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What Strategic Issues and Problems Merit Managerial Attention?

Question 4.5 – What Strategic Issues and Problems Merit Managerial Attention?

 

This is a critical question for preparing your SWOT matrix and the Action plan. Good analysts and consultants would highlight to their clients strategic issues before operational issues.  Operational issues would be secondary.  You need to highlight operational issues that impact the attainment of strategic objectives and then financial objectives.

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Strategic Issues and Problems
The following are typical issue areas.  This is not an exclusive list of areas.  You should provide additional strategic issues based on your analysis of the environment and the company’s competitive capabilities and resources.
Facts
What does this mean?
Is the present strategy adequate in light of driving forces present in the industry?

(To address this question, you must examine the SWOT matrix and the quadrants where the majority of the intersections occur.)
Yes, Kodak has capitalized on its strength of technology to be able to develop their own range of digital cameras to meet this new demand of the consumers.
Previous production of film continues but has taken secondary priority as compared to the digital camera market. Due to the nature of the original business model, manufacturing film and printing, Kodak is also able to print high quality pictures as compared to competitors who specialize only in digital cameras.
Is the company’s present strategy geared to the industry’s future key success factors?
The key success factors of the industry would be one, to produce the same quality pictures as pictures taken by an analogue camera. Furthermore, environmental factors play a role in this industry, by helping build a paperless environment. Online material is made more interesting and attractive through the use of digital pictures.
Kodak does amplify high quality images through their cameras. In fact, they exceed this role by tapping into consumers’ emotions. They exemplify the emotions of care and the importance of memories when taking pictures. This allows consumers to be attached to photography and even encourages them to use as many pictures as possible via digital content.
How good a defense does the present strategy offer to the 5 forces?

(To address the preceding question, you should examine the quantity of strength and weakness intersections with threats from the 5 forces.)
With its attractive prices and new products line its defense is very strong against its competitors
Opening kiosks for printing, still, under the name of Kodak, represents extensive promotion in the industry.
Does the present strategy protect the company against external threats and internal weaknesses?

(To address the preceding question, you need to examine the weakness-threat quadrant intersections.)
Yes it does protect it against external and internal threats
Several new strategies were adopted to bring change in the internal environment and business relationship
Is the company vulnerable to competitive attack by one or more rivals?
Fuji is the closest rival to the company. Fuji also has always been Kodak’s closest rival even before their paradigm shift to digital cameras.
Kodak is vulnerable to Fuji’s research and development ability as both companies are familiar with both business models. In addition to that, Fuji has also penetrated the US market extensively with high-end Japanese quality products. Fuji however, lacks the environmental friendliness Kodak has to offer.
Does the company have competitive advantages (Refer to your responses to question 2 above.) or must it offset the competition’s competitive advantages?
Kodak’s environmental concern acts as an advantage as it asserts the role of social responsibility into its business plan. Very often, companies are extremely consumer focused that they play upon selfishness and greed. Caring about the environment through Kodak, a consumer will feel as if he or she is contributing to the bigger picture in supporting Kodak’s products.
Kodak also reaches out to other businesses in order to spread their “going green” policy. This encourages businesses to liaise with Kodak on their own business plans and creates a need for reciprocal favours. These businesses are more likely to choose Kodak products over others.
What are the strong and weak parts of the current strategy?
Strengths:

Kodak is well-versed in technology that involves printing, thus its costs are low.

Weaknesses:

Kodak’s digital cameras come in secondary in nature.

Strengths

 

Kodak also thinks beyond profits when reaching out to the consumers. Consumers who support Kodak products are receiving personal attention as well as ethical values with respect to helping preserve the environment. On personal service, Kodak provides kiosks for quick print-out to clients.

 

Weaknesses

 

They compete with heavyweights such as Canon and Olympus in terms of delivering digital cameras.
What additional moves are necessary to:

Improve costs
Capitalize on emerging opportunities
Boost the company’s competitive position
Improve cost

Kodak’s continuous research and development would be able to reduce costs with respects to technology obsolescence. There is always a fear of obsolescence in the technology industry and cameras are as vulnerable as other high-tech equipment.

Capitalize on emerging opportunities

Kodak can consider tapping into other fields of camera technology. For example, mobile phones with digital cameras. The wave of mobile phones with cameras has been arresting.

Boost the company’s competitive position

Kodak sponsors film reels for documentaries. Branching out into charitable documentaries is also feasible for Kodak as sponsorship is an excellent route of marketing. Coupled with the burning need to tend to environmental concerns, Kodak can consider sponsoring programmes that require donations – especially those related to wildlife.

Marketing Kodak’s name in the arena of charity plays at Kodak’s credibility at philanthropy. It is imperative to allow the consumer that Kodak is able to think out of the box – without the realm of picture-taking in mind. Companies often make a mistake in concentrating on products and services that translate into profits. Kodak can take the alternate route.
Improve cost

Short product life-cycles are synonymous with obsolescence. Production that adheres to quality management would include just-in-time production with low buffer stock. This would curb costs substantially.

Before coming up with new products, Kodak must be able to predict its sustainability in advance.

 

Capitalizing on emerging opportunities

 

With companies like Sony being able to produce mobile phones and cameras (but with printing at lower quality), Kodak can consider providing consumers with mobile phones the quality edge in picture taking.

Boost the company’s competitive position

 

Marketing Kodak’s name in the arena of charity plays at Kodak’s credibility at philanthropy. It is imperative to allow the consumer that Kodak is able to think out of the box – without the realm of picture-taking in mind. Companies often make a mistake in concentrating on products and services that translate into profits. Kodak can take the alternate route.

 

 

Question 4.8 – Organization’s Culture (Refer to Chapter 2 and Chapter 13)

How do the company’s values, policies and culture impact the strategy, strategy implementation and company’s competitive capabilities?

 

Recently Kodak has turned towards some positive trends and has become more profitable after implementation of more advanced digital technologies in all its product line. It gained profit of $16 million in 2007 as compared to the loss of $46 million last year. Kodak worked to improve its organization culture and implemented those strategies that worked for the organization.

 

Innovation in the Organization

During the previous years losses, Kodak realized that they need to change their organization culture from all three point of view top to bottom, bottom-up and cross-sectional direction. In the innovation pipeline they needed to change the products and services as demanded by the customer.

 

Strategies that were used to change the organization culture

 

Adopted a new product model strategy to accommodate changing business environment
Implementing new developmental relationships for planning, structuring and promoting new business model design
New opportunities were adopted to change the infrastructure of the organization with wireless network system and digital products
Effective communication skills developmental and training programs were offered to improve communication method within the organization and to reach higher level of customer satisfaction
Breakthrough technology was employed to promote co-development experiences and relationship
Their new product line developmental process changed and new techniques were employed to produce much better and efficient digital products of film and camera. They adopted the co-development process in order to link with other stakeholders. Successful relationship and communication within the organization and its working partners was developed by employing new techniques and network model. With co-development experiences company improved a lot its management and operation.

 

Key success factors were adopting change, implementing new business model, new products development, co-development experiences and relationships and enhanced customer satisfaction.

 

 

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