|Case Abstracts: 2008 Meeting
DOWNTOWN WACO, INC.: WOMAN OVER-BOARD
Business & Society Ethics
EMPLOYEE FRAUD AT MIAMI REHABILITATION SERVICES
A leading female citizen of a small town in Texas had developed an outstanding record as the administrator of a non-profit organization named “Downtown Waco, Inc.” The organization was charged with the mission of revitalizing the inner part of the city that had been virtually abandoned by most businesses. A crisis developed when a Police Department investigation uncovered the fact that the administrator had converted checks addressed to the non-profit entity for her own use and benefit. The focus of the case is on the steps that can be taken by non-profit organizations to prevent such fraud from occurring.
The case should allow students to: (1) analyze differences in auditing practices for a non-profit organization as compared to a for-profit organization; (identify areas of responsibility within a non-profit organization for safeguarding assets; (3) apply the fraud triangle to the case protagonist; (4) discuss the key players’ responsibilities in fraud prevention; and (5) identify individuals and groups harmed by the fraud and specific ways in which each was harmed.
This case deals with a purported fraud perpetrated on a non-profit organization named Downtown Waco, Inc. by its Executive Director, Margaret Mills. Under Mills’ leadership from 1988 to 2006, the downtown area of Waco, Texas, had been completely revitalized. The gentrification project had included turning old warehouses into the upscale River Square Center, lofts, and offices. Mills had also encouraged the City to contribute river trails, a new Lake Brazos Dam and millions of dollars in the renovation of streets and sidewalks in the downtown area. Then in 2006, the Board of Directors began to uncover a practice followed by Mills of converting checks address to Downtown Waco, Inc. into her own private use. After an initial Police Department investigation of the practice, the Board of Directors launched their own internal analysis and discovered at least $410,000 in “questioned check activity.”
SANTORO’S GOURMET COFFEE UNLIMITED
The case exposes students to internal control and fraud and its impact on small business. Although the issues of internal control and fraud are involved in almost every discussion of accounting, only recently has this concept received increased discussion of their small business organizations. The case helps students to understand the importance of internal controls and how controls can be circumvented to perpetuate fraud. Further, the case examines a real fraud and exposes students to the changing role of the management when fraud is suspected. Moreover, the case examines how management/owners interact with CPAs in a non-assurance environment and opportunities for CPAs to be the client’s business advisor. As part of this examination, students are exposed to the importance of risk as a dynamic factor in the in small business and the role of the CPA in helping clients to select the proper accounting information system. The case can be used in either a graduate or undergraduate auditing course or a course in accounting fraud.
The case follows the thoughts and actions of Juan Martinez, the owner of Miami Rehabilitation services. Juan reviews the events that occurred in the organization of his physical therapy practice and how he allowed internal controls to be circumvented. The case helps students to understand the importance of internal controls and how controls can be circumvented to perpetuate fraud. Further, the case examines a real fraud and exposes students to the changing role of the management when fraud is suspected. Moreover, the case examines how management/owners interact with CPAs in a non-assurance environment and opportunities for CPAs to be the client’s business advisor. As part of this examination, students are exposed to the importance of risk as a dynamic factor in the in small business and the role of the CPA in helping clients to select the proper accounting information system.
THE SHORT HAPPY LIFE OF CELIANT CORPORATION
An entrepreneur needs assistance developing a financial plan for a small business. He would like to know whether he has a realistic chance of making money in a small espresso and coffee shop. Students are given projected financial and operating data which will enable them to do contribution and breakeven analysis, develop an analysis of cash flows, derive income statements, and calculate selected balance sheet numbers for the business. They will develop an understanding of the “economics of the business.” Can it make money? If so, how? If not, why not? Use of an electronic spreadsheet is strongly recommended. A major objective of the case is to encourage students to think about the motives that drive entrepreneurs to start small businesses and the risks inherent in such ventures. Students are encouraged to think beyond the numbers.
Tony Santoro has a vision of opening a gourmet coffee shop in a suburb of a Midwestern city. He has developed a budget for the cost of opening the store, including site work, equipment, fixtures, and furniture; total costs are expected to exceed $120,000. The site he has chosen is at the corner of a busy intersection, where city traffic counts are on the order of 18,000 vehicles per day. Santoro sees this as an untapped market in a resurrected downtown area, but the municipality is committed to mixed use [retail/residential] development in other areas of the city as well. Santoro’s approach to financing his business is unusual. He will have no cash equity in the business and will finance the start-up with a home equity loan. He knows he will need a comprehensive financial plan to take to the bank when he tries to arrange financing.
This case concerns actions taken by Lucent Technologies to spin off its power amplifier business into a company called Celiant Corporation, and then sell its interest in Celiant in a series of transactions between June 2001 and February 2002. In less than nine months, these transactions resulted in Celiant’s apparent value increasing from $117 million to $470 million.
Students are required to explain this four-fold increase. Therefore, the case is ostensibly an exercise in accounting valuation, including analysis of Celiant’s value chain and intangible assets. However, the case includes a strong business ethics component because of potential conflicts of interest on the part of the Lucent managers who engineered these transactions. Because ethical issues are seldom flagged as such in business practice, the ethical issues are imbedded in the case for students to discover. The overriding ethical question is whether managers at Lucent compromised their fiduciary responsibility to shareholders when they sold ninety percent of Lucent’s power amplifier business apparently at a deep discount.
The case was designed to help students in intermediate and advanced accounting courses to broaden their understanding of the role of accounting information in evaluating business transactions. Because of the multifaceted nature of the case, it is also a good fit for technical, integrative, honors or capstone business courses.
Although the antenna is often the most visible part of a telecommunications network cell site, each site also includes a base station that houses a power amplifier and other equipment. In June 2001, Lucent spun off its power amplifier business into a nonpublic company called Celiant Corporation. A private investor and a private equity firm contributed $55 million cash for approximately fifty percent of Celiant’s equity. The ownership interest retained by Lucent in June 2001 implies a market value of $62 million for the assets contributed by Lucent, and an initial market value for Celiant of $117 million.
In February 2002, Celiant was acquired by Andrew Corporation for cash and stock valued at the time at $470 million. Hence, in less than nine months the value of Celiant increased from $117 million to $470 million. But Lucent’s shareholders benefited only minimally from this appreciation, and the source of this valuation creation is unclear.
ARTESANIAS DE COLOMBIA - DESIGNING AT THE BASE OF THE PYRAMID
BOB ISMAIL AND UNIVERSAL FRUIT COMPANY
“Artesanías de Colombia- Designing at the Base of the Pyramid” was written to be used in MBA programs and in executive programs on Strategy, Leadership and Organizational Development, also related to social development. The case aims to expose the complexity involved in developing a social promotional strategy for an informal sector such as handicraft. The case can be used to stir a discussion around the concepts of strategic analysis, development of an informal organization, social promotion and leadership style while considering the contribution of multiple players with diverse and not necessarily convergent interests to achieve sustained progress. In addition, it enables students to analyze four key aspects of a business strategy: developing a vision for value creation, developing a strategy and an appropriate organization to that end, assuming commitments with stakeholders and understanding the relationship between leadership style, strategy and the organization.
Upon becoming general manager of Artesanías de Colombia (AC), Paola Andrea Muñoz Jurado faced the challenge of redefining the company strategy. AC was a mixed ownership company aimed at fostering, promoting and marketing Colombian handicraft, thus creating attractive job and economic development opportunities for artisans, a low-income sector mostly of indigenous origin. Soon after assuming as general manager, Paola engaged herself in reviewing the company´s previous management in order to plan her next steps. In doing this, it was key to assess the true impact on society of the activities carried out during the previous 16 years under her predecessor, Cecilia Duque’s leadership. The present case allows students to work on a no-for-profit organization strategy, with a strong social orientation, and evaluate value creation within a complex network of relationships with a strong economic, social and cultural impact.
LOS ANGELES FIRE DEPARTMENT: DIVERSITY IGNITES DISCRIMINATION
The case is appropriate for undergraduate or graduate courses in Business and Society, Business Ethics, or Small Business Management that examine corporate social responsibility, the influence of the external environment on the operations of small businesses.
Bob Ismail, a Palestinian immigrant to the United States in 1985, founded Universal Fruit Company almost as soon as he arrived in Los Angeles. Over a period of twenty years, Bob built the business from its initial wholesale fruit stand at the Seventh Street Market (referred to as the “Old Market”) to a $7 million importer and wholesaler of fruits. After 18 years at the “Old Market,” he experienced a series of problems that he was unable to control. The “Old Market,” where hundreds of wholesale produce sellers conducted their business, had rat infestations, sewage leakage, and other health, safety, and sanitary problems that scared off Bob’s customers. Bob’s complaints to the Old Market landlord fell on deaf ears. In desperation, he filed complaints with the City and the Health Department of Los Angeles County, to no avail. Relocating away from what was considered to be the “Wall Street of Produce” was not a realistic option. For two years, Bob’s complaints went unheeded and Universal Fruit’s sales declined. After 20 years of faithfully paying rent, Bob learned that the “Old Market” landlord would not be renewing Universal Fruit Company’s lease. No reasons were given. Bob marshaled legal support to fight back, and personally campaigned to get the media to report on the persistent health violations at the market. Time ran out. While lawyers argued and journalists gathered facts, Universal Fruit Company’s lease expired. Unable to find another suitable location for a wholesaler, Bob closed the business on June 1, 2005.
MICHAEL BIANCO INC. IMMIGRANT WORKERS TO SAVE COSTS
The LAFD case is appropriate for advanced undergraduate or graduate courses in Business and Society, Business Ethics, or Human Resource Management, that explore the context of discrimination in the workplace, the difficulties of implementing management practices to increase diversity, and the challenge of changing an organizational culture to embrace it.
Serving the “salad bowl” of L.A.’s ethnic communities, the Los Angeles Fire Department (LAFD) was the second largest municipal firefighting force in the United States. In 1972, the federal government filed a lawsuit against the City of Los Angeles claiming that the LAFD unlawfully discriminated against Blacks, Latinos, and Asians. As a result, LAFD adopted an Affirmative Action Program. In 2008, the LAFD had firefighters representing every ethnic group in the city, yet it continued to face difficulties in recruitment and retention of women; race and gender discrimination; sexual harassment; and the challenge of changing its culture. A series of lawsuits called into question the effectiveness LAFD’s diversity programs and the competence of the Fire Chief. In 2005, an African-American firefighter was awarded $2 million when he sued the LAFD for racial discrimination after learning that his spaghetti and meatball dinner was made with dog food. In 2007, a jury awarded $6.2 million to a firefighter who claimed that the LAFD simply could not accept her as a Black, a woman, and a lesbian. A 65 year old firefighter received $1.73 million after complaining of age discrimination. Even a loyal LAFD Captain who was “fearful for women in the organization” threatened a lawsuit on behalf of female firefighters subject to discrimination and sexual harassment. The December 2007 graduating class of the LAFD academy did not include a single female; none of the female recruits had passed the grueling tests. A journalist wrote, “City Hall’s dream of turning women into firefighters is a multimillion-dollar disaster.”
STRIKING AT THE QUEEN
The owner has been in business since 1985 and in 2004 was awarded a military contract. The business needed to increase its workforce dramatically in order to meet the contract deadlines. The company hired illegal workers to do the jobs at a significant savings. The company treated the workers shabbily but the workers kept the jobs. As badly as they were treated they had been treated worse in their native country.
The case should enable students to consider the following ethical issues- (1) hiring illegal workers (2) payment practices (3) treatment of the workers (4) employer and employee responsibility for payroll taxes (5) evaluation of contracts.
Michael Bianco Inc was a relatively small manufacturing firm employing 85 people in 2001. By 2004 the company was awarded a multimillion dollar government contract from the department of defense making backpacks for troops serving in Iraq. The company increased its workforce to over 500 to accommodate the contract. The workers, however, were illegal aliens. The department of homeland security raided the manufacturing facility and found and detained for deportation over 300 illegal workers. Further investigation revealed deplorable and unfair working conditions including lack of heat and docking worker’s pay for talking. Employees worked double shifts and instead of being paid overtime were paid straight time out of two separate companies. Humanitarian groups defended the workers and some later filed suit for back pay.
SUNFLOWER POWER ELECTRIC CORPORATION
The primary objective of this case is to demonstrate how people, even with the best of intentions, can find themselves involved in a complex situation facing numerous ethical dilemmas. Such situations often result in great personal sacrifice (such as the loss of friends, standing in the community, and jobs). This is particularly true when the “fight for right” must be focused on the person at the top of an organization.
This case is suitable for graduate or upper-level undergraduate courses in business ethics and accounting ethics. Even though the case occurs in a university setting, the challenges for the protagonists and suspected misdeeds of upper management could occur in the private sector. Because the case involves students as the central characters fighting against the administration and political leaders, it should interest class members at both the undergraduate and graduate levels.
The focus of this case was a series of ethical dilemmas faced by three undergraduate students, in their pursuit of solutions to what they believed had been serious mismanagement, financial misdeeds, and possible fraud by university administrators. After Calvin Collins, Kent Russell, and Daniel Morris (who became known as the Tech-3) accidentally found confidential university payroll records, they took the records and their concerns to several administrators. Because they were rebuffed by university officials, the students “went public” to the news media and on to the state capitol. After their public cry for the resignation of the university president, the three students were put on probation and two of the three were arrested on criminal charges. University administrators attempted to break up the solidarity of the three students. After several months of “fighting the good fight,” several enticements were offered to Collins by a university trustee. Collins had to decide whether to accept the enticements and persuade his friends they should give up their fight to improve conditions at the university. If they continued to demand change, they would be going against extremely challenging obstacles. Was it likely the administration would make it impossible for them to complete their degrees? Would continuing the battle be worth the personal sacrifice? Was it time for the students to give up? Had they already gone too far?
THE GREENING OF ARUBA
Sunflower is an electricity generation and transmission cooperative in western Kansas. In 2007, the secretary of the Kansas Department of Health and Environment denied an air quality permit to expand Sunflower’s main generating station—one 360-MW unit—by adding two 700-MW units. This was the first such permit to be denied because of concern over CO2 emissions. The decision focus of the case is whether the expansion project should be allowed to go forward. The case considers economic factors using standard corporate finance methodology. It also considers the legal, social, and environmental impacts of the expansion and related sustainability issues.
The case requires students to: (1) analyze the net present value of the expansion project and the underlying assumptions made by Sunflower; (2) identify the costs and benefits of generating electricity from the expansion project; (3) identify the environmental impacts of the proposed Holcomb expansion project; (4) evaluate the underlying issues behind the public relations campaign promoting clean coal energy; (5) examine the various ways used to generate electricity in terms of sustainability. The case writers developed the case for undergraduate Business, Society/Ethics, Finance, and Integrative Capstone courses.
Eight months after the Kansas Department of Health and Environment denied the air quality permit for the Holcomb expansion project, the expansion remained on hold. Sunflower management expressed optimism that the expansion will happen and has appealed decision in October 2007. The American Coalition for Clean Coal Electricity increased its advertising budget from $8 million in 2007 to $35 million in 2008 to promote clean coal energy as the only viable way to U.S. energy independence. The Kansas legislature passed three different bills during the 2008 session that would effectively result in the plant expansion going forward. However, all three bills were vetoed by Governor Sebelius. Meanwhile, the Kansas Supreme Court is waiting for decisions to be made by the lower courts on Sunflower’s appeal before it gets involved. Will the plant expansion be approved? Should it be?
WAL-MART UNFREINDLY VANCOUVER
The Greening of Aruba is primarily a policy and strategic commitment case focusing upon alternative technologies for renewable energy on a small touristic island with severely constrained resources. Furthermore, readers may ponder the socio-cultural disconnect between actual problems, possible solutions and suggested policy choices. Finally, the case demonstrates the (un)ethical ease with which the costs of local environmental actions are externalized. The case of Aruba is digestible because it is a very small island nation, yet generalizable to the social, economic and resource sustainability situations faced by municipalities, states and nations around the world. This case is designed specifically for use in Sustainable Economics courses and Strategic Management of Technology and Innovation courses.
In 2008, Aruba was a 20 mile long by 5 mile wide island in the southern Caribbean Sea with a desert climate, no fresh water springs, strong easterly trade winds and magnificent beaches. All electricity and fresh water on the island was manufactured using gasoline or diesel. The local population had grown from approximately 50,000 in 1990 to over 110,000 in 2008 and while not yet over-crowded, resourced were beginning to become overburdened. Tourism was adding an additional 30,000-40,000 people on an average day. There were 2.5 cars per local household. The government and the public utilities were already struggling to provide fresh water, auto fuel and electricity in large enough quantities and at low enough prices for local families, businesses and the tourist industry to survive, when crude oil hit $140 per barrel in early 2008. The government along with the utilities’ master engineer was considering three primary strategic commitments to alleviate the problems of growing demand and upwardly spiraling costs. Refitting the gas powered water desalinization and electricity generation plant with higher efficiency diesel generators; constructing a hydro-thermal heat exchange system to take hotel air conditioning off the main electricity grid; and installing a windmill farm wired into the existing grid. Policies meant to limit growth of new hotels or to encourage reducing usage of water, transport fuel or electricity were either non-existent or ineffective. The heavily used beaches were slowly degrading, and overburdened roads are snarled with traffic. Yet the island remained clean and the people wealthy: tourism was booming, the Netherlands infused financial resources into the infrastructure, and 90% of all air and water pollution disappeared to the west toward Central America driven by the prevailing current and the constant easterly trade winds.
WILLIAM H. SWANSON AND THE UNWRITTEN RULES OF MANAGEMENT
Businesses face challenges in their relations with government at all levels, but the challenge at the municipal or local level does not receive the attention it should in business courses. Municipal governments influence the corporations through the enactment and enforcement of zoning regulations. This case is typical of the challenges presented when dealing with city councillors in the request for a zoning change. It illustrates the lengthy, complicated process involved and the complications presented by a city council philosophically opposed to large corporations, in particular, Wal-Mart.
The case should enable students to: (1) appreciate the influence of government regulation by zoning laws at the municipal level and the impact on business activity, (2) understand the conflict between zoning regulation and the fundamentals of capitalism, (3) ascertain the stakeholders involved and their influence, and (4) consider the challenges of dealing with municipal politicians, in particular, the approaches to influencing their decisions. The case is versatile and can be used effectively in senior undergraduate and graduate courses as well as management development programs. Appropriate courses are: Business and Society, Business and its Environment, Business Ethics, and Business and Government.
