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As of 2007, there were very few examples of widespread measurement and reporting of health outcomes, a critical quality measure. In-vitro fertilization clinics have been required to report their patient's health outcomes since 1995. The protagonist of the case, Dr. James Goldfarb, faces a number of challenges. As the medical director of a nationally-renowned fertility program at the Cleveland Clinic, he must run an efficient and effective practice that draws patients from both the surrounding area and from around the world. As a leader of the Society for Assisted Reproductive Technology, he must contribute toward the continuing evolution of the practice of in-vitro fertilization and ensure that the outcome measurement system is creating proper incentives and delivering timely, accurate, and useful information to patients, physicians, and researchers.

eHarmony's CEO needs to decide how to react to imitations of its business model, encroachment by competing models and ascendance of free substitutes. The case provides four options to address these threats and asks students to choose one after they analyzed the company's strategy. The analysis begins with understanding of value proposition, as derived from failures of substitutes. It proceeds to examine industry structure and important differences across its different niches. Students can then analyze the essence of a focused differentiation strategy and understand the importance of costly strategic trade-offs. They can also estimate the size of eHarmony's competitive advantage over two other competitors before articulating threats to sustainability, all of which will help them choose one of the four options.

Museum XYZ built a beautiful facility in a large, Midwestern city. However, after opening to much acclaim, attendance began to fall off, finances were in a shambles, and there appeared to be a leadership void. The board hired two consultants to conduct a review to pinpoint the issues. This case discusses what the consultants learned, and the teaching note discusses what the board decided to do with the information.

The Mahindra & Mahindra Group, one of India's best-known business houses, is trying to become bigger, more global, and more innovative-all at the same time. In India's post-economic-reforms gold rush, the group, whose 2007 sales were $6.6 billion, has invested in a slew of unrelated businesses, from aircraft manufacture to film production. The flagship tractor and SUV businesses are readying to make big bets in, respectively, the Chinese and U.S. markets. Anand G. Mahindra, the group's chief executive, warns that M&M will survive only by creating a culture of innovation. "Indian companies have almost caught up with the productivity frontier," he says. "What's going to distinguish us in the future is our ability to make products and services that capture the customer's imagination." He says that in emerging markets, businesses structured as groups of companies have an edge over rivals. "I believe that business families should behave like aggressive private equity companies. They must allocate capital, demand performance, create synergies, sustain value systems, and implement good governance practices, but they should let professional managers run the companies." That's why he won't mandate change, globalization, or innovation; he believes in giving the CEOs of the group's divisions tremendous autonomy. In this interview, conducted by two HBR editors, Harvard Business School graduate Mahindra discusses the advantages of creating a federation of companies rather than a conglomerate; the real role of the corporate center in today's world; and his personal formula for organizational transformation.

How do you create and sustain a profitable strategy? Many approaches have focused managers' attention inward, urging them to build a unique set of corporate resources and capabilities. In practice, however, identifying and developing core competence too often becomes a feel-good exercise that no one fails. Collis and Montgomery, of Harvard Business School, explain how a company's resources drive its performance in a dynamic competitive environment, and they offer a framework that moves strategic thinking forward in two ways. The resource-based view of the firm comprises a pragmatic and rigorous set of market tests to determine whether a company's resources are truly valuable enough to serve as the basis for strategy and integrates that market view with earlier insights about competition and industry structure. Where a company chooses to play will determine its profitability as much as its resources do. The authors spell out in clear managerial terms why some competitors are more profitable than others, how to put the idea of core competence into practice, and how to develop diversification strategies that make sense. To illustrate the power of resource-based strategies, the authors provide many examples of organizations-including Disney, Cooper, Sharp, and Newell-that have been able to use corporate resources to establish and maintain competitive advantage at the business-unit level and also to benefit from the attractiveness of the markets in which they compete.

A business historian reminds us that since the nineteenth century, predictions about globalization have been reliably wrong. Despite technology for the fast diffusion of knowledge, information-like wealth-seems to be concentrating even further.

