A five-stage framework will help owners to determine their company's stage of development and how to ensure a profitable future. It is also useful to consultants and accountants in diagnosing problems and matching solutions to smaller organizations. The five stages are existence, survival, success (with the substages of disengagement and growth), take-off, and resource maturity. Each stage has an index of size, diversity, and complexity.
One way for companies to get reliable information about the economic risk of capital investment strategies is to use the capital asset pricing model (CAPM). It enables them to quantify risk and to link it with the returns they expect. Alaska Interstate, Inc. is one company that has used CAPM successfully to incorporate a consideration of risk into its strategic planning process.
The new commercial reality is the emergence of global markets for standardized consumer products on a previously unimagined scale of magnitude. Technology, by proletarianizing communication, transport, and travel drives the world toward a converging commonality. Well-managed companies have moved from emphasis on customizing items to offering globally standardized products that are advanced, functional, reliable, and low priced. They benefit from enormous economies of scale in production, distribution, marketing, and management.
A large chemical company has developed a novel industrial maintenance item, for which a marketing program and budget must be prepared. Case requires students to forecast demand at end-user and industrial customer levels to identify elements of the marketing mix, and to prepare a plan and budget.
What happens to an industry with millions of employees that loses its comparative advantage? This note examines this question by looking at the global textile and apparel industry. With the Multi-Fiber Arrangement coming up for renewal in December 1981, the United States, Europe, and the developing world must decide how to divide the international textile market in the 1980s. The debate focuses on who wins and who loses from protectionism, and the advantages and disadvantages of free trade.
Various proposals are set forth for expanding the capacity of the hospital. In assessing them, serious consideration has to be given to the culture of the organization and the importance of preserving it in a service delivery system. In addition to issues of capacity and organizational analysis, describes a well-focused, well-managed medical service facility that may well point the way to future economies in the field.
Describes the start up, strategy, organizational design, and operations over the first eighteen months of the airline. Focuses on the creative use of human resources as an integral part of the business strategy.
American Home Products is a company with virtually no debt. Students are asked to analyze the company's debt policy and make a recommendation to the CEO. It is likely that adding debt to the capital structure would create some value for shareholders; the CEO is firmly against borrowing.
Michael Bregman has successfully opened pilot installations of two different restaurant concepts. He now must develop a strategy for growth, including decisions about fast or slow growth, use of company-owned versus franchised units, and how to use the different concepts. To do this, Michael must give particular consideration to the pros and cons of franchising.
Often an executive blames a stressful work situation and lack of time for his or her unsatisfactory home life. These can be the cause, but they are frequently alibis to cover up much more personal factors. To improve their situation, executives need to establish clear, concrete, and achievable goals and to monitor the achievement of these. Projects should be modest, yield results that are both measurable and fun, and involve another person to help the executive persist. Authentic behavior and clear communication, together with imagination and playfulness, are the keys to a satisfying life at home.
Companies increasingly rely on industrial distributors to sell their products. Products suitable for distributors usually: 1) have a large potential customer base, 2) are stockable, 3) are sold in small quantities, 4) are bought by people who are at low levels in their organizations, and 5) require rapid delivery and service. Companies should select distributors that serve the market segment, not just the geographic area, and are suited to where the product is in its life cycle.
Presents an accounting of Ford Motor Company's handling of a product safety controversy (1970-77) surrounding its Pinto subcompact car. May be used as part of a series, Managing Product Safety, that provides an opportunity to compare and contrast the social response strategies employed by companies involved in a catastrophic product safety controversy.
Mat MacGregor took charge of a failing project but failed to turn it around because of a variety of personal, technical, cultural, and political reasons. The purpose of the case is to understand the underlying dynamics and their implications.
HCAs ratio of debt to total capital is approaching 70%, jeopardizing its single-A bond rating. Students must determine an appropriate target debt ratio for HCA in light of its growth objectives, its acquisition strategy and its changing regulatory environment.
Focuses on HCAs financing options for reaching its target capital structure. The options include new equity conversion of convertible debentures, a debt-for-equity swap, the sale of assets, and fixed-rate debt. Students must address the problem of market timing and signaling in their choice of financing vehicles.
Marketing executives at the company are considering the merits of a variety of communications programs designed to increase the effectiveness of the company's sales force of beauty consultants.
Shows how the Borg-Warner Corporation developed a statement of values and beliefs under the leadership of its chief executive officer, James F. Bere. The "Beliefs," a set of general principles intended to guide business behavior, now must be given operational meaning as they are shared and communicated to a very large and decentralized organization. Provides students an opportunity to critique the development of a corporate statement of beliefs and to relate ethics directly to business policy and practice.