This case describes Salesforce's development of Sustainability Cloud, a suite of software tools built to help companies measure, track, and report carbon emissions and other sustainability metrics. The goal of this case is to provide students with a background and foundational knowledge of three topics: software as a service (SaaS); environmental, social, and governance (ESG) standards; and carbon accounting. The case places students in the role of the fictional Salesforce vice president of sustainability, who is deciding whether or not to recommend the development and launch of Sustainability Cloud 2.0. She is pondering many issues. Since Salesforce was able to become a world leader in SaaS software, could it become a leader in sustainability software, as well? After analyzing the decision at hand, students should be ready to meet with Salesforce executives and make a recommendation about next steps for the company's sustainability software products.
The owner of a tennis ball manufacturer was reviewing the company's financial performance for its third fiscal year. The bookkeeper had already recorded the fiscal 2020 cash transactions, but may have done so incorrectly. The owner recorded the opening balances, cash receipts, and cash disbursements to calculate the unadjusted trial balances for fiscal 2020. She started with the bookkeeper's unadjusted trial balances and planned to use the balance sheet and the list of cash receipts and disbursements, if necessary. She would have to figure out where the bookkeeper posted each entry, determine whether it required an adjustment, and adjust accordingly.
This note describes the exponential growth of semiconductor technology over the last 40 years, as well as the evolution of the semiconductor value chain. Semiconductor integrated circuits (ICs) are essential to all modern electronic equipment and are used in virtually every industry, including consumer electronics, office equipment, appliances, and automobiles. Semiconductor complexity and processing power has increased exponentially, resulting in commensurate increases in the sophistication of and upfront costs associated with fabrication processes. The industry has evolved from a vertically integrated model of integrated device manufacturers (IDMs) to a disaggregated model of "fabless" technology companies that focus on research and design and rely on off-shore pure-play semiconductor foundries for production. An entire generation of US-based fabless semiconductor manufacturers, such as Qualcomm, Nvidia, and Cirrus Logic, have blossomed and thrived by taking advantage of high-quality, low-cost foundry services provided by the likes of TSMC, Samsung, and GlobalFoundries. The recent COVID-19 crisis and escalating US-China trade tensions have exposed the fragility of this ecosystem, and US technology companies must learn to manage an emerging set of risks. The note highlights how the natural evolution of an industry, in response to competitive and market pressures, may result in highly efficient but fragile value chains.
This case details the struggles of a traditional retailer (Matas) wrestling with the changing retail landscape. The Matas management team recognizes that the company's offline retail business is under serious pressure. Top-line growth has flattened, and bottom-line profitability has declined. The online market is expanding rapidly but is a tiny portion of the business. The team is aware that the company needs to grow the online business. However, this shift will be financially difficult because the margins for the online business are near zero and it represents less than 3% of total business. As the market leaders, whatever Matas management chooses to do will inevitably affect its core "in-store" business. The company needs the cashflow from the in-store business to pay dividends to investors. In this situation, the new CEO sets out three priorities (i) reignite store growth, (ii) build new growth paths, and (iii) grow online. Investors are unhappy with this direction and the stock has sunk to an all-time low. The question is whether this new strategy will enable Matas to survive or transform?
Lex Machina, a legal analytics start-up, needed cash to drive its continued growth trajectory, and had an appealing Series B term sheet in hand. Founded initially as a joint public interest project between SLS and Stanford's computer science department, Lex Machina had spun off to create a language processing software and machine learning platform to glean insights from legal documents, to support decision making at each stage of the litigation process. Similar to other start-ups, Lex Machina's investors held preferred stock, its founders held common shares, and employees received options granting them the right to buy common shares. After an informal acquisition offer from Bloomberg, the Lex Machina board explored competing acquisition bids. LexisNexis, a longtime leader in the legal database field, emerged as the highest bidder. Should Lex Machina pursue the Series B - or was this the right time to consider acquisition offers? What would be the best option for the company's future - and for the existing stakeholders?
