Strategic Management of Cooper Industries Case Study

Strategic Management of Cooper Industries - Case Study Example It is evidently clear from the discussion that Cooper Industries had always been aggressive in its diversification strategies as a means to add value to its manufacturing. While the period from 1967- 1970 was marked by the acquisition of related industries, Cooper industries grew from diversification by acquiring unrelated industries in the year 1980. Cooper Industries considered situations of crisis as opportunities and thus followed three basic principles while deciding upon acquisitions: the target company should be a market leader, the target company should be stable and has a good market for its offerings, the acquisition should make Cooper Industries a market leader in the respective industry. In its diversification regime, Cooper Industries had suffered both profits and losses. For instance, the acquisitions of hand tools, Gardner-Denver and Crouse-Hinds supplied diversification revenues while Dresser and Carrier and Black and Decker resulted in loss conditions. Thus, deciding upon the acquisition of Cameron Iron Works and Champion Spark Plugs is a dicey situation for it where it has to analyze its strengths, weakness and other factors which can provide efficiency without raising the debt burden. Over a period of thirty years, Cooper Industries acquired almost 60 manufacturing companies to add on to its manufacturing expertise. This not only made it independent of the external environmental pressures but also provided diversified revenue base where the sale of one segment compensated for another during tough times. Its organizational strategy was also aligned to the business strategy where every single acquisition was first closely analyzed and then acquired. Its MD&P (Management Development & Planning) division constantly worked on acquisitions to eliminate poor performing or redundant product lines and integrates the acquired business into its own. In these efforts, even relocation of acquired companies plants or reorganizing the staff made all the acq uired companies its profit centers. In order to gain a better understanding of its internal and external environment, the SWOT analysis puts the light.