Kodak’s Challenge‪:‬

This case explores the aftermath of Kodak’s transformation from traditional photography to a digital company during the period of 2003-2008.  The major components of the 2003 digital strategy announcement and the firm’s implementation struggle are presented.    The case also permits students to evaluate Kodak’s digital strategy in light of the many changes occurring in the digital photography industry during this time period.  These changes include rapidly improving technologies (along with competitive pressures on pricing), increases in the quality and usage of camera-enabled mobile phones, maturing demand in the United States, rapid adoption of digital photography in foreign markets, and increasing competitive challenges.  The case concludes with Kodak’s announcement at the end of 2007 that the transformation has been completed and that the company is well positioned for the future.  Kodak’s view of their progress is contrasted with the skepticism of investment analysts and rumors of possible mergers/takeovers or breakups of the firm.  Students are asked to evaluate the transformation and to consider Kodak’s next moves. 

Teaching Objectives

Students should be able to:

• Understand the forces of change that are reshaping the business environment for firms in the photography industry in the twenty-first century.
• Understand the risks involved in developing strategy when the cash cow business is in a declining market.
• Understand the risks involved in competing in a market against newer and more nimble competitors.
• Develop and evaluate strategies for Kodak.