Diversification Dilemma at Shree Niketan School

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Excerpts

Vish researched the market and had to do considerable ground work before setting up the new venture. Recalling his experiences of the initial days of the venture, he said, “I conducted a study to decide the location of where to start the school. I felt that already Chennai city was overcrowded with many premium schools like Padma Seshadri Bala Bhavan (PSBB), Chennai Public School, and it is highly costly considering the sky rocketing fixed asset prices. Hence, I decided to focus on sub-urban places and shortlisted five sub urban places near Chennai out of the entire set viz. Chengalpet, Perungalathur, Red Hills, Sriperumbudur, and Thiruvallur. Each location had its own advantage. Perungalathur and Thiruvallur had maximum middle class population and better access due to the transit connectivity through sub-urban train services.

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To offer international standards, a 1:20 teacher student ratio was consistently maintained in the school. With nearly 2083 children and 110 teachers by September 2011, the teacher student ratio was 1:18. This put it on a par with international standards and far above the state government requirement of 1: 30. .......

Before the advent of Shree Niketan, there were no professionally run matriculation schools in the locality and the school soon established itself as a strong brand in the neighborhood. The management positioned the school as a premium matriculation school providing education that was among the best in the country, with its fee structure slightly higher than that of the existing schools in Thiruvallur district. .....

In September 2010, after the Shree Niketan Matriculation School had been functioning successfully for four years, Vish at his monthly meeting with the administration and coordinators discussed the feasibility of adding CBSE education also under the brand umbrella. He had seen that there was a demand for CBSE education even when he had set up the existing school, and in four years, this demand had grown many times over.......

The existing set-up would provide readymade infrastructure for the new school which would help the management in reducing the set-up work to a large extent, felt Vish. Educomp, its education solution partner, would help it in creating a similar system customized to CBSE education for the new school. Other existing vendor sources like for books, notebooks, and stationery could be utilized for the new school as well........

The existing service operations at Shree Niketan were established with standards conforming to matriculation norms. Vish understood that the new school operation would have to be designed with quality standards conforming to CBSE norms. The established service quality also had to be maintained, to ensure that there was no brand dilution. .......

As Vish pondered on the possibilities of establishing the Shree Niketan Patshala, he took a closer look at the Balance Sheet and the Profit and Loss account statements of Shree Niketan School for the fiscal ended on March 2010 (Refer to Exhibit Va and Vb). Although his main focus remained reduction of costs, several questions were triggered in his mind, .......

Exhibit I:Infrastructure
Exhibit II: Corporate Philosophy
Exhibit III: Organizational Structure
Exhibit IV: Student Strength (as of September 2010)
Exhibit V: Student Growth (as of September 2010)
Exhibit VI: Balance Sheet (as of March 2010)
Exhibit VII: P/L Account (as of March 2010)
Exhibit VII: Eight Pillars of Innovation
Exhibit IX: Chart of Google’s Share Price from September 5, 2008 to September 4, 2013
Exhibit X: Top Innovative Technology Companies in the World