breed case study

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: )TER 1 Breed's Tipping Point: Headed towards Success or FaiLure? By Brian Tjemkes, Renee Scheerman & yuri Narayen, VU University Amsterdam Breed: A Creative Communications Agency )n 23 May 2O0B Breed was officially recognized by ,re Dutch KvK, six months later than the contpany started doing business. As Ljsa Varkevisser, one of .ne members joked: ,We chose to use a coopera_ - : as a legal form, because it is reiatively easy and :.rick to incorporate, but it took us half a year to make 3reed official.' Breed is a creative agency set|ed in -msterdam, centre of the communication and com_ rercial field in the Netherlands. lts core businesses 3re to accomplish marketing and communication; .rey sell products and services related to advertis_ rg, concept development of events, commercjals, :nline business and they initiate actrvities pertain_ rg to art, culture and musjc. Breed consists of six 'cunding members; Scott van der Velden, Cyril Stom, Varcel Ossendrijver Bisschops, Ltsa Varkevisser, Fdward den Ouden and Jean pierre Kin. Breed's Staft-Up The rent of business space on 1 September 2OO7 in ihe Maple Leaf factory was the starling point of Breed. During September and Ociober 2OO7 Ihesix members of the Breed cooperative met each other frequenily. All of them knew one another from previous lobs at various advertising and communicatron agencies, To- gether the six founders of Breed hit upon the jdea of starting a company in which freelancers were united. On the l st of January 2OOB Breed officially became a company. ln this month Breed got thejr first order: developing a web portal for The Ster (foundation of ether commercials), Because Breed acquired its first order, the 'terms and conditions, had to be written. This was the first offjcial document signed by a client. Fuelled by this instant success, other organizational matters also demanded decision_making; at that time, Breed's legal form was unclear, a website was non_ existent, as well as the requirement for a brochure to promote the company. Breed only exlsted based on the informal connection between the members. The cooperative UA as a legal form was establ shed on the 26th of February 2008 A cooperative is an au_ tonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly_owned ancl democratically-controlled enterprise' UA means that members are locked out for iiability and that no recover rights exist on the Breed members (i.e. six founders). It was also decided that the six board members would each receive one-sixth shares of the profits and that Breed always remajns intellectual owner of designed concepts. The digital brochure was accompljshed on 26th of March 2OOg. The officlal Breed web log, www. bestofbreed.nu, went live on gth of N/ay. On this web log the members update their soul mates, clients ancl fans about their activities. Although Breed did not yet officially exist for the Dutch government (KvK), the first invoice was sent to The Ster at the end of March. But, it took untill May 23 to complete the ,act and regula tion' and the notation at ihe KvK. After achieving this milestone it was finally possible to hire an accountant. Lacking knowledge and skills on running a business, the members of Breed decided to establish a Board of Advice. The board of advice consisted of three members with organizational, personnel, and legal backgrounds. They had a first meeting on 12th of February 2008 and on the 2Oth of March 2OOg all six core Breed members presented themselves and their business plans to the Board of Advjce. With the help of the Board, Breed formulated their business strat_ egy on 20th of May. After these initial activities Breed was ready to stad doing business, Breed's Environment Breed js a creative communications agency. A cre_ ative agency is a company that offers one or rTlany communicative disciplines, like advertjsing, develop- ment of events, commercials, online communication and textual or graphic communjcations, ln the past decade, severai developments and trends have been noticeable in the industry of creative communication agencies, contributing to the creation of new aqen cies, intensified competition, and new strategies. copyright o 2010 by Brian Tiemkes, Fenee scheerman & Yuri Narayen, Feprinted by permission of the authors

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Page 1: Breed Case Study

: )TER 1

Breed's Tipping Point:Headed towards Successor FaiLure?By Brian Tjemkes, Renee Scheerman & yuriNarayen, VU University Amsterdam

Breed: A Creative Communications Agency)n 23 May 2O0B Breed was officially recognized by,re Dutch KvK, six months later than the contpanystarted doing business. As Ljsa Varkevisser, one of.ne members joked: ,We

chose to use a coopera_- : as a legal form, because it is reiatively easy and:.rick to incorporate, but it took us half a year to make3reed official.' Breed is a creative agency set|ed in-msterdam, centre of the communication and com_rercial field in the Netherlands. lts core businesses3re to accomplish marketing and communication;.rey sell products and services related to advertis_rg, concept development of events, commercjals,:nline business and they initiate actrvities pertain_rg to art, culture and musjc. Breed consists of six'cunding members; Scott van der Velden, Cyril Stom,Varcel Ossendrijver Bisschops, Ltsa Varkevisser,Fdward den Ouden and Jean pierre Kin.

