Dabur, an Indian consumer package goods company, had established a strong brand equity in India by offering, for decades, a vast portfolio of over-the-counter products. In seeking international expansion in 1987, it first took the export route. It also "followed" the customer, targeting the Indian diaspora in the Middle East, Africa and the United States, already familiar with the brand. By 2006, Dabur had set up five manufacturing facilities outside India. In June 2007, Dabur had to make, in countries such as Nigeria for example, some critical choices. It had to choose between sticking to the diaspora, a market it understood best, and targeting the mainstream population. It had to choose its growth options between categories like personal care, in which it had built up competencies, and categories such as oral care and home care, which were the new engines of growth in its international markets but in which the company had no track record, either on the home front or overseas. The case study helps students deal with issues of growth and consolidation in a global market from the perspective of the company's chief executive officer and the head of its international operations.
Bio-Oil is a multi-purpose skin care product that has gone from being sold only in South Africa to being the No. 1 scar treatment product in 16 of the 17 countries that it is distributed. Retail sales have jumped from R3 million per annum to R1 billion from 2000 to 2008. Justin and David Letschert made key decisions to eliminate all of the other 119 products that were being manufactured by the company that they took over in 2000, and focused on the mainstay product of Bio-Oil. Union-Swiss accomplished its successful sales through the use of a hybrid distribution model that compelled its distributors in each country to communicate and share knowledge with each other. Union-Swiss also ensured that it remained focused on building the brand through limiting its activities in the value chain to that of marketing. It did this to such an extent that it created a separate entity to run the distribution of Bio-Oil in South Africa.
In November 2007, Barack Obama, along with his chief strategist and campaign manager, was faced with a Gallup Poll of Democratic Presidential Candidates that indicated among Democratic voters Hillary Clinton held 48 per cent support of voters, compared with Obama's 21 per cent. Pundits and analysts essentially declared the race over; however, the triumvirate was convinced they had devised a perfect campaign strategy to overcome the long odds and win the nomination. Their confidence was validated when Barack Obama was elected the President of the United States in November 2008. This win was aided by a strategy that focused on competing in markets that other candidates did not, and embracing technological developments in a manner that other candidates would not. The Obama campaign employed such tools as lowering the target donation from potential donors, competing in non-traditional markets, unique resource allocation and use of technology to gain tactical advantages.
The co-founder and chief investment officer (CIO) of Red River Asset Management is trying to improve the way he communicates his firm's key benefits to clients. The CIO's central challenge is that his firm's investment philosophy focuses on quantitative analysis while most clients are only familiar with - and trust - qualitative analysis. In addition, his presentation skills are not as polished as he would like. This case allows an instructor to discuss the importance of message development and delivery in the financial context. The supplement (B) case, product # 909C14, highlights the CIO's decision and outcome.
In 2006, Alpina had processing facilities in Colombia, Ecuador and Venezuela and its products were distributed in 34 countries. With annual sales of nearly $275 million, it was one of the largest private dairy companies in the Andean region. Alpina's social initiatives began early in the organization's history. The founders of the company and the families that were involved in its operations created a work environment in which the needs of stakeholders were a priority. As the company grew, there were changes in its ownership structure. Yet, in 2006, the owners of Alpina, Inc. were still a relatively small number of family investors. With growth there was also an expansion of social initiatives, which were carried out in different areas. Between 2002 and 2006, the Human Resources Department initiated a series of actions to consolidate social responsibility (SR) activities and to achieve greater impact. These efforts fell short when, in 2006, upon implementing a new corporate model, the Executive Committee began to question the purpose and scope of these social activities. The case puts the students in the place of Juan Pablo Fernández who, after three years in the company, was named Vice-President of Marketing. The Executive Committee gave his office the task of preparing a proposal to increase Alpina's social impact and established a limit on the amount of resources available for these activities. The information provided in the case allows the student to study and analyze two paths. One possibility was to expand the activities carried out by the company up until that point, which were aligned to varying degrees with the commercial activities of the company but were generally incorporated into the value chain. This was the path chosen by others in the industry and it would allow the company to tackle different risks and inefficiencies that affected the company's overall performance.
An international corporation's agricultural business division reviews its seven-year-old IT initiative among rural Indian farmers. Suitable for learners at all levels, the case is ideal for modules on strategic change, transformational change in a value chain, and development at the bottom of the pyramid. It also provides excellent insight into how corporations can improve both profits and lifestyles in developing nations while bolstering their worldwide competitiveness. The e-Choupal initiative provides Internet access to connect and unite farmers by teaching them more efficient farming methods and wholesaler accountability strategies. Should the company expand the initiative throughout the country? Given India's size and the various challenges involved, expansion would not be an easy task.
In May 2008, the business manager at Western Day Care Centre (WDCC) was considering expanding the company's services at its Emery Street location. WDCC was currently running at full capacity with a continuously growing waiting list and demand for day care services was increasing. The business manager was evaluating the financial feasibility of renovating the first-floor gymnasium and converting it into a classroom. Incorporating the care requirements and regulations under Ontario's Day Nurseries Act, she wanted to know the total cost of the renovation, as well as the amount of new revenue that would be generated and the payback period. Financial modeling in a spreadsheet, cost-benefit analysis (differential analysis), and determining the decision variables are all techniques used to determine the feasibility of the renovation.
