Mosaic…*I Couldn’t find the Inkjet Camera…so I have their most recent digital camera there. It’s a Wi-Fi enabled camera to make sharing and syncing photos much easier with home networks, wireless printers, e-mails and social media sites.
What happened?While Kodak suffers, its long-time rival Fujifilm is doing rather well.Despite its hefty investment in research, a rigorous approach to manufacturing and good relations with its local community—Kodak had become a complacent monopolist.Meanwhile, Fujifilm diversified more successfully through several M&As, an expensive reorganization, and restructuring of its business model. The two firms have much in common:Both enjoyed lucrative near-monopolies of their home markets: Kodak selling film in America, Fujifilm in Japan.Both firms saw their traditional business rendered obsolete. - But whereas Kodak has so far failed to adapt adequately, Fujifilm has transformed itself into a solidly profitable business, with a market capitalization of some $12.6 billion to Kodak’s $220m.Both saw change coming:Larry Matteson, a former Kodak executive who now teaches at the University of Rochester’s School of Business, recalls writing a report in 1979 detailing how different parts of the market would switch from film to digital, starting with government reconnaissance, then professional photography and finally the mass market, all by 2010.Fujifilm, too, saw omens of digital doom as early as the 1980s. It developed a three-pronged strategy: to squeeze as much money out of the film business as possible, to prepare for the switch to digital and to develop new business lines.Both firms realized that digital photography itself would not be very profitable. Kodak, however, was slow to adapt.
Kodak did not fail because it missed the digital age. It actually invented the first digital camera in 1975. (Very similar to vacuum tube TV companies example from CC’s talk, where the big companies spent the $ on R&D and had the transistor tech, but failed to competing against non-consumption)However, instead of marketing the new technology, the company held back for fear of hurting its lucrative film business, even after digital products were reshaping the market.Classic B-School case study of a failure to keep up with technological change-There were a number of steps along the way to change position or direction-Instead, Kodak stuck with what they did, and wound up where they are as a result.Sticking to legacy business is fine until you realize that your legacy business doesn’t have a future!
What Happened to Kodak?
What happened to Kodak?1.Undercutting of film business by lower cost competitors, i.e., Fujifilm2.Rise of digital photography, and a failure to adapt quick enough3.Rise of smartphones Kodak acted like a stereotypical change-resistant Japanese firm, while Fujifilm acted like a flexible American one.
What to learn from Kodak?• Kodak made a classic mistake: it didn’t ask the right question.• It focused on selling more product, instead of the business that it was in - story telling.• Believed that it could protect its massive market share by relying on its brand strength alone.• Feared self cannibalization, and was resistant to change.