Key Objectives for Eastman Kodak
- Develop the company into a viable business in the field of photography
- Focus on lean operations wherein fewer people are needed to perform operational tasks
- Penetrate new markets where there are fewer competitors
- Expand the company’s product line to encompass new trends in technology development
- Ensure the continued development of the company by hiring the necessary experts to “take the company to the next level.
Why are the Objectives Essential to the success of the Company?
There are four characteristics that are in demand within a technology-oriented enterprise, namely: high market responsiveness, fast developments, low cost, and finally, high levels of creativity, innovation, and efficiency. As such, the objectives that have been indicated encompass such aspects and will be the basis behind the future development of Kodak. In relation to the final objective, what must be understood is that the aforementioned characteristics are dependent upon the type of technical teams that are the backbone of the company. Through the utilization of a variety of management practices, a seamless integration of vertical and horizontal means of collaboration need to be implemented in order to create a stable organizational structure for proper operations and product development.
Appropriate Corporate Level Strategy
One appropriate corporate-level strategy that the company can utilize in order to gain a competitive advantage is to attempt to provide services to clients in developing countries. The reason behind this is related to the current potential such regions have towards creating a profitable customer base for Kodak. It is based on this that the company would be justified in scaling back operations within its U.S. and U.K. markets due to slow economic growth which is indicative of a deterioration of consumer spending which makes expansion far from ideal since it is unlikely that consumers would continue to patronize products at the same level that they used to. Not only that, there is a significant degree of market saturation within the U.S. and UK with numerous well-established brands that would make it difficult for the company to establish a sufficient foothold to gain market dominance.
Pursuing a multi-business approach would be profitable for the company
Industry diversity results in less competition
While having the potential for more profit, attractive industries have a far greater degree of market competition resulting in the erosion of a firm’s economic performance as compared to companies that exist in unattractive industries where, through the development of innovative products and services, a dominant market position can be reached with fewer problems related to intense competition due to the nature of the industry (Chatha, Ajaefobi & Weston, 2007).
Even if a firm has valuable, costly to imitate and rare products which has resulted in it developing a dominant market position, the problem of operating within a highly competitive market within an attractive industry is that it cannot ensure that it will be able to capture 100% of the market nor can it say with absolute certainty that other competitors within the same industry will not be able to subsequently take over its dominant position (Chatha et al., 2007). This was the problem encountered by Kodak as more competitors entered into its industry with different product offerings. By diversifying the industries the company performs in (namely in attractive and unattractive industries), this lessens the possibility of the company being overwhelmed by external forces or competitors.
An inter-functional coordination approach enables the company to respond better to its business environment
In the case of the customer orientation approach to market orientation, a company spends what resources it has in gathering data on the needs and behaviors of various consumers, the same can be said for the competitor orientation; however, it focuses on competitors instead. What must be understood is that either method has a distinct weakness; focusing too much on consumer orientation can actually blind a company to changes in the market or may actually stifle innovation since the company focuses too much on consumer satisfaction rather than changing based on trends.
Focusing too much on competitor orientation, on the other hand, results in too much time and capital being placed on competitive activities, which results in companies at times neglecting their consumer bases and focusing too much on getting ahead of the competition. By implementing a multi-business approach through the use of inter-functional coordination (i.e., combining the different approaches), a company is able to diversify its approach to dealing with its market environment resulting in a much better rate of operational performance.
Diversifying Pricing Options
One multi-business approach that the company should implement is to take into account business cycles and market slumps and adjust prices accordingly (Nilsson & Olve, 2001). Not only that, other possible pricing options include selling different types of consumer products for different consumer segments (i.e., high-end products as well as mid-range items). Pricing is a critical element of successful marketing, in good times and in bad, many companies do not focus enough on getting their pricing right. It is based on this and the cyclical cycle of business that Kodak should consider proper pricing strategies when selling particularly hard to move products (Nilsson & Olve, 2001).
This takes the form of taking into account the physical value of the product being sold as well as various non-tangible elements that consumers take into consideration before they are willing to pay for a product. By utilizing a multi-business approach that has a diverse pricing option, this enables the company to target multiple consumer segments and allow it to reduce losses should demand in one segment decrease.
International Expansion
It should be noted that another multi-business approach is to expand into various international locations that are outside of a company’s traditional markets. The reason behind such a strategy is related to the potential such untapped markets have towards increasing the profits of the company. As such, by utilizing a multi-business approach of market diversification, the company is able to potentially utilize untapped resources and increase its overall profitability (Den Haan, Judd & Juillard, 2011). Such a strategy was seen in the case of the company “Whole Foods Market,” wherein it utilized a multi-business approach of multiple market expansion in order to compete in untapped foreign markets.
Consumer Type Diversity
One lesson in utilizing the multi-business approach can be seen in the operations of IBM wherein the company has slowly taken itself out of competing directly in the consumer market and instead has focused on business to business sales and making itself into a solutions provider (Den Haan et al., 2011). By performing a similar strategy yet in developing markets, this multi-business strategy will enable Kodak to target new types of consumers.
Implementation Strategy
The suggested implementation strategy is to shift the company’s focus from operating within its traditional markets to operating within developing countries. The problem with Kodak’s traditional markets is that they are already saturated with competitors; as such, Kodak should look towards other markets for expansion. One possible avenue of approach is to shift resources towards foreign markets that have not been as adversely affected by the current economic downturn and focus efforts there instead of in cathartic local markets. For example, China’s recent economic success has resulted in the creation of an upper and middle class whose spending habits have been growing as of late and is increasingly oriented towards consuming various types of western goods and resources.
This has resulted in an unprecedented level of demand for Western goods and brands, making the Chinese market an ideal location for the expansion of numerous established brands within the U.S. and Europe. Similar to the case of China, the Philippines has enjoyed a considerable boon due to the effect of the global outsourcing industry. At present, the country has well over 350,000 workers in the various call centers and business processing centers that have opened up within the country resulting in greater levels of purchasing power. Kodak can expand in these countries, utilizing a variety of potential digital products without having to compete in an overly saturated market directly.
Ethics
Overall, when examining the suggested strategy for Kodak, it is evident that there are no problems in relation to violations of CSR (Corporate Social Responsibility) or proper business ethics. To ensure compliance with proper ethical practices, the company needs to be able to hire personnel that can help the company improve itself through the development of better products, services, and event management so as to produce positive and, above all, ethical operational gains.
Reference List
Chatha, K. A., Ajaefobi, J. O., & Weston, R. H. (2007). Enriched multi-process modelling in support of the life cycle engineering of Business Processes. International Journal Of Production Research, 45(1), 103-141. Web.
Den Haan, W. J., Judd, K. L., & Juillard, M. (2011). Computational suite of models with heterogeneous agents II: Multi-country real business cycle models. Journal Of Economic Dynamics & Control, 35(2), 175-177. Web.
Nilsson, F., & Olve, N. (2001). Control Systems in Multibusiness Companies: From Performance Management to Strategic Management. European Management Journal, 19(4), 344. Web.