The controller of AMP of Canada learned that her existing transactional processing system was not year 2000 compliant. She must choose between three alternatives: upgrading the existing transactional processing system, implementing a customized software package that many AMP companies already used, or implementing SAP. She knew that Canadian management preferred to implement the very popular SAP system, but her information systems manager did not think that users were ready for SAP and preferred an option involving the existing system. The controller wondered which solution to choose and how to persuade Canadian management, the Canadian information systems department, and headquarters management to support this decision.
The second of the AMP of Canada case series (see the (A) case, 9A99E030 and the (C) case, 9A99E032), this case describes the decision to implement SAP, the project's history, and culminates with the final decision about whether to go live. Not all functionality is complete, but some may be completed before the go live on October 5, 1998, and some may not be immediately required to run the business. With only two weeks left, the project team is divided. The decision in the case is whether to go live, and how to handle the consequences of either decision.
The third in the AMP of Canada case series (see the (A) case, 9A99E030 and the (B) case, 9A99E031), this case describes events immediately after the (B) case. Although the project is officially a success, the organization has changed dramatically since the project began. The two key questions are revisiting the same decisions in cases (A) and (B): should the project have gone live, and was it the right decision to implement SAP.
This note describes the history, merits and limitations associated with the establishment of a sole proprietorship, a partnership and a corporate or limited liability company in Canada in 1999. It reviews the flexibility of each option and the relative liability assumed by the principal owners when choosing the form of organization. The question of liability is then examined further with emphasis on negligence, product liability and professional liability. The note also outlines the standard of care defense that is central to staving off liability lawsuits.
An innovative financial services provider is struggling to arrive at a fixed interest (or SWAP) rate needed by its client. The client's new project would take five years to reach capacity, at which time debt repayments would begin. Hence the client needed to lock in interest rates for the first 10 years of the project. To arrive at a price, the financial services provider planned to start with the zero coupon rate bond yield curve, testing various points along the curve. (The teaching note for this case consists of a PowerPoint presentation. A Microsoft Excel spreadsheet is also available for use with this case, product 7A99N034.)
New options on weather from Enron are described, in particular floors, swaps, and caps on heating degree days. An electric utility is considering whether to purchase a weather derivative to offset the risk of low volume of kilowatt hours. After understanding the nature and purpose of the contract, students will structure the option in preparation for valuing it.
New options on weather from Enron are described, in particular floors, swaps, and caps on heating degree days. An electric utility is considering whether to purchase a weather derivative to offset the risk of low volume of kilowatt hours. After understanding the nature and purpose of the contract, students will structure the option in preparation for valuing it.
Designed for use during the introductory module of a financial accounting course, this case exposes students to the analysis of business transactions and preparation of financial statements. It analyzes the efforts of Mary Jane Bowers, who has recently moved to Lynchburg, Virginia, and plans to open a retail garden store. It covers her compilation of financial projections for the initial startup of her business and its first year of operation. This case can be used as a stand-alone case or can be followed by "The Garden Place-One Year Later" (UVA-C-2068), which examines the financial effects of what actually occurred during the startup and its first year of operation.
Entrepreneurs risk having strategically sensitive information leaked to competitors when their VCs discuss new ventures with outside partners. To avoid that problem, many are turning to other sources of financing.
Large corporations and small start-ups are not mutually exclusive organizational forms. Rather, they exist symbiotically, each requiring and drawing on the unique capacities of the other.
When entrepreneurs become chief executives, they frequently face challenges unlike any they've faced before. To fill the gaps in their experience, many are turning to CEO peer groups.
Many consumer goods manufacturers believe that superstore retailers are bad for their business and a scourge on their brands. But some manufacturers have turned relationships with megaretailers into a competitive advantage.
It's no secret that health care delivery is convoluted, expensive, and often deeply dissatisfying to consumers. But what is less obvious is that a way out of this crisis exists. Just as the PC replaced the mainframe and the telephone replaced the telegraph operator, disruptive innovations are changing the landscape of health care. Nurse practitioners, general practitioners, and even patients can do things in less-expensive, decentralized settings that could once be performed only by expensive specialists in centralized, inconvenient locations. But established institutions are fighting these innovations tooth and nail. Not only is this at the root of consumer dissatisfaction with the present system, it sows the seeds of its own destruction. The history of disruptive innovations tells us that incumbent institutions will be replaced with ones whose business models are appropriate to the new technologies and markets. Instead of working to preserve the existing systems, regulators, physicians, and pharmaceutical companies need to ask how they can enable more disruptive innovations to emerge. If the natural process of disruption is allowed to proceed, the result will be higher quality, lower cost, more convenient health care for everyone.
Hope Barrows, a partner at the national accounting firm Fuller Fenton, drove to the office on Sunday and swiped her access card to enter the parking garage. She noticed that another car followed her in--without using an access card. Hope could see that the driver was a man, but she didn't recognize him. Concerned for her safety, she got out and asked to see his ID. Dillon Johnson, an associate at the same firm, was rushing to meet a colleague to review a client's file. He felt he was being unfairly questioned because he was black. Hope was white. Now it's Monday, and managing partner Jack Parsons is being deluged with calls. Some charge that the organization is racist; others are outraged that a woman was made to feel unsafe. One thing is clear: this incident is just the tip of the iceberg. Jack is trying to calm people down, but he doesn't know what his next step should be. In R00502 and R00514, commentators Robin Ely, Vera Myers, John Borgia, and Jeanette Millard offer advice on this fictional case study.
When looking for ways to cut costs, most managers reach for the head-count hatchet, and the markets usually roar with approval. But a company can almost always create far more sustainable value by rigorously evaluating the small-ticket capital items that often get rubber-stamped. Drawing on his experience as a consultant and providing numerous anecdotes, the author contends that those "little" requests often prove to be gold plated or unnecessary. A disciplined evaluation involves asking only eight questions and conducting postmortems--regular audits of units' capital spending. But the payoff is enormous. Because cutting the capital budget increases cash flow, the author argues that a permanent cut of just 15% in the planned level of capital spending could boost some companies' market capitalization by as much as 30%.
Though only five years old, employee-owned St. Luke's Communications has become one of the most talked about advertising agencies in the United Kingdom, increasing its profits eightfold. Chairman and cofounder Andy Law attributes the firm's success to its determination to continuously reinvent itself in a world populated by dot-coms and mega-ad agencies. St Luke's intends to revolutionize the way business is done and provide a credible alternative to the capitalism of both the old economy and the new. To that end, it pushes its people to take enormous risks. As Law says in this candid interview, "We're fundamentally convinced that there is a connection between co-ownership, creativity, collaboration, and competitive advantage." Safety and fear play key roles. No one has ever been fired for poor performance, so employees can feel secure about their jobs, but the firm requires people "to peel away all the levels of their personalities....That's truly frightening." Self-knowledge, Law says, "is the DNA of a creative company in the creative age."