Kodak was the pioneer on innovation for digital images. For this their main resource was the role of the retail kiosks. The idea was to develop a network on the commercial market and they had the pervious infrastructure from the old technology that they had to transform for the digital imaging. The firm was going to use the opportunity it had: build and extend the existing market strength due to the positioning they had at that point in time and gradually change to serve the digital market. Therefore, Kodak was presenting an incremental approach strategy to the transforming market, on both commercial and consumer market. However, Kodak´s main idea was to maintain a mass-market leader by providing simplicity, quality, and value in the consumer market because they were providing easy solutions to customers to transition to digital photography while exploiting Kodak´s core brand and distributions, both of their best resources the firm had in its value chain. So in 2005 the software Easyshare system was in place and enabled a network where customers could take pictures on digital cameras and view their images on different devices, print them all through Kodak´s system. Figure 2 shows clearly how the network was going to maintain a growing network through their commercial and consumer market. To follow this strategy, Kodak had to generate activities to its chain value and this meant to partner up with companies that were leaders in digital technologies and hardware & software products. In consequence the firm allied with Canon, AOL, Intel, HP, Olympus, Sanyo Electric Co. and IBM. Additionally they made some acquisitions that are shown on table 2 that were essential to complement its own expertise.
In conclusion, Kodak focused its strategy on their internal resources and its core competences which were: Brand, Distribution, Technology, New product Development and Financial Resources and tried to adapt gradually the value chain so that they would be able to develop their products assuming that Kodak would be able to move away from its tradition long and meticulous product development to be able to enter the fast-cycle world of electronics.
The strategy failed because of three main reasons. The first one is the development of their strategy towards the fitting of the industry by the 2000s, the second the ability that Kodak had to sustain the competitive advantage and finally the organizational capabilities that were not adequate to the competitiveness of the market.
The development of the strategy worked for the first decade, however from the 2000´s onwards, the industry was…