capture Processing

Projection

Printing

Storage

- Film Camera

- Video Camera

- Retailer

Processing

- All Retail Stores

- Reprints

1. Managing the traditional film business

2. Leading in distributed output

3. Growing the digital capture business;

and

4. Expanding digital imaging services

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Reason For Failure

1.Core competency became core

rigidities

2.Lack of market research

3.Late mover of digital photography

4. Innovation and transformation Failure

5.Unwillingness to change

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Kodak FUJI

Market leader initially Gained considerable market share in US by aggressive marketing

Higher prices Slashed prices to compete

Defensive strategy Offensive strategy

Compatible only with Kodak products

Compatible with Kodak Cameras & Films

Strong distribution network Distribution network is good for Digital Industry

Failed in Japan, lower market share in Japan

Higher market share of FUJI in US in comparison

Stronger Brand value Brand not as strong as Kodak

Better Technology Technology not as good as Kodak

Q.1 How has the environment affected

Kodak ?

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-Kodak delayed in realizing that Digital

business is the way to go in the future.

-Kodak’s vision of digital photography is not

ready since the company is not yet prepared.

-Hence, they should start this on small scale,

& thus, not sell Kodak health and home

product division for paying debts.

Q.2 Describe Kodak’s Culture in

detail and solution ?

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• Discontinue unprofitable products.

• Change middle to high-level management

• Launch new and innovative product

• Move to another business segment such as

movie and entertainment

• Focus on high potential products– Kiosks and mini-lab

– Online services such as photo printing and sharing

• Emphasize on niche market i.e. medical market

and professional

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Q.3 If you were hired as a consultant by

Kodak’s board,

what recommendation would you make to

improve the company effectiveness ?

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Recommendation:

1) Plan to establish new Plant in developing countries.

2) Develop core competency inexisting products & markets.

3) Outsource Digital Business & maintain existing Easy Share System

4) Focus traditional photography & films in current & emerging markets & reap the maximum cash.

Conclusion

• Great example of strategic failure.

• Different models and theoretical concepts were

applied to identify key factors that have led the

company from where it was to where it stands

today.

• Lessons we can learn:

• External environment can be deceiving

• Change happens

• Greatest strength can be weakness

• Innovation is not the perfect solution

• Its not all over till its over

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Thank you

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