Vista Outdoor Inc. was a publicly traded company that competed in both Shooting Sports markets (e.g., firearms and ammunition) and Outdoor Products markets (e.g., hydration systems, sports helmets). Weak performance resulted in the initiation of a comprehensive strategic review of the company's business portfolio in November of 2017. This review was ongoing in February of 2018 when a 19-year-old former student entered Marjory Stoneman Douglas High School in Parkland, Florida with a semi-automatic AR-15 style rifle and killed 14 students and three educators. Surviving students at the school rallied the nation and asked for more action to prevent gun violence. On March 1, in response to customer petitions, both Recreational Equipment Inc. (REI) and Mountain Equipment Co-op (MEC) announced they would stop ordering and stocking Vista Outdoor brands like CamelBak and Bell because the company also manufactured guns (including semi-automatic, AR-15 style rifles similar to the one used in the Parkland shooting) and because they didn't believe that Vista Outdoor was doing enough to advance the national conversation on responsible gun ownership. As the case concludes, students are put in the shoes of Vista Outdoor CEO Chris Metz who must decide how to respond to the actions taken by its retailers and whether the current national debate about guns and gun control should be factored into the ongoing strategic review of the company's business portfolio.
Zorbas Bakeries Case presents a decision situation. The case setting is Nicosia (Cyprus, EU), December 2014. Zorbas Bakeries, a large family-owned Cypriot company, was considering a bold new initiative - opening a new concept store abroad, in New York. Moreover, it wasn't just about opening one shop, but the shop that would be used as the pattern for all future international franchise stores. Such a project would be most unorthodox for a local family-owned company and would involve multiple risks. The managing director of the company Demetris Zorbas took up the responsibility for this project in early 2014. He had to finalize the plan before the decision by the management team at the end of 2014. "Are we fully ready to go to New York? Will we be able to compete in this difficult market? What are the projected financials for the new 'test case' store? Will this project add value?" The case requires students to do first a standard NPV analysis, and then presents an opportunity to introduce students, in a relatively easy way, to the rather complex but increasingly important concept of 'real options' in finance, an extension of the traditional DCF analysis. Students who are aware of the limitations of the standard NPV model, and can identify and understand real options, become ultimately more sophisticated users of the traditional DCF analysis and are ultimately able to make better investment decisions. The case also emphasizes that a financial analysis is an important determinant of the future strategy, although clearly not the only determinant. It is crucial for students to understand the strong link between finance and strategy.
"Arizona Medical Doctors" (disguised) seeks a cost-effective solution to improve its medical claims coding quality. The new Vice President of Revenue Cycle Management learns that a contract was signed with a software firm to develop and implement, for the first time, an artificial intelligence (AI) solution that will combine natural language interpretation and machine learning for Evaluation & Management (E&M) medical coding. If it works, the new system will improve E&M coding quality at a very low cost compared with the company's current human quality control process. The VP needs to decide whether to go forward and if so, how to mitigate the significant project and business risks. The case introduces students to two branches of artificial intelligence: natural language interpretation (newer, riskier technology than speech recognition) and machine learning. Students are challenged to recognize the relationship between IT project risks and business risks, spot high-level IT project risks and consider how to mitigate them, and to consider implications for managing rapidly-evolving emerging technologies in health care and other contexts.
This research-based case uses the circumstances surrounding Virginia-based Smithfield Foods' (Smithfield's) buyout offers from multiple foreign firms to examine the political and cultural constraints of a regionally rooted global firm in pursuing its strategic objectives. Smithfield's senior leadership receives offers from three firms, ShuangHui International (ShuangHui), JBS S.A. (JBS), and Charoen Pokphand Foods (CPF), based in China, Brazil, and Thailand, respectively, to acquire all of Smithfield's outstanding assets and liabilities. Smithfield's history was one of aggressive growth through acquisition, skirting government regulations, and truculence with respect to labor and environmental activists. However, as revenues plateaued, the firm faced increasing investor pressure to either trim costs or sell off portions of the company to improve shareholder value. Though the company's operations crossed continents, its identity and brand were tied to southeastern Virginia. Would it be best for the company or its shareholders to sell? If so, to whom? What risks would the firm face, politically and culturally, if it decided to do so? Because of its many details, the instructor teaching this case can approach the content from a number of strategic or leadership perspectives.
