Management Case Study
The drivers of the photography equipment industry are the following: Changes in an industry long- term growth rate Product innovation Technological change and manufacturing process innovation Changes in cost and efficiency and Reductions in uncertainty and business risk The economic characteristics differ between film-based and digital segments on the ace of technological change, scope of competitive rivalry, number of buyers, and market size and growth rate.
Film-base cameras is slowly becoming obsolete, while digital cameras are becoming a great demand among consumers due to their fast Image visibility, enabling people to access, analyze and print images faster than ever before. As stated by Morocco and Morris, “Digital cameras have a higher Intrinsic value to consumers than film cameras. ” The numbers of existing and new rivals In the area of digital photography are emerging, placing the film-base traditional cameras competitive sector behind. Growth In digital photography market Is expanding In a quick pace while film-based are decreasing In the market share.
Continuing upgrades In the quality of Image produced by delta cameras and the lower cost AT totaling one Is Decoding possible Tort every Uninominal regardless AT geographical location to obtain one.
Film-base cameras were generally bought from emerging economies such as China, while digital cameras are distributed among developing countries such as the United States and Japan. The digital photography industry is changing at a fast growing pace, continually changing, due to new product innovations and short product life cycles. Compared to the decrease use of traditional film cameras, digital segments seem to be on the rise. . Prepare a Five Force Competitive Analysis for the photography industry. What is competition like in that industry? What competitive forces seem to have the greatest effect on industry attractiveness? In my analysis, competition is very attractive in the photography industry; the industry overall profit prospects are above average.
In the market shares in digital imaging shown in exhibit 9, the market shares for others are at high 24. %, attractively more than Kodak and Canon. The industry growth potential is positively forward looking with new technological advances created regularly.
Product innovation creates opportunities for new entrants to enter the market. With the uncertainty in the industry future we can only say digital is where we are headed. Competing sellers with suppliers of materials, parts, and other components to the photographic industry are the strongest competitive forces on the industry. Attracting new rivals with more sophisticated technology devices is also another throng competitive force in the industry. Competition appears destined to grow stronger every year. 3.
What key factors determine the success in the digital segment of the industry?
The key factors which determine the success in the digital segment of the industry are technology, manufacturing, skills and capability, and marketing-related success factors. Expertise in digital cameras and scientific research are very crucial in the development on new and improved design products. With technology advancing manufacturers become more efficient and lower the costs of production as time goes n. Product innovation capabilities, the design expertise, and new product introductions have a major impact of how well a product sells and how successful it becomes.
The breadth of product line and product selection is also a key factor to determine the success in the digital segment of the industry. 4.
Prepare a SOOT analysis. What are Soda’s key resource strengths and weaknesses? What new market opportunities does the company have? What threats do you see to the company’s future well being? In conclusion, what does this entire analysis reveal? Strengths Strong brand image. Competency In pantograph. Core competency in traditional film and photography industry, I. E.
Film for the mm camera and motion picture film used by the entertainment industry. Acquisitions of smaller companies that have been successful in the digital photography section. Weaknesses Poor track record of maintaining effectively strong strategy. Loss of market share due to anchored involvement of older technologies. Slow to change business model with the changing market.
Higher costs to print than competition. Behind rivals in product line expansion. Opportunities Profound growth in Soda’s coined term, “info-imaging”. Photography market. Rising demand for digital cameras. Expansion opportunities in home photo printing.
Growing opportunity for online sales.
Need for service to emerging markets around the world. Recession making investors more cautious. Expanding digital Threats Economic Increased competition from rivals in digital photography & online services. Lower profits from traditional printing processes Entry of a host of new competitors.
Growing bargaining power of consumers who have many more choices. In conclusion, this analysis signals an unfavorable weakness in the company overall. By far, the most obvious point within Soda’s weaknesses is the company’s inability to change their business model and strategy with the changing times.
This case on Kodak has made it abundantly clear that- albeit a company that still carries a reputable and long lasting name- they have been slow to effectively strategies and engage opportunities in the market; thus, they have succumb to serious pressure from competition, who have surpassed them and taken market share by innovating within the technological curve. Kodak needs to implement a solid strategy that will propel them forward, toward the opportunities for growth in newer technologies and wider product lines.
Their company may be able to turn their dwindling market share around by engaging a low-cost or niche marketing strategy that employs their closest and strongest core competencies. 5. What is Soda’s strategy to compete in the digital photography industry? Has the strategy been effective? Soda’s direction appears to be mostly involved in a broad differentiation strategy. CEO, Daniel Carp, put forth a Power Point Presentation in 003 that entailed segmented strategy on how the company was going to better take advantage of the digital commercial markets.
Although some of the strategy involved cutting cost, the main strategy was given to expand within I) commercial imaging, it) health imaging, and iii) consumer imaging. Expansion within these three areas covered a broad range of ideas, such as implementing more distribution outputs, offering more imaging products and services, developing more sophistication in the digital capture business, and continuing to grow market share in their old standby in ten traditional Tell Dustless.
At ten Ana AT 2 sty centenaries only Hay AT ten company stock got together to refute Carp’s strategy.
They wanted to cut costs and head in a new direction. Maybe they were right about the change in direction. In analyzing Eastman Kodak Company’s current data from The Financial Times, it is obvious that this strategy did not work given their financial and market performance- not to mention the fact that new CEO Antonio M. Perez replaced Daniel Carp shortly after the publication of this case in 2003.
Included here is the market performance of the company over the past five years:
