Kodak, which ruled the imaging industry through innovation for more than a century, found itself facing tough times in the early 2000s. The company lost focus by diversifying into many products and also failed to keep in touch with the changing needs of the consumers. Though a pioneer in the digital space, the company failed to take the initiative and capitalize on the digital business due to fear of cannibalizing the existing product lines. The company slowly started moving into the digital space but found that it was too late and the competition had become formidable. The company realigned its business model and brought in top executives from outside in a bid to recapture lost ground.
» Understand the Kodak story.
» To analyze how business models have to change over time to keep abreast of the changing consumer tastes. » Analyze the rationale for Kodak's poor business performance in recent years. » Understand and explore the reasons behind Kodak's fall.
The third quarter of the year 2003 was drawing to an end when iconic brand Eastman Kodak Company (Kodak) decided to shift its focus away from its more than century-old traditional film business to the digital one. The company believed that this shift would boost sales, which had fallen by 5.14% to US$12.5 billion in 2002, to US$16 billion by 2006 and further to US$20 billion in 2010. Daniel Allen 'Dan' Carp (Carp), Chairman and Chief Executive Officer of the company, said, “We are acting with the knowledge that demand for traditional products is declining, especially in the developed markets. 5
| Given this reality, we are moving fast - as digital markets demand - to transform our business portfolio, with an emphasis on digital commercial markets."
According to an industry observer, the shift began in the first quarter of 2003 itself when the company realigned its leadership team and began hiring top leaders with experience in...
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