Kodak's Strategic Turnaround: Innovation and Multibusiness Model
This paper examines strategic recommendations for Kodak as it works to recover from bankruptcy and declining revenues. It identifies five key objectives spanning financial performance, operational agility, and human resources, arguing that leadership commitment is essential to any meaningful transformation. The paper evaluates Kodak's use of horizontal and vertical integration, finding both approaches insufficient for the pace of modern innovation. Drawing on Google as a multibusiness model example, it presents five recommendations for Kodak to leverage cross-unit synergies, transfer technology across divisions, and streamline back-office functions. Implementation centers on improving organizational design to foster communication, cultural cohesion, and informal strategic control. Ethical and corporate social responsibility dimensions are also addressed.
- Strategic Objectives for Kodak: Five objectives covering finance, operations, innovation, and HR
- Integration Strategies: Horizontal and Vertical: Evaluating Kodak's integration approaches and their limitations
- The Multibusiness Model of Innovation: Using Google as a model for cross-unit business synergy
- Recommendations for Increasing Profitability: Five specific multibusiness strategies to restore Kodak's profitability
- Implementation and Organizational Design: Structural changes to foster communication and cultural cohesion
- Ethics and Corporate Social Responsibility: Ethical dimensions and CSR implications of the recommendations
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What makes this paper effective
- The paper moves logically from diagnosis to prescription — identifying Kodak's weaknesses before offering concrete, numbered recommendations that are easy to follow.
- The Google analogy effectively illustrates the multibusiness model concept, grounding an abstract framework in a well-known real-world example.
- The ethics section, though brief, demonstrates awareness that strategic recommendations carry cultural and social dimensions beyond profit, adding intellectual breadth.
Key academic technique demonstrated
The paper applies a strategic management framework — covering objectives, integration types, business model design, and implementation — in a structured, sequential manner. This mirrors case-analysis methodology commonly used in business education, where each analytical layer (what, how, and why) builds on the previous one to support a coherent set of recommendations.
Structure breakdown
The paper opens with five strategic objectives, then evaluates integration approaches, introduces the multibusiness innovation model with an external example, and translates theory into five specific recommendations. Implementation and ethics follow as distinct sections. This clear sectional progression — from problem identification through solution to execution — reflects a standard business case analysis structure appropriate for undergraduate strategy coursework.
Strategic Objectives for Kodak
There are several key objectives that Kodak should set. The first is that it must achieve significant financial results — revenue and profit targets are essential, as declining revenues and profits have been identified as core issues. A third objective concerns operations: Kodak has suffered in recent years because it failed to adjust quickly to changing technology. The company should therefore commit to becoming much faster on its feet, establishing itself both operationally and culturally as an innovator. Innovation can be measured by the number of new patents filed or the number of new product launches.
Human resources objectives should include lowering the average age of the workforce and bringing more creative young people into the business. The company recognizes that it needs to revitalize its approach to business, and a human resources strategy must be in place to facilitate that. These five key objectives — financial, operational, innovation-focused, cultural, and human resources — are interconnected. It is believed that if the human resources objectives are met, the company will be better positioned to meet all the others. It should be noted that achieving these objectives will require significant commitment from leadership to mark a genuine shift in the company's focus. As Kotter (2010) has argued, without leadership buy-in, transformation efforts will fail.
Integration Strategies: Horizontal and Vertical
Kodak has sought to build its competencies through both horizontal and vertical integration. The company has long been vertically integrated, building its own solutions internally. However, this approach is no longer fast enough — competitors are innovating at a much faster rate. For consumer applications especially, Kodak's reliance on vertical integration is inadequate. The company needs to be more open to outside technology and less dependent on internal research and development, which is both costly and slow (Wharton, 2012).
A similar critique applies to Kodak's horizontal integration. The company currently does not have many viable business lines, and there is a temptation to pursue horizontal integration in order to acquire technologies that can drive growth. The problem is that, given Kodak's bankruptcy, any acquisitions will be smaller and less immediately productive. As a long-term strategy, Kodak might still leverage vertical integration to some extent, but it should not expend too much energy on horizontal integration outside of strategic partnerships.
The Multibusiness Model of Innovation
The multibusiness model of innovation is based on the idea that business innovation can emerge from bringing together ideas and people from different areas of specialization. When a company operates across multiple business units, the intersection of those units can increase overall profitability. A compelling example is Google. That company earns most of its revenue from online advertising, but it is also an industry leader in browsers (Chrome) and mobile operating systems (Android). Google has invested in becoming a leader in those technologies not because those businesses are inherently profitable in isolation, but because they function synergistically — both drive more users to Google services, which increases advertising revenue, and both enable greater collection of consumer data, which is a major competitive advantage.
References
Cooren, F., Kuhn, T., Cornelissen, J., & Clark, T. (2011). Communication, organizing, and organization: An overview and introduction to the special issue. Organizational Studies, 32(9), 1149–1170.
Kotter, J. (2010). Leading change: Why transformation efforts fail. Harvard Business Review.
Wharton (2012). What's wrong with this picture: Kodak's 30-year slide into bankruptcy. Knowledge @ Wharton. Retrieved from https://knowledge.wharton.upenn.edu/article/whats-wrong-with-this-picture-kodaks-30-year-slide-into-bankruptcy/
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