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A shift from seasonal to level production of toys will change the seasonal cycle of Toy World's working capital needs and necessitate new bank credit arrangements. A rewritten version of an earlier case.

A personal negotiation episode in purchasing a car is presented. Tactics and strategies commonly encountered by car buyers and car salespeople are illustrated.

VideoGuide is emerging from a development stage start-up and requires a significant capital infusion to commercialize its product. Various financing options are considered including going public, venture capital, private placement, or a strategic partner. Given the "heated" IPO market, VideoGuide is leaning toward going public.

Craig Weatherup, the president and CEO of Pepsi Cola, leads a change process that completely transforms his company. It includes a new vision, operating philosophy, strategy, and organizational structure. He also introduces process improvement techniques and builds new performance metrics around these processes and the newly desired behaviors.

In November 1993, Dr. Richard Lerner, president of the Scripps Research Institute, faces the challenge of maintaining his organization's financial and scientific vitality. A proposed cooperative venture with Sandoz has attracted considerable criticism. Meanwhile, a new proposal to conduct clinical trials presents intriguing possibilities. Teaching Purpose: To understand how federal policy directly and indirectly shapes high-technology industries, to explore financing new ventures in a nonprofit research organization, and to value a proposed new venture.

A company meets financial analysis year-end earnings per share estimates, which have been progressively lowered during the year.

The case examines the development of the float glass process at Pilkington in the mid-1950s. Pilkington has pursued the development of a radically new process for flat glass production, but has experienced serious problems at each stage of development. The senior management must now decide whether to scale up to commercial production. A rewritten version of an earlier case.

Describes the first major joint venture between a U.S. and Vietnam rice company with reqard to the world rice trade. What are the opportunities and what are the challenges?

This case describes the situation Pierre Godfroid encountered when he took over as Sabena's CEO in 1991. At that time, Sabena was in crisis facing imminent bankruptcy. On the strength of a restructuring plan, developed by Godfroid and his staff, the Belgian government had agreed to bail out the airline in return for assurances that this would be the last time government assistance would be requested. Godfroid's task was to transform the company into a viable private enterprise. The case provides the opportunity to evaluate the viability of Godfroid's strategy and more generally to explore strategy formulation in a global industry. More importantly, it sets the stage for a sequence of follow-up cases (994M04, 994M05, 994M06, 994M07, 994M08) dealing with the implementation of the strategy. (A 43-minute video, broken into segments to coincide with the case series, can be purchased with the case, video 794M03.)

In early 1994, Dow Corning Corp. debates whether to participate in a proposed $4.2 billion product liability settlement. Specifically, the firm must decide whether to contribute $2 billion to end a class action suit filed by women suffering from connective tissue diseases, autoimmune disorders, and other medical conditions, allegedly as a result of defective silicone breast implants. Although denying any impropriety, Dow Corning stands accused of intentionally withholding information on health risks associated with its implants over several decades.

TourAmerica is negotiating a master contract with Voyager Inn International (Bethesda) for hotel rooms during the 1995 tourist season. Issues under consideration include number of rooms during peak, mid-, and off-periods, room rates, breakfast prices, and the cost of ancillary services. While the hotel manager is evaluated on the basis of several criteria, including adjusted daily rates, occupancy rates, and food and beverage profitability, and is also provided with a utility scheme to facilitate trade-offs among the criteria, TourAmerica uses an effective cost per registrant (adjusted for intangibles). These two approaches provide an opportunity to contrast measurement schemes and to justify the use of utility functions. This case is a role-play exercise and must be used in conjunction with "Voyager Inn International" (UV0357).

Voyager Inn International (Bethesda) is negotiating a master contract with TourAmerica, an international tour operator, for hotel rooms during the 1995 tourist season. Issues under consideration include number of rooms during peak, mid-, and off-periods; room rates; breakfast prices; and the cost of ancillary services. The hotel manager is evaluated on the basis of several criteria, including adjusted daily rates, occupancy rates, and food and beverage profitability. To facilitate trade-offs among the various criteria, the manager articulates a utility scheme. This case is a role-play exercise, and must be used in conjunction with "TourAmerica" (UV0679). Reporting forms for the evaluation of alternative contracts are provided with each case.

