In December of 2002, the Metro Council of Portland, Oregon had to decide whether or not to expand the Urban Growth Boundary (UGB) for the metropolitan area. The UGB had been created as a tool to help promote a more compact, livable, and efficient metropolitan area. But Portland's housing prices had been increasing rapidly, and home builders and others were arguing that the UGB was at fault for too tightly restricting the supply of developable land. This case, intended for a course in urban planning or economics, is designed to support a discussion of how the various forces of supply and demand, including zoning restrictions, affect the price of housing. It can also stimulate an examination of the rationale for various types of zoning or growth controls. Part A (1703.0) describes the basic debate, while Part B (1704.0) is an optional note that provides additional background on how housing prices are measured. HKS Case Number 1703.0
In December of 2002, the Metro Council of Portland, Oregon had to decide whether or not to expand the Urban Growth Boundary (UGB) for the metropolitan area. The UGB had been created as a tool to help promote a more compact, livable, and efficient metropolitan area. But Portland's housing prices had been increasing rapidly, and home builders and others were arguing that the UGB was at fault for too tightly restricting the supply of developable land. This case, intended for a course in urban planning or economics, is designed to support a discussion of how the various forces of supply and demand, including zoning restrictions, affect the price of housing. It can also stimulate an examination of the rationale for various types of zoning or growth controls. Part A (1703.0) describes the basic debate, while Part B (1704.0) is an optional note that provides additional background on how housing prices are measured. HKS Case Number 1704.0
This case introduces a framework for cost modeling.Two data sets (one for injection-molded plastic parts and another for compressors) allow students to apply the cost-driver framework in conjunction with basic spreadsheet and regression analysis. Although obviously applicable in a course on supply chain management, the case can also be used to teach competitive cost analysis for strategic decision making.
Senior executives at Vanguard are evaluating their marketing strategy. In particular, they are looking at their approach to market segmentation, the organization of the marketing function, and the weight placed on marketing metrics in the corporate dashboard in light of an economic and stock market downturn.
BRAC is the world's largest NGO and has over the past 20 years experienced tremendous rates of growth. The case looks at diversity within the organization and the aspects of management that have made the organization so successful.
Continues the history of the KIPP Academies--two high-performing public middle schools founded in 1995 by Michael Fineberg and David Levin in Houston and New York.
This note is a brief summary of how credit-rating agencies do their job. It includes historical information on rates and capital spreads. The note serves as useful supplementary reading, for students encounteing, for the first time, bonds in a capital-structure case, a capital-markets case, or a cost-of-capital case. The note is designed for undergraduate and executive audiences.
Unifine Richardson is a food manufacturer with 110 employees. The company's sole supplier of honey announced that effective immediately it was no longer able to supply Chinese honey. The Canadian Food Inspection Agency had rejected the importation of Chinese honey due to recently found traces of an antibiotic chemical. China had provided 20% of the world's honey supply. Faced with escalating prices, issues with customer preferences, and possible product recalls, the purchasing manager must determine the company's next step. Considerations include international sourcing, supply disruptions, supply chain management, and quality issues.
Unleashing free-market democracy in developing countries breeds ethnic hatred and instability--yet that's the very prescription wealthy democracies have promoted for healing the ills of underdevelopment. One solution is to give poor majorities a stake in local corporations and capital markets.
It's only a matter of time before some company becomes the Enron of human rights abuse, warns the general counsel in this fictional memo to the CEO. Activist U.S. courts are accepting more and more human rights claims against the business practices of global firms in developing countries. Companies should take steps now to avoid ugly and costly legal battles.
Iqbal Quadir, the founder of Bangladesh's GrameenPhone, discusses the failure of foreign aid to rescue moribund third-world economies and the need to empower local entrepreneurs. The most important feature of his company, he explains, isn't the phone system itself but the microloans that mobilize an army of individual entrepreneurs to meet an unsatisfied need profitably.
What became of the golden age of global marketing? Where are the multinational companies churning out standardized products for a world of voracious consumers? A global economic slump and mounting anti-American sentiment put an end to that party. But the multinationals' retreat to local harbors may leave them ill prepared for what's about to happen.
Formed in late 1996, Boeing Australia Ltd. (BAL) was a relatively new company and a global extension of the U.S. firm, the Boeing Co. BAL developed capabilities in the areas of space and communications, site management, and the upgrade and maintenance of military aircraft and equipment. As BAL grew, so did the legacy information system it used for both internal communications and external dealings with customers. BAL, however, faced difficult decisions as it sought to upgrade its procurement systems and processes to improve operations. In early 1999, BAL recruited a new national procurement manager, Russell Menere, whose immediate task was to look for gains in productivity by improving procurement processes, either through cost savings or by reduced processing time. To meet this objective, Menere initiated a number of short-term improvements. These included the rationalization of a large number of BAL's suppliers, improving BAL's relationships with its key suppliers; the introduction of a credit-card purchasing system for low-value, large-volume consumables; and the adoption of electronic ordering processes with BAL's larger suppliers. In 2002, with new opportunities available through e-business technology, Menere needed to decide what BAL's next step should be. Should BAL invest in a new system that would simplify the procurement process across different divisions and support complex interfaces with suppliers? Should BAL continue to sit on the fence and seek short-term improvement tools for integration with its existing legacy systems?