FODY Foods Inc. (Fody) was a Canadian-based entrepreneurial manufacturer and marketer of a line of food products designed for people suffering from irritable bowel syndrome (IBS), a condition that affected an estimated one billion people worldwide. With public awareness of the socially sensitive condition growing, Fody’s founder needed to figure out how to market the company’s line of products while creating a new category in the process.
PERTH, AUSTRALIA, September 2016. Torsten Ketelsen's history, for the last 30 years, had been deeply intertwined with that of garnet, the hardest industrial sand. He very much created a market for it, then brought GMA Garnet to a market leader position with a 40 per cent global market share. GMA Garnet's success was based on the exceptional quality of the product and on the company's complete control over the whole production and distribution cycle, from mining to processing, logistics, shipping and distribution to the final user world-wide as well as reprocessing and recycling. The industrial success story also benefited from the support of its controlling shareholder, Jebsen & Jessen Family Enterprise, a true master of entrepreneurial partnerships. But how did the Jebsen & Jessen Family Enterprise's overarching legacy, values, governance, business model and growth strategy contributed to the success of GMA Garnet? How will this relationship support or hamper the ambitious goals set for the company's future? What were the implications of the family firms' commitment to environmental mining practices and a circular economy in that context?
In 2016 Niraj Shah and Steve Conine, founders of online home goods retailer Wayfair, are faced with a decision about how to improve user experience on their e-commerce sites. A key driver of consumer interest and conversion to purchase in the home category is visual imagery, which has traditionally been generated not by the retail channel rather than by manufacturers. Catalog retailers, in particular, are famous for visually romancing the category. As a comprehensive offering, Wayfair hosts over seven million SKUs on its site, so it must solve for the lack of visual assets from manufacturers by generating visual assets of its own. Initially, the company embarks on a plan to produce these images using traditional photography studios and professional staffs, but costs mount and throughput is too slow. Seeking a solution, Shah and Conine assess the likelihood of using technology - specifically, high-resolution 3D modeling from low-resolution 2D images - to address the challenge. Resolving this issue is especially pressing, given that Wayfair has just launched private label lines and a host of what it calls lifestyle brands, which require support from high-end visual merchandising. As a consequence, the question of how to provision visual assets becomes a question of how fast Wayfair can grow. This case presents the factors involved in deciding what direction to take - a reliable path using traditional methods or a risky path using bleeding-edge technologies.
Raksul, 2018 Forbes Japan "Startup of the Year," ran an e-commerce platform drawing upon thousands of individual suppliers. Launched as a business-to-business printing services marketplace, Raksul had recently expanded to operate both a logistics/delivery marketplace and a television advertising marketplace. Each marketplace faces its own growth challenges; at the same time, the CEO must consider whether and how each marketplace can enhance the others.
This case examines the scale-up of the startup Eureka.com, an online customized gift shop. Started by a female entrepreneur in Turkey, Eureka has been the platform for providing customized gifts to individual buyers, offering professional marketing products for corporate clients, and serving designers and artists to market their creations. The case examines Eureka's financial and market position. It describes the application of managerial accounting and operations management, analyzes the performance of a startup, and investigates the necessary financial and operational decisions that the startup will have to make to scale up. This case is designed to be used in either managerial accounting or operations management courses related to entrepreneurial ventures. It contains topics important to both disciplines: contribution margin, return on invested capital, operations planning and inventory management, and performance management. The case provides an opportunity to focus solely on topics of concern to one of the specific courses or to integrate materials from both.
