The inconsistency of strategies under each CEO was detrimental for Kodak’s ability to compete in the ever changing environment of digital technology. Chandler and Whitmore realized the necessity of technological change, but were reluctant to move away from its old razor-blade strategy. There is a disconnection between invention team’s vision and senior manger’s strategy and as a result, the real potential of some excellent digital technologies was not realized. Fisher saw Kodak’s strength in imaging and electronics, and imposed his vision on making Kodak a high tech-company, which eventually backfired because of a lack of specialization.
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After seeing loss in hardware-based digital strategy, Carp adopted a “network and consumable”-based business model, and focused on camera, online photo manipulation and image output. To date the profitability of this strategy is uncertain while Kodak lost market share in its traditional film business as Fujifilm thrived. It was obvious that Kodak had not made a long-term vision in the digital market nor are they efficient in organizing the new digital division. They had not made the trade off decision of which areas to specialize in, but inefficiently diluted their energy and resources in all sub-markets of digital imaging.
The strategy of “do-it-all” was unsuccessful and they are yet to find a foothold in the digital market. Meanwhile, there are also corporate slacks such as the fragmented product development and sales division and lack of organization. Resistance from the middle management was also very problematic. Overall their transition into the digital market was quite unsuccessful. Q3: What should Kodak do now? Kodak needs an organizational-wide transformation in order to survive since the industry dynamic had changed completely. At the top level, Kodak needs find a right position and stay with it, to ensure the consistency of trategy. On the product end, Kodak needs to redefine its core business and shifts its focus accordingly. Kodak’s advantage lies in its R&D and brand image, they need leverage those strengths and emphasize on innovation in digital imaging market. Instead of exploiting everything, they should specialize in a few and become very good at it, or become the industry standard. Outsource other divisions and strategically partner up with corporations can provide them more flexibility and potential for growth. In another words, they need to make the necessary trade-off in order to keep an edge in the ever changing digital market.
Substitution is the biggest threat they face, so they have to be open to changes and act fast. On the corporate end, Kodak needs to fundamentally change its corporate culture. It had grown to be complacent being in monopoly in the industry for almost 100 years. The senior managers and middle managers need to change their perception about the business or Kodak needs to make necessary management team restructuring. They also need to cut slacks by reorganizing its division/function groups and set up goals and benchmark to improve efficiency. Bibliography: HBS case:Kodak