The case describes Wal-Mart’s application for its first store in Vancouver, British Columbia, as an illustration of the demands placed upon businesses by local government. The case briefly describes zoning regulation followed by giving background on Vancouver municipal government and Wal-Mart. Wal-Mart’s proposal to build a store is outlined along with the issues confronting the company and how it responded to them. The views opposing the project are outlined as well as the views in support. The case is written from the perspective of an architect, Peter Busby, who assisted Wal-Mart in designing the store. The case ends prior to city council’s voting on the proposal, but Busby is wondering what more he can do to get City Council to approve the zoning change and allow the first Wal-Mart to open in Vancouver. He goes over the list of councillors, thinks about which one to contact first, and wonders what his argument in support of the project will be.
The Board of Directors of Raytheon Company must decide how to respond to accusations that its chairman, presidents, and CEO, William H. Swanson, plagiarized significant portions of W.J. King’s (1944) The Unwritten Rules of Engineering in his leadership booklet, Swanson’s Unwritten Rules of Management (2004, 2005). The decision rests on a determination of the seriousness of the infraction, whether the plagiarism was intentional or accidental, and how valuable Swanson’s leadership is to the company.
The case should stimulate discussion about: (1) ethics in business communication, (2) the nature of collaboration in the generation of internal and external corporate documents, (3) the need for clarity and care in communicating with staff in distinguishing between corporate intellectual property and property not belonging to the corporation, and (4) the role of the Board of Directors in making managers accountable for transgressions and rewarding managers’ performance in a for-profit firm.
After his appointment in July 2003 as president and CEO of Raytheon Company, William H. Swanson chose to deliver his first public address to the student body of Tuskegee University. His visit and his long-time championship of diversity were extolled in an “exclusive” article in US Black Engineer under the title “Raytheon CEO’s 25 Rules of Leadership.” Swanson’s Unwritten Rules of Management, originally compiled by staff for internal presentation from notes and materials collected by Swanson, were subsequently printed for in-house distribution to Raytheon’s top managers. In July 2005, Business 2.0 Magazine characterized the unpublished booklet as “The CEO’s Secret Handbook” and presented excerpts of several rules accompanied by Swanson’s commentaries. Insiders, commentators, and bloggers clamored for more. Raytheon made the rules—now expanded to 33 for the 33 years Swanson had spent at Raytheon—available on its website. Shortly after USA Today carried its second article on the hit booklet in April 2006, Carl Durrenberger, an engineer from San Diego, accused Swanson of plagiarizing W.J. King’s 1944 booklet, The Unwritten Rules of Engineering. Now Swanson and the Board had to decide how to respond to the adverse publicity.
A NEW DAY FOR RUBY TUESDAY?
Case Research for Theory
BOMBARDIER AEROSPACE: THE C-SERIES DILEMMA
This case looks at a company that had successfully differentiated itself in the restaurant industry in its early years, but by 2005 management believed the time had come to “re-image” the brand. A new strategy was implemented just as the external environment was changing, and Ruby Tuesday found sales, profits, and stock price declining significantly in 2007 and into 2008.
This case provides the opportunity to examine strategies for achieving competitive advantage in a crowded and highly competitive industry. Once the original “bar-and-grill” casual dining in a “fun” atmosphere no longer served to differentiate Ruby Tuesday, the company tried several other methods of differentiating. It had now settled on a new strategy of creating a new image and differentiating through perceived higher quality. The case was developed for a Strategic Management course and lends itself well to (1) an in-depth analysis of the external environment (2) an assessment of the competitive environment, and (3) an evaluation of what competitive strategy might best serve to achieve competitive advantage in this industry.
Since its beginning in 1972, Ruby Tuesday had grown to be a successful player in the casual dining bar-and-grill segment of the restaurant industry. But after 30-plus years, the market was becoming crowded with very similar establishments. In 2005, management decided on a strategy to “re-image” the company as a higher quality restaurant with an emphasis on fresh foods and a more streamlined, modern look. But, the emphasis on quality and higher price represented a step away from its customer base. Was the new strategy actually achieving the desired result? Three years into this re-imaging process the company continued to experience declining same-store sales and profits; stock price fell precipitously in late 2007 and into 2008, sagging to all-time lows in early 2008. The company clearly was not achieving its primary stated goal of creating value for shareholders.
Ruby Tuesday faced strong competition in its segment and was struggling to decide how to improve its revenues and profitability. Should the company continue efforts to aim for higher quality and higher price points, or should it return to its traditional customer base?
CASCADES GROUPE TISSU IN 2006
This case may be used in undergraduate, graduate, and executive courses of strategy and business policy. It presents the students with a strategic decision the president of Bombardier Aerospace must take before the general assembly meeting which is scheduled in a few days. The dilemma consists in deciding whether the company should abandon or proceed with an initiative that has been under evaluation for about three years. Due to major transformations in the dynamics of the regional aircraft industry, the company finds itself at a cross-road and the decision at hand will determine the future of the company in this market. The case will enable the students to (1) conduct a full analysis of the company’s environment using some traditional concepts and tools such as the PEST framework (general environment) and Porter’s five forces model (competitive environment); (2) understand the importance of strategic alignment and strategic coherence; (3) apply one systematic approach to make the strategic decision at hand; and (4) sense how some decisions that may seem ordinary could actually shape the overall strategy of an organization and hence determine its future.
Pierre Beaudoin, president and COO of Bombardier Aerospace, is preparing for the May 29, 2007 annual meeting of shareholders. He expects investors and analysts to ask some critical questions about the company’s intent to develop a new generation of aircrafts called C-Series. Indeed, the initial idea to develop this new family of products was announced back in July 2004 and the principle of assessing its feasibility was approved by Bombardier’s Board of Directors in January 15, 2005. Three years later, the final decision of whether to proceed with the project is still pending. In the meantime, the Brazilian Embraer – the main competitor of Bombardier in this market – took the leadership position and invested heavily in R&D programs. In preparation for the meeting, Pierre Beaudoin must re-assess the situation and essentially make the final decision. Among the questions the investors and analysts might ask, three are of critical importance: (1) why is Bombardier lagging now behind Embraer in the regional aircraft market in which it used to be the leader? (2) why is it taking so long for Bombardier to make the final decision regarding the C-Series initiative? And, more importantly, (3) what to do next?
CRISIS AT BINGHAMTON ZOO
This case study has following objectives: Do a wrap-up of the strategic analysis model. Examine the implications and the strategic issues that could occur because of a decision that was initially benign: a supply contract from a customer who requires the Company set aside its own private brand in order to focus on the customer’s private label. Examine the link between daily decisions and management of the company’s corporate strategy. Discuss the challenges that a company that is continental in scope faces, in its transition towards the status of global player, in an industry that is becoming globalized. Discuss the tensions caused by the transition between the scope of the strategy and the organizational model of the company: does this organizational model support such a transition or is it an obstacle?
In October 2006, Mrs. Suzanne Blanchet, President and Chief Executive Officer of Cascades Tissue Group (CTG), pondered on how much weight should be given to products sold under the CTG brand compared to those sold under distributor or under retailer private labels. The fourth largest tissue paper producer in North America, CTG is one of the four divisions of Cascades Inc., a giant in the Canadian pulp and paper industry. In fact, Suzanne Blanchet has one month to respond to two calls for tender totalling $25M, from CTG customers in Canada. These contracts deal with tissue paper that would be marketed under these customers’ private labels rather than under CTG brands. The distributor and retailer private label market for offers an attractive prospect for growth but at the expense of CTG’s own brands, which are more economically viable. Developing a brand, however, requires sustained resources and investments, especially in marketing, which CTG’s plant managers are still reluctant to support. Furthermore, this decision had to take into account the opportunities and the threats related to the arrival of producers from emerging countries. Last spring, Cascades Inc’s Board of Directors had asked her to present her strategy with respect to the rise of China and Brazil in the global tissue paper market. She was considering her options with respect to the North American market but also the Chinese and Brazilian markets.
DELTA – NORTHWEST AIRLINES: SHOULD THIS MERGER BE APPROVED?
The case is designed primarily for undergraduates in a strategic management, non-profit management or small business course. It can be used early in the course since the problems are clearly stated; the course deals with a small, relatively simple organization and most students are familiar with zoos as visitors. Change management is the core issue of the case, a comprehensive term that encompasses a number of topics. Case users can address strategy formulation, planning and implementation. An important aspect of the case is leadership since a successful turnaround depends on community support. The zoo director needs to create a compelling vision that can energize the staff, the board, the zoo volunteers and the community at large to lead the organization towards re-accreditation.
This three-part case describes the crisis, and subsequent turnaround of a small zoo located in a small community. Part (A) lays out the situation in January 2006 when a new director was hired. Previously the zoo had experienced turmoil at the top that had caused the facility to deteriorate to a level that it was de-accredited by the Association of Zoos and Aquariums. Permanent closure was a realistic predicament. The start of the new season was only a few months away and the new zoo director had to sort through a multitude of problems and decide what to do.
Part (B) describes the initial steps undertaken by the new director which were met with great success. But then unforeseen events occurred: The director became seriously ill and torrential floods covering the region caused significant damage to the zoo. The zoo's leadership had to decide how to keep the zoo afloat in this emergency situation and find the capital to make the repairs.
Part (C) summarizes the zoo's turnaround till early 2008. After two successful seasons under new leadership the zoo's situation seemed to have stabilized although re-accreditation was still a few years away. Now the challenge changed, namely how to sustain the park's successful performance in a region with a limited population and limited resources as visitors had many choices to spend their discretionary leisure time dollars.
EBAY TACKLES FRAUD AND COMMUNITY UNREST
This case focuses on the current merger of two of the nation’s major airlines, Delta Air Lines and Northwest Airlines. This merger is awaiting regulatory approval by the Antitrust Division of the U.S. Justice Department. The case study was developed to illustrate the impact of political, economic and competitive forces in the general and industry environment upon an airline merger. The case was designed to hone the analytical skills and decision-making ability of those utilizing the case by determining whether the merger should be approved. Other aspects involve exploring why most of the major airlines are suffering staggering financial losses and bankruptcy while Southwest has been profitable for over 34 consecutive years. Can it be that the hub and spoke vs. point to point system is the problem or is it a lack of effective management leadership? This case was primarily designed for undergraduate, graduate, and executive level courses in strategic management. It may also be of interest in union management courses and in the curricula of university aviation departments.
This case opens with a discussion of the initial 2008 merger actions between Delta Air Lines and Northwest Airlines. The merger still must pass regulatory approval by the Antitrust Division of the U.S. Justice Department. Combining seniority rosters for both airlines appears to be very contentious as pilot seniority determines type of aircraft flown, pay levels, etc. The CEO, Richard Anderson, was appointed as Delta’s new CEO on September 1, 2007 after leaving the CEO position at Northwest in 2004. Both airlines were in Chapter 11 bankruptcy and both exited from bankruptcy in 2007. The merged company will be under Delta Air Line’s name and the headquarters will be in Atlanta, Georgia. Many questions concerning the merger still need to be answered. The primary question is one that faces the U.S. Department of Justice, “Should this merger be approved or is it anticompetitive?” For the airline itself, if the merger is approved, which of the overlapping hubs would be slated for closure? Would the closures result in severe job losses that would ignite a political storm? Would a wave of consolidations occur in the airline industry resulting in less competition and higher fares? Can NWA, with its unionized mechanics, flight attendants, gate agents, and pilots be successfully combined with Delta Air Lines employees of which only pilots are unionized? The case study presents legislation from the Air Mail Act of 1934 to the Airline Deregulation Act of 1978. The airline functional activities e.g. marketing, operations, human resources, and finance are also explored in the case.
KELLOGG’S: MARKETING TO CHILDREN
eBay must face two significant strategic challenges, one from outside the company and the other from within its outspoken community of sellers. Identity theft is the fastest growing crime in America, and eBay has become a favorite target for online phishing scams. Thieves are also stealing goods the traditional way and using the auction giant to turn the items into quick cash. Meanwhile, another threat comes from the company’s seller community, which is up in arms over recent policy changes eBay’s senior team has made designed to revitalize the eBay’s sagging core auction business. This issue has fed negative headlines in the national press. The case will enable students to: (1) address the challenges of sustaining a core competency while achieving unusually rapid growth, (2) explore how to achieve revenue and profit growth in a maturing ecommerce business, (3) understand the changing value equation for customers over the e-business life cycle, (4) examine the strategies and tools available to fight online fraud-related activities, and (5) investigate the issues related to maintaining a positive service experience while implementing controls and restrictions to protect customer security and data privacy. The case was prepared to use in Management and Marketing courses, with particular emphasis on strategy, service operations, and leadership. It is appropriate for undergraduate and graduate students.
Set against the back drop of an actual eBay-sponsored customer event -- “eBay In Person” -- the case takes place on the evening of August 31, 2006 at a downtown hotel in Salt Lake City, Utah. This town hall-type forum is hosted by Bill Cole, President of eBay North America, who addresses and takes questions from approximately 500 invited eBay users. He talks specifically about a Wall Street Journal article that highlights growing dissatisfaction among eBay sellers with the company’s senior management team and recent pricing decisions. He is also made aware of a TV news story which aired the previous evening that claims eBay takes a relatively passive stance on fighting fraud on it site. Cole asks Tim Payton, who heads up eBay’s 1200-person Salt Lake City Customer Support Center to respond to the story and speak on the array of fraud prevention policies and processes the company has in place to combat ecommerce fraud.
The case concludes with Cole taking a question from a vocal audience member, who is not convinced that the action plans shared by Cole and Payton will produce the intended results.
LANGEX KFT. (A) & (B)
This case should enable students to: (1) understand the forces of change that are reshaping the business environment for firms in the ready-to-eat cereal industry in the twenty-first century. (2) Understand the challenges involved in developing strategy when disruptive changes in the macroenvironment must be considered. (3) Understand the risks involved in maintaining an existing strategy when threatened by lawsuits, legislation and changing consumer opinions. (4) Develop and evaluate strategies for Kellogg’s.
This case was developed for use in undergraduate and MBA level courses in strategic management. In the strategic management course, this case could be used to discuss business level strategy or corporate social responsibility issues. The case may also be appropriate for undergraduate and graduate courses in marketing strategy.
Kellogg’s senior leadership team faced a difficult decision in the summer of 2006: bow to consumer and congressional pressure by reformulating the company’s popular children’s cereals or stop marketing these products to children. Advocacy groups concerned about childhood obesity and product promotion to impressionable children were putting pressure on Kellogg’s, calling the company’s products “breakfast candies” and contending in a lawsuit that Kellogg’s was directly harming kids’ health. Congress was also investigating the food industry and advertising to children. Iowa Senator Tom Harkin was threatening legislation that would control and restrict advertising to children. Almost fifty percent of Kellogg’s children’s products did not meet specific nutritional criteria for children. At risk were Kellogg’s Pop-Tarts, Froot Loops and Apple Jacks (among other products).
Twenty-seven percent of Kellogg’s advertising was aimed at children. If Kellogg’s stayed the course, a strong balance sheet coupled with advertising might counterbalance the negative publicity and potential legislation. If Kellogg’s gave in, over half of the company’s products would need to be reformulated or Kellogg’s would have to stop advertising to the target market. Without advertising aimed at children, net sales were bound to fall. Reformulation of some products would also be difficult and might also lose sales. What would Kellogg’s decide?
SAS ANALYTICS AND BUSINESS INTELLIGENCE: BUILDING SERVICE LEADERSHIP IN POLAND
Gyula Lang, a Hungarian entrepreneur and business owner, is considering growth options for his truck parts and service firm. The Langex (A) case presents three options: (1) accept a Volvo Truck service franchise that has been offered by Volvo Hungary, (2) expand Langex’s turbocharger repair and rebuilding operations with a second location in Slovakia, or (3) continue organic growth of existing operations. The Langex (B) case provides information on the choices made and subsequent events.
The case should enable students to: (1) identify and explore the nature of opportunities in economies in transition; (2) assess a firm's resources and capabilities relative to the requirements of the opportunities present; (3) understand the role of managerial preferences in the development of strategy; (4) understand the nature and impact of power in franchisor/franchisee relationships and (5) develop their strategic skills as they choose a growth strategy for Langex Kft. This case was designed to be used in a strategic management, International Business or Entrepreneurship course (especially in a module on International Entrepreneurship) to explore the nature of entrepreneurial opportunities in economies in transition, the need for strategy to fit the resources and capabilities of the firm and the difficulties in managing growth.
Langex Kft. is a small Hungarian truck parts and service firm which emerged from the entrepreneurial drive of Gyula Lang and opportunities presented as Hungary transitioned from a planned to a market economy. It sells truck and heavy equipment repair and service equipment to garages, sells parts and provides repair and service for heavy trucks and equipment, and repairs and remanufactures turbochargers for cars and trucks. It is located in Győr, Hungary, on the principal motorway halfway between Vienna and Budapest.
The Langex Kft. (A) case presents Langex at a point where Gyula Lang is considering growth options. Volvo Hungary has offered the firm a parts and service franchise for its truck line. Gyula is also considering expanding Langex’s turbocharger repair and remanufacturing operations into neighbouring Slovakia. However he is concerned about managing growth and not risking the firm in the pursuit of growth. The fundamental question is how should Gyula Lang grow Langex Kft.
SCALEXTRIC: THE DIGITAL AGE
Students are introduced to the establishment and development of a subsidiary of a world leader in analytics software in post-Communist Poland. They follow the country subsidiary through entrepreneurial growth to a leadership position on the market. In 2007 the US parent firm centralizes its international organization, previously based on a large degree of country subsidiary independence. The students must decide (1) how best the Polish subsidiary can contribute in the new global structure (2) how it should face the growing competition in Poland in an industry it had largely developed, and (3) how it should deal with the increased size of its organization which was still managed with an entrepreneurial organizational structure.The case should enable students to (1) understand the use of a legitimation strategy to solidly establish an entrepreneurial firm in a virgin industry, (2) understand the factors that lead to developing service leadership (3) understand how knowledge is created and managed so as to become an important asset for competitive advantage, and (4) realize how growth can impact organizational climate and outdate existing organizational structure.
