TAILIEUCHUNG - Resizing The Organization 7

Resizing The Organization 7. This book seeks to provide executives with useful insights, tools, guidelines, principles, and lessons learned about organizational transition and change. | Who Moved My Drink 41 Those two drink companies planned to split up the brands. Pernod Ricard acquired six Scotch whiskies including Chivas Regal and Glenlivet as well as Martel Cognac and Seagram s Gin. In doing so it reduced its emphasis on anis and catapulted itself into the third spot in the world s top five distilled spirits marketers and with a better balance in geographical and portfolio terms. Diageo already was the industry leader by far and was strengthening that position by taking Crown Royal and VO Canadian whiskies as well as Captain Morgan rum. Diageo s main rationale for the deal was to become a focused leader in the alcoholic beverage industry. Both buyers also gained distribution power through the joint acquisition Diageo predominantly in North America and Pernod Ricard in Latin America Asia and North America. However the deal was disastrous for SSWG s European marketing and sales operations which were largely going to be decimated. Furthermore brands in SSWG s long brand tail such as Sandeman Four Roses Bourbon and Oddbins were to be auctioned off by the two buying companies. The irony was that all these events happened at a time when SSWG had posted an all-time record earnings of billion in the fiscal year that ended June 2000. Furthermore SSWG had been enjoying double-digit growth during ten out of the past eleven quarters. From an earnings perspective SSWG was leading the spirits industry. These great profits had boosted the morale of the employees who now saw the positive results after five years of culture change. People felt part of a highly streamlined and winning organization with a growing performance discipline. Seagram s top management had been on the deal track for a while but there never had been any rumors that SSWG was going to be touched. The threat of unloading SSWG sent a shock wave through the organization. Consequently SSWG s senior management suddenly found themselves faced with the obvious paradox of retaining the talent

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