A New Strategy For Kodak Essay Example
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Various objectives have been established by Eastman Kodak that are considered to be critical to achieving the competitive business advantage in the competitive cloud business sector. On the mainstream level, the company has been able to sustain its competitive advantage in the technological developments and advancement. The cloud service industry has recently witnessed the development of new technologies, for example, digital imaging.
The Eastman Kodak main aim is to achieve a first mover advantage in the field of the latest technological development. Any business that becomes the first company to launch a new product in the market is able to gain market share along with customer loyalty and brand credibility that is established due to the quality and originality of the product. Second, the main objective and focus of the Eastman Kodak is mass production of products (Amit & Zott, 2012).
The company has been operating for decades and is a well-established brand in many countries. Hence, it is imperative to achieve mass production of the product to reap economies of scale and service its local and international clientele. Mass production is also significant if the company has to maintain its overall annual profitability. The main product of the company is its silver halide photography that maintains the main share of the company.
The industry Eastman Kodak operates in requires that the cost of production should be reduced and kept at the lower ends, and this is another major objective of Eastman Kodak. From the case, it is clear that Eastman Kodak competitors such Fuji in Japan has been able to maintain lower product prices. This makes it even more significant that Eastman Kodak identifies ways to cut its cost of production and be able to maintain this lower cost in order to remain in the market.
The fourth objective of Eastman Kodak is to advertise the product in a comprehensive manner. Since the company has been operating for decades, it has been able to develop a strong brand image and goodwill. With the rising competition and especially the companies that have an advanced approach towards digital imaging, the brand image, and advertising of the company has been considerably neutralized. Hence, it is important that Eastman Kodak invest in advertisement to maintain its reputation and brand image. Lastly, the domestic market in which Eastman Kodak serves is also saturated and the company intends to expand the international market. When the company will penetrate the international market, it would increase its customer base and also enhance its productivity level. The company can also access developing countries and capture a huge market share in these countries (Amit & Zott, 2012).
The implementation of vertical and horizontal integration strategies are significant for the competitive business environment.The vertical integration helps in reducing the cost of producing the products with the formation of joint ventures with different partners in the supply chain. On the other hand, the horizontal strategy helps in reducing the competition by acquiring the competitors (Boone & Kurtz, 2012). In the initial phase, the Eastman Kodak heavily invested in the horizontal integration as there was extreme competition in the cloud service industry. The company was unable to compete with other competitors in the field of digital imaging. Hence, it was imperative that it engages in various acquisitions to implement the horizontal integration strategy successfully.
The implementation of the vertical integration strategy was effective in sustainable competitive advantage. Most importantly, the company has been providing itself with the chemicals and plastics that were considered a significant material in manufacturing film. The concept of vertical integration was effective to reduce the cost of production and offer a competitive price to the customers. It is recommended that the company implements diversification corporate level strategy in order to maintain a competitive advantage within the industry. The traditional products that are being used are now obsolete, and new technology has been introduced and even the area of digital imaging is turning out to be problematic to penetrate into. Hence, it is important that the company should expand into international markets and launch a new product. Novel ideas and concepts should be launched that are not available in the markets. Related diversification will be beneficial for the company’s success.
The multi-business model diversification strategy can be seen in several ways. The company can pursue this strategy with the help of horizontal diversification and help increase the profitability of the company. The horizontal strategy helps in reducing the competition by acquiring the competitors and expand the product portfolio with new products and services. As a result, the sales will increase and the number of existing, and new customers will also rise in the target market segment (Coulson-Thomas, 2013). It is also possible that Eastman Kodak exerts power upon new industries with its competencies. For example, a company acquires a mobile communication business, restructures it and support it as its own business.
Second, this model can also be pursued through backward vertical strategy. This might involve investment in supply of raw material for itself and other companies that are operating in the cloud service industry. Third, the forward vertical strategy can also be implemented here. Since the company already has an international presence, it can provide products of other companies under its own brand name. This will also help to improve the profitability of the company. Fourth, the company can continue using this model through geographical diversification. Even though the company has strong international presence, but emerging markets like Brazil and India are still not explored. The expansion beyond the local market can turn out to be a challenging task, but if the company utilizes its resources using the geographical diversification strategy – it will turn out to be beneficial (Coulson-Thomas, 2013).
The implementation of an effective strategy is important so that the company is able to rejuvenate itself, despite growing level of competition in the company’s portfolio. The implementation strategy that is highly recommended in this case scenario is all-inclusive strategy.When this case was read comprehensively, it was clear that the autocratic style of leadership has been followed and applied in all aspects of the company. The senior managers have the position and are given the responsibility to make the final decision and to identify which strategies are to be implemented. That this strategy has been recommended involves a flat organizational structure that allows for more innovation and creativity (Hill & Jones, 2013).
Since many employees have been serving the company for a long time now, they are more experienced in using the cloud service industry than other people. This opportunity will help them to identify the threats and weakness in the sector and help the company to capture and capitalize on the available opportunities. It is important that the company structure should be more collaborative in nature because the old hierarchal structure repressed the productivity level. All inclusive implementation strategy will help the company promote and encourage employee collaboration system in order for the company to succeed. An all inclusive implementation strategy would develop an open system that may help both the internal and external stakeholders of the company.
The implementation strategy and the corporate level strategy will support the ethical business practices of the company. The diversification strategy that has been discussed earlier helps to promote the ethical business practices within the company. With the help of horizontal diversification, the ethical business will be promoted because the competitors will merge, and the company will avoid unfair business practices and such opportunities will be limited (Amit & Zott, 2012). For example, in such scenario that copyright infringements will reduce as the company will have complete rights to exploit its partners copyright and patent. Secondly, the vertical diversification will help the company to develop fair customer practices in the supply chain. The implementation of strict ethical standards will be applied from the basic level of distribution of raw material to the supply of the final product.
Likewise, an all-inclusive strategy that has been discussed earlier will help in promoting the ethical business behavior as well. The participative approach implemented in the company will be free of any illegalities as it will be self-monitored. It is important to note that a certain type of malpractices occurs in almost every company. Hence, it can be stated that corporate social responsibility and ethics does impact the implementation of these strategies effectively (Amit & Zott, 2012).
Amit, R., & Zott, C. (2012). Creating value through business model innovation. MIT Sloan Management Review, 53(3), 41-49.
Boone, L., & Kurtz, D. L. (2012). Contemporary Business (14th Ed.). Hoboken, NJ: John Wiley & Sons.
Coulson-Thomas, C. (2013). Implementing strategies and policies. Strategic Direction, 29(3), 33-35.
Hill, C., & Jones, R. (2013). Strategic management: An integrated approach (10th ed.). Independence, KY: Cengage.
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