Platform/Division growth strategy: Chemicals

A company’s performance chemicals division contained a portfolio of diverse chemicals businesses structured as small business units. These businesses were managed separately, and although some were profitable, their growth potential was limited due to their highly specialized nature and inability to leverage companywide competencies, particularly in technology/science, to drive growth in new areas. The company was looking for assistance in understanding the role of each business within the portfolio and what skills, capabilities, and technologies could be leveraged to create a growth platform.

CRA’s approach was divided into two phases.  Phase 1 consisted of developing a technology-based growth platform and screening several high-growth areas that could leverage competencies across the division and the corporation.  During phase 2, CRA developed a growth strategy for the chemicals division showing the role of each of the SBUs in the portfolio and specific actions to capture positions in the selected growth areas.  We also developed a technology platform to leverage the unique and differentiable skills that could bring the highest value to the company.

CRA concluded that there were six broad areas of capabilities that could be leveraged to capture and identify high-value growth areas.  By changing its approach to technology and repositioning its current businesses toward high-value segments, the growth platform could now double underlying market growth of the company’s portfolio while helping it achieve potential annual revenues of $3 billion. The strategy developed from this effort was supported by the executive board, and the company is now in the process of implementing our recommendations.

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