Kodak Company: Traditional and Digital Photography

Kodak’s Success in Traditional Photography

Kodak was one of the most successful photography companies during the traditional photography era. In the course of its operations, Kodak came up with innovative, effective, and efficient strategies that enabled it not only to become profitable in the short run and in the long run but also to realize its goals and objectives. During its early days of operation, innovation played a critical role in sustaining the operations of the firm. In 1884, Kodak developed a photographic film that quickly replaced the rudimentary glass photographic plates that were used in photography during that time.

Other than producing pictures that were of a higher quality, the photographic film was lighter hence enabling mobility in photography. Through market research and analysis, Kodak developed products that conformed to the needs and demands of its target market. For instance, the company introduced newer cameras that were smaller and more powerful. To keep up with market trends, the company kept on reducing the size of its photographic film to fit into the newly designed cameras that were smaller. Despite its effectiveness in operation, Kodak was facing stiff competition from rival firms. Some of these firms had products that were of higher quality. However, to maintain consumer loyalty, Kodak had an effective pricing and marketing strategy. Its products were priced at a relatively lower price as compared to its rivals. Through its advertising campaigns, the firm was successful in increasing its consumer base. As a result of its effective pricing strategies, marketing campaigns and the consistency of its products, Kodak was able to build a strong brand name during the traditional era of photography.

However, it is through research and development that the firm tremendously increased its sales and global market share. During the 1920s, Kodak commenced a research program of developing colored photographic film. After spending approximately $120 million, the company launched its color photographic film in the early 1960s. This development greatly increased its sales and market share. Furthermore, Kodak kept on expanding its product line. Between the 1960s and 1970s for instance, the company developed new products such as 126 and 110 cameras. With its new products, Kodak expanded its market base from ordinary customers and ventured into industries such as medicine and graphic arts. These strategies gave Kodak a competitive edge in photography during the traditional era of photography.

Emergence of Digital Imaging

In 1981, Sony Corporation announced its plans of introducing a digital camera that would display images on a TV screen. This development greatly threatened the survival of film photography that was the core of Kodak’s business. To keep up with the market trends, Kodak developed a division that exclusively dealt with new technologies such as digital imaging. Although the need for change was apparent in the company, its approach was poor. The company developed technologies and products that they believed will meet the needs of its consumers. However, in this entire process, they failed to gather adequate information from the market. Consequently, the company was too reluctant to move away from film technology.

Kodak realized that it did not have the skills or expertise to keep up with the changes of the photographic industry, especially with regards to digital imaging. Thus, to overcome this problem, Kodak collaborated with companies that had the resources, skills, and manpower that they required to enhance their photographic technology. By early 1990s, Kodak had developed several products that used the digital technology. In 1991 for instance, Kodak released its first digital camera that it jointly produced by Philips. Unlike its predecessors, this new product stored its images digitally on a disc. With the help of a photo disk player that the company had also produced, consumers could view images on their TVs or on their computers. However, these products were too expensive for regular customers thus they did not perform well in the market.

Consequently, the Kodak lacked an effective organization culture. Despite his innovative ideas and strategies, M.C. Fisher, the CEO of Kodak since 1993-2000, faced a lot of criticism and resistance from other managers and employees in the middle levels and lower levels of management. These individuals lacked the interest and the understanding of digital technology. Thus, his goal of converting Kodak into a high-tech company was not achievable. Consequently, the firm was involved in numerous projects that increased its overall expenses. As a result, the company lost its competitive edge to Fuji in the photography industry by 1999. Furthermore, Kodak had failed to achieve its goal in digital photography.

Kodak in 2003

By 2003, Kodak was still the leading firm in the photofinishing business. However, the company was still unprofitable in digital photography. Due to the losses that it was making, Kodak announced more layoffs in January 2003 as a strategy of reducing its operating costs. During the 1980s and 1990s, Kodak had a great potential maintaining its edge over other operators in the photography industry. To achieve this, the company would have developed products that conform to the needs and requirements of its target market. The firm would also adopt an effective pricing strategy that ensured its products are affordable to its target market. To increase its efficiency, the company would have developed an effective and efficient organization culture that embraced change. With such a system, the company would have realized the importance of digital imaging during the early days hence coming up with effective policies and strategies that would have otherwise guaranteed its sustainability in the long run.