個案總覽

Designed as a class hand-out after discussion of the (A), (B), and (C) cases.

A study of a number of companies employing some form of matrix reveals nine pathologies to which the matrix design is particularly vulnerable, along with prevention and treatment methods. Often there is a mistaken belief that matrix management is the same as group decision making, and there are tendencies toward anarchy and power struggles. The layering of a matrix can frequently result from the dynamics of power rather than from the logic of design, and there is a tendency for matrixes to sink to group and division levels.

Traditional achievement and objective-achievement compensation systems either fail to account fairly for sales territories which have different potentials, or induce salesmen to provide the company with low forecasts in order to meet their quotas. The objective-forecast-actual (OFA) system is a combination of three measurements: the company objective, the forecast of the salesman, and the actual results the salesman achieves. It is an approach that accounts for unequal territories and makes good forecasting possible by rewarding a salesman according to how close his forecasts and actual results are to the company's objective. The system brings about sales volume, payment for performance, and good field information for company planning.

Studies show the positive correlation between profitability and market share. Yet, businesses with low market shares may not be at a disadvantage and can profit by exploiting their smallness. Low market share businesses must replace broad strategy with specific and far-ranging strategy. Burroughs, Crown Cork & Seal, and Union Camp all hold small shares of their industries, yet they compete with the largest corporations in their average returns on equity. Their strategy involves four major points outlined here.

Abrasive personalities frequently prevent young, high-powered, and capable executives from gaining top positions in companies. A profile of the problem personality reveals a generally intelligent, analytical, hard worker who exhibits impatience with others and reluctance to delegate assignments. These highly competent people become key to the organization yet their political insensitivity makes them unpromotable. They tend to overorganize and oversupervise and often demoralize their subordinates. Their problems must be approached in a forthright manner.

A survey of Fortune "1000" companies shows that many companies deal with the problem of soaring interest rates by establishing investment centers and using return on investment (ROI) to measure their performance. Profit centers measure their own profitability with net income, pretax income, or net contribution. Investment centers determine profitability in relation to the unit's own investment base. Many companies use both ROI and RI (residual income) to calculate performance. The worst problem in using ROI or RI is that they will increase solely with time as depreciation reduces the investment base. The last calculation is to determine ROI budgets for investment centers.

Illustrates uses of various sources of market and consumer behavior data, including psychographics, product positioning, and market segmentation decisions for a new dog food product. Based on cases by E.T. Popper and L.S. Ward.

Provides the background on Cumberland Metal Industries' entry into the automotive components market as a supplier of emission control equipment parts. Cumberland Metal must decide what bid to quote on Beta Motor's 1978 model year business. The company previously had a three-year contract for 100% of Beta's business, but it is now faced with a competitive situation in which a small market share, yet one greater than 50%, is a virtual certainty.

SMIG, a division of G.D. Searle, was a fast growing high market-share company in the field of nuclear medical instruments. It manufactured two basically different product lines, one very successful and the other less so. Although marketing was separate for these product lines, manufacturing was not. As capacity is reached, the issue is how the company ought to expand and/or alter its manufacturing operations.

Involves a $550 million cash tender offer by Kennecott Copper Corp. for all of the outstanding common shares of the Carborundum Corp.

An in-depth study of Japanese-managed companies in the United States and Japan reveals that when technology and governmental factors are equal, the Japanese companies' U.S. subsidiaries do not outperform their American counterparts. Also, contrary to conventional belief, American managers use a participative decision-making style as often as Japanese managers do. Japanese executives use ambiguity as a managerial tool. Ambiguity is a useful concept in thinking about how individuals relate to each other, orally and in writing. It provides a way of legitimizing the loose rein that a manager permits in certain organizational situations. McKinsey Award Winner.

General managers can assess the strategic merit of potentially radical technical innovation by evaluating the two key determinants of innovation success: technology potency and business advantage. This framework uses four considerations as its criteria: inventive merit, embodiment merit, operational merit, and market merit. Development of transistorized semiconductors, and turbine engines used in supersonic jets are examples that illustrate application of the strategic assessment framework.

Reaction of a recent MBA to the climate, motivational systems, and management practices of the Lincoln Electric Company.

An administrator of a neighborhood health center is considering changing his cost accounting system from a single cost per visit to a cost per visit for each department in the center. Used to illustrate several issues related to cost accounting in health care: decisions on cost objectives and cost centers; overhead allocation mechanisms; the distinction between service and production cost centers; and others. Requires preparation of a simple step-down.

Spreadsheet Supplement for case 178189.

Describes the history and evolution of the log home manufacturing industry, a rapidly growing embryonic industry capitalizing on the back-to-basics lifestyle changes in the United States. Focuses on one of the leading firms in the industry, but allows a discussion of several of the other industry leaders as well. Designed for use in a two-day series on the analysis of strategic problems in an embryonic industry. What are the characteristic strategic issues in these types of industry environments? How do we anticipate and predict industry changes that will occur? How should an industry leader respond to the environment?

Supplements the (A) case.

Supplements the (A) case.

Supplements the (A) case.

Supplements the (A) case.