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Fraudulent behaviour in corporations is much more common than you might think. Indeed, the stories covered in the media are just the tip of the iceberg. The author, a Chair in Finance at the University of Toronto, shares findings from his research, which found that two out of three instances of fraud likely goes undetected. His analysis of the demise of Arthur Anderson indicates that prior to the 2002 implementation of Sarbanes Oxley (SOX), 41per cent of large public firms were misreporting their financial accounts in a material way and 10 per cent were committing securities fraud, imposing an annual cost of $254 billion on investors. He concludes that, if SOX reduced the likelihood of undertaking fraud by even 10 per cent, its high cost - estimated at $3.8 million per firm, on average - would be fully justified.

Whether you've heard the term or not, chances are you've already formed many of your own 'management operating principles'- the guidelines you use to make decisions and get things done from day to day. Understanding how these 'guardrails' influence your work can make you a better leader, says the author, who spent 10 years as a senior executive at Google. She shares her own four operating principles and how she formed them. In the end, she says that it is the combination of your team environment and the team's execution skill that will produce great results. But for that to happen, you need to operate within a consistent framework of core principles.

Every organization can-and should-generate more revenue from its data than it invests in producing and managing it. Yet the idea of turning data into money is often associated with sneaky tactics or 'going too far' with unacceptable privacy violations. As a result, some organizations, especially non-commercial ones, have very little appetite for the term 'data monetization.' The authors say it's time to embrace the concept. They present three approaches to monetizing data: Selling, which entails the exchange of data for money; Improving, which uses data to create efficiencies for cheaper or faster operations; and Wrapping, which uses data to enhance products such that customers want to buy more. In the end they show that, if you will limit what you view as data monetization opportunities, you leave money on the table. Often, a lot of money.

Did you know that waves, tides and currents in bodies of water could provide more reliable sources of energy than either wind or solar? Or that volcanic sand and genetically-edited crops could be significant natural carbon-capture and storage opportunities? Of course, such tech trends on their own cannot predict the future. But by understanding the changes shaping the technology landscape, leaders can make informed decisions and capitalize on new opportunities. The author, who heads up the Future Today Institute, shares three key categories of trends from the Institute's annual Tech Trends Report: Financial Services, Artificial Intelligence and Climate, Green Tech & Energy.

In the realm of cybersecurity, an important concept for every leader to understand is that of Digital Crown Jewels ('DCJs'). These are your organization's most precious digital assets, consisting of the data you possess, process, and pass on that allows you to deliver on your strategy. This might include customer records, purchasing histories, employee records, finances and intellectual property information about proprietary products and services. DCJs also include an organization's data processing environment (DPE): how data flows through the organization and the processes by which the firm and its agents access and manipulate data. The challenge is this: the list of actors who pose a threat to the integrity of a firm's DPE is long and growing. The authors provide guidelines for protecting your DCJs in three categories: preventable risks, strategic risks and external risks. They end with a warning: act now, because the potential cost of failing to act is far too great.

Economic downturns are frightening. Consumers curb spending, companies cut costs, and we all wait anxiously for the economy to recover. In such a climate, launching a product-an expensive and uncertain endeavor in the best of times-would seem to make little sense. But a new study finds that products launched during recessions outperform on several important measures. Even though people tend to limit spending during downturns, the timing may confer, for several reasons: There is less noise in the marketplace, making it easier to differentiate products and draw consumers' attention; the cost of running ads is often lower; and going ahead with new products in the midst of a weak economy is often perceived as a signal of corporate health. This article outlines other key insights from the research and offers guidance on how best to time product launches.

New research looked at the extent to which the employees of a fashion retailer followed the stocking recommendations of two algorithms: one whose workings were easy to understand and one that was indecipherable. Surprisingly, they accepted the guidance of the uninterpretable algorithm more often.

