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Nestlé Ice Cream in Cuba
In 1996, as the Castro regime began welcoming limited international investment back to Cuba, Nestlé signed a letter of intent with the Cuban government to build an ice cream factory in Havana's El Cotorro neighborhood. The plant, a joint venture between the Cuban government and Nestlé, would produce high-quality ice cream products for tourists and affluent Cubans. Nearly twenty years after this decision to enter the Cuban market, it is not clear how successful the investment has been and what the future might hold for Nestlé on the island. Nestlé has faced important challenges in Cuba-such as supply shortages, entrenched domestic competitors, and risk of government interference-but there has been evidence of some marketing and financial success. The 2015 normalization of diplomatic relations may bring new strategic threats and opportunities as American companies begin to eye the Cuban market and current competitors prepare for market changes. In the case, students will evaluate Nestle's investment and strategy for future growth in the Cuban market and consider the company's market entry strategy, operations, and finances. -
Virsto (A)
Virsto, a storage virtualization company, was founded in 2007 by Mark Davis, Alex Miroshnichenko, and Serge Pashenkov. Davis founded Virsto after managing a series of technology startups, many of which were ultimately acquired by big name players such as Dell and HP. Virsto represented the first venture Davis built from the ground up, and it was intended to do for storage virtualization what VMware had done for server virtualization. At the beginning of Davis' journey, he and his cofounders faced a daunting decision: slow the pace of product development to wait for the market leader, VMware, to develop the functionality whereby Virsto's product could "plug in" to VMware's hypervisor, or go to market immediately with Microsoft Hyper-V, a new entrant with a still uncertain future. Davis gambled on immediate commercialization via a second-tier player vs. waiting around for VMware. While his decision brought Virsto to market more rapidly, the team soon found that Virsto's product far exceeded the needs of Microsoft's audience. Therefore, in 2011, Virsto was poised and ready when VMware announced the capability to integrate with external products, and Virsto quickly saw its market potential explode. VMware, which had been working on its own storage product that had yet to gain traction, saw the tremendous potential of acquiring Virsto to accelerate its storage solution. As VMware's interest to acquire Virsto crystallized into an extremely low-ball offer, Davis faced the difficult decision of whether he could negotiate a price with VMware that would make his investors, employees, and stakeholders happy, find another higher-paying acquirer, or allow the company to continue to build market value as the clear leader in storage virtualization. -
Intuit: Turbo Tax PersonalPro - A Tale of Two Entrepreneurs
The case tells the story of a product manager within Intuit who develops an idea for a new product that spans two of the company's existing business units-professional tax software, sold to accountants, and the consumer focused TurboTax product. The new product -TurboTax Personal Pro-connects consumers with professional accountants online, allowing them to have their taxes prepared by a professional. The cycle of product development transpires within the larger, corporate context of Intuit, where founder Scott Cook has been attempting to transform the enterprise into a leaner, more innovative company. The case describes in detail the lean startup methods used by the new product team, and how their attempts bump up against the existing, entrenched systems and processes of the larger enterprise. -
EcoWash: A Business Opportunity Worth Pursuing?
EcoWash is an all-in-one system that can be used to clean the interior and exterior of a vehicle in an environmentally friendly manner. A soon-to-be business school graduate has been approached by the inventor of EcoWash to embark on a partnership and to market the product. The opportunity looks promising, but a careful examination of the product and the market place - specifically through the lens of the lean start-up methodology - is needed before a final decision can be made. -
Nephila Builds a Portfolio of Weather Risk Transfer Contracts
The weather team at Nephila Capital Ltd. (Nephila) was in the midst of the weather market's busy winter renewal period. The list of weather risk transfer contracts that needed to be analyzed and priced seemed to be growing by the minute, and one team member is devising a plan to price each deal on its own merits of risk/reward. The counterparty's bid would reflect the willingness of the contracting party to pay for a weather hedge, and none would pay more than the bid amount. Nephila wanted to meet the needs of each counterparty, but only if Nephila earned a requisite return on capital. If the bid amount were not high enough to be attractive to Nephila, the team would need to convey that news to the counterparties. Did these new deal opportunities offer something more to Nephila beyond their individual numbers? -
MOD Pizza: A Winning Recipe?
