Reckitt Benckiser plc has developed an executive compensation system. This case outlines the structure of the system, its emphasis on performance-based pay and a global outlook, and explains the role of the human resources department, the board of directors, and company shareholders in determining pay. It raises questions about how to balance incentive remuneration effectively in recruiting and retaining top managers, while addressing shareholder concerns about executive compensation.
Large discrepancies have developed between two elite technology development teams at Crutchfield Chemical Engineering in terms of motivation and creativity. To investigate, Paul Burke, director of corporate technology development, commissioned a study of the day-by-day dynamics within these teams (the Lumen and Absorb teams). Using 10 days' worth of electronic daily diaries collected from all members of the two teams, the study reveals rich information about team leader behaviors, team member thoughts and behaviors, team dynamics, and project progress. By summarizing both the diary data and personality data on both teams' members, the study presents Burke with a clear dilemma about enhancing and maintaining motivation and creativity in teams of high-level professionals working on challenging projects under difficult organizational conditions.
Colt Companies provides engineering design, procurement and construction services to the oil and gas industry. The company president knew that, to continue to grow, the company needed to expand its service offerings or its geographic base. He was considering expansion into the United States, which had a lot of prospective benefits, but also some drawbacks; among others, the company perceived the engineering contractor market was mature and highly competitive. The company had several expansion options: build its business slowly on its own; tender an initial public offering and provide existing partners with shares in the new public company, and use the cash to acquire other firms; go forward with an acquisition based on debt rather than equity; or merge with a private competitor. The president was expected to choose a strategy and champion his case to the board of directors.
Canada's tobacco manufacturers all faced similar marketing challenges: a decrease in the proportion of population who smoke, a growing list of government restrictions on promotional opportunities and increases in taxation on tobacco products. Despite the variety of packaging formats, the 10 most popular brands, produced by the three leading manufacturers, had been priced identically. When the number two manufacturer re-introduced one of its products as a discounted brand, the marketing executives at the rival companies needed to decide on their response. The supplement to this case, Cigarette Wars (B), product 9B04M010 discusses the response of the other two leading tobacco manufacturers.
A merchant bank is considering the financing of a leveraged buyout of a private jewelry manufacturer. A representative from the bank must determine what risks are associated with this investment and if the financing fits the banks investment criteria. If he decides to invest in the jewelry manufacturer, he would need to structure an appropriate deal to be competitive with other merchant banks. An Excel spreadsheet with the financial model is available, product 7B04N003.
The case is concerned with the evaluation of a relationship strategy: implementing "JIT" delivery to key customers. The strategy has structural implications and an adaptation may be necessary.
This case provides a definition of strategy, distinguishes between corporate and practice strategy, and discusses how and why developing and implementing strategy for professional service firms is different from developing and implementing strategy for commercial firms. The case discusses how practice strategy involves positioning the practice on a spectrum of services and aligning the organization and its professionals to the position. Practices are subjected continuously to forces that move their positioning. To be successful, practices must dynamically reposition or realign themselves. The csae concludes with a discussion of the corporate strategy challenges facing multipractice professional service firms.
Yamato Transport is the leading Japanese parcel delivery company and has dominated its industry for more than two decades. In response to new competitive challenges, Yamato must decide how to reposition itself in the industry and optimize the size of its network. The recently corporatized Japan Post is the only company that can deliver personal mail
Describes the dilemma facing Chris Masterson, the head of HSBC's private equity division, in negotiating this team's buyout of its organization from HSBC, its corporate parent since 1992. Discusses the pros and cons of being a captive fund and the delicate balance among many interests--limited partners, team members, the parent, and the investee companies--that must be maintained.
Electronic Arts (EA), the world's largest independent video-game publisher, must decide whether to support Microsoft's initiatives in online gaming. Historically, EA has been platform-agnostic, releasing versions of its titles for all major console platforms. However, its managers have serious concerns about Microsoft's strategy for its online gaming service, Xbox Live. Microsoft has maintained tight control over game features and customer relationships and has refused to share online gaming subscription revenues with game publishers. Sony has offered terms for Playstation2 online games that are acceptable to EA. Can EA afford to forfeit sales through Microsoft's platform?
This case from a three-case series that includes S-0110 and S-0111 explores competitive strategies in a mature industry within the context of the Asia-Pacific region and is appropriate for use in competitive dynamics, international business, or business strategy courses. The state-owned Port of Singapore Authority wanted to become the World's Port of Call. The port of Singapore was one the world's busiest and a model of efficiency and operational excellence. But, by the end of 2001, it had lost two key customers to an emerging competitor, the port of Tanjung Pelepas (PTP), in neighboring Malaysia. In 2002, the Chinese shipper COSCO Pacific was considering a shift to PTP. By 2003, the port of Singapore had laid off staff and tried to explain the reasons behind the layoffs.
This case provides students with an opportunity to understand how to analyze costs and profit at the service-line level. Students have a chance to allocate general and administrative costs to service lines in a number of different ways and are directed toward considering drivers of overhead expenses in the allocation process. In addition, students should be challenged to discuss whether it even makes sense, in this setting, to allocate all the general and administrative costs. Finally, students are asked to calculate the incremental contribution margin percentage for each service line, and determine which service line(s) Finnegan should try to expand.
This case presents an opportunity for students to use flexible budgeting to perform a variance analysis on the operating results of EntertainmentNow.com. First, the company's original budget is flexed to account for changes in sales volume. Then, actual results are compared to the flexed budget and analyzed for product mix, price, cost of goods sold, efficiency, and other variances. In addition, the case requires a simple calculation to determine the breakeven level of sales given the company's current variable and fixed costs.
Sixty-year-old Martha Stewart, founder and former CEO of Martha Stewart Living Omnimedia Inc., was charged with four legal actions alleging she breached her fiduciary duties to MSO when she made "materially false and misleading statements" about her involvement in trading ImClone stock. Although Stewart's firm was not accused of any crime, she and her company were being likened to corporate villains such as Enron and WorldCom. The A case outlines events and Stewart's initial reactions, providing students an opportunity to examine issues of crisis containment and communication. Through the disaster, what might she anticipate for herself, for her role at MSO, and for the survival of the company she created? How should Stewart deal with unwanted media attention and negative attacks? And what audience was Stewart speaking to when she finally did appear publicly?
Wal-Mart Stores, Inc. is a large Fortune 500 retail chain. The distinction of being the top-ranked company comes with intense scrutiny from the public and, especially, critics. Wal-Mart, a company lauded for its rapid response capability and stated commitments to gender equality, is deficient in some glaring areas--the percentage of women compared to men at all levels of the company and the compensation paid to women vs. men at all levels of the company, to cite two examples. An executive vice-president must examine why these inequalities exist when the company seems to be doing everything else right. The company is the target of several gender discrimination lawsuits. The executive vice-president has the opportunity to obtain information that would be useful in the current situation and must determine what information is needed.
Canada's tobacco manufacturers all faced similar marketing challenges: a decrease in the proportion of the population who smokes, a growing list of government restrictions on promotional opportunities, and increases in taxation on tobacco products. Despite the variety of packaging formats, the 10 most popular brands, produced by the three leading manufacturers, had been priced identically. When the number two manufacturer reintroduced one of its products as a discounted brand, the marketing executives at the rival companies needed to decide on their response.