Transport Solutions was a global travel services company with headquarters in the United Kingdom (UK). It had a matrix organization design with 5 lines of businesses (LOBs or verticals) supported by 5 different business units (BUs or horizontals). However, with the entry of smaller and Agile new players in the market around 2015, Transport Solutions started experiencing challenges. The organization followed a 'waterfall' model of software development with teams from different BUs contributing to the development in a systematic stage-by-stage process. This helped ensure high quality products and services. However, the downside was that the minimum time to market (cycle time from concept to reality) was 26 to 33 weeks depending on the complexity of the product. Everyone was busy doing the work as expeditiously as possible and there was no reason to believe that the cycle time could be reduced further. The case focuses on the transformation of Transport Solutions from a siloed organization to an Agile organization, and the assistance provided by TCS in facilitating the transition. It describes some challenges faced during the transition and the interventions by the management of Transport Solutions and TCS to address those challenges to successfully implement Agile.

ELGi transformed from a small family-run manufacturer of compressors and pumps to a global player through multiple initiatives based on improving the quality of their product and the productivity of their workforce over two decades. They adopted an innovative approach to improve their blue-collar workforce's lifestyle and income levels, linked to worker upskilling, increasing job autonomy, and a radical approach to wage agreement. Previously, wage negotiations for ELGi workers were unpredictable and without a clear structure. The process took time and was ad hoc. Dr. Jay, the promoter family member, did not subscribe to the traditional approach of keeping labor wages low and benefiting from the wage arbitrage followed by global subsidiaries in India and other Indian manufacturing companies. He wanted Indian workers to earn competitive wages, almost equal to what blue-collar workers in the West make and become globally competitive. Hence, a "basket of goods" approach to wage fixing was introduced in 1996 to ensure a good lifestyle for workers and their families. This approach linked consumption to compensation and was determined based on the needs of a family of four. Moreover, the company acknowledged the importance of enhancing worker motivation in order to remain competitive on a global scale. By defining a basket of goods as "must have" and "good to have", which was collaboratively developed between the workers, their families, and the management, they periodically expanded the basket items over multiple years. Additionally, with organization-based profit-sharing schemes, suggestion schemes, and career progression mechanisms, ELGi built a dedicated, motivated, and engaged workforce. Furthermore, the practice of keeping workers as contingent workers for long periods was changed to offer permanency for workers completing over three years based on their performance feedback.

Spreadsheet supplement for case IMB983.

Spreadsheet supplement for case 723430.

Since its founding in 2019 by Kim Kardashian and Jens Grede, Skims, a solutions-oriented brand creating the next generation of underwear, loungewear, and shapewear with an eye toward body-type and skin-tone inclusivity, has experienced a meteoric rise. Kardashian, who was a well-known media personality, socialite, influencer, and businesswoman, served as the brand's creative director and aesthetic muse and brought her cultural impact and followers into the brand. CEO Grede and COO Emma Grede had experience managing celebrity brand relationships and founding other celebrity brands. In July 2023, the company was valued at $4 billion, an incredible achievement for a direct-to-consumer products company. Skims seemed to be bucking the trend that was dragging down other DTC brands, which for the first time in a decade were having trouble raising new venture money, raising money in down rounds that diminished the valuations of their companies, or seeing sharp stock price declines post-IPO. Instead of looking to other DTCs for inspiration, Skims' founders were inspired by brands such as Nike, Apple, and lululemon, hoping to propel Skims to iconic brand status. With the recent $4 billion valuation, Skims' investors would pressure the management team to drive exponential topline growth while managing profitability. Could Skims continue to accelerate its growth trajectory or would it fall prey to the same forces slowing down the growth and profitability of other DTC brands?

Cormac Kinney, Founder and CEO of Diamond Standard, was on a mission to transform the U.S. diamond market through unlocking the precious gems as market-traded assets. As a serial FinTech entrepreneur, he hoped to add an additional service to his vault: Carats. The commodity currency would be backed by a fungible resource, being the first in its field to have a physical-digital combination. Following the recent crypto-market crash, Kinney wondered if this was the right opportunity to launch his product. Although Kinney saw Carats as the best of both gold and other decentralized currencies, his advisors were wary of the potential regulatory risks that could ensue, in addition to the current dreary landscape of the crypto-market. Should Diamond Standard pursue Kinney's vision of Carats, or focus its limited resources on other diamond-backed financial products?

