Discusses the role of professionals in the Enron debacle. Argues that professionals failed to prevent or predict Enron's collapse because of the conflicts of interest they faced. Concludes with observations on management and regulation of conflicts of interest facing professionals.

The case illustrates the efforts of the International Federation of Red Cross and Red Crescent (IFRC) in the area of emergency response preparedness. It provides an anecdotal description of IFRC's failure in promptly responding to the 1998 Hurricane Mitch disaster that swept through Central America. It then proceeds in describing how the disaster triggered off IFRC's pilot initiative, the Pan-American Disaster Response Unit, as well as general awareness on the need to institutionalize preparedness by leveraging on five different "resources": people, knowledge, goods, money, and the humanitarian community.

In a revolutionary technology plant, iron ore is converted into pure iron by hydrogen reduction. The case describes the process flow, including flow diagrams, mass balances, yields, and equipment uptimes. The case then describes the fixed and variable cost structure of labor, material and equipment, resulting in an analysis of the plant economics.

It was long believed that entrepreneurship in Russia is close to impossible without government or mafia connections. This case study argues that, on the contrary, garage-type entrepreneurship is possible in Russia. For the Russians at Frontstep, the company in this case study, however, there were no how-to manuals to turn to. When the employees started making demands for Western-level salaries and benefits, matters came to a head. The problem was solved as the founders developed a hybrid organization, with Western incentives and structures, and Russian corporate culture.

It was long believed that entrepreneurship in Russia is close to impossible without government or mafia connections. This case study argues that, on the contrary, garage-type entrepreneurship is possible in Russia. For the Russians at Frontstep, the company in this case study, however, there were no how-to manuals to turn to. When the employees started making demands for Western-level salaries and benefits, matters came to a head. The problem was solved as the founders developed a hybrid organization, with Western incentives and structures, and Russian corporate culture.

A new associate in a consulting firm attempts to navigate his way through the norms and culture of a new setting and to manage his relationships with his superiors and peers, which got off to a poor start. PLEASE NOTE: This case was revised in January 2014. Some language and incidents have been lightly edited, to bring the case up-to-date.

In June 1999, the Basel Committee on Banking Supervision announced plans to revise the capital standards for banks. The Basel Committee believed that project loans were significantly riskier than corporate loans and, therefore, warranted higher capital charges under the new proposal (known as Basel II). Bankers, fearing that higher capital charges would damage project lending by lowering profits and driving borrowers to nonbank competitors, formed a consortium to oppose the proposal by studying the actual default and loss characteristics of their combined portfolios of project loans. The study showed that project loans were not riskier than corporate loans. Armed with this data, the consortium sent a letter to the Basel Committee in August 2002 urging them to lower the proposed capital charges on project finance loans.

Martin Smith, a new associate at an LBO firm, must respond to a problem posed by his boss, based on an historical deal that suddenly came undone. After months of negotiation, his firm's plan to buy a bankrupt competitor of one of its portfolio companies and close it down, thus reducing capacity, was ready for board approval. Recently, not only has the market for the product improved, but management of the target firm has presented a more attractive deal to recapitalize the company. This would have disastrous results for the entire industry by perpetuating an overcapacity problem. Discusses Smith suggestions.

Mike Tarkington, a partner at Reality Venture Partners, must recommend a course of action to his colleague, Steve Bonhomme. Bonhomme is trying to decide whom he should put on the board of a company that is acquiring one of Reality's portfolio companies. Reality will own a very small portion of the merged entity, which will be headquartered in Finland, and Bonhomme is considering a host of options.

Describes the challenge of starting new ventures or new activities in established companies, especially if they diverge from the mainstream of ongoing commitments. Fledgling ventures require a different kind of management that acknowledges their uncertainty, intensity, and need/desire for freedom from mainstream constraints. One challenge is how integrated or not the new activity should be with the rest of the organization. Provides criteria for making this choice and offers some examples.

Presents the fundamentals of GDP accounting (including definitions, etc.), examines the history of national accounting, and surveys the international debate over "Green GDP." The first section explains the basic rules and definitions of national economic accounting and the meaning of GDP versus NDP. The second section provides historical context for the development of national income estimates, 1886 to 1940, culminating in the creation of GNP by the U.S. Department of Commerce in the 1940s. The third and final section discusses the standard imputations currently made to reflect nonprice economic activity (e.g., for owner-occupied housing and government services) and explores the debate over imputations for natural resources and environmental quality.

This case tracks McKinsey's evolution from its origin in 1926 to 2002, emphasizing the institutional heritage of the firm. It closes with a description of the challenges facing the firm's leadership in 2002.

