Phillips-van Heusen’s Acquisition of Tommy Hilfiger: Case Study I in Operational Planning

Phillips-van Heusen’s Acquisition of Tommy Hilfiger:

Case Study I in Operational Planning

In a Toronto Star article entitled, “Phillips-van Heusen to buy Tommy Hilfiger

in $3B Deal”, Anne D’Innocenzio and Mae Anderson report on the purchase of the

‘Tommy Hilfiger’ (TH) retail company by Phillips-van Heusen (retail giant which

owns such brands as ‘Calvin Klein’ (CK), ‘Izod’, and ‘Arrow’) for $3 billion in cash

and stock. The acquisition of TH, did not lead to a change in its existing sales,

marketing, and designs strategies, with Tommy Hilfiger retaining his position as

principal designer. This move led to a 10 percent rise in the stocks of Philips-van

Heusen (PVH) on the New York Stock Exchange, and was expected to increase the

combined company’s revenues to $4.6 billion. The authors note that PVH’s move is

contrary to the recent trend of “shedding labels” among many apparel conglomerates

(D’Innocenzio/Anderson, 2010).

The above article is closely tied to two concepts in the domain of planning and

control (ch.8): strategic vs. operational plans, and qualitative vs. quantitative

forecasting. Regarding the first concept, it becomes clear from the article that

Phillips-van Heusen acquisition of TH was a strategic, not operational plan. The

reason for this is that the operational aspects of TH were not altered and remained

under the control of the principal designer. However, the inclusion of TH translates

into a change in the overall strategic plan of Phillips-van Heusen. The article

indicated that the TH brand’s popularity in Europe would be capitalized on to increase

the popularity and sales of Phillips-van Heusen’s other brands

(D’Innocenzio/Anderson, 2010). So while the strategic plan dictates the broader lo...

... middle of paper ...

...etitive techniques that are integral to a

business’s strategy plan and which include a continuous and systematic search for

technological innovations, insight into consumer trends, anticipating the competitors

next step, and launching products quickly and efficiently.

Works Cited

Anderson, Mae and D’Innocenzio, Anne. (March 2010). “Phillips-van Heusen to buy

Tommy Hilfiger in $3B Deal”. Toronto Star. Retrieved at

.

Schermerhorn, John R. and Wright, Barry. (2007). Management Fundamentals,

Canadian Edition.

Stalk, George Jr. (January 2010) “Winning the Business War and Securing the

Territory.” The Globe and Mail. Retrieved at <

http://www.theglobeandmail.com/report-on-business/managing/winning-thebusiness-war-and-securing-the-territory/article1426477/>