• Maersk's business-model transformation: Building a bridge over troubled water?

    In 2016, A.P. Moller - Maersk (hereafter "Maersk") announced a strategic decision to separate its oil- and gas-related operations (sold to French Total in 2017) from the conglomerate and to concentrate on container logistics. However, instead of only focusing on sea freight, Maersk adopted a growth strategy aimed at making it an integrated logistics company offering customers end-to-end (E2E) supply chain solutions when the supply chain included containers. The strategy required substantial investments in land- and air-freight facilities as a supplement to the existing sea-freight business. Hence, Maersk embarked on a transformation of its business model from a focus on container shipping to globally integrated logistics. Under the slogan ALL THE WAY (later changed to ALL THE WAY TO ZERO to emphasize the importance of zero carbon transportation of cargo, including decarbonized shipping), the new value proposition offered to customers was to handle their entire container-related supply chain, including sea, land, and air transportation; storage; and customs clearance and other paperwork. The case provides relevant background information for a review of Maersk's E2E strategy (as per November 2023) seven years after its introduction. During the intervening years, the environment in which Maersk operated changed dramatically. Obstacles to the strategy arose and new opportunities to support it emerged. The case revolves around the question of whether Maersk should abandon its E2E strategy or continue it (possibly with some adjustments).
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  • Maersk’s Non-Market Strategy Towards State-Owned Chinese Rivals

    After the 2008–09 financial crisis, the Chinese shipping industry grew markedly and took on a more dominant role in global shipping. As a result, it was felt by some that China’s state-driven economic model had possibly created an unequal playing field. Under the political agenda of the Belt and Road Initiative, specifically the Maritime Silk Road, Chinese state-owned enterprises acquired strategic infrastructure assets, establishing a global network of shipping infrastructure through investments in strategically important ports and terminals. The growth of China’s shipping industry raised several concerns in Europe and for AP Moller–Maersk, the largest container shipping conglomerate in the market. By late 2020, some European governments were becoming more cautious; the European Union had increased restrictions on investments by Chinese companies, and European governments had become increasingly outspoken about China’s geopolitical ambitions. How could AP Moller–Maersk use non-market strategies to better position itself relative to increasing competition from China?
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  • Carlsberg Breweries A/S: Facing Political Risk in Russia

    Carlsberg Breweries A/S (Carlsberg) had developed from a local to a global player in the brewing industry, having focused on growth in emerging economies in Europe and Asia. This growth path was against the background of economic transition and political change in Russia—from optimism about opportunities in the new market economy in the 1990s, to increasing regulatory obstacles, political authoritarianism, and increasing local competition in the 2010s. In 2022, Carlsberg, more than other West European consumer goods companies, was exposed to Russia when Russian military forces invaded Ukraine in February. This created complex operational and ethical challenges the company had to address with urgency. The company’s annual general meeting was coming up, on March 14, and by then the executive board had to communicate to shareholders concerned with both the company’s financial performance and its international reputation—as well as to Carlsberg employees across Europe (including both Russia and Ukraine) and the increasingly impatient Danish media—what steps the board would take to address the crisis.
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  • Carlsberg Breweries A/S: Facing Political Risk in Russia

    Carlsberg Breweries A/S (Carlsberg) had developed from a local to a global player in the brewing industry, having focused on growth in emerging economies in Europe and Asia. This growth path was against the background of economic transition and political change in Russia-from optimism about opportunities in the new market economy in the 1990s, to increasing regulatory obstacles, political authoritarianism, and increasing local competition in the 2010s. In 2022, Carlsberg, more than other West European consumer goods companies, was exposed to Russia when Russian military forces invaded Ukraine in February. This created complex operational and ethical challenges the company had to address with urgency. The company's annual general meeting was coming up, on March 14, and by then the executive board had to communicate to shareholders concerned with both the company's financial performance and its international reputation-as well as to Carlsberg employees across Europe (including both Russia and Ukraine) and the increasingly impatient Danish media-what steps the board would take to address the crisis.
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  • Maersk's Non-Market Strategy Towards State-Owned Chinese Rivals

