In 2004 and 2005, Wal-Mart began to implement a nonmarket strategy to respond to detractors and improve its image. This case details the many steps that Wal-Mart took, from becoming politically involved to creating community relations offices to working with special interest groups. Wal-Mart ran ads in various newspapers, launched a major environmental initiative, extended health care benefits, set up a diversity task force, and announced support for local businesses in communities in which it planned to open new stores. Study questions set up a discussion of Wal-Mart's actions.
The co-founder of a continuing education lecture series needs to develop and implement a marketing communication strategy to meet target enrollment while constrained by limited promotional funds. The case focuses on the development of a marketing communication strategy in a non-profit environment and emphasizes the importance of target market definition. It introduces issues surrounding the use of e-commerce and websites to support a marketing plan.
lululemon athletica is on track to exceed $2 million in sales for 2001, a remarkable achievement considering it was founded in 1999. To achieve his targets of rapid growth, Chip Wilson, founder of lululemon athletica, is considering franchising his concept. But concerns remain, including control over branding and store-level operations. On the other hand, franchising would allow Wilson to rapidly expand and capture market share, as competitors are starting to take notice. This case is the fourth in a series of seven lululemon athletica cases that focus on decision-making using real-options analysis. Other cases in the series are: 906M36, 906M37, 906M38, 906M40, 906M41 and 906M42.
In February 2005, the top management of Fuji Television Network, Inc., one of Japan's leading media conglomerates, was informed that a small IT-related company, Livedoor Co., had bought 35% of shares in Nippon Broadcasting System, Inc. (NBS) with the help of Lehman Brothers, a U.S.-based financial services firm. Fuji TV owned 12.39% of NBS shares and was in the process of acquiring it. What complicated the issue was that NBS' main asset was its 22.5% stake in Fuji TV. The news came as a shock because Livedoor had acquired NBS shares through off-floor trading at the Tokyo Stock Exchange--prohibited by the Securities Exchange Law, unless done for the purposes of a takeover bid. Fuji TV's top management had to take effective measures to counter Livedoor's move. Such measures involved the assistance of legal counselors and the planning department, who studied which legal and effective actions Fuji TV could take against Livedoor and calculated the corporate value of NBS using both American and Japanese methods.
Examines the industry structure and competitive strategy of Coca-Cola and Pepsi over 100 years of rivalry. New challenges in 2006 include boosting flagging carbonated soft drink (CSD) sales and finding new revenue streams. Both firms also began to modify their bottling, pricing, and brand strategies. They looked to emerging international markets to fuel growth and broaden their portfolios of alternate beverages like tea, juice, sports drinks, energy drinks, and bottled water. Coca-Cola and Pepsi-Cola had vied for the "throat share" of the world's beverage market. The most intense battles of the cola wars were fought over the $66 billion CSD industry in the United States, where the average American consumes 52 gallons of CSD per year. In a "carefully waged competitive struggle," from 1975 to 1995, both Coke and Pepsi had achieved average annual growth of around 10%, as both U.S. and worldwide CSD consumption consistently rose. This cozy situation was threatened in the late 1990s, however, when U.S. CSD consumption declined slightly before reaching what appeared to be a plateau. Considers whether Coke's and Pepsi's era of sustained growth and profitability was coming to a close or whether this apparent slowdown was just another blip in the course of a century of enviable performance.
A 123Systems was a young company that was founded on basic materials science research at the Massachusetts Institute of Technology. A co-founder of the company, Yet-Ming Chiang, was a full professor at MIT and served as scientific adviser. Intellectual property based on the science, which offered a radical way to construct lithium-ion batteries that promised higher energy densities, was licensed from MIT. The concept for the company was based on laboratory demonstrations that the three components of battery cells could be selected and treated so that they would self-assemble (due to intrinsic molecular forces). This resulted in finer battery structures and better performance. Following 14 months of research and development, the company found that it required more time and resources than originally anticipated to take the self-assembled battery to market. However, additional IP for a new cathode material, which presented an intermediate market opportunity, had also been licensed from Chiang's lab at MIT. The new material had advantages over the incumbent electrode material: It met the criteria for self-assembly, and it could replace the electrode in the millions of lithium-ion batteries currently in production. The management team needed to decide whether to pursue the breakthrough self-assembly technology or move resources to commercialize the new electrode material and then return to the original breakthrough technology.
With 26 casinos in 13 U.S. states and $4.5 billion in revenue in 2003, Harrah's Entertainment Inc. was one of the leading brand names in the casino entertainment industry. Bill Harrah, the founder of Harrah's, was passionate about getting to know his customers and had instilled a deeply rooted commitment to customer satisfaction into Harrah's corporate philosophy. In 2003, Harrah's was focused on building loyalty and value with its target customers through a unique combination of great service, excellent products, unsurpassed distribution, operational excellence, and technology leadership. Through innovative customer relationship management strategies, effective management of its service supply chain, and sizable investments in enabling information technology, the company was at the forefront in attracting, serving, and retaining its customers.
Traces the history of IKEA's response to a TV report that its Indian carpet suppliers were using child labor. Describes IKEA's growth, including the importance of a sourcing strategy based on its close relationships with suppliers in developing countries. Details the development of IKEA's strong culture and values that include a commitment "to create a better everyday life for many people." Describes how, in response to regulatory and public pressure, IKEA developed a set of environmental policies that grew to encompass a relationship with Greenpeace and WWF on forest management and conservation. Then, in 1994, Marianne Barner, a newly appointed IKEA product manager, is surprised by a Swedish television documentary on the use of child labor by Indian carpet suppliers, including some that supply IKEA's rugs. She immediately implements a strict policy that provides for contract cancellation if any IKEA supplier uses child labor. Then Barner is confronted by a German TV producer who advises her that he is about to broadcast an investigative program documenting the use of child labor in one of the company's major suppliers. How should she react to the crisis? How should the company deal with the ongoing issue of child labor in the supply chain?
