Rise and Fall of Kodak
Case Code: BSTR417
Case Length: 20 Pages
Pub Date: 2012
Teaching Note: Not Available
Organization: Eastman Kodak Company
Industry: Consumer Electronics
Countries: Unites States
Themes: Corporate Strategy
Abstract Case Intro 1 Case Intro 2 Excerpts
Right from the 1950s, Kodak faced tough competition from Japanese manufacturers like Fuji in the film business and Olympus Corporation (Olympus), Nikon Corporation (Nikon), Canon Inc. (Canon), and others in the camera market. Kodak, however, continued to develop new products. In 1975, the company invented the world's first digital camera which could take black and white photos with a resolution of 10,000 pixels (.01 megapixels) . In 1979, the company developed the world's first viable Organic Light-Emitting Diode (OLED) material. Kodak kicked off the OLED industry with its reports of the first working OLED devices in 1987...
In 2000, Carp, President, Kodak, took on additional charge as CEO. In the same year, the company acquired Lumisys, Inc. , through a stock buy of around US$39 million. On September 26, 2000, InfoTrends Research Group Inc. (InfoTrends) came up with a new report '2000 Worldwide Digital Camera Forecast Summar'. According to the report, digital camera sales represented 13% of total camera sales all over the world and North America and Japan were the leading markets with 52% and 23% share respectively in digital camera sales worldwide. The worldwide digital camera market was led by Olympus, Sony, Kodak, and Fuji with a 60% combined unit market share...
Lessons from Kodak
To overcome its volatile growth rate, the company decided to diversify into other related but noncore industries. Between the 1980s and the early 1990s, the company tried to diversify into other industries and acquired various companies in different industries. It acquired the copier services business of IBS, a pharmaceuticals company, the medical diagnostics business, computer hardware business, Mass Memory business, and bioscience and lab research firms. However, none of its attempts at diversification were a success. In fact, they increased Kodak's debt burden. ...
Kodak's Strategy for Future Growth
In 2003, Kodak unveiled its digital-oriented growth strategy. It believed that its sales would touch US$16 billion and US$20 billion by 2006 and 2010 respectively. To achieve its target, the company realigned its operation and leadership team and hired many top leaders with experience in digital technology to accelerate its growth in the digital space. The company hired Perez, Corporate Vice President of HP, as President and Chief Operating Officer (COO), Yusuke Kojima from Olympus Optical Company, Ltd. (Olympus) as General Manager of the Consumer Digital Camera Business, Bernard Masson from Lexmark International Inc. as President of Kodak's Display Group, and Daniel Kerpelman from GE Healthcare as Head of the company's medical-imaging group....
Exhibit I: Cash and Cash Equivalents at Kodak between 1991-2003 (in US$ million)
Exhibit II (A): 5 Years Consolidated Statement of Operations of Kodak
Exhibit II (B): 5 Years Consolidated Statement of Financial Position of Kodak
Exhibit II (C): 5 Years Consolidated Statement of Cash Flows of Kodak
Exhibit III: Worldwide Kodak's Employees between 1991 and 2003
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