Breed's Staft-UpThe rent of business space on 1 September 2OO7 inihe Maple Leaf factory was the starling point of Breed.During September and Ociober 2OO7 Ihesix membersof the Breed cooperative met each other frequenily.All of them knew one another from previous lobs atvarious advertising and communicatron agencies, To-gether the six founders of Breed hit upon the jdea ofstarting a company in which freelancers were united.

On the l st of January 2OOB Breed officially becamea company. ln this month Breed got thejr first order:developing a web portal for The Ster (foundation ofether commercials), Because Breed acquired its firstorder, the 'terms and conditions, had to be written.This was the first offjcial document signed by a client.Fuelled by this instant success, other organizationalmatters also demanded decision_making; at that time,

Breed's legal form was unclear, a website was non_existent, as well as the requirement for a brochure topromote the company. Breed only exlsted based onthe informal connection between the members. Thecooperative UA as a legal form was establ shed onthe 26th of February 2008 A cooperative is an au_tonomous association of persons united voluntarilyto meet their common economic, social and culturalneeds and aspirations through a jointly_owned ancldemocratically-controlled enterprise' UA means thatmembers are locked out for iiability and that no recoverrights exist on the Breed members (i.e. six founders).It was also decided that the six board members wouldeach receive one-sixth shares of the profits and thatBreed always remajns intellectual owner of designedconcepts. The digital brochure was accompljshed on26th of March 2OOg. The officlal Breed web log, www.bestofbreed.nu, went live on gth of N/ay. On this weblog the members update their soul mates, clients anclfans about their activities. Although Breed did not yetofficially exist for the Dutch government (KvK), the firstinvoice was sent to The Ster at the end of March. But,it took untill May 23 to complete the ,act and regulation' and the notation at ihe KvK. After achieving thismilestone it was finally possible to hire an accountant.Lacking knowledge and skills on running a business,the members of Breed decided to establish a Boardof Advice. The board of advice consisted of threemembers with organizational, personnel, and legalbackgrounds. They had a first meeting on 12th ofFebruary 2008 and on the 2Oth of March 2OOg all sixcore Breed members presented themselves and theirbusiness plans to the Board of Advjce. With the helpof the Board, Breed formulated their business strat_egy on 20th of May. After these initial activities Breedwas ready to stad doing business,

Breed's EnvironmentBreed js a creative communications agency. A cre_ative agency is a company that offers one or rTlanycommunicative disciplines, like advertjsing, develop-ment of events, commercials, online communicationand textual or graphic communjcations, ln the pastdecade, severai developments and trends have beennoticeable in the industry of creative communicationagencies, contributing to the creation of new aqencies, intensified competition, and new strategies.

copyright o 2010 by Brian Tiemkes, Fenee scheerman & Yuri Narayen, Feprinted by permission of the authors

Page 2: Breed Case Study

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Trends in the Communication MarketDue to an emphasis on costs and economizing, clientsstafted to use a 'pitch-system' enabling them to havemultipie creat ve agencies apply for one commission.However, the time and efforts necessary to pitch areoften not compensatecl by the client, putting high pres_sure on the revenues of the creative agencies, Anotherconsequence is that several creative agencies adopteda cost-leadership strategy to meet clients' demands,fufther reinforcing an already competitive marker.

Another trend rn the industry is the shift from build_ing client-relationships to the use of project-basedorders. Companies used to have a long_lasting rela_tionship with one creative agency. Nowadays, theyprefer to let agencies pitch for a project and repeatthis process for every project, By using their bargaining power clients are able to realize cost reductions,For instance, they only have to pay a creative agencyduring the project and to win pitches creative agencieslower their prices, Another reason, however, pertainsto changing customer demands requiring that clientsinvest in creative campaigns to maintain and increasetheir market shares. Stimulating competition betweencreative agencies enables clients, at the expense ofgiving up long-lasting reiationships, to obtain state_ofthe aft creative work,

Online communication has become an importantproduct/service of the creative communications industry. Traditional communication was restricted to com-mercials on television and radio, graphics and textualcommunication. In contrast, online communicationassociates with websites, interactive and digital com_mercials, banners, online polls, etc. Nowadays, offer_ing multidisciplinary approaches has become a crjticalsuccess factor. Creative agencies should have knowl_edge of traditional media as well as online media.

