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Jieliang Phone Home! (A)
At Precision Electro-Tek's mobile phone manufacturing facility in southern China, thousands of operators-bright and capable young men and (mostly) women like Jieliang Hao-are motivated to improve line productivity through small innovations for faster assembly and have discovered many ways to increase their performance. Meanwhile a globally networked team of manufacturing experts led by Marty Cole, the case protagonist, is trying to spread best practice from other sites around the globe. Unfortunately these two processes sometimes inadvertently clash, presenting a management challenge. The case helps students examine the implicit assumptions managers make in organizing work inside a factory. These assumptions reflect theories of worker behavior and motivation in combination with managers' beliefs of what constitutes "best practice." Students are offered an opportunity to dissect these lean manufacturing theories and recognize that in this particular implementation, implementation of best practice without sufficient consideration of the interplay of theories on motivation has led to unexpected outcomes. The case offers an opportunity to explore the link between work design and compensation and to understand the differences between compensation and motivation. The case frames the role of the general manager in setting up work structures and compensation systems in a very traditional and explicit setting, one where linkages should be clearly visible yet assumptions are often deeply buried and implicit. Our expectation is that students will see the lessons generalize to most, if not all, of the organizations where they have worked. There are three cases: the (A) case describes the management view, the (B) case describes the direct labor worker view, and the (C) case details the results of an employee survey that was conducted on two manufacturing lines. -
Jieliang Phone Home! (B)
At Precision Electro-Tek's mobile phone manufacturing facility in southern China, thousands of operators-bright and capable young men and (mostly) women like Jieliang Hao-are motivated to improve line productivity through small innovations for faster assembly and have discovered many ways to increase their performance. Meanwhile a globally-networked team of manufacturing experts led by Marty Cole, the case protagonist, is trying to spread best practice from other sites around the globe. Unfortunately these two processes sometimes inadvertently clash, presenting a management challenge. The case helps students examine the implicit assumptions managers make in organizing work inside a factory. These assumptions reflect theories of worker behavior and motivation in combination with managers' beliefs of what constitutes "best practice." Students are offered an opportunity to dissect these lean manufacturing theories and recognize that in this particular implementation, implementation of best practice without sufficient consideration of the interplay of theories on motivation has led to unexpected outcomes. The case offers an opportunity to explore the link between work design and compensation, and understand the differences between compensation and motivation. The case frames the role of the general manager in setting up work structures and compensation systems in a very traditional and explicit setting, one where linkages should be clearly visible yet assumptions are often deeply buried and implicit. Our expectation is that students will see the lessons generalize to most, if not all, of the organizations where they have worked. There are three cases: the (A) case describes the management view, the (B) case describes the direct labor worker view, and the (C) case details the results of an employee survey that was conducted on two manufacturing lines. -
Zappos.com: Developing a Supply Chain to Deliver WOW!
Zappos was founded in 1999, during the Internet boom, to sell shoes online. The company's founding premise was to provide the ultimate in selection to its customers-all brands, styles, sizes, and colors. Zappos organized all aspects of its business (including recruiting, culture, call center, inventory, website, and supply chain) to provide the best possible service-it wanted to "wow" everyone who interacted with the company, from customers to employees to corporate partners. Zappos grew rapidly, and by 2008 was profitable with net sales (after returns) of about $650 million. The company faced a number of issues as it looked forward. While it had penetrated only about 3 percent of the U.S. market for shoes, Zappos had expanded its product lines to items such as camping gear and video games. It needed to determine those elements of its strategy had contributed to its success in shoes, and whether it would be able to duplicate that success in other product lines. It also needed to determine how it could scale its business-much of the effort it had made to "wow" its customers was labor intensive and expensive-could this be scaled to a company with revenues of tens of billions? Finally, the economic landscape changed dramatically in late 2008, with the financial market collapse and recession. The service-intensive Zappos.com business was based on sales at little to no discount, unlike many websites that relied on selling at the lowest possible price. Would the company need to make changes to respond to the changed economic environment, and if so, what were those changes? The case provides an opportunity to evaluate the core competences of an Internet retailer that has experienced rapid, initial success. The case enables students to consider supply chain issues, which are critical to the company's success, in the broader context of the business: the bases of Zappos' success, its core competencies, culture, and competitive environment. -
Publicis Groupe 2009: Toward a Digital Transformation
