Profiles veteran investor Wilbur L. Ross, Jr.'s plan to turn around the aging steel assets of LTV, formerly America's second largest integrated steel producer. Purchasing several key assets from LTV under Section 363 of the Bankruptcy Code, Ross is able to acquire the assets free of any pension or healthcare liabilities to retirees. Examines the challenges Ross faces as he tries to make the reborn steel company into a global player as one of the world's lowest cost producers. To accomplish this, he must negotiate a new agreement with the steelworkers' union, transform the old LTV culture, and secure long-term contracts with the right customers who could fulfill ISG's capacity requirements.
This note which describes the architecture and processes that characterize effective teams, begins by detailing the steps involved in designing a team, from diagnosing the complexity, interdependence, and objectives of the task to harnessing the key resources teams need from their environment. It describes the qualities to search for when selecting team members, including finding the right number of people, individual skills along both technical and interpersonal dimensions, and a mix of skills appropriate for the task. Once the team is designed, team leaders and members need to shape and monitor team processes, starting with the team launch. Describes how to diagnose emergent team processes such as information exchange, collaboration, decision making, impression formation, and underlying identity dynamics. Includes steps managers can take to improve dysfunctional team processes such as restructuring and shaping the social forces within the team. Ends with a discussion of bridging differences in teams across both geographic and cultural divides.
Digital media--legitimate and otherwise--were one of the few bright spots for high-technology companies in the middle of a deep and protracted recession. These demands left computer makers, builders of components such as microprocessors, software developers, and others between a rock and a hard place. Consumers disliked many of the anti-piracy technologies promoted by media companies because they often restricted legal (as well as illegal) uses of the technologies. High-technology companies feared government intrusion, legislating which technologies they could market. Many thought that digital media could provide compelling services (the "killer app") that would drive device sales and promote broadband uptake. The issues surrounding intellectual property protection could either promote or inhibit digital media. As these complementors squared off, countless billions of dollars and much of the future of media and technology were at stake.
Waiting lines, sometimes called queuing situations, are encountered widely in business operations. Improvements to the waiting-line process would result, in many cases, in better use of labor, equipment and facilities, and a greater capability to provide customers with a level of service that matches the business objective. This note presents methods for determining the resources needed to provide particular service attributes in waiting-line situations.
Introduces the issues attendant to valuing privately held portfolios and distributing thinly traded stock. Although they have existed since the beginning of the formal venture capital industry, they have received increasing amounts of attention as the money invested in private equity has grown. Presents the perspectives of the many participants in the industry.
Describes the organizational transformation occurring at the Washington Suburban Sanitary Commission (WSSC), a public utility. Faced with the possibility of privatization after decades of providing service in the absence of competition or performance pressures, the WSSC leadership orchestrates a reorganization to improve efficiency and effectiveness, while facing massive layoffs. A critical decision the organization faces is whether, and how, to add new entrepreneurial services to increase otherwise flat revenues. Analyses focus on assessment of the change process and approach.
In an attempt to reduce its ecological footprint, Interface Americas, a leading manufacturer of commercial carpet tile, has launched the Evergreen Services Agreement (ESA)--a lease agreement that provides would-be carpet purchasers with comprehensive floor-covering services (color, texture, warmth, beauty, acoustics, and safety). Under ESA, Interface retains ownership of all carpet material, thereby ensuring proper recycling. Despite active media attention and a lot of interested calls from potential buyers, Interface is having difficulty selling ESA. CEO Dan Hendrix is at a crossroad and must decide whether to continue support for ESA or to focus on other initiatives. This case, grounded in a failed negotiation with the University of Texas, Houston, details a discussion of the difficulties of structuring a long-term lease agreement, defining a new service value proposition for the customer, and developing a sustainable business model for product-related services.
Updates the continuing developments in the disposable diaper industry from 1994 to 2003. Investigates new product innovation, global expansion, and emerging competitors in the highly competitive diaper industry, including the rise of training pants and ventures into Europe. Tracks the improvements of Kimberly-Clark's Huggies, Procter & Gamble's Pampers and Luvs, as well as the market share battles that result.