Breed's Competitive positionBreed ls one of many creatlve agencies jn the Nether_lands. Most of them are setiled in or around Amster_dam. There are a few large players in the market, acouple of small-mediurr sized companies, and thereare numerous freelancers. Creative communicationagencies can be arrangecl by the diversity of commu_nication methocis they offer to clients ancJ thejr attitudetowards innovation. With respect to communjcationmethods agencies vary from singie drscipiinaqy to mu/-tidisciplinary. Possible communrcatrve disciplines aretextual or graphic communications, onltne communl-cation, commerctals, production and account managing, A creative agency can offer one of these seruices.

FA*T I

a combinatron of services or all of these servtces.Another important distinguishing feature betweenagencies is their attitude towards developing jnnova_tive products and services. Some companies seeka unique position in the market by presenting them-seives as highly innovatjve and proacttve. ln contrast,other companies position themselves as reactive andconseryative, The main competitors of Breed can beorganized along these dimensions (see Exhibit 1 .10).

Breed is highly innovative and possesses a lotof expertise in different mocles of communication.Therefore, Breed consjders itself as a pro_active multidisciplinary creative agency (i e. right top quadrantin Exhibit 1.10). Competitors, such as ,They, and'Noise', have adopted similar positioning strategies;however Breed is the smallest firm among them. Mostiikel.v, once a client decides to commission an innova_tive advertising campaign these companies becomedirect competitors. However, corrditional on the communication mode companies specialized in one cljsci_pline (i,e. left-top quadrant in Exhibit 1 .10) shouid beconsidered as competitors as well, because they areexpert in one of the disciplines Breed olfers. ln addi_tion to competitors another important group of play_ers in the market form a threat to Breed: freelancers.A freelancer is an experl in a certain area and can behired by a company. Some freelancers have unitedthemselves in freelance communjties. For example,'Machf is a medium-seized freelance communitywhich focuses on multitask orders. Freelancers orfreelance communit es shoulcl be seen as importantcompetitors for Breed, because they can otfer simi_lar expertise, flexibility, price and they have the pos_sibility to adapt their collaboration to fit every orcler.To conclude, in line with recent developments creative agencies are more and more opting for a mul_timedia approach. To date however, Breed still hasa competitive advantage compared to most conrpa_nles as Breed is able to combine a multi_disciplinaryapproach with innovative products and seryices.

Breed's Competencies and StrategyTo offer state-of-the-arl products and services Breedhas developed two core competencies providingihem with a unique se/ling point: expertise and flex_ibility. Due to the members backgrounds Breed pos_sesses a unique combination of know_how andsk lls, Blendlng of expertise pertaining to innovativecommunication methods and state-of-the_artproductron enables Breed to develop out_of ihe_boxsolutions tailored to ciients, denrands, For instance,

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CHAPTER 1

EXHIBIT 1.10 Marrrx

Single-taskCreative

Agencies

of the Posttton of Creatrve Agencres

lnnovative/Proactive Creative Agencies

Gonservative/Reactive Creative Agencies

Multi-taskCreativeAgencies

Breed members have expertise in graphics, produc-

tion, online businesses, personal relations as well as

textual communications, suggesting that all members

individually contribute to Breed's success. ln addition,

f Breed is lacking in-house expertise they are still able

to develop unique solutions, as Breed is suppoded by

a strong neiwork of soul mates. Soul mates are peo-

ple that stand close to the Breed-members and have

their own field of expertise. As Breed is a relatively

small organization they are fast and flexible in concep-

tualization and delivery of products. ln order to make

a product that fits best to the client's demands, they

engage in frequent interaction with their clients. Fur-

thermore, as Breed members have different specializa-

tions, all members can act autonomously within their

projects. That is, decisions are not approved by differ-

ent managers, but are often taken after quick consul-

tation by the members. This comb,ination of expertise

and flexibility dlstinguishes Breed from its competltors

Breed tries to distinguish themselves from other

creative agencies by offering many products and ser-

vices, including online communication, commerclals,

graphic communication and production, As such,

their main strategy is best characterized as one of

differentiation; however, it is the combination of sev-

eral strategic decisions that really distinguishes them

from other creative communication agencies. Breed's

strategy is closely related to Breed's identity and

F.

