Case Study, Kodak

Case Study Report

Case Study On Kodak, What Went Wrong? Patricia A. Webster Oklahoma Wesleyan University

Introduction

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This case study will analyze what areas of failure caused Eastman Kodak to continue to have continued underperformance and misalignment within the company’s operations. There were four serious counts of corporate failure on the park of Kodak’s strategic planning and decision making.

The analysis will review these failures, recommendations for change will be discussed, and clear explanations as to why the wrong decisions lead to the failure for growth will be reviewed. A conclusion will discuss how Kodak has managed to survive despite the bad corporate decisions and how the company must reconsider the majority of the recent strategic choices they have made. Strategic Analysis George Eastman founded Eastman Kodak Company in 1880. Within four years Kodak had become a household name after he replaced glass photographic plates with a roll of film.

His decision regarding the company’s philosophy was to focus on quality. He stated, “Nothing is more important than the value of your name and the quality it stands for”. By 1963, color prints surfaced by this company. By 1981 they launched new product lines including cameras, graphical arts, and medical imaging. Their top sales tripled to $10,000,000,000 at that time. Kodak’s performance today is in trouble, sales are drastically falling, the company’s profit margin had declined to a staggering 3% in 2005.

The chairman of the shareholder’s stepped down that year conceding a disappointing performance all-around. Due to declining economic environment in this country the company continues to fall. Several corporate failures have contributed to the spiral downward. The connection between logic and creativity was not present. They failed to jump on board with the digital age and technology at the beginning of its era. Next was the lack of strategy between revolution and  evolution and the strategy it called for.

Kodak did not realize the importance of the strategic planning needed to move ahead and attack the changes the company needed. Kodak could have addressed the change by evolutionary means by slowly adapting business strategy incrementally since the beginning of the digital age in the 1980’s, but they did not and this lead to great demise of the company. Also important was the lack of marketing and resource strategic planning. The leaders should have addressed the multiple levels of relationships between resources and practices that exist within a business.

Finally and one of the most important factors was the lack of focus on the competition. Very little strategic planning was performed in regards to the competition of other technologic corporations. Solutions, Recommendations, Conclusion Despite continually reports of poor financial forecast, Kodak has managed to keep afloat by handing on to the traditional razor-blade model of analogue technology. The company’s CEO, George Fisher recognized the validity of the digital world. So the company needs to grow on that new insight.

Marketing will need to broaden their horizons, even crossing oceans and opening new ventures in the Eastern markets and beyond. Kodak should take advantage of the disparate demands of consumers around the world. Strategic review and planning should involve knowledge of their competitors. Knowledge is power, Kodak’s greater insight and understanding of other corporations such as their own will lead to more enhanced strategy and planning for its future. The key now is to build a global strategy that can continue to exploit both the older and new generations.

References

1. Brickley, J. , Smith, C. & Zimmerman, J. (2009).
2. Managerial Economics and Organizational Architecture. (5th Ed. ). Boston, MA: McGraw Hill Irwin. Hamel, G. (1990).
3. The core competence of the corporation, Harvard Business Review. May- June, pp. 79-91. Kodak, 1985. Annual Report, Eastman Kodak Senge, P. (1990).
4. The Fifth Discipline: The Art and Practice of the Learning Organization. New York, NY. Currency Publishing. Wit, B. & Meyer, R. (2004).
5. Strategy Process, Content, Context. Chicago, IL. Thompson Learning.

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