From Dysfunction to Value
With considerable excitement, Collaborative Learning, Inc. extended its course management offering with acquisitions adding curriculum tools and a consulting services group. Excitement turned to frustration when growth stalled instead of accelerating. Very few schools bought more than one of the three offerings. None bought all three. Worse, the triple business unit structure led to internal strife over resources.
A Vision of Synergies
By the time CEO Jim Westrick called my firm in, his vision of a synergistic three-part offering for the K-12 school market created more frustration than revenue. The two software applications didn’t integrate, and the consulting group prioritized consulting revenue over supporting the firm’s software applications. Separate sales forces and business unit management made the integrated vision, intended as a competitive differentiator, ring hollow to customers and created openings for competitors.
So, why not just integrate the offerings? Limited cash reserves and a reluctance to “bet the farm” meant the Board was only willing to fund a limited set of upgrades. The leaders of each business unit—who also happened to be the three primary stockholders—lobbied to prioritize upgrading their individual offerings over the integration work needed to fulfill the company’s vision. The company stood at a crossroads.