Case studies in_strategy(catalogue_iii)
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  • 1. 1S T R A T E G Y – IIIS T R A T E G Y – IIIS T R A T E G Y – IIIS T R A T E G Y – IIIS T R A T E G Y – III www.ibscdc.org
  • 2. Industry Fashion Customer preference; Competitive Reference No. INA0078 environment; US Auto industry Industry Analysis Year of Pub. 2009 Fashion Industry: Can Asia Buck Teaching Note Available the Trend? Struc.Assign. Available The US Newspaper Industry at Keywords Crossroads? Well, how does one define fashion going global – When a Gucci or Armani is Asia, Oriental, Fashion, Blue Ocean The print newspaper industry of the US displayed on the fashion streets of Japan Strategy, SWOT Analysis, GAP Analysis , has been witnessing revenue decline since and China or when celebrities like Liz Japan, China, Europe, Retail, Gucci, Global, 2005. Decreasing circulations and Hurley or Will Smith showcase themselves Brand, Apparel, Supply chain consequently decreasing advertising in an Asian outfit? The winds of global revenue, due to the increasing popularity fashion industry are changing their course of digital media, is said to have affected – no more do fashion winds move only the print medium. Many newspaper CAFE Fuel Rules: Changing Auto from west to east but they blow from east companies initiated several cost cutting to west too. Asian fashion, of late, has Industry Dynamics in the US efforts to cope up with the industry made its presence felt on the global ramp. In a move to increase fuel efficiency and downtrend. The increasing online For centuries, western brands like Gucci, to reduce gasoline usage for travel, a bill advertising revenue at the US newspaper Versace, Armani and LVMH maintained was passed by US Federal government websites put forth a notion that the their supremacy in the world of fashion. raising the standards of Corporate Average industry will undergo a paradigm shift from Innovation, rich designing, marketing Fuel Economy (CAFE) standards to 35 the print medium to the online medium. expertise coupled with the presence of miles per gallon (mpg), to be achieved by Many analysts believed that the US excellent fashion connoisseurs, enabled the 2020 from the current standards of 27.5 newspaper organisations will retain their western brands to command a premium mpg for passenger cars and 22.2 mpg for local franchises in print format, as it over the years. In comparison, the Asian trucks. US car manufacturers like GM, Ford contributes significantly to their revenue. fashion industry, which is still in the nascent and Chrysler were apprehensive of this However, speculation is rife about the stage of growth, has been trying vigorously decision as they were in doubt in achieving future of US print newspaper industry as to position itself among the global players. the proposed standard in 12 years. The the focus shifts to the online medium. Although oriental fashion is pulling huge automakers were left with two options – crowds to its fashion weeks, the Asian either make cars more expensive or make Pedagogical Objectives fashion industry, despite talented designers them smaller and less powerful. By and lean manufacturing processes, is failing upgrading their manufacturing processes • To analyse the increasing popularity of to build a brand image in the high-end and investing in expensive technology, new media over the traditional media in luxury segment. Factors like low brand they hoped to reach the standards set by the US value, lack of technical know-how, the Act. It was also found that Japanese • To provide an overview of the US infrastructure and distribution networks manufacturers like Honda or Toyota were newspaper industry and the competitive have been hampering their growth closer to the proposed standards as scenario opportunities globally. compared to the Detroit 3 and European car manufacturers. On the other hand, • To analyse the various factors that affect This case study dwells upon the dynamics the US print newspaper industry of the global fashion industry and the fearing a rise in oil prices, consumers are comparative position of the Asian fashion looking for fuel efficient and compact cars. • To analyse how the US print newspaper industry. The case study also analyses the Consumers as well as market analysts industry can hold its audience and challenges and threats to Asian fashion presume that new CAFÉ standards can be increase its revenue. designers and brands from global players met by 2020 which is in contradiction to besides providing a scope to identify the the view of the automakers. The case Industry Newspaper Publishing ways in which Asian fashion industry can attempts to profile the needs of consumers Reference No. INA0076B create an uncontested market space and and expertise of auto-manufacturers, in Year of Pub. 2008 make competition irrelevant. the wake of new CAFÉ rules. Teaching Note Available Struc.Assign. Available Pedagogical Objectives Pedagogical Objectives Keywords • To understand and analyse fashion • To comprehend the implications of US Newspaper Industry; NAA; WAN; industry dynamics in a flat world (market environmental regulations on industry Digital Media; Ad spend; Classified ads; share, profit margins, value chain, etc.) dynamics Consumer spectrum; Interactive • To understand the impact of CAFE bill marketing; New media; Internet • To analyse the critical success factors advertising; Crossroads; Newspaper for fashion industry and debate on on US customers and auto manufacturers websites; Business models; Google; Yahoo whether they would change when the • To understand the prospects and companies go global challenges of US auto industry. • To understand the Asian fashion Industry Auto Industry Indian Animation Industry: industrys capabilities and contrast them Reference No. INA0077C Roadblocks for Global with the global fashion industrys critical Year of Pub. 2008 Competitiveness success factors Teaching Note Available Struc.Assign. Available Since 2005, India witnessed an increase in • To debate on the essential requisites for the amount of work related to animation any Asian fashion house to go global Keywords outsourced to India. Most of the companies and the strategies they should follow to CAFÉ rules; Environmental Standards; that outsourced such work were from the position themselves so as to successfully Industry Analysis Case Studies; Big three; Europe, US and also Asia. Though there compete with the incumbents. Detroit three; Japanese Automakers; has been an increase in the volume of2 www.ibscdc.org
  • 3. outsourced projects and co-production (14.4% to 2.17 million units). The demand at much lower prices. Whether Nikon S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIdeals, the animation content in the form for such scooters increased in Indian two- would be able to successfully fight grey S T R A T E G Y – III S T R A T E G Y – IIIof movies and television content did not wheeler market due to improvement in market issue in India was yet to be seen.seem to entice the Indian audience. This product features, design and style; and wascast doubts on the competitiveness of the targeted to attract young college girls, Pedagogical ObjectivesIndian animation industry. This case study housewives, and teenagers. Looking forexamines the various hurdles that Indian growth, Suzuki launched gearless scooter • Dynamics of compact camera marketanimation companies need to cross, not Access 125 (Access) in the 100cc to 150cc in Indiaonly to appeal to the local market but also segment to compete with its competitors • Market entry strategies of Nikon into become globally competitive. like Honda, Kinetic, and Bajaj. But still, a India segment of customers preferredPedagogical Objectives motorcycles because of bigger wheels, • Strategic implications of grey markets better road grip, power, higher groundThe case study helps in understanding • Nikons strategies to fight grey markets. clearance, and low maintenance cost• The growth of global animation industry compared to scooters. The case facilitates Industry Compact Camera Market discussion on whether Suzuki would be able Reference No. INA0073A• Growth prospects of the Indian to succeed in capturing these buyers mind Year of Pub. 2008 animation industry in relation to the space. Teaching Note Available worldwide markets Struc.Assign. Available Pedagogical Objectives• Inadequacy of the Indian animation Keywords industry to compete globally. • To examine the growth drivers and Nikon Corporation; Compact CameraIndustry Animation Industry demand factors of Indian two-wheeler market Market in India; Grey Market; CompactReference No. INA0075B Camera; Single Reflex Camera (SLR);Year of Pub. 2008 • To understand the importance of Canon India; Kodak