The case starts with Alicja Wiecka opening the first SAS Institute office in Poland in 1992 during the ‘shock therapy’ period which is leading Poland towards a market economy after the fall of the Communist system. It stresses how the coming together of post-Communist Poland and SAS Institute would lead to extensive knowledge creation and provide an example for service leadership in Central Europe over the coming years. Then the case moves on to describe Wiecka’s building of legitimacy for the new subsidiary with Polish universities, ministries and then industries. Success leads to a rapid growth in the highly skilled workforce of the firm over the years from 4 to 200 technical support and sales people, as well as consultants, which raises the issue of maintaining organizational efficiency. A major focus of the case has to do with the sources of legitimacy for an entrepreneurial firm and the development of added value services as a source of leadership in the business analytics industry.
SEACOAST SCIENCE CENTER: SAILING THE SHOALS
Scalextric (or SCX in the US) has been the reference for scale model (1:32) racing sets since 1954. It is also TecniToy’s star brand, the company that designs and manufactures the product. Awareness of the Scalextric brand in Spain is around 90%. The primary focuses of the “Scalextric: The Digital Age” case series are strategic fit in a digital technology environment, changes in customer preferences and the need to manage international expansion and global operations. Case (A) centers on the challenges of design, manufacturing and production processes to establish the right time to market in global operations, raising additional issues such as manufacturing in China and supply chain and retail management. Case (B) focuses on Scalextric’s challenges in the digital age, exploring if the game has a future due to the emergence of videogames. In addition, other questions include how to lever the value of the game’s community, the emergence of the Web 2.0 community in the US and the possibility of opening the business model to develop a new global strategy. The case was written for General Management and Senior Executive Programs. The case is divided into two parts and proposes using YouTube as an academic tool.
Case A starts “somewhere in the Arabian Sea”, when the captain of the Rosebud, a cargo vessel transporting 20,000 1:32 model cars from Hong Kong to Barcelona for the Christmas campaign, receives a phone call from Sergi Pastor, TecniToys’ new CEO, since the cargo may arrive late due to a series of misalignments in the global operations process. The case aims to challenge students by putting them in Pastor’s shoes to understand the implications on the management of Supply Chain Network and time to market. Moreover, students are asked to think about the strategy the company should adopt for its plan to expand its global operations and what information and information systems are needed. Case B explores the game’s challenge in the new digital context of videogames. The case also describes the power of its 35,000 customer community and raises the question of how to manage it. Moreover, the case describes the successful product’s penetration in the US and the emergence of the SCX community through YouTube. Finally, the case describes the Scalextric “Digital System” launch and the possibility of licensing its technology to other toy manufacturers in a process to open its business model.
THE ROAD TO TORTUGUERO
This case was designed for an undergraduate course in strategic management. It could also be used in a course in non-profit management at either the undergraduate or graduate level. In strategic management, it can be used to discuss strategic direction, evaluation and control systems (part of implementation), or to illustrate how strategic management applies in a not-for-profit setting. Key issues include the impact of changing market forces (decline in school groups; growth in distance learning), strategic direction (grow & if so, how, maintain, possibly retrench); pricing & its impact on market demand, and non-profit revenue sources. The case can be used to apply a number of strategic management models, including SWOT, competitive advantage, the 5 forces model, alternative strategies, the relation of strategy and structure, and evaluation and control.
Learning objectives include:
1. To have students analyze the operations of a non-profit and understand its differences from a similar-sized business
2. To have students apply theories and models from strategic management
3. To have students evaluate the current risks and advantages of a price increase
4. To have students develop a recommended course of action
Wendy Lull, President of the Seacoast Science Center (SSC), was reviewing the changes since the SSC had become independent in 2001. There had been two major expansions, the most recent being an interactive learning studio that had opened in November 2007. A number of new exhibits brought the flora and fauna of the seacoast of New Hampshire vividly to life, and illustrated many aspects of humans’ interactions with the sea. However, visitation was growing slowly, at best, and there was a persistent $50,000 deficit in operating income. Wendy was considering a substantial increase in the admission fee for the SSC facility. An underlying question was whether the SSC should seek to grow, and if so, how. The title refers to the shallow waters offshore as well as to the lack of depth in the SSC’s financial position: both can be navigated, but only by selecting the proper course.
A guide and bed & breakfast owner in Tortuguero, Costa Rica, is about to meet with his fellow guides to determine how to use the funds they donate from payments received for guiding turtle tours at night. There are a host of business, social, and ecological issues to consider as some Tortuguerans push for a road to be built through a national park preserve to make Tortuguero more accessible. By reading and discussing the Road To Tortuguero case, students should come away with: (1) the ability to apply an ethical model of decision-making in a strategic context; (2) the ability to apply Porter’s Five Forces model, including a “PEST” analysis to macro- and micro-level strategic decisions; (3) the ability to perform a stakeholder analysis; (4) an understanding and appreciation of the conflicts arising from ecological preservation and social welfare; (5) an appreciation for the long run consequences to the environment and an area’s inhabitants of a decision made today; and (6) an understanding of the need for, and appropriate techniques of, influence in “selling” one’s strategic perspective to other stakeholders.
Daryl Loth operates a bed & breakfast in Tortuguero Village, situated on a 22-mile slip of land in Costa Rica that is home to the most prolific nesting beach for giant sea turtles in the Atlantic. The Village numbers about 1000, and is isolated from the rest of the country because it is only possible to reach by boat.
Loth and his fellow guides are about to meet to discuss how to best use the funds they each donate from the payments they receive for guiding turtle tours at night. Concerned about the possibility that residents and outsiders will use the difficulty of access to Tortuguero to renew the push to build a road through TNP to within a three minute boat ride of the village, some guides have proposed using some of the funds to move the boat launch from a place called La Pavona to one that would make boat access to Tortuguero faster, less dangerous at night (in an emergency), and less inconvenient during dry season. Loth wonders what he should do. Would having the road help or harm the community, or both? The case presents primary and secondary data on both sides of the debate.
INTERNATIONAL CHANGES AT ABB FROM 1987 – 1999: ROSY ON THE OUTSIDE BUT BLOODY ON THE INSIDE
INTERNATIONAL EXPANSION MODEL: LINKING THEORY AND PRACTICE
In a three level analysis the paper will highlight organizational changes at the company level, firm level and at the level of individual. The objective is contribute to understanding the workings of a large multination organized as a network by indicating some of the functional and dysfunctional effects of the matrix structure. The objective of using Allison’s model developed to explain the Cuban Missile Crisis is to separate and compare the change dilemmas facing ABB at three levels of the company. The model helps us solve the riddle of conflict resolutions within the matrix structure and with new insights into the shortcomings of the way the matrix worked.
A puzzle initiated the research project reported in this paper. Why was the most efficient transformer plant within ABB closed and moved to a different area of the world, when ABB’s rewarding policy which consisted in rewarding when goals of efficiency were reached? The decision to close the plant was a result of a power game and a long process of negotiation within ABB that took place over several years as a result in changed bases of social power of organizational players involved in the decisions making. The three level analyses of changes at ABB brought us closer to answering the questions why the much praised matrix structure had to be challenged and ultimately changed. At the first level, the ABB corporation was treated as a black box. Organizational changes from the strategy of growth and rationalization were reported change actions from 1988 to mid 1999 categorized as either a change to improve practices or to expand the scope of business operations. The ratio of exploration/exploitation was compared with the expectancy of organization performance indicated in the fluctuations of the ABB stock prices. In contrast to the rosy impression from the outside, the ABB was bloody at the inside. The second and third levels of analyses showed conflict resolution when goals and interests conflict at both the organizational and individual level. Moving across levels, the change moved from exploitation to exploration. The change occurs in a political process with heavy bargaining. Here there are Chiefs and Indians. Where you stand depends on where you sit at the level of individuals. However when players accept the rule of the game of the matrix, Indians become Chiefs. The bases of social power change.
REINVENTING AN INTERORGANIZATIONAL SYSTEM: THE BIOSENSE CASE
As a result of their involvement with the International Franchise Association, two university researchers want to develop a theoretical model that will be relevant, timely and useful to association members in the formulation of their international expansion strategies. They form a relationship with a member of the association, Bill, who has recently been appointed Senior Vice President for What’s Your Beef, a franchised quick service food company. Bill agrees to work with them in developing and applying their model to his organization. The case documents this process.
The case will enable students to: (1) identify the problems that US-based companies face when seeking to expand internationally; (2) evaluate how a relationship between academia and the business world can be mutually beneficial; and (3) evaluate the most important drivers that US-based companies should consider when expanding internationally.
Over a period of two years attending the annual convention and sub-committee meetings of the International Franchise Association, two researchers from the Rosenberg International Center of Franchising at the University of New Hampshire had established a relationship with Bill Harris. Bill had recently been appointed Senior Vice President of Marketing for What’s Your Beef, a successful US-based quick food service company. What’s Your Beef had identified international expansion as a key growth strategy for the company and Bill had been asked to develop a strategic plan to recommend to its board. Prior to his recent appointment, the company had ventured into the Mexican market where setbacks and losses occurred that Bill felt were largely a result of a ‘what works here should work there’ mentality. Bill therefore felt it was necessary to develop an assessment model that would identify the most suitable target markets and weigh the potential opportunities against the potential risks in the various proposed host countries. The researchers developed a three-phase theoretical assessment model that examined international expansion from a macro-environmental, a micro-environmental and an implementation perspective. Bill agreed to work with the researchers and use their model as a primary tool in the development of his strategic plan for the international expansion of What’s Your Beef.
TOWARDS A COMMUNICATIVE MODEL OF INTERORGANIZATIONAL COLLABORATION: THE CASE OF THE COMMUNITY ACTION NETWORK
This paper reports on a case study of BioSense, an interorganizational system that was designed as an early detection tool for bio-terror attacks and subsequently modified to better serve this need as well as to operate as a routine public health system for pinpointing geographic clusters of conventional communicable disease outbreaks. By examining the interplay among the political and organizational dynamics and technical properties of the BioSense system, we shed light on processes affecting reinvention in an interorganizational context. We discuss our findings in light of theories of the diffusion and reinvention of innovations. We call for further research on interorganizational innovation in e-health and other domains.
The paper is organized as follows. First we review prior studies of innovation, with a focus on key findings about reinvention and related processes affecting or resulting from interorganizational systems innovations. We explain the methodology employed for the case study, and then describe the BioSense initiative, including the context for, design and development of, adoption and early experience with this interorganizational system and reinvention events that took place in the mid-to-late 2000s. We discuss our findings in light of the reviewed literature and offer suggestions for further research on reinvention of interorganizational systems.
The purpose of this study is to explore the social processes of collaborative interorganizational relationships (IORs), with a particular emphasis on the constitutive role of communication practices that create and sustain these organizational partnerships. This is a theory building case intended to help develop a constitutive view of communication in collaborative IORs. This case should enable the reader to: (1) understand the constitutive and transmission views of communication and organizations, (2) appreciate the importance of communication in interorganizational relationships, (3) recognize how certain communication practices function to constitute collaborative relationships between multiple organizations, and (4) consider how a constitutive model of communication and interorganizational collaboration can provide new insights into various organizational partnerships.
Within the context of organizational research, scholars working from a constitutive view of communication see organizations as grounded in social process of interpretation that are created and recreated through the ways in which various organizational stakeholders make sense of their experiences. The organization is not a container that exists a priori and subsequently uses communication to exchange messages, but rather organizations are the product of various negotiations and interactions between relevant stakeholders within a particular domain. In this way communication is not simply a tool used by organizations, communication is actually part of the ontological foundation of what it means to be an organization. Communication thus moves from being an ambiguous conclusion seen in much organizational research (i.e., “improve communication”) and instead becomes a starting point for investigation and inquiry. The Community Action Network (CAN) is a collaboration of social service providers in Austin, Texas that demonstrates how certain communication practices constitute organizational partnerships. The reciprocal nature of stakeholder participation and the communicative tensions of inclusion/focus and talk/action provide a communicative infrastructure that shape the way in which organizations develop collaborative solutions. Recognizing these processes is an important part of understanding the way in which these collaborative IORs function in our society.
CREATING EQUAL OPPORTUNITY IN AMERICA: MANAGING URBAN EDUCATION REFORM
Finance & Economics
FINGER-POINTING: A TEACHER CANDIDATE DILEMMA
This case illustrates the process of educational change in an urban elementary school initiated by a 1998 New Jersey Supreme Court ruling and the 2001 federal No Child Left Behind (NCLB) act. It is an account of the use of law to produce social change.
The purpose of the case is for students to identify key issues that influenced the trajectory of the change, explain important events and processes from a theoretical perspective, and, as a practical matter, consider how the changes could have been managed to achieve the intended results.
The Bridge Street Elementary School is in Newark, New Jersey. Its population is almost entirely low-income African American students. In 1998, the New Jersey Supreme Court mandated it--along with all elementary schools in thirty similar school districts--to implement remedies to improve student achievement with a new funding formula that equaled or surpassed the wealthiest school districts in the state. Other important mandates included reduction of class size, the use of computers in all classrooms, zero-based budgeting, a school management team and the use of a scientifically grounded whole school reform model in all classrooms. Implementation of the court decision is described over seven years.
The case also documents implementation of the 2001 No Child Left Behind (NCLB) act in Bridge Street. NCLB introduced high stakes testing, the measurement of student achievement with Adequate Yearly Progress (AYP) to create accountability, and the possibility of sanctions for school districts and schools if they failed to achieve AYP. The sanctions ranged from the right of students to transfer from failing schools to the disbandment of school districts.
LITERACY ANALYSIS: WHY IS STEVEN STRUGGLING ?
A student teacher accuses her mentor teacher of incompetence and possible sexual innuendoes. Her mentor teacher and university supervisor accuses the student teacher of being unprepared and irresponsible. The principal of this important partnership school removes all of the student teachers from this college who are placed in her school. The reader must decide: (1) who is not telling the full story, (2) what to do with the student teachers; (3) whether to go further with the mentor issue with the school principal and/or school district; (4) whether to ask for another school with which to work in the future; and (6) how to set in place other policies to better protect the student teacher, the mentor, the supervisor, and the partnership in the future.
This case should enable field directors and students in educational leadership (along with those who are currently teacher educators) to: (1) set in place better expectations and outcomes for students in field placements, (2) analyze ways in which to better work with students and schools in the field placement environments, (3) work with districts to better maintain positive environments during field experiences, and (4) set in place better routes of communication.
“Good evening,” began an email to a student teacher supervisor from a teacher candidate who had been placed in a school that was part of a particularly important partnership district with a college of education. Unfortunately, it was going to turn out to be anything but! The message continued: “I have been trying to contract you through phone and trying to keep you in the loop. I am not having a great experience this semester. I am not getting the quality education I deserve. My mentor teacher is not being a mentor….My future is being ruined because of her….this is not the type of education I should be receiving.”
During the fall semester, a student teacher who was not doing well in her school placement, began to complain that her mentor teacher was not communicating, modeling bad practices, and even “hitting on her.” The mentor, in turn, accused the intern of lying in her journal, leaving early, and instigating others against her and the school. Before the college could react, all student teachers from this particular university were asked to leave the school—with two weeks of the student teacher time commitment still required. The college, as well as these student teachers, had much to lose.
OK, WHAT DO I DO NOW?! - THE DILEMMA IN THE CAPSTONE COURSE OPENING CLASS
The case was developed primarily to use in graduate reading/leadership courses as a basis for discussion. It provides an opportunity for participants to learn the need to utilize an interactive assessment model rather than a deficit model. The case will be presented in two sections. First course participants have an opportunity to analyze testing data on the child in the case to determine possible remediation. In the second section the participants will be given information on the context. They will focus on the following two outcome objectives: 1) evaluate how the context, school and home, may affect literacy performance & 2) synthesize the information from testing data and context evaluation; and, re-evaluate recommendations for instruction. The case has been utilized in a professional development for educators in the reading and educational leadership graduate programs.
The Fourth grade team of teachers are assembled for T.A.T. (Teacher Assessment Team) meeting to discuss students who are struggling. Mrs. Souza had asked permission to share her student first. Steven is in her fourth grade classroom of 21 students. “My classroom is an inclusion classroom with both regular education students and some on I.E.P’s (Individual Education Plans). A few of the students on I.E.P.’s are pulled out for services. Steven has been tested but he is not on an I.E.P. He works hard in my classroom, but likes to talk constantly. He has difficulty putting his ideas on paper, particularly what he has just read. I am not sure whether he is having difficulty comprehending what he has read or if he has trouble writing. Any suggestions?
PEDAGOGICAL ISSUES: TOWARDS EFFECTIVE TEACHING STRATEGIES AT MORRIS UNIVERSITY
The case was developed primarily to use in case teaching development seminars as a basis for discussion. It provides opportunity to focus on potential problem situations that arise in classrooms on a regular basis. Seminar participants have opportunity to a) develop alternatives approaches to the situation, b) undertake a situational analysis, and c) consider the interaction between situational factors and the alternatives. The case has been utilized in a professional development for this purpose (i.e., it has been “classroom tested”).
During the first MBA class of the semester CA Anderson opens introduced each of the students from a sheet of information the student provided. The information included “three important things about yourself.” Mike, a typical student in the class, had written, “My wife just found out she was pregnant --- a surprise!” Immediately after CA read Mike’s statement, another student said loudly, “Why the surprise?! Had you been told you couldn’t father any children?!” The class laughed. CA was looking at Mike who appeared to not know where to look. Now, thought CA, what do I do or say next?!
The case provides information about the course, CA Anderson, Midwestern University and its Business School. The discussants are faced with the dilemma of CA’s next move in response to the students’ comments.
TEACHER EDUCATION: THE CHALLENGES OF A PARADIGM SHIFT
This case critically assesses Nina’s capabilities and limitations as an instructor and course designer at Morris University (MU). MU is a historical black institution situated in a rural town in USA. The case explores the effectiveness of teaching pedagogies used by Nina in her class, its suitability to the student population and, discusses possible reasons for her trials and tribulations as an instructor.
