Torstar Corporation Survival by Controlled Growth

1
Torstar CorporationSurvival by Controlled Growth

• by J. Y. Shen

2
Objective

• Organization Growth
• Controlled Growth
• Torstars History
• Similarities to Greiners Model
• Distinction from Greiners Model
• Torstars Controlled Growth
• Advantages
• Disadvantages
• Torstars Future

3
Organizational Growth

• Greiners Model
• Growth through creativity ? Crisis of leadership
• Growth through direction ? Crisis of autonomy
• Growth through delegation ? Crisis of control
• Growth through coordination ? Crisis of red tape
• Growth through collaboration ? Crisis of ?

4
Controlled Growth

• Restricted growth rate
• Despite favorable environment
• Incremental growth
• Adjust before next step in growth
• Find best growth direction
• Centralized Management
• Family owned
• Remain in direction stage
• Improve core competence

5
Torstar Corporation
Newspapers
Printing Distribution
Book Publishing
Internet Multimedia
6
Brief History
Birth of Evening Star
Atkins as publisher
Renamed The Star Reach top
Establish Torstar Corporation
Bought Harlequin
Renamed Toronto Star
Galloway as CEO
Honderich as publisher
The Star bought by Trustees
Expansion
Atkins Death
Prichard as CEO
Atkins Charitable Foundation
1892
1948
Present
1976
Charitable Gift Act
Romance War
Newspaper War
7
Torstar Development Eras

• Pre-Atkins Era (1892 1899)
• Birth
• Atkins Era (1899 1948)
• Growth (Creativity and Direction)
• Post-Atkins Era (1948 1976)
• Growth (Direction)
• Torstar Era (1976 present)
• Growth (Direction Delegation)

8
Atkins Era

• Growth through creativity
• Identify niche
• Establish reputation
• Attract readers
• Smooth transition into Direction Stage
• Balance the finances
• Monitor the organizational structure
• Controlled Growth
• Maintain optimal size

9
Post-Atkins Era

• Direction Stage
• leadership crisis and autonomy crisis
• Maintain Status Quo
• Growth under Honderich
• Maintain core competence
• Expand into related fields
• Slowly acquired entire Harlequin Enterprises

10
Torstar Era Honderich Dynasty

• Torstar Corporation
• Divisional structure
• Honderich is CEO and Director
• Honderichs Objectives
• Maintain core competence
• ? publisher of Toronto Star
• Adjust to the acquisition of Harlequin
• ? Galloway to fight Romance War

11
Torstar Era Galloway Dynasty

• Direction not Delegation Stage
• Galloway
• Under the Board
• Board insist on resisting the convergence trend
• Low level of debt and solid core competence
• Achievements
• Acquire numerous newspapers
• Failures
• High tech education, internet

12
Torstar Era Present

• Departing from Controlled Growth
• Little centralized power at Board level
• Shifted into Delegation Stage
• Making many new acquisitions, alliances
• Growing quickly
• Moving towards control crisis
• Losing focus of core competence

13
Controlled Growth

• Controlled Growth
• Incremental growth steps
• Centralize new acquisition before more growth
• Advantages
• Avoids pendulum effect
• Remain centralized organization
• Follow good growth direction
• Disadvantages
• Not fully exploiting expansion opportunities
• Dwarfed in their industry

14
Conclusion

• Initially, Torstar followed the controlled
  growth.
• Currently, Torstar approaching Greiners Model.
• The controlled growth is a good growth strategy
  and it should receive some credit for Torstars
  survival.