Presents interviews and conversations with a woman who recently started a publishing house. Primarily concerns her immediate future regarding harvesting options: IPO, sell out, step up to chairman, venture capital, etc. Also deals with the excitement and thrill of having your own business dream; i.e., the thrill of doing.
Consists of a series of four brief descriptions of the use of financial futures as hedging vehicles: a savings and loan hedging the rollover of three-month money market certificates with T-bill futures, a corporate debt issuer hedging the cost of a future debt issue with T-bond futures, an equity investor hedging a decline in the market, and an example of a company with a natural interest rate hedge on its balance sheet. The examples describe the details of T-bill, T-bond, and S&P 500 stock index futures. Issues addressed include variation margin and basis risk (due to differences in the securities underlying the cash and futures positions, changes in the carry, etc.).
Presents a new divisional vice president's entry into a well-established and still successful manufacturing organization which is nevertheless facing an impending competitive crisis. Demonstrates his challenge and his efforts, under pressure from corporate headquarters, to convince his staff that the crisis is real and to make changes in the organization's family culture and practice, in order to better position them to face the onslaught of price wars and new technology. Concludes with several complex choices facing the new vice president as he considers whether or not to replace some key but problematic senior managers, and what strategy to adopt in his relations with the retired but still visible descendant of the firm's founder.
Describes the new divisional vice president's decisions and strategies in his first full year of management there. His influence style and tactics are demonstrated.
Presents the results and impact of the new vice president's strategies in his first full year. Concludes with his reflections on the challenge he undertook.
A major Korean firm has begun production of televisions in the United States. Output and quality are below Korean standards. Students must determine why and suggest ways to improve.
Presents a description of international equity markets, including comparisons of the U.S., Japanese, and British markets and recent trends toward deregulation of these markets. The decision focus of the case is on the initial public offerings of British Telecommunications stock. The offering was part of a broader privatization program begun by the U.K. government in 1981. The issue was offered simultaneously in four markets: London, New York, Tokyo, and Toronto. The case is written from the perspective of Morgan Stanley, underwriters of the U.S. offering, and focuses on the issues of pricing foreign equities, differences in underwriting practices and securities regulations across markets, structuring an installment sale of equity, and hedging foreign exchange risk on a purchase of foreign equities.
After working unsuccessfully for three years with the new sales and distribution channels organization, Wright Line's managers assess their experience and restructure their marketing organization.
Acquisitions continue to be an important method of strategic redirection and renewal. But many companies experience disappointing results. Research suggests that an important source of success and failure in acquisitions lies in three factors: the involvement of specialists and analysts with independent goals and multiple, fragmented views of the agreement; premature closure and limited consideration of integration issues; and an inability to resolve important areas of ambiguity before an agreement is completed.
The apparent inability of traditional modes of financial analysis like discounted cash flow to justify investments in computer-integrated manufacturing has led many managers to turn to criteria that seem more closely connected with strategy. Actually, there is no conflict between the financial and the strategic justification of CIM. There is no unbreachable gulf between the logic of DCF and the nature of CIM. All that are needed are new ways to apply DCF to CIM investment proposals. DCF usually fails to work right when companies set arbitrarily high hurdle rates for evaluating new investment projects. Despite the costs that introducing CIM entails, for many companies there is no real alternative to investment in CIM.
Because of the growing number of domestic and international markets blocked by high entry barriers, companies need to master the art of favorably influencing parties other than target consumers. In addition to the four Ps of marketing strategy - product, price, place, and promotion - executives must add power and public relations. Megamarketing is the strategically coordinated application of economic, psychological, political, and public relations skills to gain the cooperation of a number of parties in order to enter and/or operate in a given market.
To improve distributor relations, manufacturers must start by understanding distributor needs. This is accomplished by monitoring distributors - getting into the field and talking with them. Field sales reps must also talk among themselves. Some companies conduct market research studies to zero in on distributor needs. Others establish distributor councils where distributors meet with manufacturing executives to talk about ways to improve distributor programs. Once manufacturers identify distributor needs, manufacturers must work to build partnerships with distributors.
Appointed general manager in 1980 of Westinghouse's newly created Synthetic Fuels Division (SFD), William Peace devoted most of his time to strategy at the expense of employee morale. Many employees did not support the division's new mission. Not until some of them vandalized cars belonging to two managers did Peace realize how abysmal morale really was. Several lessons emerged from the experience: managers must be alert for employee perceptions that don't match their own; frequent and open communication is essential to organizational effectiveness; and, finally, managers can build trust in organizations by disclosing their true feelings and taking risks on behalf of their employees. McKinsey Award Winner.
The matching principle says, "Don't finance long-term needs with short-term capital." Small businesses, however, rarely use strict matching. By not adhering to the matching principle, small businesses incur three risks. First, when loan-renewal time comes, interest rates can be higher. Second, a lender may decide to terminate the agreement. Last, a lender might begin to make operating "suggestions" that limit the company's autonomy if payments are not met in time. To deal with these risks, small businesses that use some amount of short-term capital to finance long-term requirements need to be flexible enough to eliminate the debt in a reasonable period of time without disturbing operations.
The publicity surrounding just-in-time production, or JIT, emphasizes the lower inventory costs and greater ROI attributable to the technique. More important, however, are the improvements in manufacturing that result from operating with low inventories. Since converting to JIT involves a big change in a company's culture and operations, many companies have resisted it. Successful conversion to JIT rests on management commitment and the involvement of the entire work force. Appointing a champion to set up a training program, make a conversion schedule, and form a conversion team will expedite the transition.
Describes a major conflict within Apple Computer in 1985 over control of product distribution. The founder and chairman, Steve Jobs, proposed a new distribution process which would transfer many responsibilities away from distribution manager, Donna Dubinsky. Dubinsky believed, however, that this process would be practically and financially unworkable. Presents her defensive and unsuccessful conflict management, culminating in her threatened resignation. May be used with Debi Coleman and Apple Computer, Inc.