This note identifies the key issues that must be addressed in the creation of a viable venture, and provides an overview of the processes and techniques available to resolve the issues discussed.
As founders of First Interstate BancSystem, which held $8.6 billion in assets and had recently become a public company, and Padlock Ranch, which had over 11,000 head of cattle, the Scott family had to think carefully about business and family governance. Now entering its fifth generation, the family had over 80 shareholders across the US. In early 2016, the nine-member Scott Family Council (FC) and other family and business leaders considered the effectiveness of the Family Governance Leadership Development Initiative launched two years earlier. The initiative's aim was to ensure a pipeline of capable family leaders for the business boards, two foundation boards, and FC. Seven family members had self-nominated for governance roles in mid-2015. As part of the development initiative, each was undergoing a leadership development process that included rigorous assessment and creation of a comprehensive development plan. As the nominees made their way through the process and other family members considered nominating themselves for future development, questions remained around several interrelated areas, including how to foster family engagement with governance roles while guarding against damaging competition among members; how to manage possible conflicts of interest around dual employee and governance roles; and how to extend the development process to governance for the foundations and FC. The FC considered how best to answer these and other questions, and whether the answers indicated the need to modify the fledgling initiative. This case illustrates the challenges multigenerational family-owned enterprises face in developing governance leaders within the family. It serves as a good example of governance for a large group of cousins within a multienterprise portfolio. Students can learn and apply insights from this valuable illustration of family values, vision, and mission statement.
Insigne Health is a fictional for-profit, integrated health insurer/health care provider whose leadership believes that by shifting members' focus from "sickness" to "well-being" it could increase the overall health of its insured population and decrease the resources it spent each year on delivering care. The case puts students in the role of design researcher charged with understanding the member segment about which Insigne Health leadership is most concerned: The "silent middle." This cohort represents 70% of membership. They are "neither sick nor well," and may, without changes in a range of behaviors, be quietly developing conditions that will evolve into costly chronic diseases. From interviews included in the case, students uncover insights into member behavior and, based on these insights, generate and develop concepts to help members change behaviors and lead healthier lives.
Since its founding in 2011, Art With Impact (AWI) had one precise goal—to enable young people in Canada and the United States to talk about mental health issues through art and media. The foundation enjoyed great success. However, like many other charities and non-profit organizations, AWI was struggling with the challenge of raising adequate funding. In 2017, AWI was looking ahead and wanted to design a sophisticated social media to attract numerous smaller donors. Was there an ideal strategy to achieve high levels of funding and high numbers of donors? Or would it be best to focus solely on raising the number of donors to build a database, collect data, and refine a strategy to collect more funding from AWI’s donors in the future?
It was July 2017 when the co-founders of Fitpass Business Ventures Private Ltd. (Fitpass), an online platform providing passes to fitness establishments in the Delhi–National Capital Region, were reflecting on the need for continuous innovation to stay relevant to their users. Launched in June 2015, the company intended to satisfy the unmet market need for flexible workout options at an affordable price for fitness-conscious Indian youth. The company’s application, FITPASS, had been downloaded 100,000 times, and the company had gained 60,000 registered users and created a partner network of 1,500 fitness establishments in the region. Generating 100 per cent growth in month-on-month revenue, the company was among the leading platforms in this region. However, the online marketplace was becoming crowded with look-alike competitors, and the founders faced some tough questions: How could the company sustain its position in the current market? Was the company ready to move into other similar markets using the current business model and innovative capabilities?
Paytm Payments Bank Limited (Paytm) was the leading firm in the digital wallet (also known as the “mobile wallet” or “e-wallet”) industry in India; yet, the company had reported a loss of more than INR15,485 million for fiscal year 2016. Paytm’s resources were stretched further when, on May 23, 2017, it started its long-awaited payments bank operation. There were also doubts about the viability and sustainability of the online payments industry in general as a result of; India’s demonetization exercise in 2016; the introduction of the uniform Goods and Services Tax in 2017; and a general slowdown in the economy’s growth rate. In the highly competitive and crowded banking sector, how could Paytm survive, grow, and achieve continued success in this complex business landscape?
In 2015, nine black Americans were killed in a racially motivated shooting spree. The incident fuelled ongoing racial tensions in the United States and launched a conflict over the presence of Confederate memorials in public spaces. When the push to remove Confederate memorials began, the task for Mitch Landrieu, the mayor of New Orleans, was to deal with the city's notable Confederate monuments and the conflict they engendered in a city divided along racial lines demographically, economically, and historically. On May 19, 2017, Landrieu addressed the public. Students have the opportunity to evaluate the speech, consider why Landrieu chose this occasion to address the public, and determine what the speech reveals about his leadership character.