Set against the backdrop of under-served, over-exploited rural India, this case highlights how the use of technology by the Indian conglomerate ITC transformed the lives of many rural Indians at the same time that it was benefiting the company. Continually plagued by an inefficient supply chain in rural agriculture, ITC implemented the e-Choupal initiative in 2000. Under the initiative, ITC set up small Internet kiosks in villages that allowed farmers access to an efficient and transparent alternative to the traditional mandi for marketing their produce. By establishing a direct channel between the farmer and ITC, e-Choupal significantly marginalized the role of middlemen, thereby ensuring farmers more money for their produce. In doing so, e-Choupal not only mitigated ITC's agrarian supply chain concerns but also achieved a greater good-the economic uplift and empowerment of the Indian farmer. Although e-Choupal was conceived as ITC's answer to their supply chain woes, ITC was quick to realize that they had discovered the delicate balance between achieving corporate profitability and making a social contribution. Aware of the multitude of challenges faced by impoverished rural Indians, ITC extended its e-Choupal framework to deliver core services, such as access to health care, education and information. They even liaised with other companies, including fast-moving consumer goods companies and finance companies, to deliver products and services to rural Indians that had previously commanded huge premiums or were simply unavailable. Evolving into a platform for community development, e-Choupal was both eradicating poverty and chipping away at rural isolation, even while ITC continued to enjoy the benefits of functional procurement and distribution value chains.

The story of Daksh, one of India's leading BPO companies that was bought out by IBM in April 2004 at an estimated amount of US$170 million, had all the elements of the great Indian IT dream: entrepreneurship, innovation, venture capital, wealth creation and a quick exit. Elaborating the post buy-out scenario the case highlights various issues arising from mergers and acquisitions and throws throws open for discussion different aspects of the dynamics of acquisition integration. The case also addresses the question as to why the soon-to-go-public Daksh had agreed to a sell-out and, more importantly, what had prompted IBM to acquire Daksh. Students are challenged to evaluate whether or not the takeover was the right decision, and how it fit into IBM's overall strategy. The case can either be used independently or in conjunction with Daksh and IBM: Business Process Outsourcing in India - Part 1. The Formative Years, which looks at Daksh as a fast growth entrepreneurial venture.

In April 2007, Zong Qinghou, founder of Hangzhou Wahaha Group and chairman of all its joint ventures formed with Danone, divulges details about Danone's plan to buy a 51% interest in Wahaha's non-joint venture subsidiaries and related entities that are owned or managed by Zong's family interests. The disclosure of what is supposed to be a trade secret sparks off a series of public accusations, followed by lawsuits by each partner against the other. On the one hand, Danone indignantly retorts that its takeover plan is grounded in a breach of its contractual interest by Zong. Danone alleges that Zong has been making many of the same products as the joint ventures have under the same "Wahaha" trademark through a parallel network of production facilities that he or his family own or manage. He also uses the joint ventures' distribution channels for selling them. On the other hand, Zong argues that the "Wahaha" trademark has never officially been transferred to the joint ventures and complains of Danone's lack of effort throughout. He also accuses Danone of attempting to monopolise China's beverage market by driving out national brands like Wahaha, which are part of China's cultural heritage and thus are the heart and soul of Chinese people. As a way of protesting, Zong resigns from his post as chairman at the joint ventures. Danone then appoints Emmanuel Faber, chairman of Danone Asia Pacific, as the new chairman, but the legitimacy of this appointment is denied by Wahaha. This case illustrates the conflicts in interests, practices and cultural values that foreign investors may encounter with their local partners when doing business in China. It also examines the dynamics of revenue sharing, control rights and contract enforcement between foreign and local partners.

This note helps teams work through a problem-solving process that facilitates the design and implementation of a strategy for continuous improvement.

In the past, design has most often occurred fairly far downstream in the development process and has focused on making new products aesthetically attractive or enhancing brand perception through smart, evocative advertising. Today, as innovation's terrain expands to encompass human-centered processes and services as well as products, companies are asking designers to create ideas rather than to simply dress them up. Brown, the CEO and president of the innovation and design firm IDEO, is a leading proponent of design thinking - a method of meeting people's needs and desires in a technologically feasible and strategically viable way. In this article he offers several intriguing examples of the discipline at work. One involves a collaboration between frontline employees from health care provider Kaiser Permanente and Brown's firm to reengineer nursing-staff shift changes at four Kaiser hospitals. Close observation of actual shift changes, combined with brainstorming and rapid prototyping, produced new procedures and software that radically streamlined information exchange between shifts. The result was more time for nursing, better-informed patient care, and a happier nursing staff. Another involves the Japanese bicycle components manufacturer Shimano, which worked with IDEO to learn why 90% of American adults don't ride bikes. The interdisciplinary project team discovered that intimidating retail experiences, the complexity and cost of sophisticated bikes, and the danger of cycling on heavily trafficked roads had overshadowed people's happy memories of childhood biking. So the team created a brand concept - "Coasting" - to describe a whole new category of biking and developed new in-store retailing strategies, a public relations campaign to identify safe places to cycle, and a reference design to inspire designers at the companies that went on to manufacture Coasting bikes.