India; NikonsTeaching Note Available continuous innovation in two-wheeler Coolpix; Industry Analysis Case Study; GreyStruc.Assign. Available market Market; Digital Cameras; ProductKeywords cannibalisation; Brand Image; Brand • To study the impact of consumer BuildingIndia; Emerging economy; Animation; behaviour in Indian two-wheeler industryGlobal animation Industry; Indian • To discuss whether the strategies adoptedanimation Industry; Roadblocks; by Suzuki would help it succeed in Indian Hotel Industry (A): TheDeveloping nations; Financial News;Outsourcing; Intermediaries; Industry shifting the consumer priorities from Competitive Dynamics motorcycles to gearless scooters inAnalysis Case Study; MNCs; Animation India. Fuelled by the countrys booming economy,outsourcing hub low-cost air carrier introduction and Industry Automobile Industry liberalisation of FDI norms that allow Reference No. INA0074A 100% foreign investment in real estate, Year of Pub. 2008 Suzuki in India: The Growing Teaching Note Available the Indian hotel industry is currently seeing Gearless Segment of Indian Struc.Assign. Available a boom. Demand for hotel accommodation has increased tremendously across India but Two-Wheeler Market Keywords the rooms supply has seen an insignificantThe worlds second largest manufacturer growth, causing staggering room rates andof two-wheelers – the Indian two-wheeler Indian Two-Wheeler Market; Industry insufficient room availability. Inbound tourindustry is broadly classified into three Analysis Case Study; Transportation; operators blame these as key deterrentsproduct segments – scooters, motorcycles Consumer Behaviour; Motorcycles; that keep tourists from visiting theand mopeds. During 1980, the de-licensing Gearless Scooters; Marketing Strategy; country. Moreover, with poorly facilitatedpolicy of Indian government allowed Joint Venture; Competition; Foreign airports, inadequate road infrastructure,foreign companies to operate in Indian Players; Product Innovation; Suzuki; high taxation levels and a bureaucratic visatwo-wheeler market through joint ventures Honda Motorcycle & Scooter India (P) processing system, Indias hotel industry(JV). Especially, the entry of Japanese Ltd.; Hero Honda; Bajaj Auto; Kinetic; has serious challenges ahead. Significantcompanies changed the dynamics of Indian LML investments in tourism infrastructure aretwo-wheeler market by concentrating on essential for this industry to progress andcustomer aspirations, and embracing new ultimately achieve its potential.technology. Banking on the opportunity, Compact Camera Grey Marketduring 1982, Suzuki Motorcycle India Pvt. in India: Nikons Dilemma Pedagogical ObjectivesLtd (Suzuki), a subsidiary of Suzuki MotorCorporation (SMC), entered the Indian Sensing the fast growth in the Indian • To understand Indian hotel industrytwo-wheeler market through a joint camera market, Nikon Corporation, a dynamics before and after the countrysventure partnership with TVS Group, an Japan based camera brand, in 2007, decided economic liberalisation and analyse theIndian company, to manufacture to set up a subsidiary in India. Nikon was a key success factors of the industrymotorcycles. Until 2000s, the motorcycles late entrant and players like Sony, Canon, • To examine the Indian hotel industrywere more popular in Indian two-wheeler Kodak and Samsung had already established segmentation and contrast it with themarket. But the launch of gearless scooter themselves as key players in the Indian countrys economic development andHonda Activa – a four-stroke scooter by market. To establish itself in the Indian room pricesHonda Motorcycle and Scooter India Pvt market, Nikon had to compete with theseLtd (HMSI) in 2001, changed the demand established players. Apart from this, the • To highlight global hotel chains growingdynamics of Indian scooter segment. Since presence of grey market was a serious presence in India and the various market2007, the gearless scooter segment has concern for Nikon. Nikons own products entry strategies available for them tobeen growing as compared to motorcycles were widely being sold in the grey market establish their presence in India 3 www.ibscdc.org
  • 4. • To analyse Indian hotel industrys Pedagogical Objectives and how it has changed the meaning of demand-supply mismatch, the reasons business over the decade. Specifically it can Industry Analysis for it and the necessary steps to fill the • To understand the dynamics of the be used to: gap. Chinese B2B E-commerce market • To understand the difference between Industry Hospitality Industry • To analyse the business methodology of Internet economy, electronic business Reference No. INA0072 the Alibaba group and electronic commerce Year of Pub. 2008 • To discuss the risks of online business, Teaching Note Available • To discuss the significance of digital especially in global expansion economy vis-a -vis traditional economy Struc.Assign. Available • To understand the importance of • To understand the constituents of e- Keywords efficient and adequate business model in commerce business Indian Hotel Industry; Industry the growth of an online business. Segmentation; Indias Economic • To analyse the critical success factors Industry E-Commerce Liberalisation; Industry Classification; for the growth of e-commerce Reference No. INA0071 SWOT Analysis of Indian Hotel Industry; Year of Pub. 2008 • To debate the relevance of e-commerce Critical Success Factors; Challenges in the Teaching Note Available business in China Indian Hotel Industry; Role of Government Struc.Assign. Available in Industrys Development; Industry • To understand the resulting business Analysis Case Study; Taj and Oberoi Group Keywords opportunities and challenges. of Hotels; Market Entry Strategies; Global E-commerce; Dynamics of online business; Industry E-Commerce Hotel Chains in India; Incredible India Alibaba.com; Internet commerce; Chinese Reference No. INA0070 Campaign; Demand Supply Disparity electronic commerce; China in global e- Year of Pub. 2008 eommerce; Digital economy; Critical Teaching Note Available success factors of e-commerce; Industry Struc.Assign. Available Emergence of China in the Analysis Case Study; Strategies of Keywords Global E-Commerce Market (B): Alibaba.com; Internet economy Alibaba.coms Surge E-commerce; Dynamics of online business; Industry Analysis Case Study; Electronic Second in the two case series, this case Emergence of China in the global marketplace; Internet commerce; portrays Alibaba.com, a portal that Chinese electronic commerce; China in withstood the Chinese and emerged as a Global E-Commerce Market (A): global e-eommerce; Digital economy; leader in a short span of 9 years. Launched Dragon Drags on Adaptation Critical success factors of e-commerce; in 1999, the portal targeted SMEs One of the most popular economic stories Opportunities and challenges of e- providing Business to Business (B2B) in the last decade and half was the emergence commerce; Internet economy; Old solutions and aggressively expanded the of China as a formidable force in the global economy and New Economy customer base by tailoring its offerings to economy. With the growth booming at more various SMEs. Alibabas web presence than 10% per annum, all sectors of the includes an international marketplace, which focuses on global importers and Chinese economy got the required thrust, Luxury Brands in China: Profiting E-commerce being one of them. Internet from Scale exporters, and a China marketplace penetration in the country registered focusing on domestic suppliers and buyers. dramatic surge, as the Chinese establishment China’s 1978 economic reforms helped Alibabas business and operational patterns eased regulations and foreign multinationals boost its economic growth and in turn, the helped it to become the highest market provided the required know-how along with income levels there. China’s demography valued firm. This enabled the company to necessary hardware. Once the infrastructure too changed - with thousands of be listed on the Hong Kong Stock was in place, the Chinese business millionaires and a growing middle class Exchange in November 2007. And set its community was quick in embracing E- coming up. All this had an impact on the sights on global expansion, also offering commerce. However, the common country’s luxury industry, whose growth is more services to its domestic clients. populace was not quick enough, being pulled expected to jump from 1% in 2000 to 29% Though hailed as a good strategy, as the back by many apprehensions – chief among by 2015, making it the largest market for incremental revenues will out do them were lack of physical feel of the luxury brands. However, China is a incremental costs by miles, it has its own products and security (over privacy and complex cultural market. risks. Companys success of the company payments) – ultimately E-commerce has depends on its ability to tailor itself to suite the needs of global diversities – not a not gained expected popularity. Albeit Pedagogical Objectives slowly, number of people purchasing online mean task by any measure and not many is picking up – much to the liking of Chinese The case study helps students: portals could achieve in the past. This case e-commerce companies. This case study, enables analysis on the strategies, which • Analyse the impact of China’s economic the first in the two case series, enables a the company has adopted in its initial reforms discussion on why e-commerce failed to stages to establish itself facing adverse attract Chinese public, though it had all the • Discuss the growing demand for luxury conditions. How could Alibaba.com install necessary ingredients. Why was Chinese brands faith in its customers in such a short span public averse to online transactions? What of time? What measures did the company strategies did the companies adopt to • Assess Chinese consumer behaviour take to overcome the resistance of the increase the popularity of E-commerce? Chinese? Is the company too ambitious in • Discuss various strategies How China was able to establish itself on its global plans? Can the company handle global E-commerce market place? • Analyse the challenges for players. diverse needs of foreign and domestic customers? What measures should it take Industry Luxury to succeed the complexities involved in Pedagogical Objectives Reference No. INA0069 global expansion? Which regions should it Year of Pub. 2008 The case study is meant to understand the focus on? Teaching Note Available importance of electronic form of business Struc.Assign. Available4 www.ibscdc.org
  • 5. Keywords Industry Internet Search & Navigation prompt customers to buy the new product. S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III Then the growth phase sees rapid market S T R A T E G Y – III S T R A T E G Y – III ServicesLuxury Brands; Counterfeiting; Luxury Reference No. INA0068 expansion and increasing competition, withRetailing; Tourism and Luxury Industry; Year of Pub. 2008 the entry of new players. In these twoBrand Image; L’Oreal; LVMH; Teaching Note Available phases, a lot of evolution (both in termsCompetition; Critical Success factors; Struc.Assign. Available of products and markets) happens. ProductsMarket Entry Strategies; Consumer undergo many changes with the applicationBehaviour; Industry Analysis Case Study; Keywords of new technologies, rising demands andIndustry Dynamics; Brand Building; varying choices of consumers. This caseChallenges for Luxury Goods Companies Google; Baidu.com; China’s Search Engine Market; Business Model; Industry Analysis study sees how Motorola dealt with such Case Study; Globalisation and Localisation; evolution in an emerging market. Motorola CAGE Frame Work; Alliance Strategies; was the first to enter the Chinese mobile Google vs Baidu.com (C): The Acquisitions and Partnerships; Chinese phone market in 1987. So it was blessedBattle for China’s Internet Search Google; Government Business with the First Mover Advantage for nearly Market Environment; Internet Censorship; Online 15 years. However, with the evolution of Advertising; International Business; Legal Chinese telecom industry, improvementsFrom being an emerging economy, China Environment and Regulations in mobile networks there and entry of newis a surging one and the number of its competitors (local and foreign), MotorolaInternet users is swelling. With that, the began to lose its market share. But Chinanumber of companies offering search became a crucial market for Motorola, asservices there is also going up. Google, the Motorola in China (B): From its western markets dried up.preferred search engine in many countries ‘Intended’ to ‘Emergent’beats its rival Yahoo! by a wide margin. Strategies Pedagogical ObjectivesYet, in China - forecast to be the largestInternet market in the world - Google finds This case study is a sequel to Motorola in • To understand the evolution of China’sitself upstaged by a local rival, Baidu.com. China (A): Dealing with an Evolutionary mobile industry and the operatingChina’s cultural nuances seem to Industry Life Cycle. This case explains how challengescompletely elude Google. The company Motorola tuned its strategies to emerging trends. Actually, by January 2003, its going • To discuss and analyse strategyto find a foothold in China, is however, was becoming tough in the Chinese market. formulation in the evolutionary phaseleaving no stone unturned. It has opened Most of its invented strategies failed. Then of an emerging marketan office in 2005, hiring a Chinese at thehelm. The company is working to improve it realised that its strategies can no longer • To discuss whether First Moverits sales force. Along with this, Google in neglect the market trends. Viability of these Advantage can guarantee success in theChina has launched a censored Chinese emergent strategies can be vividly long run.version of its site in 2006, which is a first discussed. Industry Telecommunicationsfor the company. This case, the third inthe series, Google vs Baidu.com, details the Pedagogical Objectives Reference No. INA0066 Year of Pub. 2008Chinese online search landscape along with • To analyse and discuss the causes of Teaching Note Availablethe major players. The focus is on the Motorola’s failure in China’s mobile Struc.Assign. Availableongoing battle between Google and Baidu, phone market, in spite of having theand the reasons for their failure and success First Mover Advantage Keywordsrespectively. The case facilitates adiscussion on the critical success factors • To analyse whether its emergent Motorola; China Handset Market;for search engines and the need for strategies are workable and sustainable. Economic reforms in China; Mobilelocalisation. The business dilemma of Phones; Motorola and Eastcom; Industry Industry Telecommunications Analysis Case Study; Motorola and Nokia;choosing between ethical behaviour and Reference No. INA0067 Centrally planned economy; Industry Lifeshareholder wealth creation is also briefly Year of Pub. 2008 Cycle; Intended Strategies; Emergentdealt with. The case finally dwells on Teaching Note Available Strategies; First Mover Advantage; Firstwhether Google, after making changes to Struc.Assign. Available Mover Disadvantages; Chinese Guanxi;its approach, will be able to succeed inChina and what should be its plan of action. Keywords Chinese Business EnvironmentPedagogical Objectives Motorola; China Handset Market; Economic reforms in China; Mobile China’s Retail Industry (B):• The critical success factors for a search Phones; Motorola and Eastcom; Industry engine and whether these factors need Analysis Case Study; Motorola and Nokia; Consumer Behaviour and to be localised Centrally planned economy; Industry Life Competitive Responses Cycle; Intended Strategies; Emergent While case (A) enables an analysis of• The Chinese Internet search market and Strategies; First Mover Advantage; First what makes it attractive to China’s retail industry dynamics, case (B) Mover Disadvantages; Chinese Guanxi; provides scope for analysing Chinese multinationals Chinese Business Environment consumer behavior (with specific reference• Why Google, otherwise the leading to retailing). Using this analysis, students Internet search provider worldwide, is can decode the variety of competitor’s losing out in the Chinese market to a Motorola in China (A): Dealing responses Each one wants to their slice (a local player that has no presence with an Evolutionary Industry Life bigger one though) of the retail cake. overseas Cycle Whose strategic moves are viable? Which• The business dilemma between ethical company is better poised to tap China’s An industry’s life cycle runs through four retail potential? Since economic reforms behaviour and what may be construed as stages: introduction, growth, maturity and in the 1980s, China’s production and foolishness by exiting a lucrative decline. In the first stage, companies productivity rapidly grew, while average emerging market. 5 www.ibscdc.org
