Case # : The Transformation of Thomson

(a) Identification of Central Issue

There are many reasons which attributed to the fall of Thomson:

1. Thomson stick to low end technology for TV sets which was under decline. There were
low margins and their debt kept on increasing to be in this segment.
2. Management was not able to transform their business model for reforms from analog to
digital technology as low cost competitors started emerging in Asian markets for
consumer products segment
3. There were no new offering or complete solutions provided by Thomson rather
Thomson provided part wise solutions
4. Thomson was lacking in good proactive strategy as they did not diversified their
business model as they eliminated their medical business & defense business
5. Corporate staff size was very high and synergy was missing.
6. Thomson’s acquisition strategy was also ineffective and they acquired businesses in
which they were not having expertise.
7. Investment in R&D for future product development was very low wrt revenue
generation.
8. Patents were not utilized properly for further revenue generation

(b) Analysis of data, events, statements, etc., to build the big picture and arrive at the
root cause/s of the problem

(c) Approaches/designs to address the root cause

Submitted by: Group 12