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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Seeker of Truth who wrote (39968)	3/4/2001 1:56:10 PM
From: DaYooper	Respond to of 54805

Can you think of a single gorilla where the growth of sales was not primarily "organic", i.e. internal, not dependent on acquisitions? Not sure if you are asking for a company with huge organic growth or huge acquired growth. MSFT is an example of the former and CSCO is the best example of the latter. Rory

To: Seeker of Truth who wrote (39968)	3/4/2001 2:00:11 PM
From: Mike Buckley	Respond to of 54805

Malcolm, Can you think of a single gorilla where the growth of sales was not primarily "organic", i.e. internal, not dependent on acquisitions? That's a really good point about which we need to come to our own conclusions. It's not as easy to do as appears on the surface. That's because an acquisitions strategy can be a form of paying for R&D. Companies very often can't afford to wait to develop their technologies in-house because the delay, compared to the speed of buying the technologies by acquiring a company, lessens their competitive advantage with faster moving companies. As an example, I don't know how Cisco should be categorized. If Cisco is a company that has done extremely well not growing "organically" as defined by traditional metrics, my bet is that they've grown organically by more modern metrics. My best guess is that the difference between growth by acquisition and so-called internal growth is that the former has more to do with buying sales and that the latter has more to do with leveraging existing core technologies. But that's a very, very fine line. Siebel, as an example, bought both product and sales when it bought Scopus. Yet its CEO is very clear in recent quarters that the acquisitions it makes will be to acquire technologies it needs as opposed to acquiring market share. --Mike Buckley