BRAC is the world's largest NGO and has recently initiated a number of successful profit-making commercial enterprises, ranging from dairy processing to vegetable exports, as well as a university. Explores the tensions and benefits of a major nonprofit entering the commercial arena and the consequences for the organization.
Mike Graves, the general manager of a U.S. apparel company's 50/50 joint venture with a Chinese manufacturer, has made the joint venture into a big success, at least in the eyes of its Chinese executives and local officials. Zhong-Lian Knitting has turned around three money-losing businesses and has increased its payroll from 400 to 2,300 employees. But Mike's boss, the CEO of the U.S. company, Heartland Spindle, doesn't share the rosy view. He's looking for a 20% ROI, which he says will require laying off 1,200 Chinese workers. He also wants to aim at the high end of the clothing market, meaning the JV will have to meet much tougher standards of quality than it has been able to do so far. To make matters worse, the Chinese executives now want to make a fourth acquisition, which they hope will position the venture to start its own brand of apparel--a move that could eat into profits for years. Can Mike keep the joint venture from unraveling? In R0308A and R0308Z, four commentators offer expert advice on this fictional case study: Eric Jugier, the chairman of Michelin (China) Investment in Shanghai; Dieter Turowski, a managing director in mergers & acquisitions at Morgan Stanley in London; David Xu, a principal at McKinsey in Shanghai; and Paul W. Beamish, the director of the Asian Management Institute at the University of Western Ontario's Richard Ivey School of Business in Canada.
For all the talk about global organizations and executives, there's no definitive answer to the question of what we really mean by "global." A presence in multiple countries? Cultural adaptability? A multilingual top team? We asked four CEOs and the head of an international recruiting agency--HSBC's Stephen Green, Schering-Plough's Fred Hassan, GE's Jeffrey Immelt, Flextronics' Michael Marks, and Egon Zehnder's Daniel Meiland--to tell us what they think. They share some common ground. They all agree, for example, that the shift from a local to a global marketplace is irreversible and gaining momentum. "We're losing sight of the reality of globalization. But we should pay attention, because national barriers are quickly coming down," Daniel Meiland says. "If you look ahead five or 10 years, the people with the top jobs in large corporations...will be those who have lived in several cultures and who can converse in at least two languages." But the CEOs also disagree on many issues--on the importance of overseas assignments, for instance, and on the degree to which you need to adhere to local cultural norms. Some believe strongly that the global leader should, as a prerequisite to the job, live and work in other countries. The executives' essays capture views that are as diverse and multidimensional as the companies they lead.
More than 100 miles from Bangalore, India, there's a rural area called Kuppam where one in three citizens is illiterate, more than half of the households have no electricity, and there's a high rate of AIDS. It's exactly this challenging atmosphere that prompted Hewlett-Packard to choose Kuppam as one of its first "i-communities" initiatives. Through the program, HP creates public-private partnerships to accelerate economic development through the application of technology while simultaneously opening new markets and developing new products and services. HP brings to these initiatives the management disciplines of a successful technology business. For example, it unearths customer needs using an iterative cycle that involves prototyping products and services and then closely observing residents' experiences with them. It fields a diversely talented team that brings many skills to the initiative. It takes a systems approach, simultaneously examining all the elements that must come together to create a working solution to a given problem. It establishes a "leading platform" on which other players--companies, nonprofits, and government agencies--can build technologies and applications. Practices like these help ensure that HP's investment yields real, sustainable results for the community in question. But HP also sees returns to its own business. In Kuppam, the company is discovering the need for (and developing) new products like a solar-powered digital camera, with printer, that fits in a backpack. By engaging the community and its leaders and working with them to design valuable new tools and capabilities, HP is gaining the knowledge it needs to be a stronger competitor in other developing regions.
Abraham Lincoln would have well understood the challenges facing many modern emerging nations. In Lincoln's America, as in many developing nations today, sweeping economic change threatened older industries, traditional ways of living, and social and national cohesion by exposing economies and societies to new and powerful competitive forces. Yet even in the midst of the brutal and expensive American Civil war--and in part because of it--Lincoln and the Republican Congress enacted bold legislation that helped create a huge national market, a strong and unified economy governed by national institutions, and a rising middle class of businessmen and property owners. Figuring out how to maximize the benefits of globalization while minimizing its disruptions is a formidable challenge for policy makers. How do you expand opportunities for the talented and the lucky while making sure the rest of society doesn't fall behind? It may be helpful to look at the principles that informed the policies that Lincoln and the Republican Congress instituted after they came to power in 1861: Facilitate the upward mobility of low- and middle-income groups to give them a significant stake in the country, emphasize the good of the national economy over regional interests, affirm the need for sound government institutions to temper the dynamics of the free enterprise system, tailor policies to the national situation, and realize that a period of turmoil may present a unique opportunity for reform. These principles drove the reforms that helped Americans cope with and benefit from rapid technological advances and the fast integration of the American economy in the 19th century. They may be instructive to today's policy makers who are struggling to help their own citizens integrate into the fast-changing global economy of the 21st century.