The case should enable students to: (1) recognize the relationship between students’ culture and their cognitive learning styles (2) become aware of the differences in learning styles of students (3) adopt appropriate teaching pedagogies which suit the learning styles of their students in their classrooms. The case writer has developed the case for teaching pedagogies workshop for new academic faculty and education and diversity management courses dealing with issues relating to teaching strategies and student retention.
Morris University (MU) is a historical black institution with 90% of its faculty, students and staff being of African American origin, situated in a rural town in USA. MU is committed to the objective of educating African American youth and the concept of “students first” was one of its core institutional value.
Nina, is a 30 year old Asian Indian, female who joined Morris University in Fall semester 2006 soon after the completion of her doctorate. MU is her first teaching position. Nina was given the responsibility of redesigning, improving and teaching a module MGMT 4000, organizational learning at the undergraduate level by the head of the department, Dr Carr.
Nina’s experience teaching the organizational learning course was very unpleasant. Her student evaluations were poor with harsh comments written against her and the course by the students. Nina in dismay wonders about her next move.
THE LEADERSHIP DILEMMA – LEAD, FOLLOW, OR GET OUT OF THE WAY?
This case is intended for use with graduate students majoring in educational leadership. The focus is on organizational structures and how they affect the implementation of curriculum changes. Different aspects of organizational change and leadership theories are to be examined. A constructivist, inquiry approach will be used. The theories will be read and presented, but the students will have to apply them to this case. Participants will be required to a) do a situational analysis, b) examine institutional policies that might help/hinder change; and c) consider what might improve the chances of sustaining such a paradigm shift over time.
This case focuses on the efforts of four elementary education faculty’s attempt to make a major paradigm shift in the department’s education program. The team decided to integrate four methods course into one 12 credit hour course with a field component. A Professional development school that was thirty-five miles away was assigned to the team just prior to the fall semester. While there are many challenges in making this paradigm shift, the biggest challenge comes in trying to get it institutionalized. The case provides information about the challenges the two tenured and two tenure track professors faced as they tried to develop and implement the course. The discussants are faced with the dilemma of how the challenges imbedded in the case might have been handled differently; and, how to get the course institutionalized into a large education department.
WE ARE 100% PURE: DIVERSITY DILEMMA IN A FIRST YEAR SEMINAR
This case study presents an opportunity to address the most critical issue concerning policy governance: where does the line exists between a board setting policy and monitoring progress versus micro-managing the administration of an institution? Here, a community college trustee shares with counterparts his conflicted thoughts about how to balance these competing demands in a situation where performance is not living up to expectations. The case study offers multiple points for exploring this ever present dilemma. While no ‘right’ answer exists, discussion and analysis is a valuable exercise in developing a proper understanding of the responsibilities of effective governing boards. The case, based on an actual situation, was written for a graduate course in the Certificate program in Higher Education Leadership at the University of South Carolina.
The central character is vice-chair of a community college board of trustees. He is concerned about the college’s sporadic success in aligning courses and programs with local business and industry demand. As he describes the situation, questions arise over the college’s role in serving local workforce development needs versus fulfilling an academic transfer role. The college has had some success with aligning technical and industrial programs in the past but not on a sustained, systemic level.
The trustee also serves as his college’s representative to a statewide trustee association. At a meeting of the statewide association board, he shares his concerns and asks colleagues from other colleges about their experience with alignment issue. As the dialogue unfolds, a key question emerges: How should a governing board see that a mission critical policy is successfully carried out when existing efforts seem to be falling short?
This case was developed to be used in case teaching development .Seminar participants have the opportunity to discuss the following issues: 1) diversity in higher education and classroom, 2) attitude of first year students in higher education ; 3) effective teaching strategies
“I am pure, according to my family, there is no interracial marriages or mixed blood in our family tree. We are 100% pure Albanian.” This response was made by a freshman in a first year seminar in which the focus was about service learning and multicultural communities in the US. Leigh, the course instructor, who joined Midway University five years ago, was taken aback by the statement. For the past seven weeks, the class has been learning and discussing about multiculturalism, racial and diverse cultural practices in the United States and around the whole. “Has she not learned anything?”, thought Leigh. This case provides information about the course, effective teaching practices, Midway University and Leigh’s teaching experience.
HOTEL RISCAL FOR WINE AFICIONADOS
INTERNATIONAL ROYALTY CORPORATION IPO
Two recently hired employees of the Marqués de Riscal wine producer have made a radical proposal to management; construct a hotel on the grounds of the winery. Although they both propose a hotel, the characteristics of the hotels are quite different; a small, luxury operation or a much larger mid range facility.
The case examines the characteristics of each proposal and their implications for the firm, its financial position and its wine operations. Students generate pro forma financial statements for each hotel proposal, analyze those statements and present their findings to Riscal management. The case could be used in a basic or advanced financial management class s well as a capstone case class for finance majors in an MBA program.
For more than one hundred and forty years the Marqués de Riscal company had been producing premium red and white wines in the Rioja region of Spain. Their brands were known throughout Spain, Western Europe and North America. Management was taken by surprise when two recent hires approached them with proposals to diversify into the lodging industry by constructing a facility on land between the winery and one of their vineyards. Since these two employees had different visions for this facility, they were encouraged to generate formal proposals that would be presented to management for evaluation. After two months of effort, they were ready.
Each of their proposals, in narrative form as well as with detailed financial back up, were made available to Marqués de Riscal management. After a Question and Answer session, management had to decide whether either proposal would prove valuable for their firm. Analyzing the financial data prepared by Señior Hedo and Señorita Batista would go a long way towards their decision.
ISSUES SURROUNDING VALUATION OF ASSETS IN REGULATED GAS DISTRIBUTION INDUSTRY
The case has several major objectives: 1) to value a small company going through an initial public offering (IPO) in an industry that is unfamiliar to most students, 2) to value mineral property royalties in the production, near-production, and exploration stages, 3) to be creative in applying a variety of business valuation methods for such diverse royalties: discounted free cash flows, the market or multiples approach, and the Black-Scholes option pricing model, 4) to reconcile differences in indicated business values, 5) to recommend the total IPO proceeds that are needed to purchase such royalties, and 6) to estimate how much corresponding dilution will occur in this IPO. This case is intended for senior undergraduate and advanced graduate courses in finance and small business where business valuation topics are taught.
This is a decision based case written from the point of view of the chief executive officer (CEO) and the chief financial officer (CFO) who are trying to put together all the information and analyses needed for an upcoming IPO. The key decision is to determine the total proceeds needed in the IPO to acquire the significant mineral royalties that will be the major assets of the company. If such IPO proceeds are not sufficient, then, they will need to figure how much additional debt financing will be needed or whether such equity and/or debt financing is feasible to build this company. The company was started three years ago for the purpose of acquiring mineral royalties. The company’s only royalties to date comes from gold and silver mine properties. However, the CEO has just signed letters of intent to acquire nickel/copper/cobalt, gold, and diamond royalties. All such acquisitions depend on the company figuring out what to pay for such royalties and then raising the capital to acquire such royalties.
KELLAH FARM BED AND BREAKFAST
The person from RWE Transgas, a. s. responsible for ensuring regulatory compliance regarding the company’s gas distribution activities triggers an initiative towards a build up of a new model for a valuation of newly acquired gas assets (pipelines) from municipalities or developers. There is a range of different incumbent models however neither is generally considered optimal. The valuation may prove as a challenge because convetional DCF models refer to liberal markets. Although the core of this case circulates around valuation issues, many affecting complexities must afore be taken into consideration and thus the case is suitable not only for corporate finance courses but for applied microeconomics or courses focused on regulatory issues in energy industry just as well. It depends upon the lecturer to which direction he or she will incline. The case should familiarize students with (1) an organizational design of energy industry, (2) principles of energy regulation and (3) budgeting problems arising on account of regulation.
The gas industry in the Czech Republic expected the rules to be re-established by Czech Energy Regulatory Office and therefore this might be a good opportunity to improve processes in this sector and make them as effective as possible, both from the point of view of the final customers, gas end-users, and from the point of view of the companies that secure gas distribution. The special task addressed here focused on valuation of assets gas distributor acquires (buys) from municipalities or developers. The problem was that there had been no yardstick to support the final price which therefore represented a blend of educated guesses and bargaining positions of counterparties. To make the negotiated price as objective as possible there should exist a valution model, theoretically correct and practically applicable. Because the very existence of a private company in any regulated enviroment is justified by the same principles governing the existence of a private company in a non-regulated enviroment, it was quite straightforward to begin with a forecast of cash flows generated by investments into assets the regulated company made. But as students will find out this is, because of regulation, a challenge.
LEVEL 3 COMMUNICATIONS, INC.
This case is surprisingly complex. On the surface it appears to be a simple capital budgeting case with a few wrinkles thrown in. Most students see the case as a typical capital budgeting case and proceed to evaluate the B&B units with an academically accepted method of analysis such as NPV. Particularly observant students will see the less apparent, but more important, issue: are the traditional methods of financial analysis appropriate when the goal is not limited to maximizing value? When textbooks assume the financial objective is to maximize stockholder wealth, certain types of analysis are preferred and others are considered to be inferior. Surveys of business practice, however, show that the textbook preferred analysis is not always used in practice. This case bridges the gap between the textbook and the student who says, "that's what the book says, but it's not what we do." The main issue in the case is to develop the relationship between the organization’s financial objective and the methods of analysis used. The case is written for an undergraduate finance case course and is appropriate for all levels of finance provided the class is interested in why the academically preferred methods of analysis are not always used in practice. It works particularly well when some students have business experience, especially in small businesses.
Tom and Leslie Teasdale, owners and operators of a sheep and cattle hill farm located in Northumbria, Northern England, are deciding whether to add a five-unit bed and breakfast business in a presently unused building on the property. Figures for the investment outlay, projected revenues, and expected expenses are provided. Not far away is the Roman Wall, a World Heritage site and a tourism draw. Farming in the area is in a long-term downtrend and there is a further need to supplement revenues and generate income. The Teasdales do not want to be the generation, which lost the farm after it had been in the family since 1849. Further, two of their three children have moved away for better job opportunities and they hope to provide employment for their daughter. The Teasdales must decide how to conduct the analysis, the data to include, how to include the nonrepayable grant from the local government, and whether to take on a loan in order to have a higher standard bed and breakfast. There is no established method of analysis used in the past by the Teasdales. After gathering some of the data, the Teasdales turned the task of recommending how to analyze the project and whether to proceed and over to their daughter, Katie, who is working temporarily in the travel business in Australia. Katie, they note, should be able to figure it out if she’s going to be able to run the B&B business.
THE AIRBUS A380
The case was written for an advanced undergraduate corporate finance elective or for an MBA core or elective finance class, which covers hybrid financing. Students need to know how to apply the Black-Scholes option pricing model to price the conversion feature of the proposed convertible bond issue. This case explores basic financing issues. After completion of this case students should be able to (1) Perform a FRICT analysis – look at a firm’s flexibility needs, risk, income, control and timing and how these impact the choice among debt, equity and convertible bonds, (2) Calculate the yield on a deeply discounted bond, (3) Find the value of a convertible bond, including its straight bond value and the value of the option embedded in the convertible bond using the Black-Scholes option pricing model, and (4) Explore why companies choose hybrid securities over straight debt, floating rate over fixed, senior vs. junior debt.
Level 3 Communications, a fast growing telecom company, faced difficult company and industry situations in July 2002, but the firm also faced potentially great opportunities. There had been severe downsizing in the telecom industry and Level 3 wanted to take advantage of this opportunity by acquiring financially-distressed competitors that would complement and expand its business. The company’s stock price had declined precipitously from its peak, and its bonds were all trading as junk. The company did not need additional financing to fund its current operations, but because there were a number of bankruptcies in the telecom industry, management believed that this was a good time to seek out bargain-priced acquisitions among financially distressed competitors.
The firm wanted to raise $500 million to use as a war chest for future, as yet undetermined, acquisitions. Should it finance with debt, equity, or a convertible bond issue? Issuing debt was a problem because the company’s bonds were junk-rated. Issuing equity was a problem because the firm’s stock price was considerably below its peak price. As a result, the company was considering a convertible bond issuance, which would preserve shareholder ownership to a greater extent than would an equity issue. It also offered a lower interest rate than straight debt. The convertible bond alternative needed to be priced and compared to the options of issuing straight debt or equity. The case lays out details of Level 3’s past financing choices and the terms it could expect for future financing.
THE BETANCOURT GROUP
This case study deals with capital budgeting and discounted cash flow valuation. Issues examined include the advantages of using the APV (adjusted present value) method, determining the value increase caused by loans subsidized by governments and the sensitivity of cash flow forecasts to changes in valuation parameters. The case suits first or second year graduate students, especially majors in Finance. It can be used in classes on Corporate Finance, Financial Management or Project Finance. Its presentation takes about 90 minutes in class and 15 hours of preparation by students. The teaching objectives are: (1) identification of the information relevant for a cash flow forecast, (2) understanding the challenges in building up a cash flow forecast, (3) calculating the net present value for a risky, real life project and (4) using discounted cash flow valuation for a project which provides more challenges than a textbook problem. The case deepens the knowledge of students regarding valuation and capital budgeting. Thus, it can be used for classroom discussion after the relevant chapters in standard textbooks like Ross/Westerfield/Jaffe/Jordan, Corporate Finance, or Brealey/Myers, Principles of Corporate Finance, have been discussed. Based upon our experience with the case, students should be required to work through the case in groups before dealing with the case in class. Excel spreadsheets can (but do not have to) be distributed in order to structure the discussion.
This case analyzes the decision of Airbus to develop and market the A380, the largest aircraft of the world. The main question is whether this project delivers a positive NPV or not. Data sources for the case are press releases, annual reports, analysts’ reports, rating information, published company data and interviews with company managers. The case requires the reader to make his own assumptions also. It is very interesting to use different perspectives: First, the main question is equivalent to the question of whether the project should be started in 2000 or not. Since the project has been started by Airbus, the second question is whether the project should be continued or terminated. The latter perspective uses information available now, i.e. in 2007.
This case study aims to illustrate the various factors that have to be taken into account in this type of acquisition by a venture capital fund. More specifically, it describes how value can be created in a company by improving aspects of its operations and how the take-over is financed. The case study is aimed at post-graduate students taking the Financial Management II course, looking at the topic of leveraged buy-outs. It could also be used in seminars on corporate finance or valuation.
In late November 2006 Mark Hughes, an analyst in the acquisitions financing department of Madrid-based European Bank, received a proposal from London Investment Bank to join a leveraged buyout of the Betancourt Group as the mandated lead arranger (MLA). Although, after a first look at the transaction, everything seemed fairly reasonable, the market situation and future outlook made it advisable to study in more detail before taking a decision. This case study describes in detail the process of the sale of part of the Betancourt Group to a group of venture capital firms, analysing the transaction from the point of view of the financing institutions.
JOB CRAFTING AT DOZET FACILITATION, INC.
This disguised case is a real situation used to provide undergraduate and graduate students with an opportunity to make practical application of sound management principles within a small pediatric medical practice. Students are given the opportunity to diagnose the various management issues facing the practice and to suggest possible solutions. The clinic is beset with problems of lack of supervision, failure to exert effective controls, lack of leadership, and conflicting personalities. Dr. Abdul-Aziz is considering separating from the group practice in which he is a partner and establishing his own independent practice in the same market. The case is appropriate for students to develop alternative management strategies and provide Abdul-Aziz with a reasoned analysis for staying or moving to a new practice. Students should be encouraged to evaluate different scenarios related to the case. This case is suitable for written reports, oral presentations, and examination purposes.
This case deals with an actual situation involving Dr. Abdul-Aziz (all names are disguised) who must make a decision about his future with the small group pediatric practice he is a partner with. Dr. Abdul-Aziz has been with the group for about five years, but has been disappointed in how the practice is managed. The lack of effective staff supervision has resulted in several significant problems. Physicians have established certain policies without informing other partners. Nurses and reception staff have been poorly supervised and as a result some have resorted to surfing the Internet instead of handling important office tasks. Improper supervision of filing has caused slowdown and embarrassment with patients. Billing carelessness and pricing inaccuracies have cost the partners hundreds of thousands of dollars over the last few years. With the growing patient base of Dr. Abdul-Aziz, he has the opportunity to leave with his patients and establish a new independent practice.
The case focuses on the decision of Abdul-Aziz to remain with the group and try to change people, philosophies, and procedures or to separate and establish a new practice where he can implement the professional systems with properly trained and supervised staff, guided by his own philosophy of service and medicine and unfettered by his current environment.
MAKING A TOUGH PERSONNEL DECISION AT MARRIOTT
The newly hired director of operations in a small leadership development and training firm is constantly explaining to the founder what he is working on and how he’s contributing to the bottom line. When hired he had taken on two merged roles, with the understanding that he’d grow the firm through effective internal operations and move into a chief operating office role line with his skills and experiences. However, the firm had ambiguous jobs, vague performance measures, and moving strategic growth targets and plans. Is there top-down confusion, poor impression management, an incorrect set of expectations of what the company expects or is owed, or something else going on here? The case follows an employee’s experiences from hiring through firing as the employee struggles with work goals and performance. Students: (1) analyze a psychological contract and its fulfillment and/or violation, (2) articulate positive and negative outcomes associated with role ambiguity, (3) discuss the proper use of goal-setting theory for performance management, (4) articulate an employee’s role in maintaining visibility and upward communication of job performance, and (5) apply concepts of job crafting and job design. The case writers developed the case for undergraduate and graduate courses in Organizational Behavior, Career Planning and Strategy, though it can be used in Small Business Management as well.
MEDICAL RESULTS MEDICAL CENTER: INTRODUCING TECHNOLOGY TO AN OLD-FASHIONED MEDICAL OFFICE
This case is appropriate for an undergraduate course in Human Resources Management or Organizational Behavior.
The teaching objectives for this case are as follows. Students should be able to: 1) identify the key managerial issues facing Laura; 2) assess the pros and cons of Marriott’s approach to interviewing and selection; 3) identify the decision alternatives facing Laura and use at lest two different ethical theories to assess the implications of these alternatives; and 4) describe the impact these alternatives may have on employee psychological contacts and employee motivation.