    After the 2008-09 financial crisis, the Chinese shipping industry grew markedly and took on a more dominant role in global shipping. As a result, it was felt by some that China's state-driven economic model had possibly created an unequal playing field. Under the political agenda of the Belt and Road Initiative, specifically the Maritime Silk Road, Chinese state-owned enterprises acquired strategic infrastructure assets, establishing a global network of shipping infrastructure through investments in strategically important ports and terminals. The growth of China's shipping industry raised several concerns in Europe and for AP Moller-Maersk, the largest container shipping conglomerate in the market. By late 2020, some European governments were becoming more cautious; the European Union had increased restrictions on investments by Chinese companies, and European governments had become increasingly outspoken about China's geopolitical ambitions. How could AP Moller-Maersk use non-market strategies to better position itself relative to increasing competition from China?
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  • SAP: The Challenge of Aligning Sourcing and Innovation Strategies

    In late 2011, SAP, the German leader in the enterprise software industry, announced a major investment plan for expanding in China and also acquired a leading American firm in cloud-based human capital management software. At first glance, these investments seemed rather unconnected. A closer look at SAP's strategy, however, revealed a closely connected and coordinated network of strategic decisions and investments for which alignment and finding the right balance were key challenges. Hence, it was crucial to ask: What were the principal challenges for SAP in aligning its innovation and sourcing strategies? Compared to its key competitors - Microsoft, IBM and Oracle - how was it aligning its innovation strategy with its sourcing strategy?
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  • SAP: The Challenge of Aligning Sourcing and Innovation Strategies

    In late 2011, SAP, the German leader in the enterprise software industry, announced a major investment plan for expanding in China and also acquired a leading American firm in cloud-based human capital management software. At first glance, these investments seemed rather unconnected. A closer look at SAP’s strategy, however, revealed a closely connected and coordinated network of strategic decisions and investments for which alignment and finding the right balance were key challenges. Hence, it was crucial to ask: What were the principal challenges for SAP in aligning its innovation and sourcing strategies? Compared to its key competitors — Microsoft, IBM and Oracle — how was it aligning its innovation strategy with its sourcing strategy?
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  • ISS & Nordea: Facility Management in the Nordic Region

    Nordea Bank had emerged as the largest financial group in the Nordic region. As part of its consolidated approach, Nordea’s top management had made the strategic decision to outsource a number of the company’s peripheral activities, such as catering, security, and cleaning, in order to focus on the core business of banking. In Denmark, Finland, and Sweden, some services had been outsourced to one of the leaders in the facility management (FM) market, the global service provider ISS. The relationship between Nordea and ISS on the delivery of facility services had a long history, but a new contract was successfully concluded by the end of 2010. Consequently, ISS was chosen as Nordea’s FM partner and would continually be providing Nordea with a scope of supportive services across 20 locations in the Nordic region. From 2010 and onwards, a significant switch was made to an output-based focus in the contract, where it was the quality of the delivered services that was specified rather than how to achieve this level of quality, i.e. the input. The change to an output-based contract was seen as a new beginning of a relationship that required significant changes on both sides in terms of mentality, organization, governance structures, and adjustments of expectations. Both the view of the customer (Nordea) and the supplier (ISS) are presented and contrasted in the case.
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  • ISS & Nordea: Facility Management in the Nordic Region

    Nordea Bank has emerged as the largest financial group in the Nordic region. As part of their consolidated approach, Nordea top management has made the strategic decision to outsource a number of the company's peripheral activities, such as catering, security and cleaning, in order to focus more on the core business, banking. In Denmark, Finland and Sweden, the peripheral activities have been outsourced to one of the leading players in the facility management (FM) market, the global service provider ISS. The relationship between Nordea and ISS on delivering of facility services has a long history, but a new contract was successfully concluded by the end of 2010. Consequently, ISS was chosen as Nordea's FM partner and would continually be providing Nordea with a scope of supportive services across 20 locations in the Nordic region. From 2010 and onwards, a significant switch was made to an output-based focus in the contract, where it was the quality of the delivered services that were specified rather than how to achieve this level of quality, i.e. the input. The change into an output based contract was seen as a new beginning of the relationship that required significant changes on both sides in terms of mentality, organization of work, governance structures and, not least, adjustments of expectations. Both the view of the customer (Nordea) and the supplier (ISS) are presented and contrasted in the case.The case examines the financial, organizational and managerial challenges met by an international company outsourcing peripheral activities to a global facility service provider. Many of the tensions related to the collaboration and the different aims of the two companies are illustrated in the case, and so is the mutual learning and building of trust in the relationship.
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