Kodak's Decline

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| 2013|
| Oxford Brookes University
Thomas de Kerchove 12083686
P58502: Richard Mohun24th of April 2013|

the management of innovation and change :|
Case study : Kodak and the Digital revolution|

Table of content

1) Introduction:3
2) Increased competition (1975- ):4
2.1) Change challenge (Diagnosing)4
2.2) Kodak’s reaction (Enacting)5
2.3) Critical analysis (Explaining)6
3) Lack of communication and the cultural change:6
2.1) Change challenge (Diagnosing)6
2.2) Kodak’s reaction (Enacting)7
2.3) Critical analysis (Explaining)9
4) Digital technology and its disruption of the film business9
2.1) Change challenge (Diagnosing)9
2.2) Kodak’s reaction (Enacting)10
2.3) Critical analysis (Explaining)11
5) Conclusion:12
6) References:14
Internet sites:14

1) Introduction:
To start this assignment about Kodak, a short introduction of the company is needed. I will then focus on the 3 most crucial challenges Kodak had to face during the 1975 - 2012 period. Every change goes through 3 phases that I am going to describe by using the enquiry-action framework (Beech et al., 2012). For every change challenge, I am going to delineate the problem and the change needed (Diagnosing), explain Kodak’s reaction (Enacting) and analyse it critically (Explaining). Finally, I am going to conclude by proposing some recommendations on how they could have avoided this disaster. Eastman Kodak was created in 1888 by George Eastman, who has set out the values of the company from the start. Kodak is an American multinational specialised in photographic equipment. George Eastman created the push-button photography and Kodak established its hallmark easy-to-use camera systems. At first, it was only a film and camera retailer but it then diversified into the Chemical and the Pharmaceutical industry (Cavetti et al., 2005). Kodak has been successful for decades by following the razorblade strategy which was characterized by low margins on the camera but high ones on the consumables such as the films and the paper to print out the photos. It was doubtless the bread and butter of the company. Kodak’s supremacy was as strong that in 1976 that they had a 90% market share in the USA (Neate, 2012). Unfortunately, due to unexpected and unpredicted changes, things started to turn around slowly but steadily from 1975 until nowadays. Several reasons lead to the unstoppable collapse of Kodak. Indeed, Kodak struggled financially because of a decline in sales of the photographic films due to the high competition with the Japanese company FujiFilm. Another reason was the difficulty to transition to digital photography that went along with a cultural problem in the company related to a communication problem amongst the different levels of management of the company (Robertson 2012). The aim of this assignment is to diagnose the key challenges faced by Kodak between 1975 and 2012 and to critically evaluate Kodak’s reaction to those specific changes. In other words, I will throughout this paper, try to find out why and how the dominating Kodak ended up filling for chapter 11 bankruptcy on Januray 19th 2012 and what they might have done in order to avoid it (Reuters, 2012). In the main part of the assignment I will discuss 3 main challenges Kodak had to face and analyse their actions by linking the theory with some critical thinking on some additional research. To have a complete and distinctive picture of Kadak’s history and challenges, I thought the best option was to divide it by the three main change challenges they struggled the most with. The first one would be from the growing competition with FujiFilm. The second one is Fisher’s period (1993-2000) characterized by a cultural change at Kodak and the division of the film and the digital photo industry. The last one is the period of the emergence of the digital technology as a disruptive technology. In some...
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