Laura Green, Director of Event Management at the Marriott Waterfront Hotel in Baltimore had been through the hiring process many times. She was very comfortable with Marriott’s team hiring and behavioral interviewing approaches. They had only interviewed two candidates for the open Senior Event Manager position, yet they had been discussing what decision to make for two and a half hours. Normally these kinds of meetings wrapped up in 30 minutes with a clear consensus about what to do. But today they seemed to be gridlocked, unable to agree on a path forward. Shannon, the internal candidate, had been with Marriott for three years, she was really nice and well liked and had an excellent track record as an Event Manager – she rarely had a customer issue. Matt the external candidate, worked at a smaller sister property, he was already a Senior Event Manager there. However, he did not have experience working with larger groups and budgets like the ones at this hotel. But he was hungry and eager to grow. Who should they hire? One or the other? None? Both? They couldn’t agree on anything. This was a very unusual situation; Laura felt uncomfortable and suggested that they all “sleep on it.” They would get together first thing in the morning when they were fresh and decide what to do.
QUALITY BUILDING CLEANERS
This case illustrates the decision belonging to an Office Manager and Doctor of a small medical office of whether or not to introduce technology into a traditional office and the issues that may be involved in regards to employee resistance to change. This case also provides an example of generational differences and dynamics that exist in many workplaces. Although the decision is presented as one of whether or not to introduce technology and other organizational procedures, the most important issue in this case is not whether the office needs to be updated, but how the Office Manager and Doctor should go about implementing the changes.
The case should: (1) Expose students to the decision making process relating to the introduction of technology into a traditional, old-fashioned workplace; (2) Allow students to develop analytical and prioritizing abilities; (3) Allow students to apply change theory to a real world situation; (4) Expose students to a situation that may involve employee resistance to change; (5) Introduce students to issues relating to generational differences in the office.
Ms. Michelle Ebbtide, Office Manager and Mentoring Coordinator of Medical Results Medical Center (MRMC), has been pushing for computers, computer systems, printers, and other technology to be placed in the medical office since she had began working at the office in 2006. The problem is that office is entirely composed of older employees who are not acclimated to using computers. Ms. Ebbtide, a full-time student in her twenties, does not understand why the Doctor and the other employees are resisting her attempts to modernize their working environment. Due to the lack of technology, patients’ information is being misplaced, misfiled, and entries written in the appointment ledger are illegible. The paper-based systems that are in place, including the filing system, appointment entry, and timesheet entry systems, lead to inefficiencies and errors. Ms. Ebbtide knows that in order to correct these problems, the office must be updated. However, is it smart of her to introduce change into the workplace when the rest of the office is resisting?
RESTRUCTURING AT SOUTH EAST UNIVERSITY: SOMETMES THE BEST INTENTIONS FALL SHORT OF PRODUCING THE INTENDED RESULTS
This case is intended for an introductory course in human resource management. The normal participant is an undergraduate student who has very little prior exposure to human resource problems. On the analytical dimension, the problem will be stated but no solutions are provided in the case. The students must analyze the case, generate alternative courses of action, develop decision criteria as well as an action and implementation plan. The theoretical concepts in the case focus on the fundamentals of HR (i.e. recruitment, selection, orientation, training, pay and performance management) and the lack of in-house HR expertise as well as the lack of strategic thinking on the part of the owner and his managers. The case is medium in length. The case objectives are: 1) to familiarize students with the human resources challenges of running a medium size business; 2) to allow students to recognize the need to go beyond the symptoms of the case and address the root causes of these problems. 3) to recognize the need for the company to hire professional human resource expertise.
Despite rapid financial growth in the past decade and a growing demand for their services, behind the scenes, Quality Building Cleaners (QBC) is wrestling with many human resources challenges. QBC specializes in cleaning commercial properties throughout Southwestern Ontario, Canada. John North, partner in QBC, has reviewed the results of the employee exit interviews conducted earlier that year. North was surprised to learn that employees reported widespread dissatisfaction. This dissatisfaction was also reflected by turnover and absenteeism figures that were higher than the industry average. John knew he needed to figure out how to improve employee satisfaction before it impacted customer satisfaction. One key issue is the lack of professional in-house human resource management expertise.
QBC currently conducts their human resource management in a rather haphazard fashion using outdated practices and procedures for handling human resources. In addition to a lack of human resource planning, several different employees have handled the selection process leading to variability in the employees hired. QBC struggles with how to attract and retain its employees in a business known for high turnover, poor working conditions and low pay.
SAMANTHA DOESN'T SAY NO! (A), (B) SHE’S LEAVING THE COMPANY… ISN’T SHE?
Dean Len Boyle implemented a substantial change in the management structure of the business school at South East University (SEU). Throughout the change process, Dean Boyle felt he had communicated openly and invited feedback from all faculty in the business school. As an organizational behavior research project, three MBA students studied this restructuring. Dean Boyle was somewhat surprised by the results of their survey of the faculty. Apparently things had not gone as well as he had hoped across the entire faculty.
This case will enable students to (1) improve their understanding of the various drivers for change that organizations face, (2) determine the requirements for executing an effective structural change process within an organization, (3) learn about the importance of selecting the appropriate communication channels, and (4) to develop an improved understanding of organizational culture and how it can serve as a critical factor in resisting change.
Dr. Len Boyle, dean of the business school at South East University (SEU), had just received some interesting data from a group of MBA students. In their Organizational Behavior course, these students explored faculty reaction to the dean’s recent reorganization of the business school. In retrospect, and perhaps confirmed by this data, maybe Dean Boyle could have handled the process differently.
According to the results revealed by the students’ research, an overwhelming number of faculty in the business school expressed being “unsure”, “doubtful”, and “very pessimistic” that the recent restructuring would produce the intended outcomes important to the dean and the business school. Furthermore, 33% of the faculty reported that they felt they had remained outside the communication loop in advance of the restructuring process and they, in turn, expressed indifference regarding the change process itself. Dean Boyle studied the report with his head in his hands, reviewing the findings relative to faculty perceptions of job satisfaction and organizational commitment. As he looked at the numbers, he began thinking about the restructuring process at the business school and how he might have done things differently.
The purpose of this teaching case (Case A and B) is to present and discuss key issues in career decisions, regarding the individual aspects and issues in Organizational Culture. The self-knowledge process, the personal values and the analyses of one’s life story, along with the organizational culture, are introduced as critical points for the decision making in career decisions. The elements presented in the case suggest the influence of the family bonds and the importance of people that belong to our social network, whenever a decision is needed. The case provides an opportunity to examine career choices and career development as a product of relevant personal aspects, such as personality traits, values and life history. Concepts in self-knowledge, job satisfaction, personal values and organizational culture can also be understood, as the students analyze Samantha’s decision process. One of the most important aspects provided by the case is the analysis of the story of a life as a form to diagnose problems faced when choosing a career. It can be used in undergraduate and graduate courses, and in programs to develop career counseling, where concepts about organizational behavior, psychological aspects and career development are required. Its use is recommended at the end of the program, when students have learned the main concepts for career development.
The Case A presents the dilemma faced by Samantha Vincent, a professional in the Human Resources area who left a company where she had worked for 7 years and in which she had had good experiences. Samantha left to join Patricia, her friend and former boss. In the new job, Samantha felt frustrated about her work expectations, and was concerned about the amount of working hours: she could neither more give the same amount of attention to her family nor have time to study. Samantha decided to quit, but Patricia asked her to stay and try a little more. Samantha couldn’t resist Patricia’s solicitation and agreed to try for two months more. Samantha continued to have difficulties to coordinate everything she was in charge of. The Case B presents the dilemma faced by Samantha, a few months later she agreed to stay at SAP to help Patricia to find someone to substitute her. She was accepted again at the Master Program and the routine was overwhelming again. After a second period as it was wanted by Patricia, Samantha quitted SAP. She tried to have a good performance at the Master course, but she was not making it.
A DATABASE DESIGN AND DEVELOPMENT CASE: NANOTEK NETWORKS
IGF: TECNOLOGY ADOPTION
The objective of this case is to provide a real-world case/project for students enrolled in a management information systems, database management, or systems analysis and design course in which database design (entity relationship and/or normalization) and development are taught.
The specific objectives of the case are: (1) To create a moderately complex data model that meets the functional requirements of NanoTek Network’s Marketing Department. (2) To gain an appreciation of how difficult it is for developers to interpret and understand the functional data requirements for a new system. (3) To create a physical database based on a data model. (4) To populate the physical database with the data provided. (5) To develop a series of queries, forms, and reports necessary to assist in managing NanoTek Network’s Marketing Department. (5) To develop a navigational menu system for an application. (6) To gain an understanding of the work and time involved in designing and developing a new system that meets functional requirements of its users.
The case consists of a business scenario to provide background information and details of the unique operating characteristics of the Marketing Department of NanoTek Networks, a description of the functional business requirements, and sample data. What is unique about this case study is that most of the functional requirements and sample data are presented to the students through a series of business memos. The main business issue presented in the scenario is a rather typical management accounting problem: NanoTek Network’s financial accounting system does not supply sufficient data for the Marketing Department to manage the financial details of their day-to-day operations. The Marketing Department’s functional requirements are somewhat similar to a cost accounting system that a job shop would employ. The Marketing Department needs to be able to track costs by the marketing activities associated with specific product promotional campaigns. The case provides sufficient information to design and develop a moderately complex database to assist NanoTek Network’s Marketing Department in solving their management accounting problem. The case is divided into two deliverables. In the first deliverable students are asked to design a database, convert their conceptual design into a physical database, and populate it with data. Students develop a series of queries, forms, reports and a navigational menu system that satisfies the stated functional requirements of the Marketing Department in deliverable two.
RFID, BARCODES, AND LEMONADE
This case should be used in introductory MIS or strategic management course at the graduate or undergraduate level at the point when technology adoption is discussed. The case was written from interviews that the author has conducted with the main user of the system, Lynn. Addition information about the Goods and Services Tax were obtained from the Internal Revenue Authority of Singapore website, www.iras.gov.sg.
This case explores issues related to technology adoption in a small business organization. The critical decision is whether or not IGF should become a GST trader to offset the Goods and Services Tax (GST). As IGF’s revenue is increasing, the 7% GST rate is adding up to a significant sum. Becoming a GST trader would means that IGF would have to purchase new accounting software that is GST compliant. It would also mean that IGF might have to invest in new computer hardware. Adoption of the new accounting software should be straightforward and would not pose any problems to the operation of IGF or to any of IGF’s staff.
TEAMPAGES.COM: BUILDING A BUSINESS IN AMATEUR SPORTS
A wealthy Indian, with experience in his family’s large chemicals business, a private equity firm that he founded and several personal start-up ventures, is contemplating starting up a new company to capitalize on RFID technology. The purpose of this case, which was developed based on interviews with the entrepreneur and two of his employees, is to provide an opportunity for students to consider some technical, strategic and other challenges associated with building a business around a new information technology which might be a disruptive technology. The case is designed for use as a vehicle for discussion in a class that brings together engineering or computer science students with business students. No accounting or finance background is required, so the non-business students can participate on a par with their business student peers. Students will consider the investments in complementary technologies and processes that would be necessary for this business to succeed, as well as strategic and marketing issues. We envision its use in an MBA program.
Atul Mahajan (name disguised), a member of a wealthy Indian family, sits on the board of his family’s chemicals company, Kisan Group (also disguised). Charged with managing the family’s wealth, he founded and manages a private equity group that helps build mid-market companies. He also previously built a few technology start-ups using his own resources. One unsuccessful start-up venture attempted to sell a service that used encrypted and masked bar codes for document authentication. Although Mahajan successfully persuaded the family business to purchase this service for authenticating Kisan Group stock shares following a financial markets regulatory change, his company was not successful in selling this service to any other company. The case offers hints that this failure might have been due either to poor timing or a poor marketing and sales effort. Mahajan did, however, build a successful company that provided administrative and data management support for pharmaceutical clinical trials. Now, with both successes and failures under his belt in the realm of technology-enabled businesses, and apparently with sufficient resources to contemplate another entrepreneurial venture, Atul Mahajan wonders whether to revive the document authentication business by developing products and services that would use encrypted RFID tags instead of the older barcode technology.
A recent business school graduate, buoyed by winning a business plan competition, has launched a content management and social networking site for amateur athletes and sports organizations. A year after its launch, the company has almost run out of money and is far short of the customer base Mike Tan (CEO) and his investors expected. The outlook for the concept is still promising, but Mike must come up with a viable new business plan before his investors will put more money into the company. There is also some risk that the investors will take control of the business and displace Mike as CEO.
The case should enable students to: (1) assess three potential markets; (2) analyze financial statements and projections to project future costs and revenue potential; (3) evaluate the viability of revenue models appropriate to businesses with largely fixed costs; (4) evaluate the critical success factors for web 2.0 businesses, and (4) generate realistic recommendations that will convince investors to provide additional capital to the fledgling firm. It is written to be used in undergraduate and graduate courses in e-business, entrepreneurship, strategy or marketing.
Mike Tan, 25-year-old founder and CEO of TeamPages.com, scanned his boardroom. Every inch of wall was covered with flipchart paper. Every sheet was a sea of data, a veritable business school analysis of every detail of the company’s environment, operations, and prospects. But it was May of 2008 and the time for analysis was over. At the current burn rate, TeamPages had six weeks’ worth of resources left. Investors were ready to provide more cash if Mike had a viable business plan, so it was crucial to develop the key elements of that plan quickly. TeamPages had evolved from an innovation competition business plan to a start-up that had captured the attention of a major German venture capital firm. It combined social networking with content management in the epitome of web 2.0 businesses – a technologically sophisticated backend system and prosumers who would supply and depend on specialty content. In the case of TeamPages, the prosumer audience was a wide range of individuals, teams and leagues involved in the burgeoning domain of North American amateur sports. Like many entrepreneurs, Mike was full of enthusiasm for the project and saw unlimited potential in its future. But a year after its launch, it was still short of its targets and the company had to come up with a realistic and feasible plan to make the company profitable.
DANGER OF GROWING
GHANA RICE CRISIS
This case is appropriate for undergraduate students and graduate students in management, small business and entrepreneurship, international management, and business and society courses. It spans a range of topics normally covered in these courses, including strategies of small business development, corporate social responsibility, government regulation, and changing business environment.
After studying the case, students should be able to: (1) Critically evaluate the top-managers’ choices with respect to corporate social responsibility; (2) Critically evaluate the behavior of the company in the setting of a particular business environment; and (3) Become familiar with the peculiarities of the business environment in a state-controlled economy of post-Soviet.
The case “Danger of Growing” describes the process of launching and developing a U.S.-Belarus joint venture that produces biofuels (wood pellets) in Belarus and delivers the product to the European Union countries. While the wood processing industry in Belarus mostly belongs to the state and is controlled by the state, wood-waste products are currently outside the state’s area of interest.
Having a well organized operation and constant demand for its products, the company grows successfully. However, along with success and growth, the company faces a danger of visibility that would attract local and central government institutions in state-controlled Belarus. Local institutions (city and regional governments) would perceive the firm as a continuous source of revenue for solving the problems of the city infrastructure. Central institutions would consider the firm as a part of their system of central planning. To avoid these threats, the firm has to choose one of the three options. Staying its course, it can continue to grow and accept the role of a major donor for the city’s needs and become a part of the larger government-managed wood-processing industry. Alternatively, it can control its growth by slowing down or splitting up into several smaller firms that are located in different regions and still stay considerably invisible. Third, it can move to another post-Soviet country, which provides a friendlier environment for business operations, yet operates with similar cultural and economic advantages.
JARAMILLO SPECIAL COFFEE: THE WORLD’S BEST COFFEE
This case should enable students to understand the ethical issues involved in free trade, for example dumping, which is illegal in the United States; guide students to critically consider the poorer countries perceptions of IMF/World Bank/WTO’s organizational values and the trade policies of the G8 countries as well as the value of their own governments; and evaluate external influences of superpowers on poorer nations. This case is designed to be taught in graduate level classes in business administration and public administration, specifically in International Trade and Business/ Government relations. The global ramification of free trade makes this case particularly appropriate for students who are interested in international business and policy development. This case is written with the assumption that students have prior knowledge of international marketing and economics.
It was quite a moving scene. Men and women of all ages and all works of life braved the very hot Ghana sun to protest at the World Trade Organization’s meeting in Accra Ghana. They chanted, “Our eyes are red, save our farms, save our livelihood”. They were protesting against the current policy that International Monetary Fund (IMF) forced on the Ghanaian government concerning total withdrawal of subsidy to Ghana’s farmers as well as a drastic lowering of tariffs on imports, especially on imported rice. They were also protesting the massive subsidy given to their counterparts in G8 countries. The governments of these countries, through massive subsidies, encouraged their farmers to produce excess capacity and dump their excess on poorer countries at prices below their cost of production. Ghana rice farmers cannot compete against these massively subsidized imports. For instance, it costs a U.S. farmer $240 to produce a ton of rice which he or she can sell in Ghana for $205 because of the subsidy. The same ton of rice costs a farmer in Ghana $230 to produce. Since subsidies are not available to Ghana farmers they cannot sell their rice below cost and therefore cannot compete against U.S. imported rice. This case raises issues of ethics, and highlights the ills of bad domestic and foreign policies. It showcases a global perspective in analyzing the leading world problem; hunger and poverty. Ghana has accepted a loan from IMF that came with certain detrimental stipulations to its domestic rice industry. Ghana must devise a solution to this problem that will not violate its agreement with IMF but will correct this unfair trade policy.
MOLSON VERSUS KAISER: A CASE OF UNSUCCESSFUL ACQUISITION
The case wants to help students understand the trade trends of the most important traded commodity in the world after oil: coffee. The case illustrates many issues such as: 1) Value, cost and demand for quality, 2) Demand elasticity and market power, 3) Differentiation for de-commoditization of Coffee, 4) Umbrella marketing strategy, 5) Coffee Value Chain for special and commodity coffees, 6) Opportunity cost of land, 7) Corporate Social Responsibility (CSR) and 8) The value of the Auction as compared with Direct Trading. The case can be used to address only some to the objectives depending on the course and the audience. Depending on the expertise of the professor, the case can focus on the interest of the current audience of a given session. The case can be used in international trade, marketing and finance courses at the undergrad, MBA and Executive Programs level.
