Profico: The Way Forward

Profico Trading and Contracting Company WLL, an aluminum and glazing contracting company in Lebanon, assembled and installed aluminum and glazing doors and windows and aluminum composite panels for local construction projects. The company's revenues had increased over the years, but over the previous four years, revenues had declined, largely as a result of regional political turmoil that affected the construction industry. The management team was contemplating an opportunity to invest in a production line that would expand the company's scope through backward integration, conceivably increasing the company's revenues by 40–50 per cent. Was the investment worthwhile in the context, and if so, how might the company finance it?

This case is suitable for an undergraduate or graduate strategy course to interpret qualitative and quantitative factors in decision-making; a graduate course in the strategic management of innovation to assess the innovativeness of a company and benchmark it to other companies; a graduate human resources development course to develop a plan to train, motivate, and develop employees for improved retention and lower turnover; or a graduate project management course to introduce company structuring techniques and apply business process re-engineering solutions and tools to improve a company’s organizational structure and processes in managing projects.<br><br>This case challenges students to make a strategic decision about an investment opportunity and develop a plan to implement the investment to ensure a sustainable reversal of the decreasing trend of revenues in the prevailing political and economic conditions. After completion of the case, students will be able to do the following:<ul><li>Undertake an external environment analysis.</li><li>Evaluate the attractiveness of industries.</li><li>Identify key success factors and their importance in ensuring better performance and a sustainable competitive advantage.</li><li>Identify actions that successful companies can adopt to overcome barriers impeding innovation, and to leverage available opportunities for innovation and growth.</li></ul>

• innovation, diversification, contruction