Cargill is one of the world's leading marketers, processors, and distributors of agricultural, food, industrial, and financial products. In 1998, the company decided to develop a strategic intent to restructure and refocus the company. It did so in response to the consolidation of the industry, globalization, and the impact of the genetic revolution. It had to change its focus from the producer to the consumer and market solutions.

Describes three different approaches to electronic purchasing taken by a state government: 1) ERP-to-ERP by State Health (the state government's largest spender); 2) a central catalogue (the state government Buyers' Catalogue) maintained by government purchasing officers; and 3) an outsourced gateway hub known as JEBI (the government's Joint eBusiness Initiative project), intended for use initially by government agencies and eventually by small and medium-size businesses (SMEs) across the state. The gateway hub approach needs to incorporate the other systems' transaction volumes for it to be viable and to realize the longer term goal of creating an e-business marketplace for the state's SMEs. How will the JEBI project manager co-opt the other electronic purchasing projects to its cause?

Frontier Adventure Racing is a relatively young company that is facing some significant financial issues. The company president, owner and organizer of Canada's most well-recognized series of adventure races (Raid the North), is passionate and knowledgeable about the sport of adventure racing. Also, as the captain of Canada's top adventure racing team, his profile has loaned credibility to his own company and has heightened media coverage of its races. The company has great products, a solid international reputation among adventure racers and good name recognition in the field. Even so, the company is up against some serious financial hurdles, having made little or no profit four years in a row. The Sports Network and The Outdoor Life Network have offered two hours of television coverage for the company's next race and half of the ad spots during the show if Frontier Adventure Racing is willing to pay the production costs. This kind of coverage would boost the company's visibility, but where could the company come up with the funding? Already faced with the problem of finding new sponsors, a bill for sponsorship, and a need for TV production costs over and above the normal cash requirements, the president knows the situation is difficult at best, and wonders what possible options are available to him.

Track Concealers Company Ltd. produced valances to cover the tracks above bifold doors. When the company received a large order from a U.S. building retailer, the owner needed to quickly secure capital to fund the production commitment. Although he was able to acquire the needed financial backing through his family, the owner was uncomfortable with this arrangement. He was determined to acquire independent short-term and long-term capital for his company within six months.

Global Bubbles Incorporated is a worldwide manufacturer of chewing gum. The vice-president of manufacturing must evaluate various global capacity rationalization plans to determine the strategic direction the company should take. Her goal was to determine the optimal manufacturing strategy for the various markets supplied by Global Bubbles. She must analyse multi-currency net present value calculations, discount rates, exchange rates and the role of strategic options associated with multiple sourcing locations.

The president of Try Recycling & Aggregates, a company which recycled materials not acceptable at garbage landfill sites, has to decide whether the company should sell its products through a new fundraising initiative - the Grow Green Program. This program would involve approaching organizations taking part in fundraising activities to determine if they would be interested in selling the company's gardening products in order to raise funds for their organizations. He had determined which products would be sold, but must determine which fundraising organizations to target and how to promote his idea.

The costs of global warming are enormous. The increase in concentration of greenhouse gases, as a result of growth in industrial activities worldwide, is directly related to the increased frequency of natural disasters. United Nations has estimated that the effects of global warming (namely natural disasters, loss of land due to rising sea levels and damages to fishing stocks, agriculture and water supplies) could cost over US$300 billion annually. The Kyoto Protocol is an international agreement setting out legally-binding levels of greenhouse gas emissions for 160 participating nations. The signatory nations approved the principles of the treaty, leaving the operation and enforcement details to be determined. While the intent of the protocol, to reduce worldwide greenhouse gas emissions to the benefit of all countries, is honorable, the impacts of the Kyoto Protocol are difficult to predict and will affect its stakeholder groups (the insurance industry, developed and developing nations, signatory and non-signatory countries, existing and potential industries) differently. Implementation issues, alternate approaches, the challenges of global environmental problems and possible solutions are discussed. The response of governments and businesses to global environmental issues, in general, and to the Kyoto Protocol, in particular, will determine the strengths and weaknesses of this global initiative.

Two managers attending an executive education course attempt to develop a cost of capital estimate for a leading telecommunications company. The two managers are confused about the costs of various sources of capital, the calculation of the overall corporate cost of capital, and the appropriate use of the hurdle rate. They must investigate the concept of cost of capital, review historical data on risk premiums, develop a process for estimating the various components of the cost of capital, and determine the corporate cost of capital.