After a series of acquisitions, Maurice Levy, the Chairman and CEO of Publicis Groupe, had created the fourth largest marketing and communications company in the world. His next major challenge was managing the firm's digital transformation. In December 2006, the company acquired Boston-based Digitas, a leading digital agency headed by David Kenny. After the initial merger, which included the unbundling of Digitas capabilities and the global expansion of its agency network, Publicis Groupe launched VivaKi, a new company-wide digital platform, to spearhead the firm's total transformation. But since the June 2008 launch, the global economy had taken a turn for the worse. Could Levy, Kenny, and other leaders change the holding company quickly and effectively enough to make the new model work? -
Carrefour China and the Olympic Torch Relay: Managing Corporate Crisis amid Evolving Expectations of Multinational Firms
Prior to the 2008 Summer Olympics in Beijing, Chinese people were outraged by repeated interruptions of the Olympic torch relay in Paris on 7 April 2008. Soon after the incident, LVMH Group, a shareholder of the retailer Carrefour, was accused by some Chinese internet users of donating money to the exiled spiritual leader of Tibet. The rumor spread on the internet quickly, leading to calls for a large-scale boycott of Carrefour on 1 May 2008. Despite the souring public sentiment, Carrefour did not provide a consistent response to the public, even after one whole week of the crisis. The situation deteriorated quickly, with demonstrations taking place in various cities across China. Meanwhile, further rumors about Carrefour's anti-boycott promotions were circulating on the internet. How should the local management react to the public relations crisis and how can Carrefour manage its corporate image going forward? -
Mibanco: Meeting the Mainstreaming of Microfinance
Mibanco, Peru's leading microfinance bank, faces intense competition as the banking industry rushes into low income segments. Companion video clips bring into the classroom the contemporary reality of a world-class microfinance institution, where the unpaved streets and cluttered markets of the loan officer coexist with the sophistication of technical financial analysis and premier professional management. Rafael Llosa, the General Manager of Mibanco, must find the way to maintain the financial performance of one of Peru's most profitable banks and meet the strategic growth goals set by his board while facing the most aggressive competitive scenario in the 25-year history of microfinance in Peru. Courseware No. 9-309-701, "Microfinance: An Operating Perspective," contains five chapters filmed at Mibanco: Introduction, Competition, Marketing, Operations and Human Relations. -
Arthur D. Little in China: A Whole New Ball Game
In 2006, Thomas Schiller, a managing director of Arthur D Little ("ADL"), arrived in hazy Beijing with a crystal clear objective: to resurrect a consultant practice that lacked brand recognition in China. Despite success and renown around the world for its technology-focused consultancy business, ADL's first attempt at the Chinese market in early 2000s was hamstrung by its global restructuring. Was there a magical key to unlocking the giant market that had eluded Schiller's predecessor? How could Schiller ensure success for the practice in China? -
TATA NANO: DILEMMAS IN SUSTAINABLE DEVELOPMENT
The Tata Nano was launched by Tata Motors, a member of the Tata Group in January 2008. This "one lakh car" ($2,500) was hailed as the people's car. Ratan Tata, chairman of the Tata Group, which was widely respected for its socially responsible business practices, had personally championed the Nano's development in the belief that it would revolutionize the mobility of the middle class in India. The first models were due to roll out of the company's green field factory in Singur, West Bengal in October 2008. While Tata Motors had been offered financial incentives to locate to West Bengal, the company also wished to play an active role in the re-industrialization of the state and contribute to the economic development of the region. But protests severely disrupted work at the Nano plant and it finally ground to a halt on 2 September 2008. In October 2008 the company announced that it was relocating its Nano factory to the western Indian state of Gujarat, walking away from its $328 million investment. Learning objectives: The pursuit of Sustainable Development (SD) is not as straight forward as its proponents advocate. A firm's financial, social and environmental performance may be at odds with each other. The challenge for top management is to deal with the underlying dilemmas. Nano offered the middle class Indian a safer alternative to carrying his family of four on a two wheeler. The company located its Greenfield factory in West Bengal, again to help develop backward regions of that Indian state. Yet, there were challenges to the Nano project from environmentalists and politicians concerned about the impact of the project on subsistence farmers. -
Yahoo! in China (A)
In 2007 Jerry Yang, CEO of Yahoo!, was lambasted by U.S. Representative Tom Lantos, chairman of the U.S. House Committee on Foreign Affairs, for Yahoo's role in the arrest and imprisonment of Chinese journalist and democracy advocate Shi Tao. The case describes the actions that Yahoo! had taken to grow its business in China, its handling of a government request for the identity of a Yahoo! user, and subsequent actions by the firm to respond to negative publicity and Congressional inquiry. The case raises broad questions about the challenge of complying with domestic law when operating in states that do not consistently respect human rights, and satisfy stakeholders across national boundaries. It allows students to consider the practical steps that a firm can take to protect itself and its stakeholders in states where the law is not always a reliable safeguard. -
Yahoo! in China (B)
Describes the actions that Jerry Yang took to manage the aftermath of the Shi Tao incident following the 2007 Congressional hearing. -
The Acquisition and Restructuring of Kia Motors by Hyundai Motors
