1. How has Cirque du Soleil leadership been able to create a new market space in a traditional industry? Is setting a direction, designing the organization, nurturing a culture sufficient to create a sustainable business?

2. Cirque du Soleil was known for its innovation. Now that it was struggling, how could it continue to innovate in new directions?

3. What strategy can Cirque du Soleil adopt to sustain its competitive advantage?

In 2017 the founder of Cirque du Soleil, Guy Laliberté, after seeing the firm’s growth prospects wane in recent years, had to think about the choices he’d made trying to expand his firm in new directions. For three decades, the firm had been reinventing and revolutionizing the circus. From its beginning in 1984, Cirque de Soleil had thrilled over 160 million spectators with a novel show concept that was as original as it was nontraditional: an astonishing theatrical blend of circus acts and street entertainment, wrapped up in spectacular costumes and fairyland sets and staged to spellbinding music and magical lighting. But since 2008 it had seen a decline in profits, had had poorly reviewed shows, and even the public death of a performer. Consultants warned that Cirque’s market had hit saturation and the company needed to be careful about how many new shows it should add. One suggestion had been that Cirque should seek growth by moving its concept to movies, television, and nightclubs.

The company was seeking additional ways to position itself as Laliberté worked with Cirque’s executive team to come up with a sustainable business restructuring plan. He had wanted to manage diversification by creating discrete business units under a central corporate entity, thereby beefing up the noncircus side of the business. Recent influx of capital via a majority stake taken by global investment firm TPG and a minority ownership agreement with a Chinese investor could provide needed funds, but giving up control might necessitate a shift in the company’s culture, and what might that do to Cirque’s strong brand identity?

Running on Broadway since 2016, the Paramour, a combination of theatre and acrobatics, was the first show to be launched by a new subsidiary for musical-theatre production based in New York City, but the reviews had been lukewarm. Another subsidiary, 45 Degrees, was beginning to produce special events, and the firm was venturing into the development of small cabaret shows at hotels, children’s television programming, and theme parks. Would this diversification be enough to help Cirque take on new and different challenges, or was the rarity gone?