Upon becoming General Manager of ArtesanÃas de Colombia (AC) in January 2007, Paola Muñoz faced the challenge of redefining the organization's strategy. The mission of AC, a mainly government organization with a 3 % private ownership, was to foster, promote, and market Colombian handicrafts, thus creating economic development opportunities for artisans, a low-income, mainly indigenous population. In early 2007, soon after assuming her role as General Manager, Paola evaluated the strategy, achievements, and limitations of her predecessor's 16-year-long management tenure, in order to craft her own strategy for the organization. Whereas the previous strategy focused on crafts-with a strong emphasis on the promotion of design and the positioning of crafts as very differentiated products among high-income clients-Paola wanted to discuss with her staff the pros and cons of reorienting the AC's strategy toward the artisans, through increased training, support, and capacity building especially in administrative, economic and organizational areas. The case is based on an organization that is primarily a public/ government organization with a social mission. Governments and government agencies still represent in most OECD countries between 40% and 50% of the economy. This case invites students to (1) strategy formulation in not-for-profit or governmental contexts (specifically in this case a hybrid organization with (a) a dual mandate -social and business orientations (b) in a sector in which the small focal organization promotes value creation with a vast number of producers -over 350,000 artisans in the country) and to (2) highlight the relevance and limitations of strategic management concepts and tools in such contexts. Besides a strategic management course, this case can be used in a corporate social responsibility course to illustrate the challenges of a hybrid organization, in which profit-making and social mission are complementary objectives.
Multinational retailers have been slow to understand consumers in the developing world. As a result, they've been vulnerable to local competitors that know how their shoppers think, what they crave, and how they buy. These local retailers offer some valuable lessons: Forget the myth that the high end is the most lucrative segment. In emerging markets, the number of affluent consumers who could champion your product is small, and the wealthy tend to favor shopping trips abroad. Instead, aim your products at low-income segments from the start. Cater to consumers' tendency to buy a lot of the cheapest products and a little of the best by providing decent quality at the low end and aspirational choices at the high end. Turn your stores into centers of learning, where shoppers can fill the gaps in their product knowledge. Expect the unexpected and develop quick reflexes-you'll need them to deal with the rapid market expansion and demographic change of emerging economies.
In June 2001, Empresa Editora El Comercio (EEEC) had launched a new popular newspaper, Trome, for low-income families. Although several studies had preceded this launch, sales in following months failed to reach expected levels and actually displayed a decreasing trend. Trome embodied the company's effort to expand its news coverage to new population segments that were not served by its other newspaper, El Comercio, a market leader that had served as the foundation for the company itself. Six months after Trome's launch and faced with dropping sales, company managers had met to discuss their options. This case describes management team members' dilemmas at that meeting: "Should the new paper's style and contents be changed? Should Trome focus more on sex and violence-related issues, as its competitors did? Would it be convenient to replace the silverware promotion chosen to support launching? Was the channel conflict adequately managed? Were intended readers' needs truly and fully understood? Should the company re-launch Trome or would it be wiser to just give up on this project?
The Disco chain of supermarkets has pursued a successful local niche strategy in Argentina to compete with intense competition from multinational chains. Now Disco considers options for expanding its regional strength.