Page 4: Breed Case Study

slogan: 'Stay true to yourself'. For instance, Breeddecided to only accept orders which they flnd inter-esting and reinforces their identity. Another definingcharacteristic ls that Breed actively involves their cli-ents in the conceptualization and productton phases.This enables Breed to align concepts wlth clients'wishes, whereas clients can monitor expenses. Breedalso decided that short-term fjnancial gains may notbe gained at the expense of long-term creativity, ex-clusivity and quality, The Breed members believe thattheir unique products and enthusiasm for every proj-ect provides Breed with a stronger market positionthan their (cost focused) competitors.

Breed's lnternal Organ izationBreed has a flat organizational structure with sixfounder members. Within this structure all membersare equal and no hierarchical order or leader (i.e. drrec-tor) has been installed. Breed has a functional structurewhere all members have different areas of expertise,which depicts their functional discipline, Members rn-

form each other of their projects and try to be informedabout the activities of the other members. In additionto their functional specialization, each member hasbeen assigned another management task. Lisa is theaccount director of Breed, but also takes care of ad-ministrative tasks, including contact with lawyers, de-signing contracts, arranging insurances, formulation ofthe statutes, terms and conditions, the recognition bythe Dutch KvK and the formulation of Breed's strat-egy. She also takes most responsibility to encourageand control the activities of the other members. Scottfunctions as the chairman of Breed and hjs expertiserelates to that of ar1 director and motion designer, AtBreed, Cyrii's task is that of art director and interactiondesigner. He leads on-line and off line projects. Cyril'stask is also that of treasurer and currently he is oc-cupied with financia tasks, such as sending invoices,maklng payments and keeping track of hours workedon projects. Edward and J-P are primari y concernedwith keeping track of creative deve opments, Edwardrs strong at concept design, theme communicattonand sales promotion, whereas J-P makes creatlveconcepts visual. At Breed Marcel fulfils the functions

PART I r,';' r'l r r' i' : ,,,i : ,"

secretary to the board and producer, as he is mainlyconcerned wiih the production of audio and video,However, as production is a very small part of the mainactivities, Marcel is exploring how he can contributeto Breed.

However, several tensions have emerged betweenthe members. For instance, clients are behind withpayments, clients reported that having multiple con-tact persons within Breed is confusing; information onclients, projects, and finances is disorganized and often tacit. Although, Breed members cons dered thesetensions as start-up problems they started to makesome changes. For instance, Lisa wrote a job descrip-tion for the members of Breed and the core-membersof Breed discussed how to assign and specify the re-sponsibilities of the different members. However, todate the assignment of the tasks and responsibiiitiesis not clear, resulting in a situation in which each mem-ber feels more or less responsible for different tasks.For instance, although Lisa is primarily responsible forexternal communication she also deals with internalcommunication. Fudhermore, in July 2008 the Boardof Advice was officially dismantled with the exception ofonly one member of this committee.

Breed's Acquisition of ClientsBreed acqutres new orders in two ways. First, poten-tial clients are approached through connections in

their personal networks. Due to the work experienceof all Breed members, they know ditferent people inthe busjness, which may lead to possible new orders.For example, leads were generated by these personal

networks to potential clienis, such as Heinz, Peilnen-burg and Van Haren, Lisa has also become friendswith Marijke Helwegen, a Dutch celebrity. A contacthas already led to several orders or links to other peo-ple who might have an order for Breed. The Breedmembers also obtained orders through their advisoryboard. However, provided with the broadness of thenetwork, relatively few contacts are used to generateorders. Although, clients are approached to ensurethat they will remind Breed first when they have anorder, the members do not capitalize sufficiently oniheir networks.

EXHIBIT 1.11 Breed s OrganrzationaLDesign

Page 5: Breed Case Study

CHAPTER 1

Second, pitches are common practice in the indus,try to connect clients to creative agencies. The Sterorder was, for example, won by a pitch. A pitch is aunique possibility to show to a client what Breed canoffer. The Breed members prefer to convince a poten-tial client with a visible product, like a model, a pre-sentation or graphics instead of a description of theirideas. To develop a product for a pitch it is necessaryto invest into the idea for the pitch and build the prod-uct. However, a disadvantage of a pitch is that the timeand efforl spend on a pitch can not be charged to theclient. lt is common practice, however, that a companythat loses a pitch receives a compensation of €1000.