In recent years, greater competition and diminished profits, due to domestic and global oversupplies as well as higher development costs, have led the automobile industry to engage in domestic and international mergers and strategic collaboration. This case examines one of the largest mergers and acquisitions (M&As) in the Korean automobile market in recent years: the acquisition of Kia Motors (Kia) by Hyundai Motors (Hyundai). The case describes the background conditions of the acquisition, the integration processes after the acquisition, and the requisites for Kia Motors to normalize management within a short time. Hyundai, in acquiring Kia, enhanced its competitive power in both domestic and global markets, achieving economies of scale and scope and strengthening its global market basis. That said, Hyundai/Kia faced several pressing challenges, among them the cooperation of Renault and Samsung Motors, the unclear domestic treatment of Daewoo Motors, and M&As taking place among top motor companies worldwide. This case study asks students to analyze the process of post-acquisition restructuring and the resulting synergy effects, inviting them to think through the strategies by which Hyundai/Kia may thrive in the global automobile market. Further, it illustrates both the current state of the domestic Korean automobile industry and recent trends in the global automobile market. -
Tata Motors' Acquisition of Daewoo Commercial Vehicle Company
In January 2004, the chairman of the India-based Tata Group, announced that the Tata Group would focus its efforts on international expansion to become globally competitive. This largely domestic vehicle manufacturing firm subsequently acquired a leading established South Korean firm, Daewoo Commercial Vehicle Company (DCVC). This case focuses on the background of the firms and the acquisition, and the bidding and acquisition process. It provides information on the interests of the acquirer and target, and how both came to see the value in the acquisition. The Tata Group acquisition presents an uncommon situation of how an Indian firm acquired a firm in South Korea while overcoming a series of cultural and other barriers. An analysis of this case provides the basis for determining what criteria should be considered to guide a successful acquisition. A companion case is also available, Tata Motors' Integration of Daewoo Commercial Vehicle Company. -
Tata Motors' Integration of Daewoo Commercial Vehicle Company
In January 2004, the chairman of the India-based Tata Group, announced that the Tata Group would focus its efforts on international expansion to become globally competitive. This largely domestic vehicle manufacturing firm subsequently acquired a leading established South Korean firm, Daewoo Commercial Vehicle Company (DCVC). This case complements the case Tata Motors' Acquisition of Daewoo Commercial Vehicles Company, #9B08M094. Commencing from the successful completion of the acquisition of DCVC, this case details the strategic, organizational and operational changes implemented to integrate the two firms. The value of this case is twofold: 1) it demonstrates how firms can effectively integrate an acquired firm, particularly in terms of the wide range of strategic and tactical actions; and 2) it provides an example of a firm that takes an unorthodox approach to integration. Students have an opportunity to evaluate the factors that determine the success of a post-acquisition integration. -
The HBR List: Breakthrough Ideas for 2009
Our annual survey of ideas and trends that will make an impact on business: Elizabeth Warren and Amelia Tyagi believe consumer credit should be made as safe as any other product. Paul Collier and Jean-Louis Warnholz reveal an increasingly investment-friendly climate in sub-Saharan Africa. Amy J.C. Cuddy asserts that warmth and competence are not mutually exclusive. John Sviokla predicts a surge of peer-to-peer lending in the wake of the financial crisis. Noah J. Goldstein explains the impact of social pressure on customers' behavior. Raymond Fisman urges the creation of a global forensic economics lab modeled on Interpol. Paul Saffo warns of a brain drain out of the U.S. Gurdeep Singh Pall and Rita Gunther McGrath contemplate the ramifications of immortalizing business meetings in searchable, high-quality digital video. Janine M. Benyus and Gunter A.M. Pauli illustrate the advantages of innovation copied from nature. Michael I. Norton observes that an investment of effort can lead to unduly glorifying its results. Peter Schwartz dispels the illusion that global temperatures are actually falling. Nicholas A. Christakis shows that personal influence wanes beyond three degrees of separation. Marcelo Suarez-Orozco sees the migrant millions as untapped brand emissaries to their relatives back home. Ian Bremmer and Juan Pujadas chart the growing influence of state capitalism in four industry sectors. Steve Jurvetson shares a fun way to stimulate the growth of new brain cells. Lew McCreary spotlights the interior designs of two adventurous architects who aim to counteract the degenerative effects of physical comfort. Tom Ilube explains the semantic web - a quiet revolution in technology that will radically change the internet. Alex Pentland weighs the benefits of combining two distinct kinds of social networking. Thomas H. Davenport and Bala Iyer look at the offshore outsourcing of decision making. R. Stanley Williams envisions a central nervous system for the earth. -
Seize Advantage in a Downturn