Carlos Ghosn, a former executive vice-president of Renault, became the COO of Nissan Motor Co., a troubled auto company in Japan when Renault bought 38% of the company in 1999. This case deals with how Ghosn turned the company around. Examines in considerable detail how he went about successfully energizing and mobilizing the demoralized employees after a decade of failed efforts. A rewritten version of an earlier case.
Worldwide Equipment Ltd. is one of the world's largest manufacturers of heating, ventilating, and air-conditioning equipment. The Beijing regional sales manager has just heard that the sales performance of his office ranked the lowest among the sales offices in China. As a result, the Beijing sales force will not receive their year-end bonuses unless the situation can be turned around quickly. The regional sales manager must determine whether the sales management process or a recent new hire on the sales force, whose hiring was strongly suggested by the manager's boss, are to blame for the poor sales performance and how to keep the situation from recurring.
HEB, a family-owned Texan retailer, is the 12th largest supermarket chain in the United States. In expanding its operations into Mexico in 1997, the company transferred not only its products and services but also its social strategy of working with food banks. The Monterrey Food Bank (Banco de Alimentos de Monterrey), one of Caritas's social service programs, began in 1989 with the purpose of providing nutritional assistance to needy families regardless of religious affiliation. The collaboration of HEB with the Monterrey Food Bank enabled this operation to move from basic to world-class level in terms of new storage and handling facilities and administrative systems. The partners perceived significant benefits for each other and the community. Strong leadership and interpersonal relationships contributed to the development of a considerable mutual trust that has fostered a vigorous and growing partnership.
Describes a marketing executive and an engineer who are starting a company together. Each is still at his/her former employer, and each has signed a different employment agreement that, on paper, may prohibit soliciting customers or employees. Focuses on how individuals should think about leaving their employers in general and how these specific legal agreements may impact the situation. Includes issues dealing with venture capitalists, nondisclosure agreements, and selecting a lawyer.
Describes a company during the start-up phase and focuses on the founders' decisions regarding splitting the equity and compensation. Also considers establishing policies and practices that will set the tone for the company as it grows. Discusses a number of specific action issues including: splitting equity and compensation among the founding team and follow-on employees, designing compensation and hiring practices for the young firm, deciding what the corporate culture should be and how to institutionalize it, and deciding whether to hire a senior-level employee--the first nonfounder employee--at a salary higher than, and equity allocation similar to, the founders.
In 1992, Toys "R" Us, the pioneer of the "category killer" retail format, faced significant competitive threats from mass discounters and warehouse clubs and was losing market share. This case explores the dynamic sustainability of Toys "R" Us's retailing model, its competitive options, and the benefits and costs of leveraging market power.
To distribute products to very small retailers in a very fragmented retail environment, the local subsidiary of a large consumer products company created an innovative distribution mechanism. The subsidiary's Small Local Stores division employed middlemen who distributed vans full of consumer products throughout the Philippines. The channel was growing rapidly, but it was the company's least profitable. Now the subsidiary had to decide what to do. Should it try to squeeze more margins out of the channel, even if that would lower the middlemen's incentives? Should it scrap the channel altogether? Or should it try to build an internal capability to reach the smallest stores, even if it involved significant capital expenditures? Regional management was due to arrive and the company had to come up with a plan.
Deals with the issue of integrating two large business groups after the No. 6 air conditioner manufacturer, Kelon Group, acquired the No. 5 air conditioner producer, Huabao. Whereas Kelon Group is a nonstate-owned company, Huabao was spun off from a state-owned enterprise group. It was a landmark acquisition case in which a nonstate entrepreneurial firm took over a state enterprise that had a strong name brand and national reputation. The two companies have different resource bases, history, tradition, corporate culture, management style, product features, and reward systems. They were traditionally close rivals located in the same township. The combined capacity will make the new Kelon-Huabao the top air conditioner manufacturer in terms of market share, assuming a successful merger and integration.
This technical note defines some of the key vocabulary and theories used in ethical decisions and situations, providing a framework for the discussion of ethical issues in business. It builds on and further develops the already familiar ways in which we think and talk about ethics. It provides background, language, and concepts to identify and analyze managerial problems from an ethics perspective.