Scott and Ally Svenson, the founders of MOD Pizza, had to make a number of decisions in planning how to scale their small company. They wanted to grow MOD from 45 stores as of May 2015 to 200 stores by the end of 2016, and while the two believed that MOD could manage this growth from an operational standpoint, they wanted to make sure that MOD's culture was sufficiently strong to survive this rollout. The company had developed a strong culture, and the Svensons did not want MOD's core values and philosophies to be compromised as it rapidly expanded. To that end, they considered what the company needed to do in order to protect its core culture. Should it put rigid safeguards in place or trust that MOD could successfully scale its culture by hiring the right people and helping them develop as employees? The Svensons also discussed the possibility of an IPO at some point in the near future; what would this mean for its ability to stay true to its core values? -
Pershing Square 2.0
In June 2015 William A. Ackman, the CEO and Founder of New York Hedge Fund Pershing Square Capital, reflects on the success of the fund he has spent over a decade building. Since its inception in 2004, Pershing Square's assets under management had grown from $500 million to well over $18 billion. Ackman is now considering a sizable new portfolio position and must decide how he should raise capital to undertake this new investment. This choice is affected by the recent launch of his new, $6 billion closed-end vehicle, Pershing Square Holdings, as well as the firm's lengthening investment horizon. Although always activist in nature, Ackman and his fund had in recent years become substantively involved in the management of portfolio companies, often working to drive shareholder value by improving operating performance. -
Hungry Hogs: The Hot Dogs from India
In 2009, a former engineering student set out with some like-minded friends to create a unique fast food service in Bangalore. Hungry Hogs Private Limited adapted a classic western favourite - hot dogs - to the local palate. The company went on to experience substantial success with revenues in excess of INR 7 million in 2013. The founding partner who set the business in motion must decide between expanding his successful business through franchising options or through the continued establishment of company-owned stores. He is concerned about maintaining the integrity of his products, keeping control over his business and maintaining the brand's favourable image. -
Future for Children: A Social Enterprise Project in Transition
This case is set in January 2015 and follows Future for Children (FFC), a poverty eradication charity initiated by Swiss banker, Daniel Elber, in Muntigunung, Bali (Indonesia). FFC began by piloting a phased development programme in one village by establishing local social enterprises that address key development hurdles and improve livelihood outcomes. Following the success of the pilot programme, the initiative is now ready to be replicated and rolled out to other villages in Muntigunung. However, some key challenges need to be addressed. For example, management of the social enterprises needs to be handed over to the local community. In addition, more funds are needed to replicate and scale up; and a sense of community ownership of the programme needs to take hold. In addition, the business model of FFC needed to be reviewed for its efficacy in achieving the mission's goal. -
Uber: Managing a Ride in China
As the ride-sharing app, Uber, expands into China, it is confronted by government regulatory concerns and local competition, while also facing opportunities generated by a fast-growing emerging market and aided by local collaborators. Uber endeavours to take the lead in the market, but, as the newcomer, it needs to make many decisions. The case study highlights China's online chauffeuring market and the challenges facing Uber. As students attempt to develop a feasible plan for Uber to succeed, they will review Uber's service offering and the strategies that both Uber and its competitors have adopted. The case also explores other opportunities and challenges that Uber faces as the company works with local businesses and government responses toward the new business sector. -
S. J. Lawson, Inc.-A Performance Measurement Behavioral Audit
With the encouragement of its overseas parent company, Cochran Consumer Products Inc. (CCPI), the U.S.-based executive team at S. J. Lawson, Inc. (SJLI), was nearly ready to announce the new financial performance measurement focus and economic profit (EP) for the company's product category managers. Currently, the SJLI executive team was finalizing plans for its initial announcement to the subsidiary's five product category managers. The team had received some general guidance from headquarters but it had also been told that because it knew the category managers best, it should develop its own local strategy for introducing the initiative. -
Night-Lights and Nearsightedness (A)
Researchers at the University of Pennsylvania were interested in whether exposure to light early in life might affect eye growth and lead to an increased risk of myopia (nearsightedness). Eyes grew rapidly after birth, but myopia usually did not develop until later in life and arose from excessive postnatal eye growth. They knew that the duration of daily light had been shown to increase eye growth in chicks and wondered whether the same might be true for humans. The results startled researchers and might explain the increase in myopia rates over the last two centuries. The B case gives the results of a follow-on study conducted by the Ohio State University. -
Deflategate and the National Football League
On January 18, 2015, the New England Patriots faced the Indianapolis Colts in the AFC Championship game. In the second quarter, a Colts player intercepted a pass from Patriots quarterback Tom Brady. Colts equipment personnel alerted NFL officials that the ball's air pressure was below the required 12.5 PSI (pounds per square inch). Some argued that lower PSI provided a competitive advantage as it made the ball easier to grip and harder to fumble. At halftime, game officials found the air pressure in 11 of the 12 Patriots game balls to be under 12.5 PSI. The NFL launched an investigation into what became known in the media as "Deflategate," and commissioned attorney Ted Wells to investigate whether or not the balls had been intentionally deflated. Wells' team, with expert consultants, examined air pressure data recorded by referees, the temperature on game day, the behavior of Patriots players, and other evidence. Did the Deflategate investigation reveal any actual evidence of cheating? Were there flaws in Wells' investigation? -
Ron de Venezuela
This case study depicts the cooperation process undertaken by several companies in Venezuela's rum industry to add value to their products through securing the protected designation of origin (Ron de Venezuela). The case describes basic dilemmas that companies face when they need to implement cooperative strategies to develop competitive advantages in the global market, even when benefits and costs obtained from such cooperation are not equally distributed. It also describes the role played by the Chamber of Venezuela's Alcoholic Products Industry (CIVEA, for its Spanish acronym) in coordinating companies in their effort to obtain the Ron de Venezuela protected designation of origin in a hostile political and regulatory environment. -
Karstadt Warenhaus GmbH: Do Department Stores Have a Future?