In 1987, Dennis Hightower, was recruited from outside for a newly created position as head of Disney Consumer Products European operations. Hightower has to win initial acceptance of entrenched country managers, integrate the company's diverse subsidiaries closer together, and revitalize European operations.

Describes the actions taken by Dennis Hightower as president of Disney Consumer Products in Europe and the Middle East from 1988 to 1994. Focuses on how he has established a regional office and knit local operations closer together, the benefits that the process has generated, but also the tensions it has created within the organization. The case ends with Hightower contemplating whether he should be changing directions, given the emerging strategic and organizational challenges.

Amoco Corp. is negotiating to sell a wholly-owned subsidiary, MW Petroleum, to Apache Corp. MW owns large reserves of oil and gas comprising many properties at different stages of engineering, development, and production. The proposed acquisition is a large one for Apache and poses several important financing and valuation problems. This case focuses primarily on valuation.

Explores the strategy, financing, and governance of a new type of organizational form, dubbed the Leveraged Build-Up by its inventor, Kohlberg, Kravis, Roberts & Co. The company makes leveraged acquisitions of small publishing companies, managing them in a very decentralized way. It has grown dramatically between 1989 and 1993. K-III's organization and governance structure combines many of the characteristics of leveraged buyouts with those of venture-backed companies. Each individual operating company is highly leveraged, achieving the discipline of debt and avoidance of free cash flow problems that otherwise plague pubishing companies. At the same time, the top management mandate is to acquire companies, requiring continual infusions of cash. Explores the tension between the debt repayment obligations and the demand for additional financing.

1994 was a turnaround year for pulp prices and the Aracruz company. How does the company respond to environmental pressures and to new types of competition in the industry? Teaching Purpose: Indicates how to position oneself in the value-added timber/pulp industry in an environment-friendly manner.

TV Guide is the largest magazine in the United States and is attaining record profitability. This case details the economics of TV Guide's success by studying its advertiser and reader relationships. Presents a detailed look at how a large magazine manages all aspects of its business in the face of emerging competition.

Eric Holt had one responsibility as FireArt's director of strategy: to put together a team of people from each division and create and implement a comprehensive plan for the company's strategic realignment within six months. It seemed like an exciting, rewarding challenge. Unfortunately, the team got off on the wrong foot from its first meeting. Randy Louderback, FireArt's charismatic and extremely talented director of sales and marketing, seemed intent on sabotaging the group's efforts. Anxiously awaiting the start of the team's fourth meeting, Eric was determined to address Randy's behavior openly in the group. But before he could, Randy provoked a confrontation, and the meeting ended abruptly. What should Eric do now? Is Randy the team's only problem? In 94612 AND 94612Z, Jon R. Katzenbach, J. Richard Hackman, Genevieve Segol, Paul P. Baard, Ed Musselwhite, Kathleen Hurson, and Michael Garber offer advice in this fictional study.

Eric Holt had one responsibility as FireArt's director of strategy: to put together a team of people from each division and create and implement a comprehensive plan for the company's strategic realignment within six months. It seemed like an exciting, rewarding challenge. Unfortunately, the team got off on the wrong foot from its first meeting. Randy Louderback, FireArt's charismatic and extremely talented director of sales and marketing, seemed intent on sabotaging the group's efforts. Anxiously awaiting the start of the team's fourth meeting, Eric was determined to address Randy's behavior openly in the group. But before he could, Randy provoked a confrontation, and the meeting ended abruptly. What should Eric do now? Is Randy the team's only problem? In 94612 and 94612Z, Jon R. Katzenbach, J. Richard Hackman, Genevieve Segol, Paul P. Baard, Ed Musselwhite, Kathleen Hurson, and Michael Garber offer advice on this fictional case study.