  • 6. consumption growth was slower. No doubt, online music stores and supermarkets. But many more are embedded into this case consumers create a huge retail potential. When the giant retailers are struggling by series that can be unearthed with meticulous Industry Analysis But, do they have similar aspirations? So, selling all-things-to-all-people how could analysis. Retail industry is one among the what should companies assume? Do their FOPP survive by selling just CDs, DVDs, many that saw intensified competition assumptions mismatch consumer books and gift items to one consumer during the past decade, in China. aspirations? More so, as the Chinese segment? How long can the patronage in Competition is not yet even because of consumer tends to save more than spend, these dynamic times last? Now, when huge untapped potential; so a discussion how can retailers get them to do the internet is posing the biggest threat to every on Industry Life Cycle can ensue. It is for reverse? other seller, can the company sustain? If the players to strategise their moves and yes, how long? If no, does the company counter-moves, where value chain analysis Pedagogical Objectives need to change its business approach? would prove essential. Market entry strategies of Wal-Mart and Carrefour would • To understand the (ever-) changing Pedagogical Objectives make up for an interesting analysis. consumer behaviour in China and debate its effects on the way retail companies • To understand unique business dynamics Pedagogical Objectives respond of music industry and also music retailing • To give a brief overview of retail • To juxtapose and analyse the obvious • To analyse the critical success factors in industry’s formats and the operational paradoxes in these responses (which can the music retail industry dynamics involved help better in converting adversities into advantages?) • To understand and relate consumer • To understand the potential and behavior in music retail industry to the attractiveness of China’s retail industry Industry Retail target market selection. Reference No. INA0065 • To analyse the challenges of operating Industry Entertainment Year of Pub. 2007 in China’s retail industry because of its Reference No. INA0064 Teaching Note Available value chain Year of Pub. 2007 Struc.Assign. Available Teaching Note Available • To debate on the critical success factors Keywords Struc.Assign. Available in China’s retail industry Wal-Mart; Carrefour; Chinese Consumer Keywords • To analyse the market entry strategies Behaviour; Economic reforms in China; of Wal-Mart and Carrefour and debate Centrally planned economy; Investment- Music Retailing; Customer Segmentation; on their effectiveness. led growth; Industry Analysis Case Study; Customer Targeting; Niche Marketing Consumption-led growth; Organised retail Fopp; Industry Analysis Case Study; Fifty Industry Retail industry; China’s traditional retail industry; Quid Bloke; Music Labels; Music Recorders; Reference No. INA0063 Re-balancing of the economic growth; Universal Music Group; Sony BMG Music Year of Pub. 2007 Saving patterns in China; Consumption Entertainment; HMV; Customer Teaching Note Available patterns in China Community; Music Industry; Positioning; Struc.Assign. Available Differentiation Keywords Wal-Mart; Carrefour; Economic reforms FOPP, UK’s Music Retailer (A): China’s Retail Industry (A): An in China; Retailing in China; Centralised Profiting from Positioning? supply chain system; Logistics and Supply Assessment of Potential and Chain Management; Centrally planned With the current trend of consumers Challenges economy; State-owned department stores; exploring music online and supermarkets The first of this three-part case series helps Dalian Dashang; China’s traditional retail offering CDs at competitive prices, stand- richly and deeply analyse a happening industry; Metro AG; Ito Yokado; Industry alone music retailers face an uphill task to industry in China - retailing. Its competitive Analysis Case Study; Chinese Guanxi; maintain real differentiation in the dynamics is the fine thread that runs Retail industry dynamics industry. The Fopp case series (A&B) track the positioning, the challenges and the through all the three cases. Now that China growth dilemmas of Fopp - a music retailer is on every global (MNC/TNC) company’s with 105 stores spread across UK and growth agenda, the class can debate Global Steel Industry: The Scotland. The company had been selling industry-specific dynamics as well as Country Factor CDs, DVDs, books, and peripherals for about economy-wide factors. So bigger questions 25 years. Started in early 1980s, the retail pop out. What is the “China Factor”? The reconstruction of infrastructure across chain has grown from a small corner shop What does this mean to the companies the world after the Second World War to UK’s third largest music retailer. What operating or willing to operate in China? prompted steel industry rise sharply. differentiates Fopp from its rivals is its What should be their homework before Demand exceeded supply resulting high positioning to reach Fifty Quid Bloke: the entering China? What should be their profitability which translated into capacity marketing name for people aged between strategic moves, while they are in China - augmentation. But since 1970’s the demand 25 and 45, who are cash-rich and time- strategy or tactics? With Chinese economy plummeted down, resulting over capacity poor. A typical Fifty Quid Bloke is seen on integrated into the global economy (since and high cyclicality in the Industry. The a Friday afternoon buying piles of CDs, all 1978 and more so from 2001 when it industry regained from 2002 due to China’s worth £50, thereby giving the company formally joined the WTO), its economic booming economy, higher economic more revenue per visitor. The company is growth rate has hovered around 10%–12%. developments in other BRIC (Brazil, said to have developed strong patronage And that’s very good news for all the major Russia, India) countries, emergence of CEE with these music followers. Case A describes global corporations because there is huge (Central and Easter Europe) countries as the dynamics of the music industry in demand there. However, this good news rapidly developing economies and positive general and UK’s music retail industry in has a flip-side too: China’s business terrain economic developments in Triad (Europe, particular, and will trigger a discussion on is bumpy for a variety of reasons. What USA and Japan) etc. Analysts were Fopp’s positioning strategy against the are those reasons? Hard infrastructure and skeptical about the long term sustainability soft infrastructure are the prime suspects. of the industry. The concern is vital for6 www.ibscdc.org
  • 7. the senior managers and the policy makers • To understand the US real estate market • To debate the ethical participation by S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIin the steel industry to understand the developed and developing countries on S T R A T E G Y – III S T R A T E G Y – IIIdynamics of this industry and to shape their • To analyse the volatilities in the US real humanitarians ground in carbon trading.strategies accordingly. estate market Industry Carbon market • To debate whether the US real estate Reference No. INA0060APedagogical Objectives market would recover after the downturn Year of Pub. 2007 started in 2006. Teaching Note Not Available• An outlook of global steel industry Industry Real Estate Struc.Assign. Not Available• Factors affecting the demand and supply Reference No. INA0061K of the global steel industry Keywords Year of Pub. 2006• The impact of China, BRIC, TRIAD and Teaching Note Not Available Carbon dioxide; Greenhouse Gases; Industry CEE economies on the global steel Struc.Assign. Not Available Analysis Case Study; Kyoto Protocol; industry Carbon trading; Emission Trading; Global Keywords Warming; Climate Change; Annexure I• Opportunities and challenges for the US real estate; United States housing bubble; countries; Annexure II countries; Assigned players in the global steel industry. Industry Analysis Case Study; Economic Amount Units; Emission Reduction Units;Industry Steel bubbles; Stock bubble; P/E (price-to- Chicago Climate Exchange(CCX); EU ETS;Reference No. INA0062K earnings) ratios for houses; National UK ETS; New south Wales market (NSW);Year of Pub. 2007 Association of Realtors; Speculation; House Joint Implementation; Clean DevelopmentTeaching Note Available price index; Baby boomers; Downtrend in mechanism (CDM)Struc.Assign. Available housing; Foreclosure; US mortgage rates; Stock vs house investment; Collapse inKeywords housing; Housing wealth Chinese AutomakersCEE; TRIAD; Steel Production; BRIC; International DriveValue Chain; Arcelor-Mittal; Baosteel;Fragmentation; Industry Analysis Case Kyoto Protocol and its effects on Following the footsteps of their Asian predecessors Japanese and South KoreanStudy; Downstream Production; the carbon trading automakers all major Chinese automakersInvestment Trap; Global Steel Industry;Regional Champions; Niche Specialists; Carbon Market, the new concept of trading like Geely, Cherry and other leading autoGlobal Player; Steel Cycle Carbon dioxide (CO2) and other companies aspired to become global Greenhouse gas was much