When Luca Garavoglia became chairman of the Campari Group at the age of 23 following the death of his father, he immediately adopted a strategy of fast growth through acquisitions. Over the next 24 years, Campari acquired 26 companies, spending over €3 billion and establishing its own distribution network in 20 countries. This two-part case series describes how Campari transformed from a single-brand local Italian company to an important player in the global spirits industry with over 50 premium brands distributed in over 190 countries. CASE A follows Campari on its journey from 1994 to 2018, providing an overview of its history, business strategy, market place, trends and competitive landscape. learning objective: The case describes the successful transformation and survival of Campari as a small player among "giants" in a niche sector of the spirits industry. It can be used for class discussion on different business and social topics, such as: 1)Business strategy (SWOT, Porter's 5-forces); 2) Globalization (from local to global); 3) Growth through M&As (value creation, synergies); 4) Family-owned businesses (conflict of interest, strategic fit); 5) Marketing strategy (market trends, ethical role of marketeers).
At the age of 23, Luca Garavoglia became chairman of the Campari Group following the sudden death of his father two years earlier in 1992. From the start, Luca adopted a strategy of fast growth through acquisitions and over the next 24 years, Campari acquired 26 other companies, spending a total of over €3 billion and establishing its own distribution network in 20 countries. This two-part case series describes how Campari transformed from a single-brand local Italian company to an important player in the global spirits industry with over 50 premium brands distributed in over 190 countries around the world. CASE B starts with the announcement of a friendly tender offer by Campari for Grand Marnier in March 2016. This was the largest acquisition in the 156 years of Campari's existence and also one of its most complex ones. It took Campari over 18 months to arrive at this point and it had to wait another month to find out how this offer would be received by the shareholders of Grand Marnier and Campari. Calculating the offer price was Campari's biggest challenge. With no business plan, and no equity research financial forecasts available, it had to make its own projections based on its business knowledge of the spirits industry.
The Relax case traces the history of a massage services company from its founding in 2007 to mid-2017, when it is considering the best strategy for growth and an acquisition. The company's owner and top managers wonder how the firm should reorganize to cope with the challenges posed by the company's transformation from a small, independent operation to a professionally managed enterprise. This case illustrates the challenges of preparing for rapid growth. It covers issues of internal management and organization, as well as brand management decisions. Relax can be used in an entrepreneurial management or small business course. Because of the emphasis the company places on its brand, it may also be applicable for some marketing or brand management classes.
In the summer of 2017, after completing his third year of business school, a student was eager to apply his newly developed business and technology skill sets at his father’s company during his four-month summer position. His father’s business, Custom Closet Contractors, designed and manufactured custom home organization solutions for home builders and individual clients. In the past year, the successful company’s sales growth had slowed, while expenses as a percentage of sales had increased. The company had experienced operational problems leading to higher expenses, and the student had found that part of the problem was the lack of data organization, which led to miscommunication between the front office and the production staff. To solve the problem, he proposed to design a centralized database and set to work trying to understand the business processes in order to design a data model.
In September 2015, Bartos Stainless Limited, an Indian steel-producing company that emerged as a strong brand in the mid-2000s, was facing a series of internal and external challenges: challenges from frequent changes at the chief-executive-officer level, fluctuating metal prices, the global slowdown of the steel industry, increasing competition from imports, and diminished investor confidence. The managing director needed to address these challenges and manage the risks of his business model, while maintaining profits.
In 2013, two entrepreneurs founded Magic Markers, a whiteboard animation company in Bogotá, Colombia, with the mission of gracefully explaining complex issues to interested audiences. The (A) case describes how the company experienced unanticipated growth after one of its videos went viral. The two founders faced several challenges and needed to quickly learn how to manage their growing business. Human resources issues proved to be particularly trying and difficult to manage. In late 2017, an investor presented Magic Markers with an investment offer, which the owners needed to evaluate carefully. The (B) case focuses on social media reactions to content posted by the company.
Beginning in fiscal year 2018, a new and relatively unnoticed accounting rule took effect that had the potential for a major impact on the reported earnings of companies holding financial assets or owing financial liabilities. Dubbed the Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities, or Accounting Standards Update 2016-01 (ASU 2016-01), the updated rule sought to increase financial reporting transparency and relevancy by changing how companies accounted for equity. Specifically, the update required recognition of changes in fair value in net income and affected the presentation and disclosure requirements for financial instruments. Entities across a broad range of industries were significantly impacted-specifically; companies holding minority passive stakes in other entities that had to be valued quarterly, whether that value had increased or decreased. This inherent volatility then flowed through a company's income statement, causing fluctuations in earnings per share, and calling into question the relevance of reported net income. This case describes the updated standards for equity investments under FASB's ASU 2016-01 and IASB's IFRS 9 and their impact on Alphabet Inc. By providing viewpoints from preparers, investors, and standard setters, the case allows students to appreciate the trade-offs of the different accounting methods for asset valuation.