Sylvan Case Analysis in Order

SYLVAN Case Analysis

In order to be able to list the strategy links and directions that Sylvan has used in its history, we need to see what each historical period, respective to the company's owner, brought about, in terms of business level strategies.

The first period dates from the company's founding to its acquisition by KinderCare. During this period, the company's strategy was quite simple and, as we have seen from the case study, extremely profitable, as the original founder sold it with a $5 million profit. This was the so-called niche strategy. As a small company, Sylvan could not, at that time, play as a global player, so instead it chose to draw some benefits from the $300 billion education industry. This niche was represented by the extra services offered as a parallel alternative to those offered by public schools.

While the KinderCare period cannot be characterized by any strategy changes, the period during which Becker and Hoehn-Saric were at the company's leadership, from 1991 to present, brought a somewhat radical change. First of all, we may assert that Sylvan moved from a niche strategy to an acquisition and diversification strategy, with the determined goal of representing more than the niche company it had been until then.

The new strategy that was approached had come as a response to the changes in the education industry, which had been increasingly profitable during the 80s. This industry was represented, generally, by private alternatives to the public school system, whether they are computer programs, private tutoring or distance learning facilities. The industry itself is quite segmented, not necessarily because there are many players, but mainly because there are many different business levels or business segments they can operate in.

As we have seen, for example, Sylvan had split its business activity into two main business segments, Sylvan Learning Center and Sylvan Education Solutions, both operating on specific sub-markets, both on the K-12 customer segment. For the postsecondary customer segment, again there are two different business levels, Sylvan International Universities and Sylvan English Language Instructions. So, as we can see, diversification seems to be a key strategy in this phase, mainly because the education industry has different customer segments, generally depending on the customers' age, but also on their locations or abilities.

If in some cases, the company chose to develop in-house solutions, it was often the case that a serious and aggressive acquisition strategy was applied in order to complete the company's products. This was the case, for example, in the postsecondary market segment, but also in what some of the international ventures were concerned. According both to the company's CEO and to the final evaluation for the company's future, it seems that this trend will continue after 2000, with a distinct emphasis on the international aspect.