Raises the issue of the appropriate role of IT in lean manufacturing. Most large manufacturing companies have implemented ERP IT systems to support lean manufacturing practices. The Kerry plant of Esterline Technologies attempted an ERP implementation and then terminated it. Now the Kerry plant is revisiting the appropriate use of IT in an environment of highly innovative lean manufacturing.
In 2004, following an investigation that began in 1998, the European Commission (EC) issued an antitrust judgment against Microsoft Corp., levying a record fine of 497 million euros ($613 million) and mandating changes of commercial behavior and bundling of Windows Media Player with Microsoft's Windows operating system. Summarizes the EC's ruling and Microsoft's response to it, places that ruling in the context of U.S. Government antitrust action against Microsoft, and describes Microsoft's efforts to comply with the ruling. Also covers Microsoft's appeal of the ruling, which was heard in a European court in April 2006, and outlines further EC scrutiny of Microsoft.
Jeremy Moon, CEO of Icebreaker, maker of merino-fiber activewear, thinks about the strengths and weaknesses of staying focused on his rapidly expanding U.S. and European markets vs. broadening his attack to include China. If he enters China, should he continue his current strategy of pushing the technical merits of the merino fabric, or should he go the inherently subjective fashion route, given that the technical apparel market in China is virtually nonexistent.
Founded in 1987, Taiwan Semiconductor Manufacturing Co. (TSMC) was the world's first pure foundry, focused solely on the manufacturing of semiconductors. Operating in the cyclical semiconductor market, the company managed to grow rapidly and to become the world's 8th largest semiconductor manufacturer with more than a 50% market share in the foundry business. In the company's early days, TSMC management focused on manufacturing excellence and technology leadership. As competition in the sector intensified in the late 1990s, the company began to focus on customer service to differentiate itself further from companies like UMC, its next-door neighbor and closest competitor, and the rapidly growing Chinese foundries. The company invested heavily in the development of innovative, value-added services and proprietary information systems that would facilitate better communication and improve customer service, putting in place eCommerce applications such as eFoundry and Enterprise Supply Chain Management suites. TSMC management believed that customers, typically U.S.-based integrated circuit design houses facing high financial stakes, rapid technological innovations, short product life cycles, and intensive competition, would choose a foundry business partner based on quality, trustworthiness, and reputation, as opposed to price only. Could superior customer service make an impact in a capital-intensive, process- and quality- oriented industry such as the semiconductor industry, or would TSMC have to compete on price? Explores these issues, as well as other factors affecting TSMC's strategic path as it moves forward in the mid-2000s.
This month, all of Harvard Business Review's Forethought contributions address avian influenza, its potential to become a pandemic, and the red flags this possibility raises for businesses. Jeffrey Staples warns that the H5N1 strain of the avian flu represents a new class of global threat and urges companies to plan accordingly. Scott F. Dowell and Joseph S. Bresee show how mutations of the virus could boost its ability to spread from person to person. If a human pandemic does strike, Nitin Nohria explains, the most adaptive organizations have the best chance of surviving. Warren G. Bennis says that such times call for a leader who can articulate the common threat and inspire people to overcome it together. Baruch Fischhoff, too, emphasizes the importance of risk communication, warning that managers who dismiss it may endanger the people they're responsible for and force stakeholders to look elsewhere for information. Fischhoff also demonstrates, in another article, how managers can map out their companies' vulnerabilities. Larry Brilliant tells us what people worldwide can expect from their governments. Peter Susser views the threat of a pandemic from a legal perspective, examining several HR-related issues businesses could face. Sherry Cooper points out the social and economic lessons we should have learned from Toronto's 2003 outbreak of severe acute respiratory syndrome. William MacGowan explains how Sun Microsystems is building a continuity plan to keep its global workforce healthy in the event of a pandemic. Wendy Dobson and Brian R. Golden caution that if a pandemic begins in China, as many scientists expect, the global impact will be immediate because China is so integral to the world economy. HBR also provides pandemic planning guidelines adapted from a checklist compiled by the Centers for Disease Control and Prevention as well as a list of recommended avian flu resources.
Asian Paints Ltd. (APL), recognized as one of the best managed companies in India, has recently embarked on a significant push to internationalize its activities with the goal of becoming one of the top five decorative paint companies in the world. The president of the international division is faced with the challenge of simultaneously meeting sales volumes expectations and contributing to the company's goal.
Presents a conceptual framework that decomposes the overall acquisition integration process into four sequential and co-evolving processes: formulating the integration logic and performance goals, establishing the integration planning approach, executing operational integration, and executing strategic integration. Managing the strategic dynamics of acquisition integration in fast-changing competitive environments requires attention to all four processes and the feedback loops between them. An analysis of the HP-Compaq merger, however, suggests that creating a strong feedback loop between the operational integration process and the process of formulating the integration logic and performance goals is difficult. At the same time, it is needed to maintain sustained top management attention to the remaining longer term operational integration tasks and to the multiyear strategic activities necessary to meet the dynamic competitive challenges.
The market at the "bottom of the pyramid" represents an important business opportunity, provided that managers understand the challenges of reaching this huge market segment. The difficulties in designing and introducing new products and technologies are generally attributed to a lack of understanding of the local environment in these countries. However, accessing the potential market in the developing world also requires an appropriate business model. Nongovernmental organizations are uniquely positioned to develop some of the most innovative and successful business models in the developing world. For-profit organizations would do well to engage with NGOs to create effective business models to market technologies in the developing world.