The success of Crown Cork and Seal in the beer can and aerosol container markets is attributable to their concentration on specialized design and manufacturing for those two specific high growth markets. While competitors diversified and lost container market shares to former customers engaged in self manufacture, Crown Cork's careful market strategy paid off. Market choice demands a long range commitment in terms of customer base, competition and required resources. Horizontal and vertical product-market choices allow a company to concentrate marketing where it has an advantage over competitors. Choice of product/market position at the beginning or the end of the market depends on company commitment to manufacturing, quality control and service.
A hypothetical case illustrates managerial problems in a firm that has lost strategic control of technology and its competitive edge by becoming insulated from technological realities and by allowing important technological decisions to be made by lower-level management or technical people. The company redefines its focus and prescribes remedies in terms of R&D project selection, competitive product position, strategic performance, and a more disciplined approach to monitoring the progress of R&D projects.
Materials requirements planning (MRP) is a computer-based system of coordinating materials supply, demand, inventory, and production scheduling for manufacturing operations. In addition to the master production schedule 'drive file,' files are created for bill of materials, inventory status and the materials requirements planning package. The value of MRP depends on an operation's size and the efficiency of its current materials system. Its adaptability, however, promises new applications in other areas.
After 18 months of deficit operations, Southwest Airlines stands on the brink of profitability. Selective application of discount fares has contributed to a rapid growth in market share. Then, in February 1973, its major competitor halves all fares on Southwest's principal route. Management must decide how to respond. Exhibits detail Southwest's cost structure plus passenger and flight statistics for Southwest and competitors.
Describes the nature and purposes of market analysis. Among topics briefly discussed are primary and selective demand, determinants of demand, market segmentation, the product life cycle, and temporal or cyclical demand variations. Intended as background reading in an introductory marketing course using case materials.
Provides a framework for the analysis of industry structure. Identifies the major structural features that influence the profit potential in industries and some illustrative implications of these for strategy formulation. Can be used as a reference note for business policy courses and/or as the background for a lecture on industry analysis.
Covers the strategy and management practices of the world's largest manufacturer of welding equipment. Discusses the compensation system and company culture, and the leadership style of management.
Guidelines to aid the student in analyzing a case situation by casting himself or herself in the role of protagonist, developing criteria for alternative decisions, and generalizing to other situations.
Describes the formation, selection, and experience of a task force with multidepartmental membership. The problems faced by the task force leader at the end of the case raise issues of who does the selection; the establishment of group norms, values, and goals; the leadership of a task force; confidentiality and responsibility; individual rivalry; and intergroup conflict and politics. Based on Belmont-White Co. and Vandercook Chain Stores, Inc. by E.P. Learned.
Raises the following issues: understanding another person from his/her point of view, understanding how two people can view the same situation differently, and understanding how an individual's behavior can have secondary consequences of which he/she may not be aware.
Executives who wish to avoid being caught off guard when speaking to the press or to the public need a sound attitude (one that is neither arrogant nor falsely humble) and they need thorough preparation. Ten specific guidelines to remember include: talk from the viewpoint of the public's interest, not the company's, speak in personal terms, avoid "off-the-record" statements, state the most important fact at the beginning, avoid arguing with the reporter or losing your cool, avoid repeating or denying questions containing offensive language, provide direct answers to a reporter's direct question, offer to find out the answer to a question if you do not know the answer, avoid "playing dumb," tell the truth, and do not exaggerate facts.
A research technique, called conjoint measurement, evaluates consumers' judgments to determine the nature of a product and the available market. This technique is especially useful when choosing between multiattribute products. Studies of various complex product choices illustrate how conjoint measurement indicates customer preference and the number of prospective orders. Conjoint measurement also shows consumers' evaluations of new product formulations; effective packaging, brand name, and promotional copy combinations; pricing and brand alternatives; verbalized descriptions of new products and services; and alternative service designs.
In a service organization, quality control of employee attitudes and performance is comparable to product quality control in manufacturing. The Marriott Corp. pursues an elaborate 'rescue' operation to keep good management people after recruitment and training. This rescue operation which provides employees with challenge, satisfaction and growth in their jobs, consists of eight programs including: Individual Development; Management Training; Manpower Planning; and Career Progression. Other programs include: annual Opinion Surveys; Fair Treatment; and Profit Sharing.
Presents the results of a computer simulation of aircraft hull insurance. Discussion will focus on the interpretation of the results described. Designed to be handed out in class. Rewrite of an earlier supplement by P. Vatter.
Judy and John DeRight, looking to diversify their investment portfolios, have retained Angus Cartwright, Jr. to identify prospective real estate acquisitions. Mr. Cartwright has four potential properties that he feels merit an in-depth financial analysis. The case provides an opportunity to examine the various components of real estate return--cash flow, tax benefits, and futures--and measure the profitability of a proposed investment through the calculation of net present value, internal rate of return, and capitalization rate.
Financial vice president is expected to prepare a financing plan for Bio-Tech matching the most recent long-range plans of three operating groups. The latter, however, must be adjusted to take account of recommendations to be made on plant investment of one product group and possible sale of a major division.
Test marketing has proper uses and serious limitations. It provides a measure of sales performance and the opportunity to identify and correct any weaknesses in the product or in the marketing plan. It is, however, costly and laborious. Four factors to weigh in determining the efficacy of test marketing are: the cost and risk of product failure against the profit and probability of success; the difference in scale of investment between a test and a national launch; the likelihood of being copied and preempted by the competition; and the costs in money and reputation of a product failure.
Overhead value analysis identifies structural cuts that will reduce overhead costs by 15% to 30%. Overhead value analysis requires delegating to every manager in the company, plus a small, high-level task force, the responsibility to cut overhead costs. The target should be a 40% reduction in costs. This program may have the undesirable side effects of hurting employee morale and of terminating a disproportionate share of minority employees. A company should apply the program when it has an acute short-term need to improve profits, or badly needs to gain a competitive edge by improving its economic structure.