- and the winner is rewarded by obtaining the order. To

deal with the downside of this pitching system Breeddecided to (1) only pitch one time per client and (2)

deliver a state-of-the-art pitch. Although, this strategyincreases risks and costs, it turns out to be a success-ful strategy, as to date all pitches have been won.

Breed's'Service Production' ProcessThe production process of Breed exists of sevenstages. The first stage in the service production pro-cess is orientation. ln this stage the first acquaintancebetween Breed and the potential client takes place.The second stage in the production process is mak-ing an inventory. In this stage among other things theactual strategy, proposition and goals of the clientare discussed, inspection of former campaigns takesplace, figures and facts are collected and budgets anddeadlines are discussed. Furthermore in this stageBreed makes a plan of action and formats a projectteam which will work on the project. The third stageis the strategy stage. A target group analysis happensin this stage, as well as the arrangement of the goalof the project. Furthermore the client takes care of abriefing of Breed, a closer look at existing means willbe discussed and a debriefing by Breed takes place.Finally Breed provides the client with an indication ofthe costs of the projeci and makes a plan for the con-cept design. Concept development is the fourlh stagein the productron process, in which concept designand elaboration take place. ln this stage a briefingof the creation and presentation for the client takeplace. The fifth stage is pre-production. ln this stageBreed visits its clients, preferably on the client's loca-tion; the assignment is formalized in detail, That js, itis decided what is going to be produced and how.An interim presentatjon for ihe client is performed anda final agreement on the art work is made. The pre-production stage is followed by the production stage.ln this stage the actual production of the project

happens and the end of this stage means delivery ofthe products and services. The seventh stage of theproduction process is the post-production stage. ln

ihis stage the production is evaluated and discussedwith the clieni. During the second, third and fourthstages of the production process account manage-ment is leading, however across the stages the core-members of Breed are not working independently.They have continuous contact with the project mem-bers and they are expected to help one another bydiscussing their progress and output. FurthermoreBreed keeps in touch with the client durinq theproduction process.

Breed's Start-up Performance

Project PerformanceSince the foundation of Breed, the company has landedseveral projects. The projects of Breed can be cate-gorized into three groups. The first group consists ofprojects performed for commercial clients, the secondgroup consists of social projects and the third groupconsists of Breed initiated projects. The first client ofBreed was a big fish akeady. Thjs client was The Sterand Breed was asked to create and rmplement a newstructured website and develop a strategy and onlinepresentation for The Ster, Breed's first ever invoice wassent to The Ster at the end of March 2008. Breed alsocreated a campaign for lnterior Matters in which cam-paign stickers were glued on cast-off furniture that wasplaced along the roads as bullly refuse. Other clients ofBreed included Mexx, Voedingscentrum and Junkbeat.Concerning social prolects Breed has performed activi-ties {or Hiphopinjesmoel. Jean Pierre is actively involvedin this organization and Breed helps Hiphopinlesmoelwith their contacts in the media. Another social proj-ect Breed is active in is No Kidding. This is a projectwhich cares about the guiding of derailed youngstersin youth prisons to return into the society. Lisa is active at this organization which is creating a nationalaction plan and communication plan. Thirdly, Breedalso developed several of their own projects, whichmeans that Breed is responsible for concept develop-ment, financial investments and execution. Examplesof such projects are the Minimafair (www.minimafair.com) and Meccabox.

Marketing PerformanceDuring the first year of the ljfe of Breed the company'sbrand awareness grew very quickly. This resulted inthe landing of projects of a couple of big clients. Ex-amples of these clients are the Ster, Voedingscentrumand Mexx. Concerning public relations Breed decjded

Page 6: Breed Case Study

not to invest in all kinds of public relations activities,such as interviews in professionai magazines. Theirwork should speak for itself and do the work for Breed.Breed only wants to make use of public relations if theyare sure that pro1ect is ready to be taken into public re-

lations. For instance, the project Breed performed forInterror \,4atters resulted in an arlicle about Breed andthis project in the creation publication of the magazineAdformatie" Breed's Minimafair project entered intothe media in November 2008 through coverage tn theStory (a Dutch gossip magazine) and by several televi-sion interviews with Marijke van Helwegen.