In June 2004 the press was astonished by the record price obtained by Jaramillo Specialty Coffee in the Specialty Coffees Association of the Americas’ auction. The price was $21 a pound, when normal coffee prices would be 73 cents a pound and special coffee retailers like Starbucks etc. would pay $1.20. The price was so unusual that the auction was temporarily closed. The next year the price increased from 50 dollars to 130 dollars per pound. The case describes the value drivers managed by the farm owners, the Petersons, who managed different lots of their farm, looking for excellent crop, actively participating in every coffee trade show, and in the Cup of Excellence program evaluation and auction. The problem is that besides the satisfaction of selling the most expensive coffee of the world, the lot size was only 5 to 10, 60 kg bags; the revenues were not big enough to pay the opportunity cost of land. The case describes many important characteristics and evolution of the coffee market around the world, and the attributes and marketing strategies that define the value and price of the product. It also helps to analyze trends in the world supply and trade.
NUCOMM INTERNATIONAL: MAKING A CALL ON CHINA
The teaching case Molson vs. Kaiser is intended to be used in International Business graduate or undergraduate courses. It describes the unsuccessful acquisition of the Brazilian Kaiser Beer Company by the Canadian brewer Molson. It presents students with the problems the Multinational Company (MNC) experienced when hiring executives from a Brazilian competitor, thus challenging the often-accepted idea that bringing in locals is better than opting for expatriates. Ever since, the literature on mergers and acquisitions has attributed much of the blame for MNCs’ failures to diversify geographically to parochialism, ethnocentrism and a lack of cross-cultural competence. A common recommendation for performing better abroad is to avoid bringing in people from headquarters and give preference to local managers, who are supposedly more knowledgeable about the host country’s institutions and behaviors. As national cultures are far from uniform and organizational culture can vary dramatically from one company to another, the acquiring company can end up incurring more cultural difficulties by hiring locals than if they had managed the acquired company themselves. The present case offers students an opportunity to discuss this issue, which has been overlooked in the research, and provides a counterpoint to the literature that tends to blame ethnocentrism and ethnocentric Human Resource policies for failures in acquisitions.
Molson Inc, one of the two dominating Canadian breweries, bought Brazilian Kaiser in March 2002 for US 765 million and sold it four year latter to Mexican brewery Femsa for US$ 68 million in one of the biggest and most costly blunders in International Business of the decade. At the time of the acquisition Kaiser was the number two beer producer in the Brazilian market, the fourth biggest of the world. At the time Molson passed Kaiser forward in January 2006 its market share had dropped significantly. In the mean time, for two years in a row, Kaiser had experienced losses of around US100 million, which affected quite negatively its value in the Canadian stock market and the career of the executives that were involved in the deal.
The case describes the Brazilian beer market situation, the strategic decisions Molson´s top team made and the problems they faced. It encourages the student to put hi or herself in the place of the Molson´s CEO at the time and consider if he has done something wrong and what might that have been.
SAP AG (A): FROM VALUE TO VOLUME MARKETING & SAP AG (B): THE DG BARCELONA HUB
NuComm is a provider of outsourced call centre services headquartered in St. Catharines, Ontario, which recently established its first offshore operation in Manila. Real Bergevin, the CEO, is now dealing with a proposal for further expansion into China which entails making decisions about the location, mode, and scale of the entry in the context of a difficult corporate financial situation. The case includes data on China’s market potential, discussion of the business culture and its heavy focus on relationship-building, as well as specific information about the alternatives to assist students in developing a recommendation with regard to the Chinese initiative.
The NuComm case deals with issues of international environment analysis and international strategy formulation and implementation. Students must conduct a market assessment of the SouthEast Asia region as a whole and then decide among specific possible locations in China for a call centre operation. The question of whether to take on a local partner or go it alone is raised, and decisions must be made regarding how to deal with the political climate in the various locations. The availability of suitable labor as well as profitability forecasts and the likelihood of profit repatriation are further decision factors. The case is most appropriate for international business courses at the second year MBA level or the fourth year of an undergraduate business course. It could also be used in the international section of a business policy course or a course focusing on strategy implementation. The case was developed as an integrating case for a week long exercise for third year business students. This case can be used early in a course focused on international business or international strategy. It covers many of the main questions decision-makers must wrestle with when making foreign expansion decisions and each of the main issues can be dealt with in greater detail in a subsequent class. Students will apply location assessment analysis, make entry mode choices, and evaluate risky business opportunities from both a long and short term point of view.
The case studies “SAP AG (A): From Value to Volume Marketing” and “SAP AG (B): The DG Barcelona Hub” were designed to be used in Strategic Marketing and International or Global Marketing courses. “SAP AG (A): From Value to Volume Marketing” is more focused on Strategic Marketing and it is a good illustration of the challenges of targeting a new market segment for which the marketing strategy of an industry leader is not entirely suitable and has to be reinvented. “SAP AG (B): The DG Barcelona Hub” is more focused on International or Global Marketing and it provides an excellent opportunity for discussing the issues and challenges of successfully rolling out a marketing strategy that has been market tested, and debating how far marketing decisions should be centralized in order to be efficient. The “SAP AG (B): The DG Barcelona Hub” case study can also provide another interesting dimension by exploring the implications of marketing decisions for Information Systems.
The case studies “SAP AG (A): From Value to Volume Marketing” and “SAP AG (B): The DG Barcelona Hub” deal with the kind of issues and challenges that SAP AG, the German company currently world leader provider of enterprise software applications, was facing in 2007 when they decided to enter the small and medium enterprise (SME) market.
In “SAP AG (A): From Value to Volume Marketing”, more than 80% of Fortune Global 500 enterprises were SAP customers. Although the company had 65% of its customer base in the SME market, targeting these companies was not that easy, and the product was not totally appropriate. There were huge revenue opportunities in the SME market, as many companies were not currently enterprise software buyers. This probably implied some changes in the way SAP was approaching its customers. In “SAP AG (B): The DG Barcelona Hub”, SAP decided to target the SME market with a new product, SAP Business ByDesign. To test the market, a Demand Generation (DG) Hub was established in Barcelona. 2008 was to be a critical year for the DG Hub: if objectives were met, the entire project would be rolled out globally. Some marketing decisions had to be centralized. But this was unlikely to be immediately accepted by SAP countries.
AGUAS DANONE DE ARGENTINA
Not for Profit
CABARRUS FAMILY MEDICINE RESIDENCY PROGRAM
“Aguas Danone Argentina” has been prepared for MBA programs and executive education courses –specifically for teaching modules that tackle marketing, branding and innovation issues. In marketing-related programs, it may be used to show the processes, tools and decisions required to exploit new category branding opportunities. In innovation-related programs, it may be used to illustrate how new products can lead to new category creation. This case discusses several issues associated with brand expansion strategies and new product category development, including: an adequate understanding of market research studies, a practical approach to segmentation and positioning notions, Brand expansion and Marketing operations in critical times –viewing crises as opportunities to drive creativity, innovation and business transformations.
In August 2002, Aguas Danone de Argentina (ADA) faced an adverse scenario. Argentina was undergoing its worst economic crisis in history, and bottled water sales were dwindling (replaced by utility network running water). The company needed to boost its revenues through new, innovating, more value-added product development. Argentina displayed a significant interest in fitness. By means of several market research studies, ADA managed to identify a segment whose needs were unmet by existing products and brands. New product launches were planned to target that segment. This case describes the dilemmas faced by ADA and the decisions required to formulate and pursue a strategy for new product launching and brand expansion in adverse scenarios. More specifically, this case provides an opportunity to discuss how a new product category can be created to address market downturns.
EAST CENTRAL OHIO FREIGHT
After completing four years of medical school physicians usually complete a multi-year residency program in an area of specialization. From there it is common for residency program graduates to continue with a fellowship program for additional specialization.
Nationally, Family Medicine Residency programs are confronted with a decline in applications from medical school graduates. With this diminishing pool of applicants the leadership of family medicine residency programs is faced with decisions regarding the future viability of its programs.
The case should enable students to: (1) Determine the feasibility for a new product/service. (2) Identify critical issues involved in adding a new product to an existing product line or product mix. (3) Analyze market opportunities and competitive forces in health care markets. (4) Utilize critical thinking skills and use strategic planning methodology. (5) Determine the impact of external forces on decision-making.
Dr. Allen Dobson, Director of Graduate Medical Education at NorthEast Medical Center was particularly concerned with the future viability of the Cabarrus Family Medicine Residency program (CFMRP). With 473 other family medicine residency programs in the United States the competition for applicants was extremely competitive. CFMRP needed to continue attracting enough residents from a diminishing pool of applicants or find other ways of enhancing the program.
Options being considered were the addition of fellowship programs in Sports Medicine, Women’s Health and Geriatrics.
FAME: I’M GONNA LIVE FOREVER POMONA SCHOOL OF ARTS & ENTERPRISE
This case should enable students to: (1) Understand the basic characteristics and operations of businesses in the trucking industry. Specifically they should recognize the differences between truckload (TL) and less than truckload (LTL) shipping and the components of pricing, (2) calculate a series of breakeven points under different assumptions, (3) apply strategic decision tools to evaluate the economic and competitive environment relative to company strengths, including the GE/McKinsey grid, Porter’s 5 Forces, and the Ansoff Matrix, and (4) to examine differences in decision outcomes given short-term and long-term perspectives.
The case is appropriate for use in undergraduate classes in Marketing, Marketing Strategy, Supply Chain and Logistics courses.
In July of 2007 the management of East Central Ohio Freight (ECOF) met to decide whether to increase the company efforts in the volume LTL (less than truckload) freight market. While the company’s limited experience in the volume LTL business had been positive to date, expansion would require considerable capital expenditure and additional work force to meet the anticipated demand. Times were difficult in the trucking business and there were no guarantees that the company would be able to generate new business sufficient to support the necessary commitment of resources.
KEN ROBERTS: MASTER MECHANIC
The case illustrates poor brand recognition and image of a charter high school, along with a lake of customer focus – at least customer focus towards one customer group. The school is located in Pomona, a city to the east of Los Angeles. Charter schools in the State of California are state funded alternatives to the public school system and, as such, open at no cast to all students, not only in the geographic area, but anyone in the state that wishes to attend. The school of Arts & Enterprise is such a school with a mission of combining extensive fine arts training along with a business background. Students should be able to identify and solve customer service issues for a service industry and identify underlying issues beyond the problems. It is suitable for an undergraduate principles class.
This case study takes us through the process the Santos and Rodriguez family must undertake in order to find out information about the Pomona School of Arts and Enterprise (SAE). This school is a state of California charter high school whose mission is directed towards education combining fine arts and basic business skills. The family grapples with misinformation, difficulty in finding any information about the school and, once they have found it, difficulty in trying to get their children enrolled.
The principal, Ms. Lucy Berger, knows the school needs to grow, but isn’t sure why it is not. Through the frustrations experienced by the Santos and Rodriguez family, many of the problems surface.
REEBOK AND THE U.S. HISPANIC MARKET
Ken Roberts, the owner of an independent automotive repair business in small coastal city in New England, arrived early for the workweek to discover an unscheduled and unknown vehicle awaiting repair in the driveway. He must decide how to deal with this unexpected repair request, balancing the demands of his existing schedule with the needs of a new customer
The case should enable students to: (1) analyze the additional marketing mix elements that are specific to services (people, process, and physical evidence); (2) identify how consumers develop expectations for service provision, how they develop quality in services, and how they create a “zone of tolerance” for gaps between their expectations and perceptions of service delivery; (3) apply consumer segmentation to a specific service industry; (4) demonstrate how service providers can effectively manage the cues that customers typically use to determine satisfaction; and (5) develop a tactical business decision regarding a specific consumer service request.
It was 7:15AM on the last Monday in February, and Ken Roberts already knew that it was going to be an interesting week at Ken’s Haus, Inc. He had arrived at work to find a mystery car parked directly in front of the overhead door into his repair shop, as sometimes happened on weekends. Tow truck drivers often dropped uncooperative vehicles in front of his shop door and threw the keys through the mail slot in the passage door, knowing that Ken would go out of his way to help out stranded motorists, even those without scheduled appointments. This car, however, was a bit different. Rather than being towed to the shop, the owner had apparently driven it there. Beyond that, Ken had never seen this vehicle before. Luckily, among other notes and mail that had arrived through the mail slot over the weekend, there was a handwritten note describing the car and its issues, along with the keys. At the same time, he did not recognize the note as being from customers he knew, at least by their first names. Ken needed to develop a tactical plan for dealing with the owner and the potential repair of the vehicle, mindful of his reputation as one of the best independent shops in the area. As a service marketer, beyond providing competent repair work, he knew that word of mouth was crucial to his business’s continued success.
THE CHURCH GROWTH SURVEY
Reebok, a major player in the very competitive U.S athletic shoe market, has given scant attention to the growing Hispanic market segment in the United States. Mr. Jorge Dionne, Director of Sales and Marketing for Reebok Latin America, has taken on the role of “U.S. segment manager” as a labor-of-love. He believes strongly that this position should be formalized and he is preparing to make such a proposal to Reebok’s management group. This is a discussion case that challenges students to consider culture and ethnicity in the context of market segmentation. The case should enable students to: 1) delve deeply into the basic concept of market segmentation; 2) see the segmentation decision not as yes/no but as a series of difficult trade-offs, e.g., greater customization vs. higher costs and fragmented marketing programs; 3) understand the role of culture and ethnicity as a powerful basis for segmentation; and 4) see how benchmarking competitors and “best practice” can be used as input to marketing decisions. The case was developed for undergraduate and graduate courses in Marketing Fundamentals, Consumer Behavior and Brand Management.
Jorge Dionne, Reebok’s Director of Latin American Sales and Marketing, is contemplating a skunkworks effort within Reebok corporate headquarters. The initiative would involve Reebok’s placing more emphasis on the large and growing Hispanic minority in the U.S. A project carried out by a local MBA student has pulled together a good deal of data on the U.S. Hispanic population overall; this data includes the benchmarking of Hispanic marketing activities at major competitors and three “best practice” consumer marketing companies: SAB Miller (Beer), The Home Depot, and Payless Shoes. The research effort has prompted Mr. Dionne to create a framework that enables a back-of-the-envelope evaluation of the degree of market segmentation. Mr. Dionne’s goals for Reebok would appear to be quite a stretch for the company. How should Mr. Dionne argue his case? What level of customization should he recommend?
THE WORKER SOLUTION
This case can be used to address the inter-related steps in the marketing research process with a specific focus on questionnaire design, evaluating the sampling plan and sample size, data analysis and report writing. Ethics in marketing research can also be discussed using this case.
In teaching this topic, appropriate teaching objectives would include to: (1) see how the type of information needed to address a decision maker’s questions and problems will influence the structure and content of the questionnaire. (2) Give students experience in critiquing a questionnaire that has been prepared to address specific research objectives and research problem. (3) Help students understand the concepts of sampling plan and sample size to evaluate the sampling used in the marketing research study. (4) Give students experience in preparing data for analysis and report writing. (5) Provide students with the experience of preparing a research report to meet the specific objectives of the marketing research study. This case has been developed to meet the learning objectives of an undergraduate marketing research course.
Cecil James, Manager of Marketing Research with a marketing research firm called Telelink Research had just completed a survey for Pastor Brady Abel and the Immanuel United Church of Christ in Sedalia, Missouri. In, St. John’s, Newfoundland and Labrador, Mr. James is looking through the data recently collected in the survey. Furthermore, Mr. James is reflecting on the questionnaire design, and how the survey was carried out. In Sedalia, Missouri, Pastor Abel is anxiously awaiting the results from the research that he and his place of worship have dedicated a lot of time and money to in recent months. Cecil James must now turn to analyzing the data, ensuring that the proper cross tabulations are performed on the raw data collected through the CATI system. Only by conducting adequate analysis of the data will he be able to effectively address the set research objectives and write a research report to address the challenges faced by his client.
TROME – NEWS FOR THE BASE OF THE PYRAMID
This partially disguised case is a real situation used to provide undergraduate and graduate students with an opportunity to make practical application of sound marketing and promotion principles within a not-for-profit organization. Students are given the opportunity to analyze the market growth opportunity for a sheltered workshop near Memphis, TN. The Worker Solution is attempting to gain market share and grow its market among competing organizations serving the Memphis market. The case is appropriate for students to develop alternative marketing strategies while using their creative skills to establish various promotion options. Students should be encouraged to evaluate different marketing scenarios related to the case. This case is suitable for written reports, oral presentations, and examination purposes.
This case deals with an actual situation involving Steve Sanders (all names and financial data are disguised) who must make a decision about the future strategy of The Worker Solution, a vital element of the Challenge Life Center’s operations. The Challenge Life Center is a residential facility which serves the needs of mildly- to moderately-mentally challenged adults. Located in Mississippi (about an hour’s drive from Memphis, TN), the center is designed to provide an environment which maximizes the mental, spiritual, physical, vocational, and emotional growth of the residents. The case focuses on the vocational services offered to clients. The Worker Solution (TWS) has a competitive advantage in its pricing to organizations that use its services. However, the organization has not been aggressive in its marketing to potential clients and therefore Sanders believes there may be an opportunity to gain an enhanced market share with a more planned and focused marketing strategy.
“Trome- News for the base of the Pyramid”, may be used for second-year marketing courses at MBA programs, as well as in specific executive education programs addressing issues such as innovation, base of the pyramid, low-income segments, emerging markets, and/or new product launches. This case may be used to analyze low-income consumer behavior in order to develop attractive value propositions, review the mix of marketing proposition drivers that render a business sustainable and to discuss challenges faced by organizations when trying to develop a new value proposition that implies a strategy change.
In June 2001, Empresa Editora El Comercio (EEEC) had launched a new popular newspaper, Trome, for low-income families. Although several studies had preceded this launch, sales in following months failed to reach expected levels and actually displayed a decreasing trend. Trome embodied the company’s effort to expand its news coverage to new population segments that were not served by its other newspaper, El Comercio –a traditional daily leading unaided recall and frequent readership rankings among high-income sectors. Six months after Trome’s launch and faced with dropping sales, company managers had met to discuss their options. This case describes management team members’ dilemmas at that meeting: “Should the new paper’s style and contents be changed? Should Trome focus more on sex and violence-related issues, as its competitors did? Would it be convenient to replace the silverware promotion chosen to support launching? Was the conflict with newspaper salesmen’s union adequately managed? Were intended readers’ needs truly and fully understood? Should the company re-launch Trome or would it be wiser to just give up on this project?”
