Academic journal article Journal of the International Academy for Case Studies

Transformation at Btr

Academic journal article Journal of the International Academy for Case Studies

Transformation at Btr

Article excerpt

CASE DESCRIPTION

The primary subject matter of this case concerns the viability of the transformation being undertaken in a large, widely diversified company with a storied past. Secondary issues include assessing merger and/or acquisition partners and the ability to assess organizational "fit" with its environment, between its headquarters and businesses, and across the portfolio. The case has a difficulty of six (appropriate for the second-year graduate level). The case is designed to be taught in three class hours and is expected to require six hours of outside preparation by students.

CASE SYNOPSIS

The story of BTR spans exactly 200 years and includes some of the most prominent leaders in British industry. The decision to be made in the case is the direct result of a successful corporate strategy coming out of phase with the changes going on during the 1990's. New management attempts to refocus the firm, but the plan is not well formulated initially, requiring adjustment and a protracted period of implementation.

The case describes the recent history of BTR in two major phases. The short first section begins in 1965 and is marked by the application of a niche-oriented business acquisition policy. In using this policy, management scanned the environment for wayward businesses that would respond to BTR's methods. Heavy reliance was placed on sound financial reporting and oversight, after a period of transformation.

By the end of 1995-after exactly 30 years-BTR's performance had sharply deteriorated. Forces outside and inside the firm incited mammoth change in the company. Initially, BTR was to be an "international manufacturing and engineering company," a more focused firm, better able to exploit relationships between the businesses. The depth and pace of the changes required were underestimated, however, and corporate management was forced to re-develop BTR the following year into a "leading global engineering company". But, the difficulties of the changes, and the complicating factors of BTR's decreased dividend and an over-extended warrant program, suggest that time and patience may have run out on the firm. At the end of the case, management is left to decide whether to finish implementing the current strategy or to seek partners for merger.

INSTRUCTORS' NOTES

Recommendations for Teaching Approaches

This case offers students solid insight into the formerly successful strategy of a prominent company in Great Britain that now requires painful adjustment. The case is taught most comfortably in a module devoted to corporate strategy, but can also be easily included in a general offering in Strategic Management. As well, the case contains a variety of major sections demanding attention, such as the relationship of environment and strategy; the interrelationship of strategy, control and culture; the sometimes overwhelming interests (and power) of key stakeholders; and the inseparability of strategy formulation from implementation. Finally, the student is allowed an overview of the effects of organizational history, how past decisions and events impact the present and the ability of management to deal with the future.

After full analysis of the case, students should have knowledge of and/or the ability to: assess organizational "fit" between the firm and its environment and within the firm (both between HQ and the businesses and across the portfolio); explain how strategy aligns the activities and resources in an organization to take advantage of opportunities; detail the difficulties (the sources of inertia, resource availability, stakeholder management) that commonly impede strategic change; and analyze the pro's and con's associated with fully implementing a plan for change versus taking up a plan to merge with any of three prospective partners.

Suggested Readings

If the supporting instruction for the case makes use of a textbook, limited opportunities are usually available for secondary reading. …

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