At the end of 2013, Karstadt Warenhaus GmbH, the second-biggest German department store chain and one of the most traditional and well-known companies in Germany, was in a highly challenging strategic position. Following recent mismanagement, it had narrowly escaped insolvency. By the end of 2013, however, Karstadt was still struggling against competition in the retail sector. Could the newly appointed chief executive officer come up with a business model and strategic direction that would ensure the company's continued existence and sustainable profits in the near future? Challenges that she had to address included increasing competition (e.g. from online shops), low liquidity, delays in necessary investments, and rising concerns about job security among employees. What strategic options were best for turning around the performance of the iconic 130-year-old department store chain? -
Agarwal Packers and Movers Limited
Agarwal Packers and Movers Limited is an example of a business that delivers superior customer service with continuous logistics design innovation. The case provides details of a leading logistics and solution provider for household goods relocation who in past was facing problems due to increase in number of customer complaints and claims and also increase in packaging costs. APML believed that mistakes could be avoided and defects could be prevented. Solutions were offered by modifying the processes through innovation in its services resulting in customers' delight. As a result of continuously improving capabilities, people, processes, and technology; the services improved too. The case gives an insight on how the company improved its services by innovating and how these innovations were sustained by such a large organization with many branches throughout India. -
Crowdfunding The Young Gallery Project
The Glasgow-based charity, Impact Arts, was looking for alternative funding streams for its Young Gallery project. As a result, it undertook its first crowdfunding campaign on the Indiegogo platform. The project did not achieve its stated target of £15,000 in the six week campaign period. Instead, only £4,715 (31 per cent of the total) was raised. While the charity did not achieve its goal, the campaign left the chief executive officer and her team feeling motivated and enthusiastic about crowdfunding as a possible complementary revenue source. However, they recognized that they needed to learn from this experience in order to make future campaigns more effective with respect to pitch (the proposition made to would-be donors) and its delivery. -
Berendsen Island
Berendsen Island, an outsourced workwear service, uses the standard costing model to determine its profitability. Because the company recently reported a loss, the plant manager and the business controller investigate time-driven activity-based costing in an effort to gain insights into its cost structures. The company also needs to provide a quote to two potential new customers. -
Bank Negara Indonesia: Enabling Transformative Change Through Human Capital
The case is set in 2014 in Indonesia, with the leaders of a once strong national bank - Bank Negara Indonesia (BNI) - facing the challenge of transformation amidst a volatile and uncertain business environment. With growing competition and the rapid economic growth of the nation, the bank leadership recognises that a major change is needed to ensure the future survival of the bank. In 2008, a new management team was appointed to address those issues as BNI fell from number one to four in terms of market share in Indonesia. The bank suffered from inefficient business practices and a capability gap due to a zero-growth policy in terms of employees. As a long-time stable state-owned enterprise, which was typically slow to adapt, bringing about change would be quite a challenge. At the centre of the transformation agenda is the need to shift from a product-centric approach to a customer-centric one. To achieve this, a strong emphasis on human capital was necessary to address the firm's strategic needs in the areas of talent, leadership, culture, and structure. For this purpose, Felia Salim, the Vice CEO, took charge of the human capital strategy. -
Walter Reed National Military Medical Center (A): Vice Admiral John Mateczun and JTF CapMed
This case is part of a four part series that examines the merger of the Walter Reed Army Medical Center and the National Naval Military Center at Bethesda - the most expensive, controversial and largest hospital merger in US history. The series includes: A case + A teaching note (Leadership of VADM Mateczun); B case + B teaching note (Army/Navy cultural issues); Epilogue (short conclusion); Film - award winning short documentary. The A case focuses on the leadership of Vice Admiral Dr. John Mateczun, a three-star Navy admiral who led the merger. Mateczun achieved what many considered to be a minor miracle - integrating Walter Reed and Bethesda Naval in the face of fierce institutional resistance. But in his drive to see the plan through, Mateczun stretched the limit of military authority, expended his political capital and alienated friends and colleagues. The case allows discussion of leadership styles and the importance of persuasion, negotiation, communication issues, and personal character. There are two companion cases and a 17-minute film. The film shows a brief history of the hospitals, explains the BRAC (Base Closure Commission), and shows the intensity and urgency of the medical needs of patients being cared for at Walter Reed during the height of the Iraq and Afghanistan wars. The B Case focuses on the difficulties of merging organizations with significant cultural differences. It may be taught together with the (A) case or on its own with the video. The short Epilogue looks at the outcome in 2014, 3 years after the merger. Case number 2035.0