Case # 18 -- Adidas in 2008: Has Corporate Restructuring Increased Shareholder Value?
Team and Individual Writing Assignment Please evaluate Adidas’ restructured line-up of sporting goods businesses. Your analysis should identify Adidas’ corporate strategy, evaluate the attractiveness of the industries it has diversified into and the strength of each of its business units, and assess the degree to which strategic fit and resource fit exists in the portfolio. Also, please recommend an investment priority and strategic moves to improve overall corporate performance and increase shareholder value. You must ...view middle of the document...
What is Adidas’ corporate strategy? Was there a common strategic approach utilized in managing the company’s lineup of sporting goods businesses prior to its 2005-2006 restructuring? Has the corporate strategy changed with restructuring? What is your evaluation of Adidas’ line-up of businesses in 2008? What does a 9-cell industry attractiveness/ business strength matrix displaying Adidas’ business units look like? Does Adidas’ business line-up exhibit good strategic fit? What value-chain match-ups exist? What opportunities for skills transfer, cost sharing, or brand sharing are evident? Prior to its divestiture, what kind of strategic fits existed between Adidas’ core business and its Salomon business unit? Has Adidas’ business line-up exhibited good resource fit between 1998 and 2007? What have been the financial characteristics of its major business segments during that time period? Which businesses might have been considered cash hogs and cash cows? Based on your analysis of Adidas businesses, did the restructuring undertaken in 2005 and 2006 make sense? Does it appear the acquisition of Reebok International will produce higher returns for shareholders? What strategic actions should Adidas’ top management initiate to improve the company’s financial and market performance now that restructuring is complete?