The chief financial officer of Pixonix Inc. is trying to decide if she should hedge, given the current strength of the Canadian dollar. Her company licenses proprietary software through a U.S. company that will cost $7.5 million in three months time. The case provides the students with the opportunity to understand the impact of exchange rate fluctuations on her firm's cash flows and some of the instruments available to manage risk, including puts and calls and forward contracts.
Green Bank of the Philippines was known for its product innovation and its ability to bring new products to market. In 2002, Green Bank designed an untested commitment savings product that both gave individuals access to formal savings and helped them commit to reaching their savings goals. Omar Andaya, the Green Bank president, must decide how to evaluate the success of this product. The management team at Green Bank discusses various evaluation methods, including a formal quantitative impact evaluation using a randomized control trial (RCT), and the value an impact assessment brings to the Bank. In particular, they grapple with the question of how success is measured for a product both for the bank and for its clients. The case highlights the issues an organization must consider before deciding to do an impact assessment as well as common design challenges.
In November 2007, a global, cross-functional team at Cisco Systems, Inc. was seeking management approval to start manufacturing a new router, code-named Viking. The team faced a host of challenges in launching the low-cost but powerful router for telecommunications service providers. After overhauling the project to sharply increase the router's planned speed and capacity, the company had just one year to launch the product, an unusually fast schedule. In addition, Cisco wanted to debut China as a low-cost manufacturing base for the high-end product. It planned to use contract manufacturer Foxconn Technology Group to produce the machine, even though Foxconn had never made such a complex product for Cisco. Could Foxconn handle the technical complexity? Could Cisco work closely with Foxconn to mitigate the project risks? Could Cisco's methodology for new product introduction rise to the necessary level of sophistication? The case highlights the challenges and complexities of developing and manufacturing a sophisticated technology product for a worldwide market. Students will consider what it takes to achieve success in new product introduction, or NPI. The case also offers an opportunity to evaluate supply chain issues in a company that outsources manufacturing globally.
In summer 2008, the Nashville Predators' management team was considering the strategy behind marketing the team. They thought it prudent to investigate the feasibility of opportunities in other hockey markets throughout North America, should a new owner want to move the team. Management had to consider both financial returns and on-ice success. They needed to create a comprehensive strategy, starting from a recommended location, and moving through specific recommendations on promotions, pricing and customer focus. To help create their strategy, the management team performed the following: developed a comprehensive tactical marketing plan, including income projections; identified the marketing challenges of operating in very different markets; recognized that the choice of a city location largely constrained the remaining decisions and tactics. Using this information, the management team could now identify their next steps, and what future plans should include.
The Stitch It Group (Stitch It) is a mall-based clothing alteration service. Having previously sold Stitch It to its current owners in 1990 (retaining the chief executive officer (CEO) position), the founder and CEO was presented with an opportunity in 2003 to repurchase the company. Having originally sold the business because he was too cash-strapped to grow it himself, Stitch It had since grown from three store locations to 84 stores under three brand names spread throughout Canada and the United States. In determining whether to buy back the firm he founded, the founder and CEO also needed to consider his daughter Jennifer's expressed interest in becoming an executive in the firm. How would he provide Jennifer with the proper technical training to become familiar with all aspects of the firm's business, and improve her business acumen and leadership skills? The founder and CEO had one week to inform the owners of his intent to purchase and he felt it was a good deal, considering the opportunity for growth. Even if the founder and CEO resolved to buy back his company, he wondered how to train Jennifer to take over the business one day.
The account manager at the Canadian Commercial Bank (CCB) in Barron, Ontario, reviewed his latest loan request. The co-founder of Druthers Forming Limited (Druthers), a long-time CCB customer, was requesting a $350,000 loan to construct a new building to house Druthers' existing operations. Construction was already well underway. The account manager also noted that Druthers was currently operating without a line of credit and he wondered whether the business could generate enough cash to cover expenses, including the new loan payments. He had one week to decide whether to lend funds and provide supporting rationale for his decision. To aid in his decision, the account manager began by assessing financial performance using statements of cash flows and ratio analysis; financial statement projection; and consideration of working capital requirements, including performing a sensitivity analysis on the days of accounts receivable, inventory and/or accounts payable.
By 2005, AXA had become one of the world's largest and most successful insurance companies, but Claude Brunet, Member of the Management Board, in charge of Transversal Operations, Communication, Marketing and Human Resources, believed that to achieve its ambitions the company was going to have to become much more customer focused. AXA Way, a culture change program that included many elements of Six Sigma philosophy and methodology, was the spearhead of this change. The case describes the AXA Way program, the challenges of its implementation, and how AXA overcame those challenges. Learning objectives: Understand how to manage the culture change necessary to improve customer service using Six Sigma. Six Sigma is sometimes seen as a technical change, as just a methodology, but change in attitude and mindset--in culture--are required for Six Sigma to succeed. Understand how Six Sigma can be successfully adopted in a service industry.
A manufacturer of private-label personal care products must decide whether to fund an unprecedented expansion of manufacturing capacity. The decision prompts fundamental financial analysis of the potential project, including development of cash flow projections and net present value calculations. Students will be required to compute net operating profit after tax, cash investment in working capital, and ongoing capital expenditures for a proposed investment, and to discount values to the present. The case also facilitates a systematic consideration of the company's capital planning process.