Financial PeiormanceDuring the second quarler of 2008 Breed had a posi-tive result of €54.912,76. Sreed and accountancycompany C aus Accountants made a forecast of theresults over the period 2008-2010. This forecastshows that over the fiscal years 2008 and 2009 anegative result before tax is predicted. This forecastednegative result is -€22.059,00 in 2O0B en -€54.381 ,00in 2009. The fiscal year 2010 is the first year thatshows a positive forecasted result. This positive re-sult numbers €34.650,00. The forecasted returns in

the period 2008-2010 are respectively €60.000,00in 2008, €880.400,00 in 2009 and €980.400,00in 2010. The Breed members decided not to givethemselves salaries until January 2009, contributingto the positive net result. The gross monthly salaryper member of the management will be €9.190,00in 2009 and 2010 which amounts to a gross yearlysalary of €110.277 ,00. With regard to the number ofown projects performed by Breed a forecast of twoown projects in the year 2008, and five own projectsin both 2009 and 2010 ls made. However, it remainsuncedain whether Breed has sufficient funds to imole,ment these projects.

Breed's Future

When looking at the future of Breed, it is the ambitionof the core members of the company to accomplishgrowth and become a successful creative agency.This growth is aspired to in several aspects includ-ing financial and marketing performance, corporatesocial responsibility, brand awareness and companysize. ln the long term, the members plan to terminatetheir freelance activities and work full time for Breed.They want to hire employees to a maximum of thirtypeople. Concerning the ambition of growth and be-coming a successful creative agency, to date thereare some enablers and barriers that may foster or im-pede Breed's ambitions.

The financial and marketing performance of Breedshows sustainable growth at this moment. Also thebrand awareness of Breed is growing, which resultedin attracting several bigger clients, Although this is apositive developmeni for Breed, the core members ofBreed are not yet ready to stop their freelance activitiesand start working for Breed full time at this moment,They do not dare to take this step at present, On theother hand, it is the short term ambition of Breed torealize more paid Breed commissions, so the mem-bers can discontinue their freelance activities. The factthat the members of Breed have to divide their timeand efforl between Breed and their freelance activitiesnegatively affects Breed's success and growth.

The diverging focus of the foundlng membersthreatens the chemistry and linkage between themembers of the company. lt was chemistry that drovetheir initial decision to start Breed. Whereas initiallymembers worked together very well and comple-mented each other, currently tension and conflicts areemerging. The member's focus is shifting and they are

exploring different directions outside Breed,

Concerns also exist with respect to the organiza-tion design. Although the flat structure enables Breedto build on its core competences, it creates ali kinds l

of communication problems and tensions betweenthe members. For instance, frequent discussions andconflicts emerge about members' responsibilities, pro-

fessionalism of the project organization, lack of infor-mation, repeated and redundant contacts with clients i

and the fact that conflicting agreements are made withclients on products. In additjon, due to Breed's motto ofequality no member feels responsible for taking care ofthe long-term strategy of the firm, A leader and leader-ship are missing, contributing to Breed's lack of focusand direction. ln addition to financial per{ormance otherperformance criteria such as efficiency, creativity andflexibility need to be included into the management in-

formation system. Given Breed s ambition to grow, it islikely that more tensions and conflicts can be expected.

The strategy of Breed and the unique Breed iden-tity are two very important grounds for the successof Breed. Especially the slogan 'Stay true to yourself'depicts a unique feature of Breed. For instance, theBreed approach towards pitchino reflects their strat-egy and identity. However, growth may threaten theiridentity as new members (i.e. stafQ, clients and stake-holders may have different views. lt, therefore, remainsa question jf the Breed identity and vision, which areessential to continue success, will remain unharmedby the ambition to grow.

Nr

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CHAPTER 1 ].,]]:''

To conclude, the fuiure of Breed is quite uncer-tain. The ambition of Breed to grow and become asuccessful creative agency is one possible reality asduring the start-up phase important decisions weremade, including the choice of the company name,logo, legal form, digital brochure, terms and condi-tions, the website www.bestofbreed.nu and the rec-ognition by the Dutch KvK. However, unexpectedbarriers also threaten Breed's success, includingconflicts between members, difficulties in acquiringnew projects, and poor internal and external commu-nication. lt is reasonable to conclude that Breed is ata critical tipping point. Therefore, the question is: isBreed headed towards success or failure?

N otes

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2. 'After three years of patnful effort, Europe's biggestelectronics company is stiil struggling to get fit', IheEconomist, Aprl 7, 1990, P9.99.G. Mahesh and S. Chaudhuri (2004), 'Philips: Restructuringto Make Thlngs Better', ICFAI Business School Case Study304 330-1, Hyderabad.Sean Meehan (2007), 'The Philips Marketing Journey', IMDCase Study IMD 5-0729.