similar to the players. With the advantages of low cost other trading markets of the world. This production and government support, concept came into force with the Chinese automakers primarily targeted US US Housing Market: Waiting for implementation of the international treaty and European market to sell their cars and Recovery called Kyoto Protocol, which envisioned consequently become powerhouse in global reduction of Greenhouse Gas emission in automotive industry.After experiencing a boom for aconsiderably long period, the US Real Estate the world. The treaty was mainly applicable Nevertheless, Chinese automakers hadstarted declining from early 2006. The to the industrialized and developed many obstacles to overcome before sellingnumber of new housing projects dropped countries of the world. cars in international markets. The imagefrom an annual rate of 1.535 million to The first implementation period was 2007- of poor quality, weak design and lack of1.486 million. Meanwhile, the mortgage 2012 which enforced many countries and distribution networks hindered the progress.loans had reduced from a peak of 6.8% on industries around the world to maintain their Besides, the world automotive market wasaverage for a 30-year fixed loan in July to level of emissions. This also gave boost to saturating and analysts opined that the6.24% in October 2006. The Federal rate carbon market around the world. This growth prospects were better in Chinaremained unchanged at 5.25% from the mechanism initiated major carbon itself.month of August. There were speculations exchange and market around the world.that the Federal Reserve could cut rates in Pedagogical Objectivesthe coming months if inflation remained The case highlights the major carbonunder control and the economy flagged. trading markets around the world and the • To discuss the global and ChineseThis further slashed down the housing countries which would implement this automotive industry scenariofinance loans. All these triggered a recovery treaty. The treaty was rejected by leading industrialized countries like US, Canada and • To discuss international market entrybut the market so far had not shown any barriers and strategies to overcome themkind of bounce-back activities. Moreover, Australia. It also faces some challenges,as the once-booming U.S. housing market debate and criticism by environmental • To discuss challenges faced by Chinesecame down in 2005-2006, economists activist. Amidst the challenges and automobile manufacturers in their questdebated whether this was a "soft" or "hard" regulatory hindrances, the treaty promised to go global.landing and the impact this slowing would to provide an initiative to prevent further global warming. The case ends on the Industry Automobilehave on consumers confidence and on the debate whether Kyoto Protocol will Reference No. INA0059Aoverall economy. This case captures both achieve its vision by 2012. Year of Pub. 2007the up and down trends of the US housing Teaching Note Not Availablesector. The case further explores the factors Struc.Assign. Not Availableaffecting the housing sector and whether Pedagogical Objectivesthere will be any recovery in the US housing • To understand the concept of carbon Keywordsmarket. trading and carbon markets Chinese Automakers; China Cars; IndustryPedagogical Objectives • To understand the international treaty , Analysis Case Study; Automobile Industry; Kyoto protocol and its mission and Globalisation; International Markets;• To discuss how the economic factors are vision Expansion Strategies; Shanghai related with the real estate market Automotive (SAIC); First Automobile 7 www.ibscdc.org
  • 8. Works (FAW); Dongfeng Motor outsourcing industry; BPO sector; contrast, the Chinese aviation market had Corporation; Geely Automobile; Chery Offshoring become the second-largest in the world after Industry Analysis Automobile; Challenges of globalisation; the US, carrying 138 million passengers in Exports; Low cost production 2005. Apart from that, Chinese airlines ordered a large number of new aircrafts in Organic Food Market in the US: 2005. Analysts felt that government The Wal-Mart Effect interference in matters related operations Emerging Destinations in was the main reason behind airlines’ poor Outsourcing: The Indian In the wake of a rapidly growing market for performance. Though government was organic products in the US, in March 2006, dilemma reforming the airline industry to make the Wal-Mart, the world’s biggest retail chain, As of 2006, India continued to remain an announced that it would include more Chinese airlines more competitive, experts IT outsourcing powerhouse, with $17.7 organic products in its grocery section. The doubted Air China’s ability to remain billion revenue in software and IT services management of Wal-Mart hoped to attract profitable in the long run. The case discusses exports, compared with $3.6 billion for more and more customers to buy its organic in detail the evolution of China’s aviation China and $1 billion for Russia, according items thereby promoting the consumption industry to its present form as well as to the trade organizations in each country. of organic products. While some analysts government reforms. It also discusses Air Also, Indias outsourcing industry was still believed that it would increase China and its operations. The concluding growing at a faster pace than that of Russias environmental awareness among the section attempts to highlight the and other outsourcing centers. But as labor consumers and prompt the farmers and challenges that the Chinese aviation costs and turnover rates began rising in supplier to adopt green practices, another industry (particularly Air China) faces. It India, companies started looking out for set of analysts felt that Wal-Mart could use also tries to raise a question regarding the cheaper labor. As a result, many alternative its market strength to exert pressure on structure of the industry in future. outsourcing destinations emerged. farmers and suppliers to its own advantage. Countries speaking European languages like Pedagogical Objectives The case starts with a short history of Hungary, Czech Republic, Russia, Poland, organic farming in the US and moves on • To understand the evolution of China’s Bulgaria and Romania were benefiting from to Wal-Mart discussing it business briefly. aviation industry the trend of nearshoring. Moving IT It then highlights Wal-Mart’s business operations into developing countries can • To understand government reforms that practices over the years and finally tries pose big risks, such as language and cultural shape the structure of the industry to raise a question regarding what could be differences, geopolitical instability, and the the possible repercussions of Wal-Mart’s • To discuss competitive dynamics of risk of stolen intellectual property. Indias entry into the organics. Chinese aviation industry outsourcing players needed to overcome major challenges to continue their growth • To analyse the competitive advantages and sustain their competitive advantage Pedagogical Objectives of Air China over other emerging outsourcing • To get an understanding of organic destinations. India needed to improve its • To analyse Air China’s ability to sustain farming infrastructure, maintain competitive labor profitability in the long run. costs and tackle the turnover rates of labor • To analyse the impact of Wal-Mart’s Industry Aviation attrition. It had to concentrate more on entry on the organic food market of the Reference No. INA0056K new areas in outsourcing such as E- US Year of Pub. 2006 governance, Retail Services Outsourcing, • To debate whether Wal-Mart’s entry Teaching Note Not Available Pharmaceutical Research, Financial would drive suppliers to adopt organic Struc.Assign. Not Available Services and Healthcare. farming or exert pressure on them for lower prices. Keywords The case outlines the changing global scenario of the outsourcing industry, Air China; Chinese Aviation Industry; Industry Organic Food emerging destinations and challenges faced CAAC; CANC;Shanghai Airlines. Reference No. INA0057K by Indian outsourcing companies towards Year of Pub. 2006 keeping competitive advantage and Teaching Note Not Available retaining business. Struc.Assign. Not Available China’s Auto Industry: The Keywords Emerging Trends Pedagogical Objectives Wal-Mart; Organic food; Retailing; With China’s entry in the WTO in • To introduce the students to the Organic farming; National Organic December 2001, the domestic automobile Outsourcing industry Programme (NOP); Supercentre; Sam’s industry witnessed a plethora of changes. • To highlight the various new destinations Club; Neighbourhood market; Grocery Overall tariff and non-tariff barriers were coming up in outsourcing retailing; Industry Analysis Case Study; US reduced and the sector was opened up for farmers; Organic seal; Supermarket; FDIs. China rapidly emerged as the third- • Factors that constitute a successful largest automobile market behind the US outsourcing destination. Discount store; United Food & Commercial Workers and Japan, with about 3.1 million new cars Industry Business Process Outsourcing being sold in 2005. The Chinese auto Reference No. INA0058C industry was evolving gradually into a Year of Pub. 2007 mature market with consumers becoming Air China and the Chinese more aware of the differences between Teaching Note Available Struc.Assign. Not Available Aviation Industry brands. Keywords By 2005, Air China was the only profitable The case while providing a broad overview carrier among the three major airlines in of the Chinese automobile industry, Outsourcing; Nearshoring; Emerging China. The other two, China Southern and discusses the emerging trends in the destinations; Industry Analysis Case Study; China Eastern, were making losses. The industry as well as in the consumer Indian outsourcing industry; Chinese low cost carriers also were struggling. By behaviour.8 www.ibscdc.org
