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Examines Southland's financial difficulties following the LBO in 1987 up to the first restructuring plan in July 1990. The teaching objectives are: to explore the complexities of a failed leverage buyout and the operating restrictions that result from financial distress, to recognize that financing decisions can restrict future flexibility, to examine the dynamics of a restructuring with particular focus on the role of new equity, and the payoffs received by pre-existing claimholders, and to explain the complexity of accomplishing a restructuring outside of bankruptcy.

Describes McCaw Cellular Communications, Inc.'s competitive position in 1990. McCaw is the largest cellular phone service company in the United States. It faces challenges of technological change and formulating strategy in an industry with a highly uncertain future. Focuses on a strategic investment in one of two new technologies for switches. Raises the general question of how one chooses among two uncertain technologies. The tension arises from potential first-mover advantages, from network effects of the currently available technology, and the promise of a superior technology soon to be available.

Examines the Thompson's $4.9 billion leveraged buyout of the Southland Corp. in 1987. As the original founders of Southland, the Thompsons were concerned about losing control over the company upon learning of the Belzberg family's acquiring interest. The teaching objectives are: to explore the characteristics of an LBO candidate, to examine the dynamics of the corporate control process when insiders are substantial stockholders, and therefore serve as both buyer and seller, and to evaluate the cash flow forecasts in an LBO and use them to analyze bidding behavior.

This case focuses on the development of AZT, the first drug approved for the treatment of AIDS, and the issues faced by its U.K. producer, Wellcome PLC, as it decides how to set the drug's price. The case includes brief overviews of the disease itself, drugs in development to treat it, the pharmaceutical industry and its practices, and the history of Wellcome PLC and its U.S. subsidiary, Burroughs Wellcome. The A case concludes with analysts' predictions for the soon-to-be-announced price of AZT. See also the B case and the C case.

This note traces the evolution and broadening of Goldratt's thinking from his OPT finite-scheduling software to his theory of constraints. The note discusses the bottleneck thinking that Goldratt presented in his novel, The Goal, and his book, The Race.

Harnischfeger, the market-share leader, is facing increasing competition in the portal crane industry. The key question facing the company is how to respond to the competitive threat without undermining the attractiveness of the industry. The case discusses a number of ways in which Harnischfeger can try to regain market-share without embarking on a price war.

Managers often ignore uncertainty and plan as if the world were certain. Frequently, strategy is formulated based on an extrapolation of current trends into the future, or the best guess scenario of the manager involved. This note discusses four approaches to shaping the firm's response to uncertainty. The first half discusses using scenario analysis to better understand how the future may evolve. The second half discusses how to use this understanding in formulating a strategic response to uncertainty. Discusses bets, "robust" choices, choices of timing, and "changing the rules."

The consumer-products division of a multinational company is facing a decision on the sourcing of product components: whether to stay in Taiwan or switch to Mexico. See also the supplement to this case, "Cost Analysis for Sourcing Alternatives for Emerson Electric Company ACP Division" (OM-0823).

This note serves as an introduction to the topic of inventory management. It covers ways to categorize inventories in measuring inventory performance, the financial implications of inventory, inventory-management systems, economic order quantities, decision rules for determining safety stocks, and the effect of multiple stocking points on average inventory.

This note reports the results of a study of 10 U.S. and Japanese companies with regard to their purchasing practices and vendor/buyer relationships. Particular attention is given to just-in-time practices in the purchasing area.

The plant manager of the Edgcomb Metals facility at Troy, Virginia is confronted with complaints that the current driver wage system-a guaranteed eight-hour day with time and a half for overtime-rewards drivers who "take their time" on daily assigned delivery routes. To investigate these claims, the plant manager compiles data on total hours, number of miles, and number of stops for several delivery runs made by each of two drivers-one recognized as the best and most conscientious, and the other recognized as the slowest. A supplemental handout (OM-0576) contains the results of a regression analysis of the data to facilitate a comparison of the two drivers and to suggest a method for developing standard times. (The B case is OM-0562, and the C case is OM-0571.)

Supplement for UV3331

Spreadsheet Supplement for case 291027.

Describes the pet food industry in the mid-eighties prior to the breakout of a major competitive battle as manufacturers fight for share. Illustrates how when there are benefits to play in multiple markets, competitors will take action in one market to preserve their position in other markets. An example of multimarket competitive interaction. Covers competitor analysis and prediction, and economies of scope.

Describes the contest for the takeover of Anderson Clayton as industry players compete for one of the seven major dog food makers.

Describes significant developments in the pet food industry in 1987 and 1988, focusing on the competitive interactions among the industry's major players.

Describes important developments in the pet food industry in 1989, 1990, and 1991, focusing on competitive dynamics among the industry's major players.

Having acquired a 26% stake in Koito Manufacturing, a Japanese automotive parts supplier in the Toyota Group, T. Boone Pickens seeks a seat on Koito's board of directors. Koito's management resists, claiming Pickens is an unhelpful greenmailer, not a true long-term investor. The struggle between the two provides students with a chance to compare and contrast American and Japanese corporate governance practices. Debate centers on whether the Japanese system fosters efficiency or merely market power that reduces economic welfare.

This case discusses the so-called sophomore jinx: professional athletes who perform superbly as rookies never seem to do as well in their second--sophomore--season. The case gives performance data for Rookie of the Year award winners in major-league baseball through 2003 (29 pitchers and 83 nonpitchers). Data cover both the first and second years. Students must decide for themselves, based on the data, whether the sophomore jinx is real or imagined.

Supplement for case UV6133