CHOOSING THE FUTURE
Production & Operations
GOVERNANCE IN TIMES OF CRISIS
Three brief cases focus on individuals facing difficult decisions about the use of genetic testing. Such tests can detect genetic markers that potentially predict a variety of disorders, diseases and defects. Choosing to use these diagnostic tools can reduce or eliminate uncertainty about the eventual onset of a debilitating malady such as Huntington’s disease or detect whether embryos contain certain genes that, for whatever reason, parents may not wish to pass on to their children. The cases challenge the reader to consider the difficult moral choices that individuals in these situations face and to also weigh the broader implications for healthcare and other dimensions of public policy and societal welfare. While all three cases are intended to require students to wrestle with the decisions themselves, the instructor’s manual provides additional information about the choices these individuals actually made and a description of some of the initial consequences of those decisions. This additional material may be helpful in shaping the teaching strategy and when shared with students offer the potential for further discussion and reflection. The cases are suitable for use in both undergraduate and graduate courses. They are intended for use in ethics courses, both theoretical and applied (e.g., bioethics), but might also be appropriate for university level courses in healthcare and social work.
Three case vignettes are presented. A woman wants to find out if she will develop a form of emphysema that runs in her family, but concerns about privacy and insurance complicate her decision. A husband discovers he is at increased risk for colon cancer. He and his wife consider whether to use preimplantation genetic diagnosis, or P.G.D., to reduce the likelihood that the baby they plan to have will not inherit this genetic predisposition. A young woman, age 23, can take a test to determine whether she carries the gene for Huntington’s disease, an incurable brain disorder. Her grandfather had died of the disease, which usually afflicts people in middle age, and several other members of her extended family have the disease.
OCEAN BEACH ANIMAL SHELTER
A newly minted MBA joins a volunteer non-profit board. Shortly after joining the board the organization experiences significant cash flow challenges. In the process of resolving this problem much deeper issues are exposed, including lack of basic financial and human resource controls, problems with reputation and image in the community, alienation of funders, and a deceptive Executive Director who tries her best to hide her own significant performance issues from the board. Eventually the President of the Board and the Executive Director leave the organization, leaving our new MBA in charge and struggling to decide if the agency can be saved, and if so, how.This case was written to motivate discussion of issues related to non-profit governance. It is presented in three parts, allowing instructors to choose one or two of several possible areas of focus. These include general preparation for governance, roles and responsibilities of management versus directors, funder and media relations, human resource related management controls and financial control mechanisms. As such this case may be useful for courses on governance, human resource management, strategy, and management controls at the undergraduate and MBA level.
Amelie joins a non-profit board, not recognizing the oddness of the circumstances surrounding her appointment. These include, among other things, a notable dearth of other candidates and a complete lack of screening mechanisms. During her first few months as a Director she notes chronic deficits, a lack of ability to keep up with funder’s reporting needs (apparently due to unreasonable funder expectations and time constraints), divisiveness within the board, and other issues. These all come to a head when the agency is unable to make payroll, leading to unsuccessful attempts to gain emergency funding, and ultimately a public appeal through the media. The media coverage results in both short term funding, significant negative exposure, and meetings with funders and staff. During these meetings it becomes apparent that many of the agency’s problems are the direct result of incompetence and deliberate deceitfulness on the part of the Executive Director. Options for corrective action are discussed. Ultimately the Executive Director leaves the organization, but the problems she created are left behind. The board’s ability to deal with these problems is negatively impacted by internal divisiveness caused by fundamentally different understandings regarding mandate and mission. This must be addressed before any stabilization is possible.
THE CASE OF THE NEW ENGLAND CENTER FOR THERAPY TRAINING AND RESEARCH
The Ocean Beach Animal Shelter case is a board of director’s decision based dilemma involving a non-profit 501(c)3 organization. The primary protagonist, Maryann White, is a volunteer for the organization who becomes aware of apparent deficiencies at the highest levels of the organization. As an animal lover, Maryann is concerned over the well being of the animals and the high levels of euthanasias being reported. She is trying to work within the system, particularly through the board of directors to recommend policy changes; however, the board appears to be closely aligned with the executive director. The case was developed for use at both the undergraduate and graduate level and can be approached from either a strategic or tactical perspective. The case can be used in a non-profit or small business management course where board of director policy or decision making scenarios are presented and analyzed.
The Ocean Beach Animal Shelter case highlights both strategic and tactical issues that top management and a board of directors may face on a regular basis. The organization was recently featured in a somewhat critical article in the local newspaper regarding overall deteriorating conditions at the shelter. Furthermore, donations have declined, while costs continue to increase. The reported animal euthanasia rate seems well above the national average.
The executive director appears to demonstrate a rather micro management autocratic style of leadership; however, she enjoys virtually unquestioned support from the board of directors. Employees are somewhat limited in their opportunity to speak out and there has been a turnover of volunteers. Maryann White, a volunteer at the animal shelter, wants to see changes made beginning at the board level with a greater accountability and oversight of overall operations. She is trying to identify ways to work within the system and her dilemma is deciding on what approach to use which will have the greatest impact.
There are board policy issues in the case including the role and function of the board and its commitment to the organization as well as sustaining the overall mission and vision of Ocean Beach Animal Shelter. The case also has tactical issues to be considered regarding fund raising and, facility maintenance, public relations and overall operations.
A fledgling non-profit organization that provided training and counseling in family therapy was in jeopardy because they did not have the money to hire an executive director. The therapists at the center needed to find a way to obtain grants, seek out donors, and develop new revenue streams, but they did not have the time or the expertise to do so. The case focused on the center’s scarce resources as well as a leadership vacuum and lack of agreement about the center’s mission in the community. The case should enable students to: Identify and discuss the challenges involved with running a non-profit organization, analyze and critically evaluate the organization by performing a SWOT analysis, and develop an improvement plan that includes specific goals and a clear plan for addressing and measuring those goals. The case was developed for graduate classes in general management, or management of not for profit organizations.
On October 2, 2007, Sandra Naughton had a meeting with her team of fellow psychotherapists. “I just don’t want to do this anymore,” she said as she sank into her colleague’s sofa. “I have no interest in it, and I’m not good at it,” she said. Sandra worked as a therapist at the New England Center for Therapy Training and Research for two years before she became Executive Director. It was not that Sandra lacked passion for the center, but her training as an artist and a psychotherapist did not prepare her for some of the more challenging aspects of running a non-profit. Like her colleagues, Sandra wanted to focus on the mission of the center, not on reconciling accounts and managing the budget. In fact, the budget was the most discouraging aspect of Sandra’s job. Because the center did not have any grant money or regular donors, it was in the red most of the time. Sandra was also worried that the group never seemed to move ahead with their goals. They had different ideas about where the center should go, and there was a general lack of leadership within the organization. Fortunately, a new academic year brought with it a new crop of psychology interns, including Cynthia, who had recently left a 20-year career as a seasoned business executive to become a therapist. Cynthia agreed to take on the role of Executive Director of the center on a part-time basis. Maybe she could use both her skills in business and her appreciation for the center’s work to get the non-profit back on track.
PRECISION STEEL FABRICATION: AN EQUIPMENT PURCHASE DECISION
SOUTHWEST BEVERAGE CONTAINER CORPORATION
A small business is considering buying a tube laser to increase its production efficiency; however, the decision comes at a time when the firm is vulnerable because it is shakily emerging from a downturn in the industry and the primary market it serves (contract office furniture manufacturing). If a buying decision is made, the tube laser must be purchased from one of three vendors. There are significant tax incentives to expedient decision making.
The case is written to provide the framework for evaluating an equipment purchase decision within the context of business and operations strategy. Students first gain an overview of the current manufacturing processes and the industry, and then use detailed Exhibits, as well as the case text, to evaluate the risks, benefits, and costs in the tube laser purchase decision. The case should enable students to: (1) analyze the decision making process for a major equipment purchase using cost analysis, breakeven analysis, and market advantages; (2) analyze dependent demand relationships in the contract furniture supply chain and business model; and (3) illustrate issues and challenges involved in the manufacturing process of steel fabrication in the contract furniture industry. The case would be useful in upper-level undergraduate or graduate-level courses in Operations Management, Small Business Management, Manufacturing Operations, or Supply Chain Management.
For nearly sixty years, Precision Steel Fabrication (PSF) had made fabricated steel components for the contract furniture (commercial office furniture) industry. In October 2004, the $10 million company was emerging from a downturn in sales and seeing its first sales increase in three years. With rosier forecasts from its primary customers, PSF was contemplating the purchase of a $1 million tube laser. The tube laser could do the work of three machines: a table saw, a hydraulic press, and a deburring machine, faster and without the need for expensive, customized tooling. Eying its ability to increase manufacturing efficiencies and simultaneously enable more competitive bidding on new projects, the firm must determine if it should purchase a tube laser. If so, now? And how should three vendors’ offerings be evaluated along the firm’s most salient buying criteria?
Southwest Beverage Container Corporation (SBCC) is one of the world’s major manufacturers of metal and plastic containers. The plant examined in this case produces 12 oz. aluminum cans for Fortune 500 customers such as Coca-Cola and Pepsi. It is in the enviable position where it can sell all of the cans it can produce. Thus, its goal is to maximize production now and in the future.
The case asks students to identify the opportunities available to SBCC to optimize production by: (1) identifying production capacity opportunities, and (2) determining the significance of system bottlenecks and how to mitigate their impact on throughput. The case illustrates the application of the Theory of Constraints in a production environment.
Southwest Beverage Container Corporation (SBCC) is one of the world’s leading suppliers of metal and plastic packaging primarily for beverages, foods and household products, and a supplier of aerospace and other technologies and services to government and commercial customers. Founded in 1880, the company employs more than 15,500 people in more than 90 locations worldwide. One of their plants is the focus of this case study. Robert, the Plant Manager, iss faced with the challenge of reviewing current production operations to determine opportunities for increasing productivity within the plant. Robert, along with the help of his management team, identifies several potential opportunities to increase production capacity.
The name of this company is disguised.
FARMING PHARMACEUTICALS: VENTRIA BIOSCIENCE AND THE CONTROVERSY OVER PLANT-MADE MEDICINES
Social & Environmental Entrepreneurship
JOSEPH’S GOURMET PASTA AND SAUCES: WHAT DO WE DO NOW?
Ventria Bioscience, a small biotechnology startup based in Sacramento, California, must determine the best strategy to commercialize its product, a medicine produced in genetically modified rice, in the face of significant regulatory and stakeholder opposition. The case challenges students to identify a startup company’s relevant stakeholders, their interests, and sources of power; generate and evaluate options for moving forward in the face of stakeholder opposition; and develop a strategy for commercializing a controversial technology. The case is suitable for an upper-division undergraduate or graduate course in entrepreneurship, small business, the management of technology, or biotechnology. In such a course, it is best positioned in a discussion of the regulatory environment and stakeholder relations. Alternatively, the case may be used in a segment on technology or stakeholder relationships in a course in business and society.
The case focuses on Ventria Bioscience, a small biotechnology startup based in California. The company had developed an innovative technology for “growing” medical proteins useful in the treatment of childhood diarrhea in genetically modified rice. In 2004, the company’s efforts to obtain regulatory approval in California to plant their bio-engineered rice on a commercial scale met with a firestorm of opposition from a wide range of stakeholders, including environmentalists, food safety activists, consumer advocates, and rice farmers. The case presents the hurdles faced by Ventria as it attempted to commercialize its technology in the context of the broader controversy over the ethics of plant-based medicines. Should the company use political muscle to influence regulators? Move to another state where the regulatory climate was more relaxed and activists were less well organized? Wait for the opposition to die down? Try to negotiate with its adversaries? The challenge for students is to construct a strategy for the company to navigate a complex regulatory and societal terrain to bring to market an innovative product with potentially significant public health benefits.
KABLOOM EXPLODES ON THE SCENE
This case is designed to demonstrate a classic pattern of entrepreneurial growth. The case can be used to trace and analyze entrepreneurial strategy, as well. Faro, the decision maker in the case must come to a strategic decision at the end of the case. This decision requires Faro, and the students to determine an appropriate valuation for the company. This can be done through the financial exhibits contained in the case. The valuation would take into account future projections for the company, which students can do based on past performance and trends. Finally, the decision has to take in more than just the financial facts and trends. Consistent with theory and concepts, Faro will probably make his decision based on his values and beliefs. The source of these factors is stated and implied through discussions with Faro presented in the case.
The Instructor’s Manual was written primarily for Undergraduate and Graduate courses in Entrepreneurship, but could also be used in a course in Strategic Management.
This case involves the decision by Joe Faro, Founder and CEO of Joseph’s Gourmet Pasta and Sauces concerning a potential joint venture with a large, international food company, or a sale of his company to either private equity investors, or the large international company. The case describes the growth of the company from a start up by a recent college student, in 1991, through the beginning of 2006.
The case describes Faro’s values and beliefs, include his vision for the company into the future, as of 2006. It also presents his expanded organization as well as the previous four years of financial exhibits.
Finally, the case describes several options that Faro is exploring with a private analyst he has hired. These include going ahead on his own to expand nationally and into new product lines; selling all or part of his company to private equity investors; or going into a joint venture, or even selling his company to a large, international, food company.
MUDDLING THROUGH: THE AERIAL CHAIR™
An entrepreneur believes he can revolutionize the flower industry in the United States. He launches and experiences early success. In this two-part case, the entrepreneur must decide in Part A whether to franchise his operation and in Part B, how to handle the serious business problems that result from rapid expansion. The purpose of this case is to introduce students to business decision making and selection of appropriate business models.
The case should enable students to (1) sort through complex information and identify salient elements. (2) Identify the difficulties inherent in decentralized management. (3) Read an income statement and apply it to determining the revenues required to run a business. (4) Analyze the distribution system and identify the shortcomings and strengths of the system. (5) Analyze the risks and benefits of franchising. (6) Identify the internal and external factors that have an impact on the financial success of a small business. The case was developed for use in undergraduate Introduction to Business or Management course.
We were going to become “the Starbucks of flowers!” explained David Hartstein when he founded KaBloom in 1998. He wanted to increase flower purchases in the U.S. by changing the way Americans thought about buying flowers, just as Starbucks had changed the concept of the morning cup of coffee. In 1998, the U.S. ranked twelfth in the world in per capita consumption of flowers. Hartstein saw an opportunity to sell more flowers in the U.S. via a cash and carry. To capture this market, he created eye-catching stores adorned with bright purple awnings and stocked with a huge variety of flowers in garden-like settings. In 1999 INC Magazine named KaBloom a “Hot Start-Up.” However, nearly three years and one recession later, KaBloom’s early growth came to end with 34 shops. A dozen of the stores were not performing well, and their failure was eating into the profits of the other 22 stores. The challenge was to connect the stores better to their respective neighborhoods and to reduce the high turnover of personnel at the store level. One potential solution was franchising. However, the investors were opposed to franchising because franchising would not return as much immediate profit as company-owned stores. Sales continued to fall and problems continued to grow. Hartstein had to make a decision in 2001 (Part A) and then again in 2005 after additional business challenges (Part B).
TAVERN ON THE GREEN: THE DECISION TO EXPAND
The Aerial Chair™ has yet to gain broad acceptance in the marketplace. Craig Hines, the chairs creator, must decide the future of this business opportunity: (1) was this just a fun hobby; (2) could the Aerial Chair™ achieve profitability in the broad market; (3) would a niche strategy generate reasonable profits? The case introduces the student to a classical entrepreneur who is passionate about his product and desperately wants it to be a market success. The case challenges the student to: (1) identify typical entrepreneurial characteristics and how they can impact business development; (2) perform an internal and external analysis of a new venture; (3) understand that challenges of estimating new market demand and assess the reasonableness of demand projections; and (4) develop appropriate strategies and tactics to guide an entrepreneur. The case is designed for undergraduate and graduate courses in Entrepreneurship, New Venture Planning, New Product Development, and Small Business Management.
In 1996 Craig Hines sold his first Aerial Chair™. The chair was a design that he personally developed and manufactured in a small shop in Montana. He originally developed the Aerial Chair™ out of curiosity, and for his own personal use. The concept became his passion, so he began trying to find customers for his product. Product interest was sporadic and material costs drove the price up to a premium level. In December 2000, the Aerial Chair™ was still not a commercial success, and many of Craig’s marketing attempts had failed. He was faced with the decision of how to best create a viable business around the Aerial Chair™ product. Craig Hines never wanted to be influenced by external factors that might hinder his creativity in developing and promoting the Aerial Chair™, consequently, he never developed a functioning business plan. The industry in which he was attempting to enter was already established with several direct competitors, and many substitute products. Given the high manufacturing cost and inventory requirements, mass distribution outlets seemed unlikely to carry the Aerial Chair™. Although Craig had learned a great deal through trial and error, he still remained unsure of the demand for the Aerial Chair™. This uncertainty regarding demand, the high material costs, and the difficulty accessing distribution channels, convinced Craig that his current ad hoc approach to building a company would not create the successful company he envisioned.
TECHMISSION: JESUS, JUSTICE AND TECHNOLOGY
The owner inherited an established business from her father. The lease for the business operation is set to expire in the next year and the owner is considering expanding into new areas including establishing a retail product line and an additional location.
The case should enable students to (1) Consider the ramifications of expansion (2) Consider human resource issues in a large business (3) Identify the liability risks (4) Analyze the business choices. (4) Recommend a direction for the business. The author developed this case for undergraduate courses in Small Business Entrepreneurship, Management, and Human Resource Management.
The Tavern on the Green is a well known restaurant in New York City located at famed Central Park. The restaurant has a long, unique and colorful past. The restaurant was taken over in 1976 by Warner LeRoy, a child of two well known entertainment families. His father directed the classic film The Wizard of Oz in 1939 while his grandfather was a founding member of Warner Brothers Studio, one of the pioneer Hollywood movie companies. He literally grew up on the back lots of the company that created such characters as Bugs Bunny and Daffy Duck. He purchased the lease for the restaurant Tavern on the Green in 1976 and true to his background turned the establishment into a restaurant with a flair for entertainment. He performed 10 million dollars worth of renovations and the restaurant became the palace of Central Park in Manhattan. It was the place celebrities went to be seen. He transformed the restaurant into one of the highest grossing businesses in the US.