  • 9. Pedagogical Objectives Ukraine by Mittal Steel, potential • To understand how to make S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III synergies and problems associated with consolidation successful one, problems S T R A T E G Y – III S T R A T E G Y – III• To understand the dynamics of the the acquisition associated with successful making of a Chinese automobile industry in the pre- consolidation and post-WTO era • To discuss how acquisition as a growth strategy help companies to consolidate • Acquisition as a key growth driver in• To understand the critical factors in fragmented steel industry global steel industry. responsible for the emergence of Chinese automobiles as the leading • To discuss the concept of ‘forward Industry Steel brands, both in the domestic and integration’ and ‘backward integration’ Reference No. INA0053K international market in steel industry Year of Pub. 2006 Teaching Note Not Available• To discuss the global impact of the • To discuss how alliance with raw material Struc.Assig. Not Available increasing export capability of the suppliers and ownership of mines help Chinese automobile manufacturers steel companies to have better control Keywords over the value chain of the industry• To understand the changing dynamics Mittal steel; consolidation; value chain; of consumer psychographics in China. • To discuss value chain of the steel global steel industry. industry and steel making process.Industry AutoReference No. INA0055K Industry SteelYear of Pub. 2006 Reference No. INA0054K Auto Component Industry: ATeaching Note Not Available Year of Pub. 2006 New PerspectiveStruc.Assign. Not Available Teaching Note Not Available Struc.Assig. Not Available According to a report by McKinsey andKeywords ACMA in 2004 Indian auto component industry was worth around $5 billionChina; Auto Industry; Cherry; First auto Keywords (Rs.25,000 crore) and was growing at theworks; GM; Toyota; Volkswagen. rate of 18% yearly. But industry experts Mittal Steel; CVRD; Riotinto; Kryvorizhstal; Backward Integration. felt that in auto component exports, India was far behind other developing countries. Mittals New Move: Capacity Indian companies did not have the scale ofExpansion or Vertical Integration production to beat global companies. The L.N. Mittal: Consolidating Indian auto component industry was highlyIn October 2005, Mittal Steel, the world’s Presence Globally fragmented as most of the auto makerslargest steel company, made a bid for belonged to Tier IV and Tier III category.KryvorizhStal Steel, the largest steel Lakshmi Niwas Mittal (popularly known High fragmentation, low investments incompany of Ukraine. In the era, when as LNM), also called the “Carnegie of R&D, low capability in high-end designing,consolidation and acquisition were Steel”, built his steel empire by aggressively manufacturing and development hinderedcommon practices in the industry, Mittal acquiring poorly performing steel plants Indian auto parts maker to move up theSteel’s new move would help it to at low prices in 14 countries across the value chain. Global OEMs and Tier 1consolidate its presence more aggressively. globe, like Trinidad and Tobago, suppliers were relocating their plants andThe acquisition was a key acquisition for Kazakhstan, Romania, Germany, Poland, set up R&D centers from US/Europe toMittal Steel in Central Europe, as it Canada and America, and turning them into India due to its low cost and skilledprovided the company with a large size money-making ventures. He is considered manpower. But the majority of Indian autolow cost platform in a core and fast growing to be industry visionary, spotting trends component firms belong to the lower tiermarket. It also helped Mittal Steel to much before his contemporaries and of Industry value chain. Tier Iexercise control on the large iron ore investing accordingly. In October 2004, manufacturers enjoyed advantages overreserves of the Ukrainian Steel major, Mittal acquired International Steel Group Tier II and Tier III suppliers in gettingwhich it planned to use in its expansion of the US for $4.5 billion and became the orders with the help of their designing,programme. In the steel industry, due to largest steel producer in the world, manufacturing and development skills.raw material shortage, the ownership of surpassing the world leader, Arcelor. The Since Tier I suppliers got the order directlymines and long-term alliances with the raw case study offers scope for discussion about from auto makers it helped them tomaterial suppliers became a critical success the acquisition strategy, adopted by Mittal recover the investments quickly andfactor for any company. The case study and how it helped him to become the enjoyed better profit margins. Indianoffers a scope for discussing the rationale market leader. It also provides information manufacturers, mostly belong to Tier IIIof the acquisition in the recent global regarding the current and future levels of and Tier IV category, lacked in high endtrends, the value chain of the industry and consolidation in the global steel industries, designing, manufacturing and developmenthow Mittal Steel plans to leverage it. consolidation as a major strategy in the skills. The case deals about how Indian autoStudents can also discuss how Mittal Steel steel industry, steel industry value chain components industry which is in the un-can leverage the acquisition by and the risks that companies like Mittal organised sector, could exploit itsstrengthening its position in Central and Steel, would encounter. strengths, nullify its weaknesses and becameEastern Europe and areas close to China. the preferred sourcing partner of global Pedagogical Objectives OEMs ,by moving up the value chain ofPedagogical Objectives • To understand the trends, dynamics of the industry.• To discuss the trends, patterns of global global steel industry steel industry and consolidation as a Pedagogical Objectives • To understand how consolidation act as major strategy in fragmented steel growth strategy in global steel industry • To discuss in details about global and industry globally Indian auto component industry, trends • To understand how consolidation and patterns of the industry• To discuss acquisition of KryvorizhStal transform the globally fragmented steel Steel, the largest steel company of industry into a consolidated one • To discuss the value chain of the auto component industry 9 www.ibscdc.org
