Eastman Kodak Company and the Fuji Photo Film Co - Essay Example

? Kodak & Fujifilm Introduction The paper describes about the two real enormous s of photographic and imaging industry, Eastman Kodak Company andthe Fuji Photo Film Co. Ltd. This paper examines the competitive relationship of two giants and the reasons behind the downfall of 130 years glorious history in the photographic segment of Kodak. On the other hand, the success story of Fujifilm, a Japanese based one of the closest competitors of Kodak will also be depicted in order to comprehend the reasons behind its success in the United States market along with the global markets. History of Kodak and Fujifilm Kodak and Fujifilm both are amid the most eminent players in the photographic industry in a global basis. The founder of Kodak, George Eastman, an American, was dedicatedly fascinated on still photography and cameras. He patented photographic film to be stored in a roll in 1884 and after four years he had developed the first camera in the world of his invention and started operating in London. Subsequently, gradually the company became the global leader and started to dominate in the global market which has transcended beyond a century. In 1975, firstly, the company brought in significant change in the world of photography inventing digital camera. However, after 1984 in the photographic industry Kodak noticed profound changes in relation to the behavior of customers but still it remained indifferent about the changes in technologies and marketing strategies. As a result, in the 21st Century, it had to stop to manufacturing of a number of products one by one for being unable to sustain and owing to a lack of demand of the products. Finally, in the year 2012, the company filed for bankruptcy (Beaudette & Palank, 2013). Fujifilm, a Japan based company was established in 1934 and within a decade it spread its landmark in the global market with the incorporation of effective strategies and continuous modernization of technology. In 1980, in keeping with customer requirements and to ensure its sustainability in the global market, the company made a switch from the film to digital market. As a result, it was able leverage huge amount of money from the film business and gradually reached the pinnacle of success in the photographic segment (Fujifilm Europe, n.d.). Core Business of Kodak and Fujifilm Kodak is a well known organization in the photographic film products, equipments, materials, digital imaging and services. Another principal business of Kodak is Kodak international-financial & banking business (Francis & Nias, 2012). The primarily business activities of Fujifilm entail to be involved in the development, production, sales and services of the color photographic film, digital cameras, color paper, photofinishing chemicals, graphic arts materials and equipments, medical imaging equipments, optical devices, photocopiers and printers. By the availability of these varied products, segmentation and innovation, it has captured a big global market after 1990s and has become a market leader in the photographic world in recent times (Fujifilm Europe, n.d.). Compare And Contrast About The Approach Of Management Of Both The Companies To Embrace Innovation And Management Differences That Have Impacted The Relative Success Of Kodak And Fujifilm In the global market perspective, the key dimensions of ‘change’ and ‘innovation’ are the key determinants of success to sustain in the competitive business world. These two factors are the main reasons for the downfall of Kodak and pinnacle of success for Fujifilm in the photographic market. Though Kodak entered in the market of Japan in 1905 but the management of the organization did not take the market seriously for strengthening the distribution system, marketing strategies, segmentation, and for making customers needs and demands assessment. After a long period in 1977, it started to focus to strengthen the marketing chain, distribution system and advertising. As a result, it became one of the best photographic product producers of the year in Japan by 1994. Nonetheless, subsequently owing to the financial crisis, poor marketing approach, short-term strategies, inefficient management, lack of innovation and unfair trade practices gradually the company lost its market share (Finnerty, 2000). On the other hand, the success of Fujifilm lies on its focus on long-term business strategic initiatives, innovation, quality of the offered products, low price, and appropriate segmentation among others. The management of the organization is very adept at altering its approach as per the needs of the changing market environment and consumer behavior. Therefore, it did continuous research in the global market and regularly introduced new products in the market and thus within a short span of time the company was able to became the market leader in Japan and the second biggest producer of photographic based products in the global market. Fujifilm’s another major strategy to surge ahead of Kodak had been established on commencing a production plant in the United States to minimize the cost and maintain its prime focus on quality and customer oriented approach to capture the market of Kodak. This is because at that point of time the consumers in the USA gradually became addicted towards the foreign brand and the management of the Fujifilm specially noticed this pertinent factor and thus started to leverage utmost benefits out of this crucial change in market dynamics (Finnerty, 2000). In the 21st Century, though the management of Kodak had focused on Business Process Reengineering (BPR) model, and enforcement of international trade agreement i.e. sustainable concessions but it was already quite late in the market to cope up with such endeavors. Besides, the management also fell under the Section-301 of the US Trade Act for unfair business practices. The Kodak’s recent problems mainly rest on the aspect that the company had not entered in the digital photographic world well enough and fast enough as per needed (Finnerty, 2000). Thus, the factors in which Fujifilm outdid Kodak include addressing the altering consumer behavior and focusing on new trends in an efficient manner, bringing in marketing and innovative strategies to deal with the competitors and depicting foresight about future market trends, distribution and supply chain. In these facets, the management of the Fujifilm has remained utmost conscious but Kodak has remained generally ignorant about these vital factors. As a result, in the last 15 years, Kodak had failed to stay ahead of Fujifilm