Set immediately after a December 2019 short-seller attack, the case explores Plug Power's long challenging history. It then focuses on two key issues raised in the short-seller report related to lease accounting and stock warrants that Plug purportedly used to boost profits.

The case is set in spring 2021, immediately after Plug Power made financial restatements dating back to 2018. The case describes the restatements, which revealed that Plug was reclassifying expense items to boost gross profits.

This case depicts the critical decisions Xingli Dong (Shirley) made during her career transition from a female Ph. D. in engineering to Energy Automation R&D VP of Schneider Electric and sparks a discussion on her next key decision for a career change. In this male-dominated field, she met a barrage of suspicion and setbacks during her growth from a female Ph. D. in engineering to the head of the R&D Center, especially in carrying out an eight-year-long project. Shirley insisted on leading the team with open-mindedness and inclusiveness, making rapid and incremental iterations through trial and error. The successful project delivery earned her the trust of the headquarters and an opportunity to lead the company's global R&D business. The new position, however, required her to balance work and family and manage a global R&D team while working in China. With authentic leadership, she won the trust and recognition of her 300-strong cross-cultural R&D team; with empathy, she managed to close down a site in Poland. Inspired by other excellent female leaders, she continuously reflected on female executives' unique strengths. In October 2021, Schneider Electric organized a 360 Leadership Assessment for senior executives, during which Shirley realized her weaknesses in strategic thinking would put her in a weaker position to exercise leadership in the long run. Shirley began to consider whether she should leverage her existing strengths in her existing role or venture out of her comfort zone to seek new opportunities. However, she had doubts about whether Schneider Electric would support her pivot into an innovation-related role, where she had no particular advantage.

In January 2019, the Competition Commission of India approved a significant merger in India's fast-moving consumer goods industry. The merger between Hindustan Unilever Limited (HUL) and GlaxoSmithKline Consumer Healthcare Limited (GSKCONS) took place in April 2020. The deal helped HUL strengthen its food and refreshments business and diversify into the health food drinks market. The hefty purchase price paid for the merger led HUL to record massive goodwill and other intangible assets that had previously not been recorded on GSKCONS financial statements. An investor researching the merger noticed these drastically increased values and wondered how a product company could have such high intangible assets on its balance sheet. What was HUL's strategic motive in the merger? Had it acquired some right-to-use assets from GSKCONS that had led to an increase in other intangible assets? What were the potential sources of value from the merger? Would the merger benefit HUL in the long run?

Spreadsheet to accompany product W33460.

As of 2023, Netflix is the largest streaming-video provider. However, it faces increased competition, as well as slower growth in subscriptions, which have caused it to reconsider its past practices. This case describes the history of Netflix's business model and the antecedents that have led it to make some significant changes-the most important of which is an ad-supported subscription option. It is also engaged in cost-cutting measures, discouraging password sharing, and even making a small foray into video gaming. This case is suitable for a capstone strategy course or an advanced elective in competitive strategy at the MBA level. It has been used by MBAs and executives (both in the United States and in Europe) in classes covering strategic management.

Raya Partners, a private equity firm, faces a crucial decision regarding Asa Specialty Coatings Company (ASCC). The dilemma involves shifting ASCC's manufacturing operations to Mexico, a move that would boost profitability and reduce emissions but result in significant layoffs in Vermont, impacting employees and the local community. Adrienne, Raya Partners' Chief Investment Officer, grapples with balancing financial gains, social responsibilities, and environmental considerations. The decision also tests Raya Partners' commitment to its ESG policy. Adrienne must devise a transparent communication strategy, explore fair severance packages, and consider ways to alleviate the financial burden. Ultimately, the choice made will define Raya Partners' values and shape ASCC's future.