  • 10. • To discuss how small players from an Teaching Note Available the likely future progress of the two industry can move up the value chain Struc.Assign. Available companies. Industry Analysis and became the key growth driver of the industry Keywords Industry Media Reference No. INA0050C • To discuss how joint venture, technical Manufacturing industry; Avtovaz; Russian Year of Pub. 2006 alliance, designing, development and economy; Russian Political changes; Teaching Note Available management skills help small companies Automobile industry; Volkswagen; Russian Struc.Assign. Not Available to move up the value chain automobiles; Russian Consumer market; Car industry; Economic crisis; Keywords • To understand the structure of the Liberlisation; Globalisation; Automobile industry. manufacturing VIACOM; CBS Corporation; Split; Spin- off; Division; Stock price; Investors; Debt- Industry Auto Component Industry burden; Strategy; Sumner Redstone; MTV; Reference No. INA0052K Networks; Paramount; Digital; Year of Pub. 2006 The Viacom Split: Is it the Right Distribution; Consolidation; Growth. Teaching Note Not Available Solution? Struc.Assig. Not Available Viacom, the media conglomerate, has had Keywords a history of splitting into two units and Will the Three Pointed Star remerging as one entity. In 1999 they Regain its Lost Sheen OEM; Delphi Corp; Reverse Engineering; became one, but in 2005, the Viacom Board Tier 1; Backward Integration. Mercedes was dodged by quality problems decided to again divide the company. The split was structured in such a way that the that eventually dented the brand’s premium existing company (Viacom) changed its image and eroded its profits. The case Automobile Industry in Russia: name to CBS Corporation, while the new profiles Mercedes’ glorious past and details the reasons that led to the brand’s lost The Growth Potential and the Viacom was a freshly founded spin-off sheen. It further outlines the new make Competitive Pressures company. The new CBS Corporation was over initiatives at Mercedes under the actually the same company (Viacom) that In 1991, the Soviet Union dissolved into was founded in 1986. The 1986 Viacom, leadership of a new chief, Dieter Zetsche different countries and the major country in turn, was the successor to a previous who had a proven turnaround track record. to emerge was Russia. As Russia started to company also known as Viacom and The case provides scope for discussion on liberalise, its economic policies changed founded in 1971. strategies for retaining the premium image and it gradually moved towards a market- of a brand. driven economy. Incomes of Russian Industry watchers wondered about the consumers are rising and they are advantages of the split. Founder Sumner Pedagogical Objectives demanding more choices. Amid this Redstone had justified it stating emphatically that the days of the big • Helps the students to understand the makeover, the Russian automobile conglomerates were over. The future would concept of Branding industry, which of late was dominated by the state-owned players, is now witnessing be interesting to see. Would the two • Traces the turnaround strategies of a change. Automobile manufacturers companies evolve and grow into individual Mercedes. around the globe are keen to set up behemoths? Or would they again come manufacturing facilities in Russia-to serve together and become a single entity? Industry Automobile the Russian market, and also export to Reference No. INA0049C The case traces the history of Viacom from Year of Pub. 2006 different countries. Global players such as 1971 when the television syndication Toyota, Nissan, Renault, and Volkswagen Teaching Note Not Available division of CBS Films was renamed Struc.Assign. Not Available plan to set up massive manufacturing VIACOM, from Video and Audio facilities in Russia. So, as competition Communications. It highlights the Keywords increases, Russian carmakers face numerous acquisitions made over the years to expand challenges to capture the market. State- operations and increase revenues, the entry Mercedes-Benz; DaimlerChrysler; Dieter owned companies like AvtoVaz have to of Sumner Redstone in 1986 when National Zetsche; Jurgen Schrempp; Mitsubishi; gear up to withstand competition from Amusements bought over and Eckhard Cordes; CORE; J.D. Power and foreign carmakers. reincorporated Viacom, the merger with Associates; Revamp. CBS Corporation in 1999, and the Pedagogical Objectives separation into two companies again in January, 2006. US Automotive Supply Industry: • To discuss the evolution of the automobile industry - with special focus The case also discusses investors’ The Chinese Threat on cars apprehensions, the observations of The US automotive supply industry, more analysts and industry watchers, the views than a century-old, produced vital • To discuss the political and economic of the Redstone family, the process of components for the auto industry and trends since the formation of the consolidation and growth, and the future employed nearly three times as many Russian federation of the two companies. people as the auto industry itself. It was • To understand the Russian automobile the backbone of the US auto sector and industry and its growth potential Pedagogical Objectives possessed a much larger machine-tool capacity. Over the years, the US auto • To discuss the challenges and • To study and analyse why the Viacom supply industry went through tough times. competitive pressures in the Russian car group merged and split over the years A number of reasons were attributed to this. industry. especially from 1970 onwards The industry was forced to cut prices by Industry Automobile • To enumerate and understand the pros the US auto makers who were their main Reference No. INA0051 and cons of division and re-merger, and clients and being bound by contracts, the Year of Pub. 2006 auto suppliers were forced to comply. There10 www.ibscdc.org
  • 11. was also a rise in raw materials, especially engine market in China was dominated by Keywords S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIsteel. The main players were also charged a number of local and international players. S T R A T E G Y – III S T R A T E G Y – IIIfor accounting manipulations and they had US Automobile Industry; General Motorsto spend considerable resources to rectify The case provides scope for discussion on (GM); Ford; DaimlerChrysler; Toyota;the frauds. All this quickened the whether Alibaba would emerge a winner in Hyundai; Japanese automobiles/cars;bankruptcy of a number of leading auto China’s search engine market. It also Korean automobiles/cars; UAW; legacysuppliers in the US. provides scope to discuss if it could sustain costs; The Big Three Automobile industry; its success or if its growth was only due to Chinese cars; labour costs; bankruptcy.In this background, there was a steady the inherent advantages of an emergingincrease in the quantum of Chinese imports market.and they posed a threat to the US auto Retailing in China: The Foreignindustry. The Chinese had a low wage Pedagogical Objectives Factoradvantage but did not possess thetechnological edge. Although industry • To discuss strategies of a B2B company China had become the economic power-experts said that the Chinese threat was • To discuss whether Alibaba would emerge house of the 21st century. The retail tradeexaggerated, if the US auto suppliers did a winner in China’s search engine market. was another high growth area which sawnot gear-up to meet competition, it was the entry of many foreign consumer goodsfeared that they would face almost the Industry B2B manufacturers into the Chinese market.same ills that the US auto sector was facing Reference No. INA0047C China’s retail market growth was firstin the face of competition from Japanese Year of Pub. 2005 among the 12 leading countries in Asia. Inand Korean auto makers. Teaching Note Not Available 1978, the Chinese Government initiated Struc.Assign. Not Available the process of liberalisation which soonThe case allows for discussion on the futureof the US auto supply industry in the face Keywords opened the door to globalisation in theof competition from China. It also allows country. The modern retail trade did notfor discussion on the strategies that the Alibaba; B2B; Chinese Internet market; emerge until the middle of the 1990s whenChinese should adopt to become a leading Search market; Yahoo! China; ecommerce; China made the transition from a planned Baidu; Google; Jack Ma; value addition; economic system to a market driven one.force in the global auto parts market. subscription; revenue model; Since 2002, after China’s entry into the entrepreneurship. World Trade Organisation, manyPedagogical Objectives governmental restrictions on the retail• To discuss the future of the US auto trade were diluted or removed giving supply industry in the face of US AUTO INDUSTRY: HEADING multinational retailers unprecedented freedom to establish wholly owned foreign competition from China TOWARDS A DEAD END? enterprises (WOFEs) rather than operate• To discuss strategies that the Chinese The Big Three automakers General through joint ventures. By 2006, at least should adopt to become a leading force Motors, Ford and Chrysler 35 of the global top 50 retailers were in the global auto parts market. (DaimlerChrysler AG) of the United States operating in China. In 2005, total retail (US) dominated the US domestic auto sales in China touched the US$755 billionIndustry Auto Supply Industry market accounting for more than 70% of mark. The high population density in theReference No. INA0048C auto sales in 1998. However their market country had lured global retailers to set upYear of Pub. 2006 share took a nosedive in 2004, when they shop and compete with a growing band ofTeaching Note Available accounted for only 58.6% of sales with local