Question

Scaling success :How you scale successfully ?
based on fuji film company documentary

Answer 1

Success story of Fuji film:

Fujifilm – A successful Digital Transformation

Fujifilm is a Japanese multinational in the photography and imaging industries. They were Kodak’s main competitor for decades, yet while Kodak might have been forgotten by many since they went bankrupt, Fujifilm is still a very profitable company, making $654M profit in 2013, 24% more than in 2012. While Kodak was dominating the photography and film market in the US, Fujifilm was doing the same in Japan.

Fujifilm was aware of the shifting market trend in photography from film to digital and similarly to Kodak, it opted to retain its existing business model, with the additional investments going into new technology and diversification into new businesses.

Fujifilm produced high quality cameras, their core business was centred on film and post-processing sales. The big picture was not better for Fujifilm as it faced the same storm as its American competitor. The president of Fujifilm remembers that “what we could not account for in our projections was the speed of the digital onslaught. The photographic film market had shrunk much faster than we expected.” Between 2005 and 2010, the sales of colour film declined from 156 billion yen to 33 billion while the photo finishing segment shrunk from ¥89 billion to ¥33 billion. Not only did the Japanese company overcome the crisis, but it thrived in this challenging environment.

How Did Fuji Overcome the Crisis and succeed:

The critical element in Fujifilm’s success is its diversification. In 2010, the film market dropped to less than 10% compared to 2000. But Fujifilm, which once made profit of 60% of its sales with film, diversified successfully and managed to grow its revenue by 57% over this ten years period while Kodak sales felt by 48%.

Evidence regarding Fuji’s success story:

Faced with a sharp decline in sales from its cash cow product Fujifilm acted swiftly and changed its business through invention, innovation and external growth. Under the decisive grip of Shigetaka Komori, appointed president in 2000, Fujifilm quickly carried out massive reforms in their company. In 2004, Komori came up with a six-year plan called VISION 75 in reference to the 75th anniversary of the group. The goal was simple and consisted of “saving Fujifilm from disaster and ensuring its viability as a leading company with sales of 2 or 3 trillion yen a year.”

First, the management re-designed its film business by downscaling the production lines and closing unnecessary facilities. In the meantime, the research and development departments moved to a newly built facility to unify the research efforts and promote better communication and innovation culture among engineers. But realizing that the digital camera business would not replace the silver halide strategy due to the low profitability of his sector, Fujifilm performed a massive diversification based on capabilities and innovation.

Even before launching the VISION 75 plan, the president ordered the head of R&D to take inventory of Fujifilm technologies, its seeds and compared them with the demand of the international market. After a year and a half of technological auditing, the R&D team came up with a chart listing the all existing in-house technologies that could match future markets.

The president saw that “Fujifilm technologies could be adapted for emerging markets such as pharmaceuticals, cosmetics, and highly functional materials.” For instance, the company was able to predict the boom of LCD screens and invested heavily in this market. Leveraging the photo film technologies, the engineer created FUJITAC, a variety of high-performance films essential for making LCD panels for TV, computers, and smartphones. Today, FUJITAC owns 70% of the market for protective LCD polarizer films.

Summary: basically Fuji is a japan based company, was founded in 1934 originally as a photographic film maker and is headquartered in Tokyo, Japan. Now, Fuji was dominating the photography and film market in the japan.