ADIDAS

Background

As we know, there are a lot of strategies that many companies use to get benefits on the market place. This time, we are talking about an Adidas Case and how its acquisition strategy brings benefits and troubles to the enterprise.

This acquisition strategy was planned for special reasons, one of the most important is because managers though of putting together all leaders of sporting products, making it the most important brand in the world. But there are more things managers should take into consideration when developing a strategy; for example, the strategy not only demands putting together the most important and powerful companies together, managers must think what they should do for those brands to improve in the market place and getting higher benefits for those strategies. Sometimes, benefits won’t be clear until some years; then, this is an important characteristic to consider in order to know what strategies will develop in a way that they benefit our company. This is what Adidas faced on 2003, they didn’t get the profits they planned; they achieved this goal until 2005. And that was because managers put in action other companies and provided them with enough profits to face the situation and take advantage from it. Now Adidas is able to achieve profitable goals and stronger presence in North America developing strategies according to demographic areas and other important items. Adidas is now the most important company of the group.

KEY ISSUES

• Adidas Salomon was a very attractive investment opportunity.

• Even though Adidas was the top selling sports Goods Company during the 60s and the 70s, Nike had overpassed them in the 80s.

• One of the most important and big problems was the lack of integration between all its areas, clothing, footwear etc.

• The acquiring of Reebok International LTD.

• The strategy they developed in order to get on top of all their competitors and integrate their products properly.

CRITICAL THINKING

When managers are planning a strategy about buying a company, they should consider important aspects and develop a strategy to accomplish what they want. Some of those points are:

1. Establishing objectives: what managers plan to achieve with this acquisition.

2. Choose the best option (company) to buy, according with a SWOT analysis, what are the objectives and characteristics to know if this company can be integrated in our enterprise and get a higher advantage and achieve organizational objectives.

3. Plan how the companies must work and what they need to do to achieve objectives, competitive advantages, etc.

4. Select the best plan according with the environment and goals.

5. Develop the plan and change it if it is necessary.

6. Control and evaluate the results, change every part of the plan if it is causing some troubles or are stopping company’s improvement. What is not working should be changed.

With this information we can develop a general idea to know the importance of what we are doing and what that will do to our future.

IDENTIFY THE GROUP’S ASSESSMENT OF WHAT MIGHT HAVE BEEN DONE TO CHANGE THE SITUATION TO PRODUCE A POSITIVE OUTCOME, IF NECESSARY.

A) Review and align corporate strategy

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