Recommendations Based on the Case the Coldstream Group Rethinks Its Approach to Strategy

Recommendations based on the case “The Coldstream Group Rethinks its

Approach to Strategy”

Managing each business with a different target will do little to address this issue. What Mullen and Regev have to do is decide what kind of managers they want to be. They can remain businessmen who are good at spotting under-performing assets. If they do, they should sell businesses that are now generating cash because these are the businesses that will fetch the highest price. Alternately, they can decide that they want to become managers who generate growth by focusing on new products and new lines of business.

The case “The Coldstream Group Rethinks its Approach to Strategy” shows three different opinions recommended for future growth with pros and cons pointed out below:

1. Charles Mullen - Option I:

Pros:

- Setting budget targets by basing the numbers on Mullen’s personal experience

- Good leadership in keeping people’s morale in terms of reaching targets

- Achiving much higher profit margin that industry on average

- forcing “divisional managers to look for efficiencies and new ways of serving

customers”

Cons:

- Thread of slowing growth due to the maturity of industries like catering and appliance

rental

2. Consulting company - Option II

Pros:

- underlining diversification

- underlining great potential in broadcasting (digital television) and hotel businesses

Cons:

- Suggesting getting rid of businesses that are profitable; getting rid of risk diversification

3. Gary Regev – Option III:

- More realistic targets adjusted for each business line

Conclusions: each view has its rights, that is why the company should benefit from all of them.

Recommendations:

- Keeping diversity: diverse businesses = diverse risk

- Sticking to the Mullen’s track of motivating managers; his personal experience show

that goals are achievable; however, due to different cycles of businesses, watching the momentum of slowing growth and selling mature businesses for best price if time

comes or adjusting targets as Regev suggests;

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