Technological Institute of the Philippines
Quiapo, Manila
AGFA
Case Study
Submitted to:
Mrs. Shirley U. Espino
Submitted by:
Dones, Fred Austie G.
AC42FB1
Responding Positively to a Changing Environment
An AGFA Case Study
I. Problem Statement
The market for imaging has grown rapidly. The growth is being fed by the
accelerating change from analogue to digital imaging which has transformed
and enriched what the industry can offer. The photographic marketplace is in
the midst of a period of excitement and change. Digital technologies are
changing the way in which the world takes, processes, and uses images.
There are now new, efficient workflows that provide customers with high
quality images, hardware and software that allows them to work with images
quickly and efficiently without requiring extensive expertise and knowledge.
The problem revolving around this case is for AGFA to strategize on how it
will adapt to the fast pace of digital revolution and to find ways on appraising
the value of its investment in digital technology.
II. Alternatives
Alternative 1 In order to properly adapt to the changing environment in
terms of new technology, Agfa needs to first do an analysis with respect to
the appraisal of the value of their investment according to a number of
criteria. These include the rate of return on a specific investment (measured
in percentage of capital outlay), the contribution of the investment to the
companys overall profitability, the market share obtained, the total sales
achieved, the visibility and popularity of the initiative in the companys
profile in the eyes of the media and of the general public. In going digital
all these criteria will be satisfied since digital imaging has a lot of advantages
over the analogue imaging. Digital images have transformed access, ease of
use and transmission of images to provide a flexible series of solutions for
customer needs. With instantaneous image capture, digital images require
only minimal storage facilities. Todays fast pace of transactions also require
companies to go digital.
Alternative 2 Agfa need not hastily invest in digital imaging, since
analogue imaging still has its place in our tradition. Analogue imaging has
not been abandoned and still has millions of satisfied consumers. Compared
with digital systems, recent analogue advances are low tech, but so too is
their cost. Image quality is excellent, and represents optimum value. The
technology can also be applied widely; even single-use cameras take good
pictures. At the present stage of development, really high quality digitally
produced images do not come cheap; the equipment required is expensive.
Professional users face high set-up costs, but in industries where speed,
quality, and flexibility in use really matter, the price is worth paying. Imaging
is an industry where copyright is jealously guarded, and ease of transfer
brings with it problems of security and copyright protection. Digital files can
also be lost or become corrupted, so some form of back-up is vital.
In evaluating the alternatives, SWOT analysis is employed.
Alternative 1
Strengths:
Appraising its investment in digital imaging technology will add up to
its core competence
It is genuinely innovative.
It will create new market sectors.
It promotes customer satisfaction with transformed access, ease of use
and transmission of images to provide a flexible series of solutions for
customer needs.
With instantaneous image capture, digital images require only minimal
storage facilities.
Weaknesses:
Large scale investment
Ease of transfer brings with it problems of security and copyright
protection.
Digital files can be lost or become corrupted, so some form of back-up
is vital.
Opportunities:
It can become cheaper in the long run
It can help Agfa become more profitable
Threats:
Agfas competitors will invest in research and development aimed at
enhancing quality at affordable prices.
A significant rise in the cost of borrowing to finance investment
Alternative 2
Strengths:
As a market, analogue photography has almost reached maturity. It is
still
significant in size with almost 70% of the market.
Analogue photography uses traditional cameras to expose silver-halide
film. This still remains the most widely used way to capture images.
Weaknesses:
Low-tech
Analogue images cannot be viewed instantly
take time to enlarge or reduce and are on prints or negatives that
cannot be re-used
Negatives need optimum storage conditions to remain in good
condition long term.
Opportunities:
Agfa can still maintain their traditional customers.
Threats:
The chemicals used in processing analogue images raise some
environmental issues.
Agfas competitors will invest in research and development aimed at
enhancing quality at affordable prices.
III. Recommendation
Based on the results of the SWOT analysis, with more strengths and
opportunities and with fewer weaknesses, alternative 1 is the best move
for Agfa, that is, to take risk and grab the chance of appraising its investment
in digital imaging technology. Although it will take years to recover the costs
of the investment, in industries where speed, quality, and flexibility in use
really matter, the price is worth paying.
