 The traditional process followed for developing

a strategy and the problem being encountered

by the management.
 Management is not clear as if they are having
right kind of approach for developing the
strategy or they need to change present
practice.
 The case also discusses various strategy
formulating approaches. Currently the
company is following traditional approach
 Coolex Founded in 1965
 Main business: Air conditioning manufacturing
/services
 Main products: Central air conditioning,
Unitary condition unit, Duct air condition units
 Market share: 40 %
 Close competitor: Airtemp 15 %
 CEO: Mr. T. R. Jagmohan
 Consultant/advisor: Asish Mahapatra
 Total Business: 620 Crore
 Present Strategy Formulation Approach: Traditional /
Planning
 14 years ago Coolex had 55 % share of
the local central air-conditioning
business. Today, it stands at 40 %.

 Closest competitor, Airtemp, accounting

for a 15 % share and growing.

 even Coolex customers are becoming,

increasingly, unpredictable
How should Coolex evolve its strategy? Should it
continue with the conventional approach, with
its focus on the external environment, in the face
of potential competition?

 The case study discusses the conventional

approach that Coolex follows which sees only
the static picture of the competition,
underplays the role of innovation, exaggerates
the role of the environment, and does not
account for the varying resource and
competence-levels across companies.
 In my views Coolex should not continue with
the conventional approach and should evolve
by not trying to find the most advantageous
strategic position in relation to the
environment and competitors. Instead, move
towards building and exploiting own
resources.

 They should base their strategy on core

competency by being proactive rather than
reactive
Is it feasible to link strategy-planning at Coolex
to its core competencies? Or is the
competencies-based approach to strategy-
development old wine in a new bottle? Has
Coolex got a grip on its core competencies at
all?
Yes it is feasible reason being
 If you adopt the industry-structure approach
to quality, strategy-planning process
becomes reactive. You look at your
competitors, suppliers, or customers and
react which can work as long as the going is
good.
 If you adopt the competence-based
approach, Coolex will look within itself, find
your core strengths, and understand how
you can leverage them to gain a
competitive edge. It will help you realize
which strategy is good for Coolex without
blindly following every move that your
competitors make.

 Coolex has set the right course but they are

far from realizing their right core
competency.
Is there an alternative to the traditional approach
to strategy-formulation?
The alternative is the proactive approach i.e.
base your strategy on your core competencies
instead of the environment and the industry.

Are the managers of Coolex asking the right

questions? What should the road-map for
Jagmohan and his team be?
Partly they have asked right ones but they left out
that it could be their pooled knowledge and
technical skills that predates time.
 Focus on a specific product segment: central air-
conditioning, unitary air-conditioners, or ducting
systems
 Look at a particular customer segment: industrial or
domestic customers.
 Adopt a mix-and-match approach, choosing to
cater to the needs of customers in profitable
segments in both markets.
 The ultimate choice would require the company to
answer 4 questions:
› Does Coolex has, or can acquire, the resources
(financial, technological & knowledge) in time to reach
the set goal?
› What are the risks associated with each alternative?
› What are the financial implications of each alternative?
› What does the choice of a particular strategy mean for
the company in the long run?