i.

Introduction
ii. The reason Kodak fail
iii. Conclusion
iv. Case question

KODAK (case study)

Introduction
Kodak was founded by the American George Eastman in 1881 with Henry Strong.
The company originally was named Eastman Dry Plate Company, in 1892 changed
its name to Kodak. In 1888, the company manufactured and marketed its first
camera product. As recently as 1994 Eastman Kodak was among the top 20
companies in the Fortune 500. In 1996, the renowned manufacturer of
photographic film and equipment employed 145,000 workers and enjoyed
revenues of more than $13 billion. As of 2005, the workforce had been trimmed
to 51,000 but revenues still topped $14 billion. But in 2008, Kodak started to lose
their money. And in 2012, Kodak was forced to declare bankruptcy to save what
could be save. The value of Kodak is determined to be $5.1 billion in assets
against $6.8 billion in debts. So what happened to the one-time corporate giant?
Most analysts approach this question by citing the advent of digital technology –
the capacity to store and process data as computerized bits and bytes rather than
as streams of electronic signals loaded onto such physical materials as magnetic
tape or silver halide film (known as analog technology).

The reason Kodak fail

 So what is the different between the two technologies. Firstly, let’s talk about the
mechanism of operation. The mechanism of operation of digital cameras is
basically the same as film cameras, with the only difference being that digital
cameras use image capture devices instead of films. Meanwhile, film cameras still
use mechanical operating functions, although nowadays, electronics have become
popular and present everywhere. With a digital image sensor, the resolution is
calculated by the number of pixels in a specific area. Film photography technology
has no pixels and therefore the film's resolution is calculated according to the
angular resolution (độ phân giải góc). Secondly, let’s talk about the sensitive
(catch the picture in low light condition). With the camera film, the film on the
market usually have a sensitive of light (ISO) between 100 and 3,200, but they
also have 6,400. But on the other hands, the digital camera has a sensitive of light
up to 409,600. Thirdly, about the storage, in the camera film you just store it in 36
images per film roll but in digital camera they can store up to 1000 images and
you can see or delete it right away but the camera film is not.
Film cameras Digital cameras

Mechanism of The resolution is calculated by the The resolution calculated according to

operation number of pixels in a specific area.the angular resolution. Using censor to
Using chemical reaction films. capture picture.
Sensitive ISO Between 100 and 3,200, also up to Up to 409,600. The higher the speed of
6,400. light sensitivity (ISO), the better the
image quality
Storage 36 images per film roll and need to can store up to 1000 images and you
be careful to have a beautiful can see or delete it right away.
images.
Convenience Spend more money for a film and Easy to take a picture and not to
keep it carefully. Take time to take worries about the storage.
a picture

With the develop of technologies, digital camera was step by step become a
substitutes film camera and more over they didn’t expect that with the first
 “smartphone” was rolled out in the 1994 and the first camera-equipped
smartphone in 2000 was ultimately be the most damaging agent of disruption
to its core film-and camera-making business.

Conclusion
Even on the brick of bankruptcy, Kodak managers failed- or refused- to
acknowledge that many of the company’s products had been marginalized by
digital substitutions. They thought their cameras were too good in the market and
had such a large market share that they could not be replaced, so they continued
to sell those cameras without a breakthrough in innovation and if they change
their camera they would give up the comfort of dominance in an analog
technology that was facing rapidly diminishing market. Even though being a
pioneer in digital technology, but go-to-market point of view, from an
organizational prioritization vantage point, it was tethered to the 95% of revenue
coming from paper and film. And then other studios like HP, Canon, Nikkon or
Panasonic were massively selling low-priced digital cameras aimed at the masses.
Now that they were no longer able to catch up with their rivals, Kodak's
technology level was lagging to the point of no return. A hired executives said that
every time he tried to give some suggestions for changing but all of it was refused,
they conservative that it was destroying margin and value of them. Many experts
agree that Kodak's failure is largely a change in technology and a failure to come
up with a reasonable strategy. Despite an abundance of superior technology, it
was among the reasons Kodak failed to move forward. The world is moving so
much faster that no matter how strong or powerful of your brand name may be,
you have to think in terms of revolution, not evolution.

Case question
1. To help Kodak ease the severity of the conditions that led to bankruptcy:
- Changing organization structure and design: If they change their overall
design and adopt a divisional design like they can innovative in digital
 camera and also develop their film camera. They won’t lose much
revenue and maybe they will get more customer because someone like
to take a picture easily so they can use digital camera or someone like to
improve photography skill so they can use film camera.
- Changing people, attitudes and behavior: they can make an incentive to
make employees to do the work better, improve their product. In the
other hands, the managers, the staff need to open mind and accept
changing, find out new ways to improve their product. Avoiding to
conservative in one thing.
- Changing process: We see that Kodak depend on 95 percent of their
papers and films. So when they cannot sell them, they will lose the
market shares. I think they can also change the field like sell accessories
for camera, photo ink and if some technology devices like printers, lens
and everything relate to camera.

2. The failure to innovate of Kodak come from:

- Lack of resource: Innovation is expensive in terms of money, time, and
energy. Even though have an infinite resources of money but Kodak doesn’t
have enough visionary leader and employees that needs to be innovative. It
may lag behind in innovation.

- Failure to Recognize Opportunities: Although they were the first to invent

the digital camera created by Steve Sasson, they did not really invest
heavily in this digital camera. Kodak are not skilled at recognizing and
evaluating opportunities, they may be overly cautious and fail to invest in
innovations that later turn out to be successful for other firms.

- Resistance to change: Kodak doesn’t want to innovate because they don’t

want to lose the status of film camera which accounts 90 percent of film
sales and 85 percent of camera sales, and almost their revenue about 95
percent coming from paper and film. Every time former executive who was
hired want to change the company will argue that he was destroying their
margin and value.