Torstar Corporation Survival by Controlled Growth by J. Y. Shen

Objective  Organization Growth  Controlled Growth  Torstar’s History – Similarities to Greiner’s Model – Distinction from Greiner’s Model  Torstar’s Controlled Growth – Advantages – Disadvantages  Torstar’s Future

Organizational Growth  Greiner’s 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 ?

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

Torstar Corporation Book Publishing Newspapers Printing & Distribution Internet & Multimedia

Brief History Birth of Evening Star Present Atkins as publisher Atkins’ Death Renamed The Star Reach top Atkins’ Charitable Foundation Charitable Gift Act The Star bought by Trustees Honderich as publisher Renamed Toronto Star Establish Torstar Corporation Bought Harlequin Galloway as CEO Prichard as CEO Romance WarNewspaper War Expansion

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)

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

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

Torstar Era – Honderich Dynasty  Torstar Corporation – Divisional structure – Honderich is CEO and Director  Honderich’s Objectives – Maintain core competence  publisher of Toronto Star – Adjust to the acquisition of Harlequin  Galloway to fight Romance War

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

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

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

Conclusion  Initially, Torstar followed the controlled growth.  Currently, Torstar approaching Greiner’s Model.  The controlled growth is a good growth strategy and it should receive some credit for Torstar’s survival.