5, Kerry Capell (2006), 'Thinking Simple At Phil ps: A panel

of outsrde experls is helping the electronics giant reinventitself', Busrness f4leek, December 1.].

6. Govind, S., and George, S. (2007), 'Philips, Making Senseof Simplicity', ICFAI Case Study 507-085 1.

7. Harry G. Barkema, Joel A. C, Baum and Elizabeth A,

Mannix, 'Management Challenges in a New Time,'Academy af Management Journal 45, no.5 QOA2\,916-930. Eileen Davis, 'Whats on American Managers'Minds?' Management Review (April 1995), 14 20.

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July B, 2008,10. Craig Unger, House of cards: From 9/1 1 to BAE, the

Saudrs have turned the purchase of poiitical power intoa fine ad, The Guardian, April .15, 2008, Pg. 28; RoberlBaer, The Saudis do not give up their secrets, Mr Blair,

The lndependent on Sunday, April 13, 2008, Pg. 50; JaneWardell, 'Calls to reopen UK inquiry into BAE-Saudi armsdeal', Associated Press Worldstream, April 11, 2008; NickClark and Stephen Foley, 'BAE chief detained as US turns upheat rn bibes case', Ihe lndependent, May 19,2008, Pg.36.

1 1 . 'Aft-^r JK; Societ6 G6n6rale, The Economist, May 31 ,

20OB; Peter Bobison, 'When traders go bad; The Soci6t6G6nerale scanda is following a familiar scripl, Ottawa

,rtl, ii:u ,i ..il.l ,i,.tr.rt:i: ;l ,t i,t ,rt ,rii,

Which organlzation design decisions do you

think are particulary relevant for the start-up ofa creative communication agency like Breed?Explain why.

What explanation can you give for the star.t-upsuccess of Breed? Consider both the externalenvironment and the internal organization.

Given Breed s ambition to grow furlher, whichchanges would you recommend to Breed tomake in the organization design? Explain yourrecommendations.

Citizen January 26,2OO8, Pg. E3; 'Societe Generale bossadmjts faults in control systems', Agence France Presse,

June 10,2008.12. Joe Willis, "'Woeful" - Scandal of Lost Data Discs', Ihe

Nofthern Echo, June 26, 2008, Pg. 1.

13, David Wessel, 'Venal Sins: Why the Bad Guys of theBoardroom Emerged en Masse', TheWall StreetJournal(June 20, 2002), Al, 46,

14. Greg lp, 'Mind Over Matter-Disappearing Acts: The RapidRise and Fall of the Intanqible Asset,' Ihe Wall StreetJournal (April 4, 2002), Al , 46.

1 5. Jim Davis (2003), 'Speculatrve Capital in the Global Age,'Race and Class,44,1 22, AniIa Hawse; 'Mergers

and Acquisitions: A Dangerous Game', Global FinanceMagazine, May,2007, Pg. 4.

16. Bernard Wysocki Jr., 'Corporate Caveat: Dell or Be Delled,'The Wall Street Journal (May 10, 1999), A1 .

17, Ancly Reinhardt, 'From Gearhead to Grand High Pooh-Bah,' BusinessWeek (August 28, 2A00), I 29-1 30,

18. G. Pascal Zachary,'Mighty is the Mongrel,' Fast Company(July 2000), 270-284.

19. Debra E. Meyerson and Joyce K. Fetcher, 'A ModestManifesto for Shattering the Glass Celling', HarvardBuslness R ev i ew (J anuary-Feb ru ary 200a), 1 27,1 36 ;

Annie Finnigan, 'Different Strokes', Working Woman(April 20Ol), 42-48; Joline Godfrey, 'Been There, Doingfhat' , lnc. (March 1996), 21 22, Paula Dwyer, MarshaJohnston and Karen Lowry Miller, 'Out of the Typing

Pool, into Career Limbo', BusinessWeek (Aprii -15, 1996),

92-94.20. Howard Aldrich, Organizations and Environments

(Eng ewood Cliffs, N.J.: Prentice,Hall, 1979), 3.21 , This section is based largely on Peter F, Drucker, Managing

the Non Profit Organization: Principles and Practlces (New

York: HarperBusiness, 1992); and Thomas V'lolI, Managrng

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