Page 16 - Stakis C Case Study

Increased profits and earnings per share will surely ensure
the future survival and growth of Stakis, provided the

management team can be retained.

By 1994 the board essentially comprised some six

members - Sir Lewis Robertson, Michels, Chisman, and;

two non-executives and Sir Reo who was now 82 and took

no effective role. Paradoxically, the structure of Stakis
under the stewardship of Sir Lewis Robertson and David

Michels had reverted to a similar flat structure evident

prior to Andros’ stewardship. The difference being that

tight financial control was exerted from the centre with
little duplication of functions and concentration on core

business activities. Under Andros and Sir Reo there was

clear strategic drift with divisions entering and leaving the
portfolio e.g. in 1988 there were five divisions. By 1994

under David Michels, there were only two divisions.

Using Argenti's model some interesting discussion points
arise. Not the least of which is the tightness and loyalty of

the group under Michels compared to that under Andros.

Likewise. the roles of Sir Reo and Sir Lewis are likely to

point to the latter providing a mentorship of exceptional
quality.

Perhaps, unlike David Michels, Andros failed to create a
team which would challenge the efficacy of his decisions.

From the first half of June to November 1996 Stakis under

David Michels had spent over £200m buying over two
dozen hotels. This was followed in November by the