Case study: This article tells the story of growth and diversification at Sonae, now Portugal’s largest company. Publicly quoted but still majority-controlled by its longstanding Chairman and CEO, Belmiro de Azevedo, it was founded in 1959 in the wood products business. It expanded from the 1980s to become the largest retail group in Portugal and has recently taken on the two incumbents in Portugal’s mobile telephony market. It won the third license auction in 1997 and achieved a 22% market share within three years. As the biggest part of Sonae’s technology investments, the move into mobile telephony played a big part in launching the Sonae share price on a roller-coaster path that has only recently steadied. The Sonae story illustrates the potential importance of long-term charismatic leadership and strategic vision by one person. It also provides insights into the factors that can help diversification to work.
Professional service firms — the ones traditionally hired to help other businesses — have increasingly found themselves in rough waters. Dominic Houlder, Bernhard Kerres and Harry Korine believe that these firms need to change.