When Warner LeRoy died he left the restaurant to his daughter Jennifer, a young girl but with a background in the industry. Warner signed a lease for the Central Park location in 1976 that will expire in 2009 and the new CEO Jennifer Oz LeRoy is looking to expand the business. Her considerations are the establishment of a retail gourmet Tavern on the Green line or another location for either a scaled down version of the Tavern on the Green or a second location as large and as elaborate as the Manhattan facility.
THE HAMILTON CLUB OF LANCASTER: CHANGE IS NOT EASY
The Executive Director of a Christian nonprofit was struggling to advance his organization from the $1 million level to the $10 million level. With limited resources and numerous programs, he had to determine where to allocate resources. Faced with balancing competing internal interests, and attempting to generate more funding in a down market, he was unsure of the next steps. The case presents a challenge to the reader: establish the organization’s sustainability while growing in a tightening market and staying true to its mission. The case should enable students to: (1) think critically about the unique issues facing a nonprofit, including fundraising and upholding its mission, (2) Consider TechMission’s internal and external challenges presented in the case, (3) Assess the strengths and weaknesses of the organization, and (4) Project a long-term view of how the organization should be positioned to achieve sustainability. The case was based on field research, and developed for undergraduate and graduate courses in Small Business Management, and Nonprofit Management.
In early 2008 Andrew Sears, Executive Director of TechMission, a Christian social service nonprofit, found the organization at a “crossing the chasm” point. His challenge was to grow it from a $1 million level to a $10 million level. With limited resources and numerous programs, he had to determine how the organization should expand. At the same time, he had to balance three competing factors within TechMission: staying true to its Christian principles, sustaining its credibility in urban communities, and using technology as the driver for promoting social justice.Under the general mission “to support Christian organizations in using technology to transform vulnerable communities,” TechMission had a number of initiatives, grouped into three categories: TechMission Corps, an AmeriCorps-funded program; TechMission Online, comprised of three different websites; and its most recent addition, City Vision College, a distance-learning school for those involved in urban ministry. These different initiatives presented different paths for potential growth. As well as determining the correct path, Sears knew that any path would require obtaining additional funding, potentially from secular organizations. The challenge was securing this funding in a tightening market and then allocating it to the initiatives that had the most potential. Additionally, it would be necessary to change TechMission’s current funding composition of what Sears felt was a potentially risky overreliance on the government by developing an individual donor base.
WILL JACKS STUDIO: A 10-YEAR ENTREPRENEURIAL JOURNEY
A private club has changed its menu with the hopes that it can offer different dining experiences whereby it can increase its attractiveness to younger members while at the same time retaining its appeal to older members. The board has appointed an ad hoc committee to review menus for both formal and informal dining. Knowing at the outset that they would not satisfy everyone, the committee made changes that had operational, marketing, and financial implications. The reader participates “after the fact” meaning that the decisions have already been made and implemented.
The case should enable students to 1) identify the various problems that are faced by small businesses, 2) understand that there are always tradeoffs present with most situations, and 3) consider the impact of those tradeoffs and that 4) they may often have unintended consequences.
It was late winter in Lancaster, Pennsylvania, home of The Hamilton Club, a private club founded in the later 1880’s to provide local businessmen with a place to meet as well as to dine. Over the years, the club tended to evolve with the addition of various recreational facilities and the inclusion of women members. A major renovation project undertaken during 2006 resulted in significant changes to the club’s facilities. With a need to increase the number of younger members in light of what appeared as a beginning trend of a graying membership, the board received approval for a fitness center, rebuilt squash courts, and enlarged informal dining area.
A year and a half after the renovations were completed, the club had seen a shift in the way the dining facilities were being used. The older members were preferring to dine in the informal area, but at the same time wanted all of the accoutrements that were traditionally found in the formal dining area. In addition, these members wanted to see the formal dress code of tie and jacket implemented and had formally complained to the board that the informal dining area was too noisy as some members preferred to engage in often animated banter often punctuated with much laughter. Similarly, those members with families started to feel less welcome in the new space and were beginning to find dining options elsewhere. Brian Duquinn, the club’s general manager wanted to be able to maintain stream of new younger members, but also keep the older members satisfied. The problem has elements of operations, marketing and financial implications that are often endemic of small business.
This case is for use in graduate or undergraduate entrepreneurship or small business courses. It could be used with chapters on entrepreneurial vision and planning, decision making, and business structure. This case was developed from interviews with Will Jacks, the central figure of the case. This case is designed to examine the importance of establishing and cultivating a vision for entrepreneurs. Additionally, students should see the difficulty of managing relationships with both partnership and customer constituents while trying to avoid decision making pitfalls.
Will Jacks 10-year journey from his start as a struggling entrepreneur to a seasoned entrepreneur at the cross roads of a career changing decision point are highlighted in this case. This case examines the evolution of an entrepreneur from his days as a journalism graduate student, to start up entrepreneur, to taking on and disentangling with partners and large commercial photography clients. Jacks’ story provides insights into a wide array of entrepreneurial struggles, obstacles, defeats and victories.
GLOBAL GIRLFRIEND (2007)
The case objectives are to identify new product ideas and opportunity in everyday life, convert an idea to an actual product and create a business out of that, and develop a corporate strategy for managing innovation and introducing new products including which markets to focus on e.g. government, commercial or both. This case may be used in graduate and EMBA courses in Entrepreneurship and New Ventures, New Product Innovation, Business Strategy, and others exploring benefits of green products and their acceptance in the market place.
DeCopier Technologies case is about innovation, new idea generation, entrepreneurship and disruptive technologies process. All of these come together to create new products, new business, and also offer the possibility of licensing new technologies to a suitable partner. The case tells the story of the idea behind the development of a new technology and the process of developing that technology from a managerial and marketing perspective rather than from a scientific one.
In recent years two big issues have been faced by the paper industry and the consumers. 1. Paper waste and the recycling of paper which is a major environmental issue; and 2. Securing the printed information so does it not get into wrong hands. Many methods (repulping, recycling and shredding) were available for both of these problems but none of them seemed satisfactory. These methods had many negative side effects – high energy costs, difficulty of removing toner, shredder noise, paper dust in the environment from the shredder, and collecting and disposing of shredded paper. DeCopier was conceived and created to remove the toner (used from laser printed and photocopy machines) from the sheets of paper in the office environment. The thought behind the whole idea was to reduce the tipping fee (cost of removal of paper from the office), cost of new purchases of paper through recycling using DeCopier machine, amount of office paper waste that was being generated, and help consumers protect and secure confidential information. Dr. Sushil Bhatia, the founder of DeCopier, recognized this opportunity while doing his recycling duty at an incinerator site. He felt that if an office use unit could be developed which would help office workers clean paper in the office itself it would present a big business potential. He refined his idea and invented a disruptive new technology. The company had many market opportunities in recycling, security of documents and other applications causing a dilemma for the founder. The case addresses these questions.
IDE IN NICARAGUA
Stacey Edgar, a social entrepreneur launches her for-profit venture, “Global Girlfriend,” in 2001 with the purpose of helping women around the world who were raising their families with just under one dollar a day. The first objective of this case is to explore the ethical dilemmas Stacey faces when in May 2007, she received a phone call from one of the co-owners of “The Greater Good,” a company based out of Seattle, Washington, who was interested in acquiring Global Girlfriend and merging it with The Greater Good family of companies. The second objective is to decide whether Stacey Edgar should sell her company or not. This case is suitable for use in undergraduate and graduate courses in Social Entrepreneurship, Family-owned Businesses, Ethics & Social Responsibility, and Sustainable Businesses.
On May 4, 2007, Stacey Edgar had a message on her answering machine. It was from one of the co-owners of “The Greater Good,” a company based out of Seattle, Washington. He was interested in acquiring Global Girlfriend and merging it with The Greater Good family of companies. Stacey was astounded at this unsolicited merger offer. Stacey had a Master’s degree in Social Work and enjoyed helping women and their families. Through Global Girlfriend, she was going to help economically disadvantaged women from developing countries to find a strong market for their products and assist them in earning a steady income to sustain their families and move out of poverty. The case describes the ethical dilemmas the founder faces during the three months following that telephone call. She is faced with making a tough decision quickly as Greater Good imposed a deadline of August 1, the same year, to complete the merger deal.
MIDLAND BULL TEST – GOING GREEN?
International Development Enterprises (IDE), a multinational non-profit enterprise founded in 1981, faces challenges in Nicaragua as it seeks to assist local subsistence coffee farmers to transition to shade-grown high value-added coffee crops in 2007. The first objective of this case is to explore the dilemmas IDE faced in Nicaragua, and to evaluate feasible credit options available to the capital-intensive farming IDE wanted the small scale coffee growers to undertake. This case is suitable for use in undergraduate and graduate courses in International Management, Social Entrepreneurship, Non-Profit Management, and Sustainable Businesses.
In 2007, IDE and its partners Nestlé SA, the ECOM Group, and the Rainforest Alliance entered into a venture. The goal was to introduce low cost drip irrigation systems to small coffee farmers in the rain forests of Nicaragua, increase their incomes through socially, environmentally, and economically sustainable coffee farming, and enable farmers to reach the lucrative value-added specialty coffee marketing chains worldwide. It was estimated that the use of an “IDEal goteo” drip irrigation system would enable a small coffee farmer to earn annually an average of $1,500 -$2,500 per hectare, net of costs. Drip irrigation was a new concept as local farmers were used to rain-fed crops. Each system, including training, cost less than $1000, half the cost of conventional systems. While IDE found a local producer to manufacture the drip irrigation kits initially imported from India and subject to a 15% VAT (value-added tax), it confronted the challenge of assisting farmers with providing the initial capital investment needed.
PURE HOME WATER: BUILDING A MISSION DRIVEN ENTERPRISE IN NORTHERN GHANA
The case should enable students to: (1) understand at a basic level how the Chicago Climate Exchange operates and how firms can buy and sell carbon credits. (2) Understand how farmers and ranchers can sequester greenhouse gases and receive carbon credits for doing so. (3) Create a dynamic electronic spreadsheet model to analyze the proposed installation of an anaerobic manure digester. (4) Develop a value proposition for positioning a business – here, a 2,000-head cattle feeding and performance testing operation – as socially responsible. The case writers developed the case for undergraduate and graduate courses in (1) Business, Government and Society and (2) Environmental Studies classes in agriculture and business.
It was June 2008 in Montana. Leo McDonnell, Jr. and his wife “Sam,” were the owners of Midland Bull Test (www.bulltest.ntp.net). They had recently invested $900,000 in a GrowSafe Systems feeding and monitoring system for producing feed efficient cattle. These cattle reached market weight at the same rate as other cattle. However, they consumed 10 to 12% less feed and produced 15 to 20% less manure and 25 to 30% less methane. Nevertheless, Leo and Sam could not sell the reductions in methane on the Chicago Climate Exchange (CCX) as carbon credits.
With 2,000 bulls on test year around, Leo and Sam wanted to investigate the financial feasibility of installing an anaerobic digester for processing manure. The digester would cost $500,000 to $800,000 and produce biogas (mostly methane) used to fuel an engine/generator to produce electricity for use or sale. In addition, the producer could receive and sell the associated carbon credits on the Chicago Climate Exchange. As a result, Leo and Sam were wondering whether they should try to market Midland Bull Test as a socially responsible operation. They could promote “feed efficiency” as economically and socially responsible. In addition, they could lobby for the development of the associated carbon credits that they could sell on the Chicago Climate Exchange. They could promote “stewardship of the land” as economically and socially responsible (e.g., using the Native Rangeland Management program). Perhaps they could even promote “manure (methane) utilization” if the economics were compelling, since it was socially responsible. Yet, they were skeptical. Sam said, “Show me how ‘social responsibility’ adds value to Midland Bull Test. Why should we risk our money and reputation on going green?”
RAÍ: TWO LIVES IN ONE
The Pure Home Water NGO (PHW) case concerns the development of a new venture in the African nation of Ghana whose purpose was to successfully distribute a water filtration device that could save thousands of lives in this developing country. The case was written to be taught in an entrepreneurship course (stand-alone, Introduction to Entrepreneurship, Social Entrepreneurship, or International Entrepreneurship) at the graduate and undergraduate level. The case is taught at the end of an introductory course, and within the schedule of a specialized course, when students have acquired sufficient analytical tools to grapple with issues of strategy; the distinction between an entrepreneur and a social entrepreneur; marketing and ethical considerations of pricing; the resource constraints of the entrepreneur; the particular issues of venture creation in the developing world; selling and distributing in difficult situations;; stakeholder management; and the combination and/or potential conflict existing among these topics. This case could also be taught in a course on strategy, management, or not-for-profit organizations.
Social entrepreneur Susan Murcott, Senior Lecturer, Department of Civil Engineering, Massachusetts Institute of Technology (MIT), Boston MA, USA, established Pure Home Water (PHW) as a Ghanaian non-governmental organization in 2005 with the purpose of selling individual household water filtration systems to the poor for use in their homes. Murcott, one of the world’s experts in the nascent engineering field of household drinking water treatment and safe storage (HWTS), was frustrated with PHW’s progress to date. Though she had received a $150,000 grant from the Hilton Foundation, and she had subsequently hired two Ghanaian staff on two-year contracts through 2007, fewer than 1800 ceramic filters had been sold in the poorest Northern Region of the country during that time. The PHW team had learned that they could not price the filter for more than $5 if they wanted the poor to buy them. However, the filters cost Murcott approximately $18 to manufacture and transport. Under the cost and pricing dilemmas were many vexing organizational issues that demanded management attention.
ROCKY MOUNTAIN MUTUAL HOUSING ASSOCIATION
The purpose of this teaching case is to present and discuss key issues in career transition, bringing up discussion on fundamental concepts in career development and management of the second career, such as self-knowledge, the equilibrium between the professional and the personal lives and the attention to personal values. The reflection through the recovery of the story of a life, of family bonds, of individual values, of the evaluation of pressures suffered in short careers, of the awareness of possibilities till then dormant appear as critical points for the solution of the dilemma on career decision making. This teaching case is particularly adequate for regular courses or graduate courses on career management. It is also adequate in workshops for professionals that feel the need to reflect on their career and to plan their personal and professional developments. We must point out its application in classes in which the teams approached are the core issues of the case: careers of short duration and value concepts.
The case tells the story of Raí, a former soccer player that, during his career, was a champion in regional, national, continental, and worldwide tournaments, as well as in the 1994 World Cup. Raí, the youngest son in a very close family of six children, was born on May 15, 1965 in Ribeirão Preto (SP). He began his career as a professional player in a small team in the interior of the state; at the age of 24 when he became one of the biggest idols in the history of soccer in Brazil, playing with an important Brazilian team: the São Paulo Soccer Team. He became internationally famous and was sold to the French team, Paris Saint-Germain. Raí also shined in France and was called the “King” in Europe. Raí became a parent at the age of 17 and at 33, he became a grandparent. At this age, he also separated from his wife, who was one of the persons that stimulated him the most in his career. He stopped playing soccer in 2000 at the age of 35. Raí also dedicated time to the Gol de Letra Foundation, a charity institution that he created together with his friend and also player, Leonardo from the Milan Club in Italy. The Gol de Letra Foundation offered educational programs to homeless children. Two years after he quit playing, fans still asked what Raí going to do with his career. It was known that he wanted to have another career or, as he said, another life: “two lives in one”. So, what would he do? Which opportunities would attend Raí’s needs? These questions hovered in the air on the night of the charity game for the Foundation when Raí should announce his decision.
TADDY BLECHER AND CIDA UNIVERSITY
In Spring 2002, Rocky Mountain Mutual Housing Association faced financial crisis as its cash flows continued to be negative. The case deals with the challenges members of the Board and executive staff faced as they tried to avert impending bankruptcy and move to becoming a sustainable organization so that it could continue to provide affordable housing and other social programs for its low income members. This case is suitable for use in undergraduate and graduate courses in Non-Profit Management, Public Policy, and Business Strategy & Policy.
Rocky Mountain Mutual Housing Association (“Mutual”) was incorporated as a not-for-profit affordable housing group in Denver, Colorado in April 1992. The Mutual was founded for the purpose of acquiring, developing and managing affordable multi-family housing to meet a social need. The idea of “mutual housing” was based on a European living model which provides permanent housing to anyone who is motivated to meet the obligations and challenges that have typically been associated with homeownership. A defining characteristic of these “mutual” communities was direct resident involvement in the management and decision-making processes that affect the community. Another fundamental aspect of the Mutual’s mission was also to provide services to its residents in a variety of areas including job training, after-school programs and homeownership programs. The overall goal of these programs was to provide the residents with the tools for gaining equality in the housing market. The case describes the laudable goals and efforts of Mutual’s founders, the aggressive expansion undertaken, and the operational and financial challenges faced by the Association as the housing market and local economy took a nosedive adversely affecting property values and cash flows. The new executive leadership works tirelessly to turn Mutual around and restructure it in an effort to make it a sustainable business.
After using this case, students will have gained a better understanding of:1. the extent to which personal transformation can lead to a new form of engagement and eventually societal level transformation through strategic social entrepreneurship; 2. the power of emotional intelligence as a source of social justice and social transformation; 3. the possible connections between their domain of study, their own abilities and transformational leadership.
This case is based on the personal story of Taddy Blecher, an inspirational South African social entrepreneur, and co-founder of CIDA City Centre University. Established in 1999, CIDA (Community Individual Development Association) University is a business university established specifically for underprivileged black youth in South Africa, for whom university education is otherwise virtually impossible. While solid professional business and management skills and acquiring technical knowledge provided by professionals from the industry—companies donate hours of their skilled professionals to CIDA, transcendental meditation, mentoring and other unconventional methodologies, such as chess contribute to building more holistic individuals. The purpose of the institution is to graduate leaders of the future, who will work towards the transformation of their country in the post-apartheid era.The intention of this case is to portray the roots of deep commitment that Taddy Blecher, as co-founder of the university, has towards his country and the people within it, as well as the personal transformation he himself went through from a high-level consultant in a leading consulting firm to the social entrepreneur he is today.