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In 1997, the Ontario Health Services Restructuring Committee mandated the merger of four facilities that treated patients with mental health and addiction issues to create what was later named the Centre for Addiction and Mental Health. This new centre, to be situated in Toronto, would provide support and clinical care to those suffering from illnesses such as schizophrenia, anxiety and mood disorders, as well as substance addictions. In 1999, the newly appointed chief executive officer and his management team have to present their recommendations to the board of trustees for implementing this complex merger. The plan will need to recognize and address significant infrastructure, strategic, organizational and stakeholder challenges. The merger will be a large change for vulnerable patient populations and their families, as well as the staff at the four merging organizations and the neighbourhoods bordering the new facility.

GetClarity Inc. is a start-up firm that specializes in the accumulation, analysis and sale of various types of data, including the firm's own data, which has been attained through an exclusive contract. The company's current job involves working for an auto-manufacturing client to identify a potential location for a new dealership. Two young analysts conduct data analysis on the age of the area and the market size, based on the customer demographic data.

Student spreadsheet for case W14290.

Supplement case to product W14290.

Student spreadsheet for case W14292.

Manufacturing is now a national strategy for many countries to combat slow economic growth, and positively viewed with the current trend of onshoring foreign manufacturing operations. We develop a cross-country regression model that predicts manufacturing employment as a function of population growth, foreign direct investment, and purchasing power parity. Results through the year 2100 suggest that manufacturing is trending toward a global equilibrium with higher levels of manufacturing outputs but much lower levels of manufacturing employment. The reason is that countries tend to evolve from having little manufacturing to commodity manufacturing at large scale and low wages. As infrastructure and human capital develop, there is the tendency to pursue advanced manufacturing in support of higher valued goods. The manufacture of commodity products is then outsourced to those countries with lower costs justified by their less-developed infrastructure and human capital, and so the virtuous cycle continues. While this model suggests that current efforts in revitalization of domestic manufacturing would lead to an increase in wealth in the United States, the bad news is that these gains are unlikely to be sustainable in the long term. However, the good news is that manufacturing acts as a rising tide that raises all nations and our global quality of life.

Revenue-sharing contracts have been heavily researched and promoted in the academic literature. However, despite some well-documented examples (e.g., the way Blockbuster and film studios were able to increase availability of the latest video releases in rental shops through a revenue-sharing contract), they seem to be much less prevalent in practice. A possible reason for this gap between theory and practice is that most academic research has focused on two-party contracts involving only one buyer and one supplier, while in reality, most supply chains consist of multiple stages. When there are several stages in the chain--as is the case for many extended, global supply chains--the traditional revenue-sharing contract is no longer optimal for the two contracting parties, as every other participant in the chain is able to leverage the revenue-sharing contract to its own advantage. Put another way, a revenue sharing contract between only two parties is not incentive-compatible across all participants. Accordingly, we suggest that a revenue-sharing contract should involve all the supply chain partners, and propose a spanning revenue-sharing contract that accomplishes coordination and incentive-compatibility across the same.

This article analyzes the differences between frequent and rare risks for supply chain disruptions, and proposes a new, improved risk measurement and prioritization method to account for the characteristics of rare risks. The varying idiosyncrasies of decision makers are integrated into this method such that risk management can be brought into alignment with an individual manager's preferences. Also woven into this tapestry is the notion of detection, which is familiar to those who have applied failure modes and effects analysis (FMEA), but novel in the arena of supply chain risk management. Rare risks in the supply chain are, by their nature, unsettling: unforeseen disruptions are always present, probability estimates are imprecise, and comprehensive data collection is impossible. These difficulties are taken into account by the presented risk management framework. While the proposed ordinal scales are perhaps unsettling to many who desire greater precision, measurement methods must fit the precision that is possible. By considering rare risks along with frequent risks, managers can be better positioned to deal with the unforeseen.

Globalization has led to the creation of hyper-efficient supply chains that work well in a predictable world. However, with globalization comes a world full of uncertainties, and these efficient supply chains often cannot cope with unpredictable fluctuations in demand and supply. These supply-demand imbalances are a major business risk in a vast array of industries--including aerospace and defense, automobiles, chemicals, engineered products, pharmaceuticals, and semiconductors-- because capacity is very expensive. Mix flexibility--whereby a plant can produce more than one kind of product--is an attractive antidote to this risk. In this article, we discuss better and worse ways to embrace mix flexibility. To begin, senior executives need to answer two key questions: How do we create flexible plants? And how do we go from flexible plants to a cost-effective flexible network? Successful companies will not blindly apply the same flexibility tactic throughout their business: they will tailor the Four Ps--product design, process design, production technology, and people--to fit the different characteristics of different tiers in their production chains. Successful companies will not sacrifice cost at the altar of flexibility: they will create cost effective flexible networks by strategically configuring partially flexible networks in a way that delivers almost all the benefits of totally flexible networks.

Drawing on research in management theory, risk analysis, and the social sciences, this installment of Business Law & Ethics Corner promotes diversity of thought in corporate governance as not only beneficial to business growth and creativity, but also imperative to managing risk successfully. The article begins with a review of four major worldviews and the risk preferences of each. Next, it examines psychological processes that guide human decision making and greatly influence risk perception. The article then applies these worldviews and psychological phenomena to the case of risk management. It offers a critique of current risk management practices, drawing on evidence from the 2007-2008 financial crisis. The article concludes by promoting increased diversity of worldviews in corporate governance as a way to prevent the same risk blindness that led to the Great Recession.

