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Bed Bath & Beyond Inc. (BBBY) was founded in 1971 and focused on retailing items for customers’ “home and heart” life events, such as weddings, births, and moves. By the end of 2017, the company had over 1,530 stores distributed in the United States, Puerto Rico, and Canada, but its third-quarter earnings results revealed a 50 per cent year-over-year decline in net profits and a 45 per cent decline in stock price compared to the beginning of the year. BBBY was facing a steady decrease in physical store sales even as digital sales showed growth. BBBY was trying to catch up to competitors with digital initiatives, gain and retain customers through discount and membership programs, and keep a close control on costs, but the question remained: How could BBBY stay relevant and competitive in the long term?

Bed Bath & Beyond Inc. (BBBY) was founded in 1971 and focused on retailing items for customers' "home and heart" life events, such as weddings, births, and moves. By the end of 2017, the company had over 1,530 stores distributed in the United States, Puerto Rico, and Canada, but its third-quarter earnings results revealed a 50 per cent year-over-year decline in net profits and a 45 per cent decline in stock price compared to the beginning of the year. BBBY was facing a steady decrease in physical store sales even as digital sales showed growth. BBBY was trying to catch up to competitors with digital initiatives, gain and retain customers through discount and membership programs, and keep a close control on costs, but the question remained: How could BBBY stay relevant and competitive in the long term?

Since the late 1980s, Progressive Casualty Insurance Company has maintained a strong position in the nonstandard auto-insurance market (auto insurance for high-risk drivers). Progressive's goals in the 1990s are to expand its insurance coverage to include standard and preferred customers (drivers with clean driving records and no accidents). The company never advertised before 1994; as a result, consumer awareness has been very low. Progressive faces strong competition in a varied insurance industry. Companies like Allstate, the nation's largest underwriter of nonstandard auto insurance, and State Farm, with 21.1% total market share, present a challenge to Progressive as the company strives to make its products available to all drivers. The case focuses on building the company's brand through advertising and enhancing product differentiation through technology.

Despite 30 years of evidence demonstrating that most acquisitions don't create value for the acquiring company, executives continue to make more deals, and bigger deals, every year. There are plenty of reasons why value isn't created, but many times it's simply because the acquiring company paid too much. It's not, however, that acquirers pay too high a price in an absolute sense. Rather, they pay more than the acquisition is worth to them. What is that optimum price? The authors present a systematic way to arrive at it, involving several distinct concepts of value. In today's market, the purchase price of an acquisition will nearly always be higher than the intrinsic value of the company--the price of its stock before any acquisition intentions are announced. The key is to determine how much of that difference is "synergy value"--the value that will result from improvements made when the companies are combined. This value will accrue to the acquirer's shareholders rather than to the target's shareholders. The more synergy value a particular acquisition can generate, the higher the maximum price an acquirer is justified in paying. Just as important as correctly calculating the synergy value is having the discipline to walk away from a deal when the numbers don't add up. If returns to shareholders from acquisitions are no better in the next ten years than they've been in the past 30, the authors warn, it will be because companies have failed to create systematic corporate governance processes that put their simple lessons into practice.