R&D companies are increasingly falling prey to patent sharks: firms with hidden intellectual property that surface, threatening to sue, when their rights are inadvertently infringed. The attacks usually come out of the blue, and companies' traditional lines of defense, designed for fighting off visible competitors, are essentially useless in this type of guerrilla warfare. Munich University of Technology's Henkel and London Business School's Reitzig offer five principles to help companies avoid attack. Move away from amassing huge patent portfolios for cross-licensing with competitors. Creating technological interdependence can work among competitors interested in exchanging technology. Patent sharks, however, want only monetary gains. Simplify standards and create more-modular designs. Companies become vulnerable when a shark's technology is built into a standard and they can neither stop using the technology nor switch to a feasible alternative. The solution is to simplify standards to minimize the number of irreplaceable core components and to create more-modular designs, so an infringing module can be swapped out for a legitimate one. Cooperate with competitors early in the R&D process. Disclosing unprotected ideas to competitors can seem counterintuitive, but sharing information early on may help companies avoid developing products that are susceptible to attacks. Foster interdepartmental and intercompany cooperation. Assigning patent lawyers to projects from the start reduces the costs of protecting high-quality technologies down the line. Stop flooding patent offices with insignificant inventions. The deluge has actually made it easier for sharks to secure protection for trivial innovations, thus increasing the chances that a company will unknowingly infringe on a patent.

China's new tax regulations provide attractive incentives for foreign companies that are willing to help the government improve local infrastructure, make Chinese businesses greener, and shift the country's industry from manufacturing cheap products to providing high-quality goods.

Chronicles the globalization of the Tata Group, one of India's largest business groups. Since 2000, many Tata Group operating companies have aggressively built international businesses, particularly through overseas acquisitions. After describing the globalization rationales and approaches of the major Tata Group companies, the case asks students to consider whether Tata Motors should pursue the acquisition of the Jaguar and Land Rover brands owned by US-based Ford Motor company.

In 2006, University of Texas MD Anderson Cancer Center was an internationally leading institution for cancer care, education, and research. Since 1996, it had successfully reorganized itself from a cancer hospital that was physically organized around clinical specialties into one that was organized into disease-based integrated practice units called multidisciplinary care centers. These units were supported by a new construction project that had created new disease-specific facilities and a widely-supported administrative plan in which physicians reported both to leadership of specialty-based academic departments and disease-based clinical centers.

The topic of formulating and implementing competitive strategy is usually considered from the perspective of a large, well established, and often time multi-divisional corporation. Achieving a sustainable competitive advantage, however, is every bit or even more critical to the survival of smaller startup businesses. Although much research has been performed on how startup companies create value for their constituencies and on how they launch products, few attempts have been made to apply classical large-company strategy ideas to startups. In this paper we consider eleven distinct differences between how large, established firms and their smaller startup counterparts consider strategy initiatives with an eye to guiding entrepreneurs toward higher probabilities of success. The eleven differences are building on market strengths, size of market, relationship to resources, presence of constraints, visibility of and by competitors, investor expectations, share¬holder/investor risk tolerance, process, portfolio management, triage, and time horizon for results.

All executives would like their organizations to perform better, and most seek ways to make that happen. This paper focuses on how supply chains-- the series of activities through which products and services are created and then distributed to customers-- can enhance firm performance. For the last couple of decades, most firms have emphasized maximizing speed or minimizing costs within their supply chains. In the current business landscape, however, a broader approach is needed. We describe the main advantages of developing "best value supply chains" as a tool for enhancing performance. These chains differ from traditional chains in important ways. Best value supply chains are used by organizations as a central element of strategy, not simply as a means to move materials. Rather than focusing primarily on speed or cost, best value supply chains are designed to deliver superior total value to the customer in terms of speed, cost, quality, and flexibility. Our contention is that organizations that develop best value supply chains will enhance their performance. We support this contention with examples from leading firms that reflect a best value approach.

This exercise enables users to: identify stakeholders and analyze their interests and expectations; categorize interests and expectations based on importance; and develop an action plan.

Student spreadsheet for case KEL330.

In January 2008, Citi and Merrill Lynch are trying to steer their ships back to calm waters. The new CEOs, Vikram Pandit (Citi) and John Thain (Merrill), have been at the helm of their companies for less than three months. This case focuses on their steps to counteract the massive losses resulting from their firms' investments in subprime-mortgage structures. What actions have these leaders taken thus far and what actions should they consider going forward? See also "Warren E. Buffett, 2008" (UVA-F-1550).