In 2018, Tesla Inc. was one of the highest-valued automobile companies in the United States-despite never reporting profits. Although Elon Musk, the founder and chief executive officer of Tesla Inc., was appreciated for his vision, learning capabilities, active presence on social media, and dedication, he was also criticized for his leadership style and controversial tweets regarding the privatization of the company. Analysts and short sellers believed Musk's narrative ability had caused Tesla Inc. to become overvalued and suspected that the company was actually on the verge of bankruptcy. Did Musk's leadership do more harm than good? Would he be able to save Tesla Inc.?
In January 2018, a senior manager at Labatt Breweries of Canada, headquartered in Toronto, was thinking of how to launch an influencer strategy for the Budweiser brand in Canada. The manager needed a strategy to connect with a group of influential bloggers and other influencers in Canada. These influencers' opinions affected the way different brands were viewed. Getting the influencers on-side would require finesse as Budweiser was typically seen as different from the new, popular craft-brew brands. Budweiser was the leading beer brand in Canada. It needed to be more relevant to the 18-24 target group, a group that the brand had struggled to reach despite allocating significant marketing dollars to promote its product. The senior manager, who was looking into implementing an influencer marketing campaign, realized that she needed to do some planning regarding how to take into account influencers' views and preferences.
In 2018, Game of Thrones, a widely popular television series, had inspired a significant increase in tourism to one of its filming locations: Dubrovnik, Croatia. The economy in Croatia, in general, and Dubrovnik, in particular, relied significantly on tourism. However, the popularity of the television series had led to overwhelming tourist traffic in the area. During the peak tourist season, the city now suffered from serious overcrowding. In addition, the city was at risk of losing its status as a UNESCO World Heritage Site. In response, the city had begun to engage in demarketing efforts. Would these efforts be successful in both managing the high demand for tourism in the area and creating a sustainable tourism industry?
The manager of Water Operations at the City of London wanted to reduce the cost of pumping water by optimizing energy use. Water Operations had been consistently experiencing higher operational costs, and electricity bills accounted for up to 30 per cent of its direct costs. If the manager could predict the future cost of energy, she could schedule the operation of the water pumps to benefit from periods of low energy prices, potentially saving up to 25 per cent of the energy costs. The manager obtained the hourly Ontario electricity prices from 2003 to 2015, and wanted to use that data to evaluate how accurately she could predict future electricity prices. How should she proceed?
In late September 2014, students in the Arnold School of Business (Arnold) full-time MBA program wrote an open-book managerial accounting exam. Immediately after the exam, one of the students, who was also vice-president academic of the Graduate Business Students Association (GBSA), was informed by a classmate that some students accessed the Internet for solutions during the exam. The GBSA representative knew she had to do something but was unsure how to proceed. In part A of the case, the student representative consulted with her colleague, the GBSA president. The two considered four potential courses of action: (1) do nothing; (2) bring the issue to the entire GBSA council; (3) inform the course instructor; or (4) speak directly to the academic chair of the MBA program. In part B of the case, the two student representatives speak with the academic chair, who explained that without any hard evidence of academic dishonesty, little could be done. The academic chair and GBSA representatives must decide how to resolve the issue when any solution is likely to disappoint some students and cause division, and possibly enmity, among classmates who are just one month into their MBA.
In 2018, Game of Thrones, a widely popular television series, had inspired a significant increase in tourism to one of its filming locations: Dubrovnik, Croatia. The economy in Croatia, in general, and Dubrovnik, in particular, relied significantly on tourism. However, the popularity of the television series had led to overwhelming tourist traffic in the area. During the peak tourist season, the city now suffered from serious overcrowding. In addition, the city was at risk of losing its status as a UNESCO World Heritage Site. In response, the city had begun to engage in demarketing efforts. Would these efforts be successful in both managing the high demand for tourism in the area and creating a sustainable tourism industry?