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In September 2013, the managing director of Darling Kenya, a hair care product company headquartered in Nairobi, was pondering his next move. As a leader in the beauty hair care industry in Africa, the company needed to stay a step ahead of increasing competition from both local and multinational firms. With limited room to grow in the industry, he was looking at a set of alternatives to protect Darling's brand from losing market share. Which option would benefit the company the most: exploring new advertising channels, especially on the Internet and in social media; reinvigorating the brand with new packaging and higher quality; or entering the rural market through road shows?

In 2012, the director of a subsidiary campus of a national university was faced with many problems: he was personally overworked as both manager of the new campus and as a lecturer; there were too many part-time lecturers on staff, leading to a loss of commitment and morale; a decision had to be made about buying or leasing the newly renovated campus building; and, most importantly, all of his decisions were subject to approval by the main administration of the university. Without controlling the campus’s bank account, the director was unable to implement the initiatives he believed will allow the school to grow in a sustainable manner. The issues that arose as a direct result of this arrangement provided an interesting perspective on the difficulties involved in managing a small subsidiary of a large public organization.

This three-part case highlights the strategic decision-making and growth management challenges in the suddenly liberalized Kenyan dairy industry. Following the 1999 collapse of the nation-wide distribution system on which small-scale dairy farmers in Kenya relied to reach the market, the resulting gap in the value chain between supply and demand created an opportunity for one entrepreneur. Cool Pastures Dairy was later founded in 1999 and rapidly expanded in an atmosphere of not only little competition but also corruption and lack of infrastructure, especially poor roads, limited banking, and almost non-existent cell phone accessibility. Although the company considered various alternatives to expanding, the business was overcome by problems with inefficient or corrupt retailers and accountants, as well as the owner’s lack of business experience, and went bankrupt. When conditions improved as the government invested in infrastructure, the entrepreneur considered restarting his business. Is this a viable enterprise in light of improved conditions? Which expansion alternative should the resuscitated company pursue? The B case 9B13M045 discusses managing corruption and the C case 9B13M046 re-considers the business model.

Part B of a three-part series. See 9B13M044 and 9B13M046.

Part C of a three-part series. See 9B13M044 and 9B13M045.