Financial restructuring for a distressed firm and its significant counterparties is the process of "recontracting." This involves significantly altering, replacing, or terminating key financial contracts for the purpose of rehabilitation. Most of these contracts, as of the date of such restructuring, typically relate to debt obligations with claim values that are known to the firm and to each of the counterparties who are involved in the restructuring process. This note examines the non-debt claims a distressed firm may face, specifically looking at (1) employee-related liabilities, such as those related to defined benefit pension obligations and retirement benefits; (2) tort-related claims, such as those related to litigation or environmental remediation; and (3) claims related to executory contracts, such as leases. The latter category is the most common, but it is also the easiest to resolve. In contrast, restructuring employee-related and tort-related claims is much more complex because the value of such claims may not be known at the time of the proposed restructuring. It is restructuring in these two areas, employee-related and tort-related claims, that are the subject of this note. The note contains three case examples for the purposes of class discussion.
The case tells the evolution of the call center transformation at Frontelco (a major telecom company in disguise). "Digital" and "agile" approaches to changing the way how call centers operate seem to produce different results. Debate between proponents of alternative approaches takes place across three levels of organizational hierarchy: the Managing Director seems to prefer "agile", those close to operations in VP ranks seem to prefer "digital", while three "managers in the middle" following each other in Senior Vice President rank seem to follow different strategies as to how to align the top and the bottom. To settle the debate, evidence-based clarity is being sought and the protagonist is tasked to design an appropriate performance measure to show the real impact of competing approaches.
The case tells the story of a project at Frontelco (a major telco company in disguise) aiming at defining and piloting a business model (Network as a Service, NaaS) in response to the advancement of a new technology (5G). It is written from the perspective of a "trusted advisor" who had been invited by the protagonist to provide methodological support to the project team. The team, which primarily represents the perspective of product management, spends significant time and effort on developing a methodical approach to their own work, leaving the substantive issue (business model innovation) to be defined only vaguely, under the dominant influence of a few team members. In the follow up to the case we learn that by the time concerns emerge that the team does not seem to have developed any presentable output, they find out that their key competitor has already made significant progress and the technology department, their "internal rival", has also moved ahead with a concept that allows them to claim ownership for a major corporate-level project.
The First Opium War (1839-1842) symbolized the peak of the era of European imperialism, with a political and cultural legacy that remains potent to this day. The British Empire, "acquired in a fit of absent-mindedness" as one observer famously claimed, seemed to be financially dependent on the sale of illegal narcotics to China, which had banned the trade. Nevertheless, London was willing to go to war to force China to import its opium, and superior British military technology made resistance unfeasible. Ever since, China's political leaders have seen this even as the beginning of their "Century of Humiliation," and China's political objective ever since has been to upend the political and economic order that made such a humiliation possible.
In the late 1920s and early 1930s when Joseph Stalin, leader of the world's first Communist state, sought to industrialize his largely peasant country on an unprecedented scale, he turned for help to those who had the most experience constructing on such a scale: American businessmen. The ultimate stated purpose of his industrialization program, however, was to end the capitalist system that those businessmen embodied. At the time, the Soviet Union was an international pariah, not recognized by Washington until 1933, surrounded by largely hostile states whose political systems Moscow was trying to subvert in a contest that both sides saw as existential. Despite this, it was American architects and engineers that gave the Soviets the advanced designs and technology they needed to build "socialism in one country," constructing the industrial base that would one day defeat Nazi Germany.
When Puneet Chhatwal took over as CEO of Taj Hotels in 2018, he faced an onerous task: improving the financials in a hyper-competitive environment marked by the arrival of foreigners such as Starwood Hotels and online entrants Airbnb and OYO. He perceived that the focus on employee empowerment and welfare (as the basis of service excellence) conflicted with the need to emphasize cost cutting to improve profitability. These inconsistences left managers and staff unsure of the overall strategy. In an attempt to resolve them, the hospitality veteran balanced a top-down drive for change with bottom-up involvement in the strategy-making process. Adept in recognizing and adjusting resource allocation to ensure the parent company IHCL achieved its goals, he delegated tasks to the leadership team and employees but kept them focused on the deliverables. With input from many managers across the organization, a new strategy emerged organically - Aspiration 2022 - that resonated with the entire staff. By late 2019, staff were reporting a stronger sense of direction in day-to-day operations. With this came increased profitability and stock performance in line with group targets. With the success of the turnaround, the CEO seemed set to pursue his strategic vision through 2022. Little did he know that the strategy-making processes he had put in place would be subjected to upheaval as a result of the imminent COVID-19 pandemic.