Downturns offer a rare opportunity to outmaneuver rivals. But to do so, you must first systematically assess your organization's ability to weather the storm and take corrective action. David Rhodes and Daniel Stelter, of the Boston Consulting Group, offer a comprehensive approach to tackling this simultaneously defensive and offensive challenge. For some companies, the outcome of this process will be a program of immediate actions that represent a turbocharged version of business as usual. For others, it will be a painful realization that nothing short of an urgent corporate turnaround will suffice. To stabilize the business, companies must (1) protect their financial fundamentals by, for example, monitoring and maximizing cash flow, managing customer credit risk, reducing working capital, and optimizing their financial structure and financing options; (2) protect their existing business operations by reducing costs, increasing organizational efficiency, aggressively managing the top line, rethinking their product portfolio and pricing, reining in investment plans, and divesting noncore businesses; and (3) work to maximize their valuation relative to rivals by being proactive in their investor relations and favoring dividends over share buybacks. To seize advantage, companies must make farsighted investments, identify opportunistic and potentially transformative mergers, and consider possible redefinitions of their business models. This recession handbook will help companies not only to survive the recession but also to thrive in its aftermath. -
Moon Shots for Management
In May 2008, a group of management scholars and senior executives worked to define an agenda for management during the next 100 years. The so-called renegade brigade, led by Gary Hamel, included academics, such as C.K. Prahalad, Peter Senge, and Jeffrey Pfeffer; new-age thinkers, like James Surowiecki; and progressive CEOs, such as Whole Foods' John Mackey, W.L. Gore's Terri Kelly, and IDEO's Tim Brown. What drew them together was a set of shared beliefs about the importance of management and a sense of urgency about reinventing it for a new era. The group's first task was to compile a roster of challenges that would focus the energies of management innovators around the world. Accordingly, in this article, Hamel (who has set up the Management Lab, a research organization devoted to management innovation) outlines 25 "moon shots" - ambitious goals that managers should strive to achieve and in the process create Management 2.0. Topping the list is the imperative of extending management's responsibilities beyond just creating shareholder value. To do so will require both reconstructing the field's philosophical foundations so that work serves a higher purpose and fully embedding the ideas of community and citizenship into organizations. A number of challenges focus on ameliorating the toxic effects of hierarchy. Others focus on better ways to unleash creativity and capitalize on employees' passions. Still others seek to transcend the limitations of traditional patterns of management thinking. Not all the moon shots are new, but many tackle issues that are endemic in large organizations. Their purpose is to inspire new solutions to long-simmering problems by making every company as genuinely human as the people who work there. -
Towards a Comprehensive Understanding of Public Private Partnerships for Infrastructure Development
Public Private Partnerships (PPP) have emerged as one of the major approaches for delivering infrastructure projects effectively. This article develops a PPP framework for infrastructure development. It discusses examples of worldwide applications, as well as benefits and obstacles of PPP through a literature review on PPP-related research over the last 20 years. The syntheses of the knowledge present foundations from which the laws, regulations, and guidelines for effective and successful PPP implementation can be established. This analysis reveals that PPP can create new and long-term business opportunities with a chance to deliver infrastructure services of higher quality and efficiency. However, these benefits will only be materialized when a PPP project is properly planned and managed and both the public and private sectors work together successfully. -
Corporate Governance: The Link Between Corporations and Society
The book A Primer on Corporate Governance was written by Cornelis A. DeKluyver, Dean of the Lundquist College of Business at the University of Oregon, and published by Business Expert Press. The book discusses corporate governance from both a macro- and micro-perspective. Historical data and examples including the recent scandals that have torn the fabric of capitalism pave a pathway to the principal challenges facing today's boards, and how to successfully manage them. Chapter 1, "Corporate Governance: The Link Between Corporations and Society," describes the U.S. corporate governance system and its principal actors and briefly surveys the history of corporate governance in the United States, including the wave of governance scandals that occurred around the turn of the century. -
Governance and Accountability
The book A Primer on Corporate Governance was written by Cornelis A. DeKluyver, Dean of the Lundquist College of Business at the University of Oregon, and published by Business Expert Press. The book discusses corporate governance from both a macro- and micro-perspective. Historical data and examples including the recent scandals that have torn the fabric of capitalism pave a pathway to the principal challenges facing today's boards, and how to successfully manage them. Chapter 2, "Governance and Accountability," building on the review of history presented in Chapter 1, delves deeper into the philosophical questions of ownership and accountability and asks, "Who owns the corporation?" It contrasts the shareholder and stakeholder perspectives and tries to find common ground between the two. -
The Board of Directors: Role and Composition
The book A Primer on Corporate Governance was written by Cornelis A. DeKluyver, Dean of the Lundquist College of Business at the University of Oregon, and published by Business Expert Press. The book discusses corporate governance from both a macro- and micro-perspective. Historical data and examples including the recent scandals that have torn the fabric of capitalism pave a pathway to the principal challenges facing today's boards, and how to successfully manage them. Chapter 3, "The Board of Directors," focuses on the role of the board and provides an overview of recent trends in board composition, structure, and leadership.