though it possessed a long tradition of success and brand recognition because after 1990s the sale of digital camera had increased and film roll decreased continuously (Kotter, 2012). Ethics and Social Responsibility of Kodak and Fujifilm and Their Impact on the Companies’ Profitability Ethics and social responsibility of any organization are amongst the most important factors for sustainability of business in terms of the aspects such as acceptability by customers, competitors, government regulators along with each individual. As per research by ‘Business Ethics magazine’ Kodak was ranked in the 58th position in the list of ethical practice in the business and for the society in 2004. The company is significantly focused about conducting Employee Assistance Program (EAP), 24/7 employee resource for any types of challenges, ensuring good relations among international and local communities. However, the main drawback of the organization is that it did this only for the maximization of profit with short-term business goal. Moreover, it was also focused on unfair business activities and fell under Section 301 of the US Trade Act. As a result, in 1997 World Trade Organization (WTO) prescribed to Kodak to show every financial document with substantial proof (Finnerty, 2000). Conversely, Fujifilm has remained ethical in its business operation. Every year, it provides the financial report to every stakeholder and takes the feedback along with valuable suggestions to develop and sustain in the market. Regarding social responsibility dimension, the company has taken varied initiatives for the development of technology to decrease the emissions of carbon and to ensure minimum utilization of power from its products for clean and green environment. Besides it is quite focused upon offering required care and concern towards its human resources because without the helping hand of employees any organization cannot sustain and develop. Thus, Fujifilm, by focusing on innovation, affordable price-less profit and taking care of society with long-term business prospective, is leading today in the global market (Fujifilm Europe, n.d.). Initiatives Taken By Both the Managements in the Changing Market Situations In the later part of 20th Century both the organizations i.e. Kodak and Fujifilm, have specially focused on the digitization of photography as per changing behavior of the consumer. However, the difference in the approach can be highlighted in terms of the aspect that Kodak has not focused on the immediate changes in the market and continuous development needs regarding technology. Another important factor in which both the organizations have also focused is regarding the need for reaching widespread global market. However, in this context, Kodak has been also lacking behind because it has not remained enough focused about the analysis of market to know the requirements of the consumers. Therefore, in the market this created a gap in between demand and supply. As a result, the competitors derived the crucial benefits out of this facet. Another initiative that both the managements had taken was to adapt to the changing needs by providing after sales service, however regarding this aspect as well Kodak failed to compete owing to its unorganized logistics process throughout the world (Kotter, 2012). Decision-Making Process For Adapting to the Changing Market Conditions The term ‘change’ is similar to the ecosystem of the environment where capability to adapt to the rapid changes in the society can only ensure sustainability. Therefore, the management and Research & Development (R&D) department of the any organization should be foresighted about the changing trends in the market. In this regard, firstly, the most effective method is taking the valuable opinions of the individuals associated with every stage of operations in the organization. Besides, to obtain the valuable feedbacks of the customers, a company should keep record by ‘feedback form’ within the outlets in reference to product quality, price and requirements among others and should also work carefully over the derived opinions (Kotter, 2012). Secondly, research oriented technical teams of the organization need to be focused on creating new valuable offerings in continued manner. Regarding this aspect, they can firstly build a demonstration purpose version to take customer feedbacks and as per consumer behavior, they can change and make the final product. Contextually, the function of the human resource (HR) team also is quite important to select the ‘right people for the right job’. Moreover, they should be focus on knowledge management along with taking care of the employee and creating a good working environment. This process will be helpful for the management and technical team to adopt them-selves as per the changing marketing environment (Kotter, 2012). Thirdly, sustained focus should be on strengthening of core competency and internal development of the organization for tackling any kind of challenges provided by the competitors in the market. Conclusion Conclusively, it is apparent that brand is always not the big factor to sustain in the market. Though Kodak played a dominant role in the market for more than a century but owing to a lack of focus on innovation, improper management process, inflexibility regarding decision making and short-term strategies for more profit seeking the company has substantially lost out to Fujifilm in the recent years. While, Fujifilm has remained quite focused on its strategic endeavors and has adopted rapidly to the changing consumer needs which has aided the company to gain competitive edge. References: Beaudette, M. & Palank, J. (2013). Kodak files plan to exit bankruptcy protection. Retrieved from http://online.wsj.com/article/SB10001424127887324266904578457030412008730.html Finnerty, T. C. (2000). Kodak & Fujifilm...not a pretty picture: The battle for global market share. Retrieved from http://www.pace.edu/emplibrary/tfinnerty.pdf Fujifilm Europe. (n.d.). History. Retrieved from http://www.fujifilm.eu/eu/about-us/history/ Francis, J. & Nias, S. (2012). Kodak says plates are core, digital is growing in $950m pitch. Retrieved from http://www.printweek.in/News/288266,kodak-identifies-core-businesses-as-it-pitches-for-950m-financing.aspx?eid=56&edate=20120128&utm_source=20120128&utm_medium=newsletter&utm_campaign=daily_newsletter&nl=bulletin Kotter, J. (2012). Barriers to change: The real reason behind the Kodak downfall. Retrieved from http://www.forbes.com/sites/johnkotter/2012/05/02/barriers-to-change-the-real-reason-behind-the-kodak-downfall/ Read More