This case profiles the National Hockey League (NHL), the most prestigious professional hockey league in the world. It presents the league's history, highlighting facts inherent to professional sports in North America. It also examines the NHL's value proposition, sources of revenue, and major expenses. Finally, it looks at the strengths and weaknesses of the league's business model, speculating about the future.
In January 2021, the co-founder of Mystery Books Co. (Mystery Books) was evaluating the company's 2020 performance under the leadership of his daughter as the new chief executive officer. His daughter had ambitions of securing Walmart Inc. as a key client, so the co-founder had promised her an additional performance bonus of 5 per cent of his 30 per cent ownership of common stock if she grew the company's net income by 20 per cent over the previous year. Throughout his thirty years of managing the company as chief executive officer, the co-founder had maintained very conservative accounting policies, some of which had been modified under his daughter's management. After reviewing the 2020 financial information, the co-founder harboured several concerns: Should he have specified more conditions for his daughter's performance incentive? Would the accounting policy changes pass the scrutiny of the company's external auditors? And how should he proceed with regard to the suspicious sales activity he noticed? With these questions at the front of his mind, the co-founder of Mystery Books thought that perhaps he should have somehow left more reporting guidance for the company prior to leaving.
In August 2021, Singapore Airlines Group (SIA) was at a critical juncture in its history. Since early 2020, the COVID-19 pandemic had forced commercial travel to almost a standstill, requiring SIA to idle most of its fleet. The group's overall revenues had declined by 76 per cent in the 2020/21 financial year, resulting in a loss of S$4.27 billion. The massive cash bleed forced the group to issue new capital, thus diluting the stake of its existing shareholders. Although SIA's results had improved for the quarter ended June 30, 2021, the emergence of new virus variants and continued travel restrictions meant that the group needed to make critical decisions that would have implications for both its short-term survival and its long-term performance.
Stemina Lubricants (Stemina) was an automotive lubricant manufacturer in Udupi, Karnataka, India. All Stemina products were a blend of high-class base oil and imported branded additives. Stemina competed with leading brands-one that was strong in the market and at mechanics' locations, having leveraged its consumer brand equity and strong advertising support to win over mechanics and dealers, and another that had a strong presence in the forecourts of gas stations in India. Customers looking for oil changes at gas stations were likely to purchase these company brands rather than a local brand, and Stemina faced an uphill battle to establish itself in a market with such entrenched distribution. How could this small business, with few resources for branding and distribution, successfully establish itself in the market?
The owner of Physio2U, the largest provider of in-home physical rehabilitation services in Western Canada, was forced to rapidly transition to telehealth amid the growing threat of COVID-19 in early 2020. While the Physio2U team and its patients were pleasantly surprised by their success with telehealth, as vaccination rates increased and the threat of COVID-19 infection became less significant, she had some tough decisions to make. She wondered if telehealth was (a) just a temporary solution to survive the pandemic; or (b) an opportunity for her business going forward. Before she invested any more resources in telehealth, including marketing funds, the owner needed to make sure she had both a strong business case and a comprehensive strategy for offering telehealth post-pandemic.
Data preparation is a necessary pre-processing step in analytics. It aims to clean the data from various resources and improve its quality for better productivity. This process includes many tasks such as fusion, cleaning, and augmentation of data. This teaching note will focus on illustrating data cleaning using the programming language Python, with all codes completed in Google Laboratory. Different solutions using the programming languages R and Microsoft Excel are also provided. To effectively illustrate the data preparation process, the relatively simple dataset Bengaluru House Prices is used. This is a relatively messy dataset with a few variables and many records, making it ideal for explaining data preparation steps.
In January 2021, Entomo Farms (Entomo), a family-owned Ontario-based Canadian cricket producer, received additional funding to support its growth and prepare for the entry into Canada of what would be its biggest competitor. As Canada’s largest and only organic cricket supplier, Entomo generated most of its revenue as a supplier of crickets as raw material to food manufacturers; however, due to anticipated industry changes, Entomo was increasing its consumer-level presence by producing and selling more of its own brands as consumer packaged goods (CPGs). To support this decision, Entomo’s chief operating officer needed to develop a strategic marketing road map for growing the revenues from the company’s CPG segment.