In September 2017, news spread of McDonald’s India terminating its franchise arrangement with its joint venture (JV) in India. The termination notice was the newest step in the saga of the conflict between the two JV partners—US-based McDonald’s and the Indian partner Vikram Bakshi of Connaught Plaza Restaurants Limited (CPRL). McDonald’s entered India in 1996 through a JV that was originally seen as the perfect combination to share investments, reduce risks, and succeed. The events between 2013 and 2017 showed that this was not true, and many reasons were suggested in the media for the problems—strategy, team, resources, and a mismatched value system. Did the former franchise holder CPRL have a legal right to use the McDonald’s name anymore? Could the partners resolve their differences?
A star fund manager at Principal First had been managing the company’s information technology fund for the previous six years. Under his management, the fund had consistently outperformed the market, delivering a five-year compounded annual growth rate of 28 per cent. The exceptional performance of the fund was due to an overexposed position in Vakrangee Limited, a mid-tier information technology company. The fund manager bought the stock in early October 2017 at ₹240. By January 2018, the stock reached a high of ₹500. However, the fund manager did not liquidate his position because he believed that there was still more value in the company. At the end of January 2018, the stock plummeted, as did its net asset value, and the fund manager wondered where he had gone wrong in his analysis.
Swadhaar FinServe Private Limited (Swadhaar), a non-banking financial company–microfinance institution (NBFC-MFI), was set up in Mumbai, India in 2008 with the objective of providing the urban poor with increased access to financial services. Swadhaar was a leading provider of financial services to clients in several major states of India. Between 2009 and 2013, there were major changes in the regulatory environment; some of these restricted the scope of MFIs and others opened new business opportunities. Although Swadhaar was able to reach financial sustainability with its existing business model, its founder was always looking at growth strategies to achieve her mission. In late 2014, RBL Bank Ltd. offered to become a strategic investor in Swadhaar. In early 2015, Swadhaar’s founder needed to decide whether or not to accept RBL Bank Ltd.’s proposal.
In 2017, Farm Harvest Pvt. Ltd., a company that produced and marketed fresh corn and ready-to-eat corn products, was facing distribution problems. The owner and managing director of the company, was worried about the sales of his company’s products. During a discussion with his core management team about the non-availability of their products in the market, the owner realized that declining sales could be due to distribution network problems. In order to revamp their distribution network, the team considered pursuing direct distribution rather than going through distributors. The team also had to look at the financial aspects of the direct distribution model versus that of distributors in order to make a decision.
In early 2015, the chief executive officer and the management team of Groupon India, a subsidiary of U.S.-based Groupon Inc., faced a management buyout decision. Buoyed by a high growth rate and huge market potential in India, they wanted more India-specific product positioning and greater control over technology. They explored growth options available to the company, but faced the constraints of being part of a global conglomerate. The management team had narrowed its options to either starting a new venture or acquiring ownership of the subsidiary through a management buyout. How could they ensure they made the right decision?
This exercise revolves around the rivalry between two financial analysts. Upset by their constant game of one-upmanship, an advisor to the governor of the Reserve Bank of India came up with a challenge for them to prove who was better. He provided them with financial data for the financial year ending March 2014 from 10 anonymous companies and asked them to match the financial data with specific industries given in a list. The challenge was timed, and the winner was to be determined on the basis of who could come up with the right combination first.
Amarnath Gupta and Sons was a distributor of lubricants and owner of a petrol pump based in Alwar, Rajasthan, India. The business was originally set up as a family-owned single petrol pump in 1953. The family member currently in charge of daily operations had expanded the business significantly, especially since the entry of new multinational players in the Indian lubricant market. In 2013, this owner-partner was looking at ways to involve his children—one of whom had finished college (a son), one of whom was in college (a daughter), and one of whom was about to start college (a son)—in the family business. Should three businesses be established for each of the three children, or should they all be part of the same business? How could the next generation enter the business successfully? This case won the 2015 ISB-Ivey Global Case Competition in the entrepreneurship category. The ISB-Ivey case competition was sponsored by ISB.