In late January 2011, the assistant deputy minister of Environment Canada is contemplating the final report of the joint review panel conducting the environmental assessment of Total E&P Canada's $10 billion oil sands project, the Joslyn Mine near Fort McMurray, Alberta. Although the report advised that the project would be in the public interest only if - and it was a big if - adverse effects on species at risk were fully mitigated, she was aware that both the company and provincial officials did not agree with the need for further wildlife protection measures. Further, behind the scenes, the industry lobby group, the Canadian Association of Petroleum Producers, opposed any offsite protection of habitat that might be seen as a precedent for future projects. The federal government's priority was jobs, and the assistant deputy minister would soon be under pressure to advise the minister on whether to authorize the project to proceed. Without a mechanism to ensure that threatened wildlife would be protected, she could not recommend approval. She needed to find a solution that would work both for the environment and the project.

In late January 2011, the assistant deputy minister of Environment Canada is contemplating the final report of the joint review panel conducting the environmental assessment of Total E&P Canada’s $10 billion oil sands project, the Joslyn Mine near Fort McMurray, Alberta. Although the report advised that the project would be in the public interest only if — and it was a big if — adverse effects on species at risk were fully mitigated, she was aware that both the company and provincial officials did not agree with the need for further wildlife protection measures. Further, behind the scenes, the industry lobby group, the Canadian Association of Petroleum Producers, opposed any offsite protection of habitat that might be seen as a precedent for future projects. The federal government’s priority was jobs, and the assistant deputy minister would soon be under pressure to advise the minister on whether to authorize the project to proceed. Without a mechanism to ensure that threatened wildlife would be protected, she could not recommend approval. She needed to find a solution that would work both for the environment and the project.

At the time when Dr. Ganesh Natrajan took over as the CEO of Zensar Technologies Ltd in India in 2001, the company was in a state of turmoil. Staff morale was low and the company was essentially a staffing agency sending IT professionals to work at client sites abroad. As Natrajan started to implement across-the-board changes at Zensar, the company had grown from 850 employees in 2001 to 4,000 employees in 2007 with the number of clients increased from 57 in 2001 to 273 in 2007. Revenue increased from US$42.8 million in 2001 to US$179.57 million in 2007. This case covers the detailed strategies implemented by Natrajan that resulted in Zensar's explosive growth.

Since its inception as an organization dedicated to promoting women's entrepreneurship through coordinated activities, the Association of Lady Entrepreneurs of Andhra Pradesh (ALEAP) has gone through different phases, acquiring distinct competencies and resources to offer an integrated approach to helping women entrepreneurs. In the two decades of its operations, ALEAP had established two industrial estates. There was scope to establish more industrial estates for women but ALEAP was contending with severe financial and manpower constraints that would make it difficult to pursue the manufacturing route to develop women entrepreneurs. ALEAP's president believed that it was time to scale up operations and explore new opportunities. However, several questions had to be addressed: What growth strategy should ALEAP adopt? Was it time to look for a new model? Should ALEAP look beyond manufacturing for its growth? Should ALEAP look for innovative approaches to set up incubation centres? Whose support should it seek?

In February 2011, the senior associate deputy minister of Industry Canada was appointed as the Canadian prime minister's personal representative to the bi-national team charged with developing the "Beyond the Border Action Plan" to both improve security and streamline cross-border commerce and travel between Canada and the United States. He was immediately faced with a range of decisions on how to proceed - whom to consult, which Canadian team members to hire, which of many possible priorities to pursue in discussions with his U.S. counterparts and which steps to take to manage a complex process involving a multiplicity of large and powerful Canadian government departments and agencies as well as private sector interests. While he didn't yet have strategies to address these issues, he knew that he would have to formulate them rapidly. Both the prime minister and the U.S. president had made clear their desire to move quickly - ideally, an action plan was to be in place within six months.

In 2012, a highly controversial bill was passed that called for major reform and restructuring of Britain's government healthcare system, the National Health Service. Public opinion of the reform was both highly polarized and volatile. The Secretary of State for Health faces two tasks: addressing key issues to ensure successful implementation of the reforms and developing a plan to ensure both long-term and short-term success.

Cancer Care Ontario, the organization that oversees cancer treatment in Ontario, is challenged with establishing an innovative approach to reducing wait times for breast cancer and prostate cancer therapy across Ontario after wait times increased to more than two months. The special advisor on cancer issues to the Ontario Minister of Health and Long-Term Care needs to report his recommendation to Cancer Care Ontario's board of directors, who manage all regional cancer centres in the province. The major challenge is to balance the needs and values of all the various stakeholders, while developing short-, medium- and long-term solutions to the wait list dilemma.

OOCL is one of the world's largest integrated international container transportation, logistics and terminal companies, with a network covering Asia, Europe, North America and Australasia. The company is well respected in the industry with a reputation for providing customer-focused solutions, a quality-through-excellence approach and continual innovation. It has been listed on the Hong Kong Stock Exchange since 1973. In a volatile industry, it has to compete and form alliances. It has a history of investing widely with variable results.

Firms in Korea's securities and brokerage industries have experienced fierce competition in the domestic market, which has led to international expansion being considered a popular strategic alternative. The chief executive officer of Hyundai Securities Co., Ltd., a Korean securities firm, envisions his company becoming the "pan-Asian market leader." As a result, he is pursuing an international expansion strategy in Hong Kong and Singapore. However, given the popularity of international expansion in these areas, the markets are highly competitive. Has the CEO made an appropriate strategic decision?

In a quest to organize the unorganized secondary market for used computers, a team of three entrepreneurs attempted to develop a viable plan in a typical emerging market context. Identifying e-waste management problems and the digital divide as overarching social issues, they identified a potential market for empowering consumers through affordable access to information technology (IT) by re-harnessing the potential of used computers. In doing so, they identified emerging market characteristics through micro and macro analyses of the environment and the IT industry.