Will Eastman Kodak under the leadership of CEO Perez succeed to manage its new environment?

Will Eastman Kodak under the leadership of CEO Perez succeed to manage its new environment

2008

Will Eastman Kodak under the leadership of CEO Perez

Succeed to manage its new environment

Introduction

The digital revolution has transformed much business and provides customers with new experience . However , for some traditional companies the coming age of digital technology also provides threats since the streaming of 0 ' and 1 ' digit threatens their existence . The situation exactly occurs in the case of photography where Eastman Kodak that is well-known in traditional photography industry

is striving for being exist in digital era

Under such circumstances , Eastman Kodak has been losing its market , as photography underwent revolutionary technological changes . Concerning the issue , this will elaborate and examine how Eastman Kodak has been adapting and even diversifying to other markets by using external analysis tool like Porters Five Force Model

Challenges of Kodak Under CEO Perez

The digital market is the new direction of the film market . Both company should not neglected the potential of the niche . Kodak for instance , has realized that camera phone is the best selling mobile communication device in United States

Therefore , the company has allocated significant amount of investment in developing new digital cameras as well as providing state of the art photofinishing services . Kodak will develop new and lower-cost business model for the silver halide films and products . Managers of the company believe that this will enhance the competitive advantage of the company in the new markets (Kodak , 2004

Porters ' Five Force Models

At the heart of this analysis is the industry analyzing model known as Porter 's five forces (Figure 1 ) model which details the threat of new entrants , power of buyers , power of suppliers , rivalry among existing competitors , and the threat of substitute products for market place organizer or transaction service provider industry satisfy following diagram :Figure 1 Diagram of Porter 's Five Forces

Source : Porter , 1998

Rivalry

This factor is characterized by examining the concentration ratio of the industry . An industry with a low concentration suggests that there are lots of players in the markets and competition is in its high level Industry that has highly concentrated suggest a situation where only a few players within the industry that control significant share of the market (Porter 's , 2004

In photography industry , their main competitor , Fujifilm has seemed to be some steps ahead of Kodak . Along with its program of targeting foreign markets , Fujifilm has established digital photofinishing services for its foreign consumers a lot faster than Kodak has (Daniels 1998

In film industry , Kodak has greatest challenges from their rival , Fuji The competition between the two companies is intense since the Kodak is considered as lack of passion in maintaining its leadership while at the same time Fuji and other competitors continue gaining their market share

Threat of Substitutes

Substitution generally means products of another industry of other segment of an industry that could appeal customers as a replacement to our products . However , the definition expands...