Fujifilm and Eastman Kodak: History and Core Business
Founded in 1934, Fujifilm has in the recent past "expanded to become an innovative leader in a variety of business fields" (Fujifilm, 2013). As the firm further points out, apart from being the first photographic film maker in Japan, it has over time "leveraged its imaging and information technology to become a global presence known for innovation in healthcare, graphic arts, optical devices, highly functional materials and other high-tech areas" (Fujifilm, 2013). Currently, the company has its headquarters in Tokyo, Japan. Fujifilm's core business happens to be the development as well as production, distribution and sale of a wide range of photography related products and equipment including but not limited to photofinishing chemicals and equipment, color paper, digital cameras, and color photographic film. The company is also involved in the production and sale of other products such as optical devices and medical imaging equipment. The current CEO and Chairman of Fujifilm as the company points out on its website is Shigetaka Kimori (Fujifilm, 2013). Given its relative size and resolve to further embrace globalization in an attempt to enhance its sales, Fujifilm employs thousands of employees from across the world. As of March 2012, the company had a total of 35, 375 employees on its payroll (Fujifilm, 2013).
With its headquarters in Rochester, New York, Kodak has surely come a long way. On its website, the company points out that it was its founder, George Eastman, who first developed dry plates for the mass market -- with his key target being photographers (Kodak, 2013). According to the company, in presenting to the globe the first simple camera, George Eastman effectively made the often cumbersome and somewhat complicated process of photography a new lease of life -- in terms of ease of use and accessibility (Kodak, 2013). Before it started experiencing financial challenges, Kodak was regarded one of the most successful and profitable firms in the global photography and imaging marketplace. Although it has lost most of its past glory, the company still regards itself "a premier multinational corporation, with a brand recognized in virtually every country around the world" (Kodak, 2013). In addition to digital printing, Kodak is also known for TV and motion picture production. According to the company, it is currently building on its "technological heritage to serve the fast-growing packaging, functional and digital printing markets, as well as established markets in graphics and entertainment" (Kodak, 2013).
Embracing Innovation: Each Company's Approach to Management
The relevance of innovation cannot be overstated when it comes to the long-term success of any business enterprise. According to the Institute of Leadership and Management (2013), "innovation often involves anticipating customer requirements, identifying products and services they haven't considered and meeting those." In addition to helping a business keep pace with the competition, innovation also makes it easy for a business entity to identify and respond to meaningful trends in an attempt to ensure that the needs of customers are addressed conclusively. It is important to note that each of the two companies discussed in this text regards itself a leader when it comes to innovation. On its website, Kodak points out that the development of future printing markets will be shaped by the strong proprietary technologies that underwrite its solutions. The company further points out that in addition to its investment in the invention of new technology, it has also set its sights on the further enhancement of relationships as it seeks to expand existing businesses and establish others. As would be expected, the management of Kodak seems appreciative (albeit lately) of the role and relevance of research in innovation. On this front, the management of the company makes use of research to "leverage scientific understanding to create technologies that enable customer solutions" (Kodak, 2013).
Like Kodak, Fujifilm is fully aware of the important role research plays in fueling innovation. As the company points out, "through research and development we refine our core technologies, which we apply to products that improve the quality of life" (Fujifilm, 2013). It is also important to note that both companies have put in place a competent team of managers to drive operations and expedite innovation. Most of those who seat on the boards of Kodak and Fujifilm are individuals who have in the past founded and steered other companies to greater heights. They are individuals who can be trusted to drive innovation in their respective positions. Next, it should be noted that in some instances, continuous improvement does lead to innovation (Davidovich et al. 2009). Unlike Kodak, Fujifilm's management seems to be more appreciative and supportive of continuous improvement. This is more so the case taking into consideration the firm's desire in the past to further refine its existing products in an attempt to meet the immediate and future needs of customers more effectively.
Key Management Differences and their Impact on the Success of Fujifilm and Kodak
From a strategic management point-of-view, the management of Fujifilm appears to be more focused on becoming a cost leader. Indeed, according to Merced (2012), some of Kodak's problems can be attributed to the entry of Fujifilm into the market a few years ago. From the onset, Fujifilm was keen on undercutting Kodak's prices. For this reason, one could state that the move by the management of Fujifilm to adopt a winning cost leadership strategy from earlier on benefited the company and led to the decline of Kodak.
In contrast to the management of Fujifilm that appears particularly proactive, the management of Kodak is largely reactive. For instance, as I point out in significant detail elsewhere in this text, both companies saw the digital age coming. However, the response of Fujifilm is more indicative of a company that was thinking ahead. It is through its anticipation of change and planning for the same that the company was able to further enhance its bottom-line at a time when other firms in the same industry were reporting losses.
Approach to Ethics and Social Responsibility
With regard to governance, Kodak is well aware of the relevance of ethical business conduct. In that regard, the company has in place "well established Values and Corporate Responsibility Principles by which" each and every employee of the company lives (Kodak, 2013). According to the company, its conduct is also governed by a number of company policies which are inclusive of both legal and ethical mandates. Most specifically, with regard to corporate responsibility, the company clearly points out that its only mandate is not the maximization of shareholder value. In addition to creating value for its shareholders, the company also strives to "promote the development of the individual, the well being of the community, and respect for the environment" (Kodak, 2013). Although one would ordinarily have expected Kodak's unique and impressive approach to ethics and social responsibility to enhance respect for the company thus promoting sales, the company suffered a significant loss during the last financial year. It is however important to note that the unimpressive performance of the company could have been largely influenced by a number of recessionary forces that were well beyond its control.
Given its current and previous engagements, Fujifilm can be regarded an ethical and socially responsible company. In addition to working to shrink its water as well as carbon footprint, the company has also been appreciative of the need to make use of natural resources and packaging materials in a more efficient way while at the same time minimizing waste generation (Fujifilm, 2013). More specifically, with regard to its approach to CSR and other relevant policies, Fujifilm points out that it is keen on contributing "to the sustainable development of society by putting into practice the Fujifilm group's Corporate Philosophy, and realizing its Vision through sincere and fair business activities" (Fujifilm, 2013). This approach to ethics and social responsibility seems to have had a positive impact on the company's public image thus leading to enhanced sales -- which is perhaps the reason why the company has over time registered impressive returns.
Adaptation to Changing Market Conditions
Looking at the histories of both companies, it is clear that in comparison to Kodak, Fujifilm has adapted most effectively to changing market conditions. Indeed, from the start, Kodak had a difficult time adapting to a world that was increasingly becoming digital. This was at a time when cameras were being replaced by smartphones and the traditional film was being replaced by digital photography. As Merced (2012) observes, the move by Kodak to file for bankruptcy early last year could have been a longer-term consequence of the firm's inability to properly read and respond to changing market conditions especially with regard to technological change. As the author further points out, it is the declining demand for traditional film (due to the increased popularity of digital photography) that ended up forcing businesses such as Kodak to halt some of their operations. It is however important to note that for those businesses that adapted effectively…