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Abstract

This is the first of a two-case series. This case describes the dramatic rise and fall of Saatchi & Saatchi (S&S) in the advertising industry, based on their vision of scale, globalisation and diversification, driven by an aggressive acquisition strategy. The (A) case, set in 1988, is a condensed version based on the earlier INSEAD case by Sumantra Ghoshal and Alice Aves (INSEAD, 1989), 'Saatchi & Saatchi Plc' (190-029-1). The (B) case provides an update of the subsequent events leading to the downfall and further developments up to 2002, with WPP, led by the former S&S Finance Director Martin Sorell, coming out as the 'winner' in this global consolidation game. The series is intended as a basic introductory case on the pros and cons of globalisation strategy in a traditionally predominantly local industry and the organisational implications of making this work. It can also be used as a basic introductory or review case on strategy and organisation. An important element further consists of the acquisition-driven growth logic, explored in the case, as represented by the price-earnings game practiced by S&S and many other companies in many other industries after them up to the present day.
Other setting(s):
1989

About

Abstract

This is the first of a two-case series. This case describes the dramatic rise and fall of Saatchi & Saatchi (S&S) in the advertising industry, based on their vision of scale, globalisation and diversification, driven by an aggressive acquisition strategy. The (A) case, set in 1988, is a condensed version based on the earlier INSEAD case by Sumantra Ghoshal and Alice Aves (INSEAD, 1989), 'Saatchi & Saatchi Plc' (190-029-1). The (B) case provides an update of the subsequent events leading to the downfall and further developments up to 2002, with WPP, led by the former S&S Finance Director Martin Sorell, coming out as the 'winner' in this global consolidation game. The series is intended as a basic introductory case on the pros and cons of globalisation strategy in a traditionally predominantly local industry and the organisational implications of making this work. It can also be used as a basic introductory or review case on strategy and organisation. An important element further consists of the acquisition-driven growth logic, explored in the case, as represented by the price-earnings game practiced by S&S and many other companies in many other industries after them up to the present day.

Settings

Other setting(s):
1989

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