operators. These retailers catered toStruc.Assign. Not Available the Japanese automakers overtaking an expanding middle-class of consumersKeywords them.Declining market share and high expected to grow from 42 million in 2005 inventories forced the Big Three to reduce to 200 million by 2015. Over 1,000 newAuto parts supply industry; Auto parts retailers had received approval, of which assemblies in North America by 9% duringmanufacturers; OEM suppliers; Big Three; more than half were foreign investors. By the first half of 2005. They were alsoPrice cuts; Raw material costs; Accounting 2006, there were over 1,000 foreign affected by an unfavorable operatingmanipulations; Hedge fund operators; retailers in China compared to just 314 environment caused by the continuousChinese auto suppliers; Delphi; low-cost two years earlier. The case looks at the price war and some serious costof labour; replacement market; R&D; retail background in China and discusses: competitive issues like increasing legacyTransplant automakers; bankruptcy. (1) the performance of retailers; (2) pricing costs and frequent disputes with the UAW. and consumer behaviour; (3) the need for Under these circumstances, it was top be mergers and acquisitions which helpedAlibaba.com – Will it win China’s seen if the US auto industry was heading retailers expand their networks and towards a dead end, or if it had a chance of search Engine Market? increase bargaining power with suppliers; a turnaround? (4) the importance of proactive strategiesEstablished in 1999, Alibaba.com had to penetrate virgin markets especially inbecome the biggest online business-to- Pedagogical Objectives the rural areas; and (5) the significance ofbusiness (B2B) player in China. Its foray value-for-money retailing.into other ecommerce activities like online • Issues faced by the US Auto Industryauctions and online payments were also • Challenges faced by the industry in Pedagogical Objectiveshighly successful although they were in entering new markets and new productcompetition with world leaders like eBay. categories. • To understand the fragmented retail tradeIn October 2005, Alibaba and Yahoo! China in China and the effect of the entry ofsigned a deal under which Alibaba would Industry Auto Industry international players into the Chinesemarket the Yahoo! China brand in China. Reference No. INA0046C marketBy this deal, Alibaba sought to establish Year of Pub. 2006 Teaching Note Not Available • Help students appreciate the buyingitself in the search engine market and Struc.Assign. Not Available power of a growing middle-class offurther consolidate its position in the consumers on the Chinese economy andecommerce scene in China. The search the need for local retailers to analyse 11 www.ibscdc.org
  • 12. and learn from the strategies of the The Maturity in the Indian Wine commanded over 80% of the market share. foreign entrants Industry The case discusses the developments and Industry Analysis strategies of the three major players till • Study the need for focused marketing Established in the mid-1980s, the Indian 2005. It also discusses the future scenario efforts by foreign companies to wine industry with a growth rate of 30% of these players in light of several penetrate the rural sector. has been showing immense potential for perspectives. Industry Retail growth. With some Indian brands winning Available at www.ibscdc.orgwww.ecch.com awards at international wine competitions, Pedagogical Objectives Reference No. INA0045C 206-058-1 Indian wines were increasingly being Year of Pub. 2006 appreciated in the global market. However, • The case discusses the developments and Teaching Note Available despite the encouraging growth rate and strategies of the three major players, Struc.Assign. Not Available the assiduous efforts being made by the Maruti Udyog, Hyundai and Tata Motors local players and the government, can the till 2005 Keywords industry live up to the promise of • It also discusses the future scenario of becoming a global entity? China; Retail trade; Consumer; World these players under several perspectives. Trade Organization (WTO); Supermarket The case traces the growth of the Indian Industry Automobiles chains; Value-for-money; Globalisation; wine industry, the various challenges faced Reference No. INA0042P Wholly owned foreign enterprise (WOFE); by the nascent industry, the big players in Year of Pub. 2005 Mergers and acquisitions (M&A); Retail the market and the efforts made by them Teaching Note Not Available sales; Households; Chain stores; Brand; to increase sales in both the domestic and Struc.Assig. Not Available Economic growth. global market. keywords Pedagogical Objectives Car segments; Pricing; Positioning; Market Boeing and Airbus: The Asian • The case outlines the growth of the share; Vendor rationalisation; Cost; Challenge Indian wine industry Competition; Consolidation; Fragmentation; Auto policy; Industry Asia had always been a large, potential • The case discusses the challenges faced structure; Product portfolio; Strategy; Scale market for the two giants in the aviation by the Indian wine industry industry, the American Boeing of operations. Corporation and the European Airbus • It also discusses the efforts made by them Industries. The opening out of the third to increase sales. world to foreign investment with the Industry Food and Beverages Industry Internationalization of advent of globalisation saw competition Reference No. INA0043P Management Education in China intensify between Boeing and Airbus to lead Year of Pub. 2006 The emergence of China’s new managerial the Asian market. Dominating this market Teaching Note Not Available class had positive and negative implications was imperative for both the major players Struc.Assig. Not Available for US companies. On one side, China’s in order to achieve the top rank in the aviation sector. In their bid to become the keywords massive market of 1.3 billion people leading aircraft manufacturer in the world, seemed lucrative enough to be penetrated. both companies had introduced new Viticulture; potential for growth; It was presumed that the graduates of the products on a global scale, Airbus the A380 international wine markets; exports; nation’s new MBA programmes would ‘Double-decker’ and Boeing the 787 imports; ‘Old World’ world wine producing supply a steady stream of local talent with ‘Dreamliner’. countries; ‘New world’ world wine better in-depth knowledge of China, producing countries; major wine growing compared to their Western managers. On The case traces the background of Boeing regions in India; other players; big players; the other side, local companies empowered and Airbus, some of the models flown and marketing; promotional strategies; major with western management ideas could put discusses the scope for penetration and hurdles; future prospects. forward tougher deterrents for the consolidation in the Asia-Pacific region multinational companies. Chinese with special reference to the markets in companies could be in possession of the China, Japan, India and Singapore. Indian Passenger Car Industry – management know-how needed to go head Heading Where? to head with global giants. The concept of Pedagogical Objective efficiency, productivity, profitability, and The Indian passenger car industry has growth held vast potential to flare up • The need to cover and service emerging China’s already blistering economy, raise shown unprecedented growth after the markets in order to attain the number living standards, and transform the nation declaration of the new automobile policy one rank in the aviation industry. from a low-cost manufacturing center to a by the Indian government in 1993. The Industry Aircraft Industry industry has attracted most major global make-or-break battleground for the global Reference No. INA0044C players to India and as a result the market economy. Year of Pub. 2006 has become fiercely competitive. There So the Chinese B-school expansion had its Teaching Note Not Available are about forty models with more than one- positives and negatives for the US and Struc.Assign. Not Available fifty variants of vehicles from thirteen Europe. Had the west thought of this? Were manufacturers. The passenger car market Keywords is also undergoing structural changes on they too fast in creating Chinese competitors? The concept of MBA in US Boeing; Airbus Industries; 787 Dreamliner; the demand and supply side. Car was almost 100 years old so, they were A380; Market leadership; Asia-Pacific; manufacturers are gearing up for capacity much more experienced and competent in Airlines; Air India; Management strategy; expansion, building a strong vendor base MBA education. But, in 15 years, China Singapore Airlines; Air China; Japan and revamping supply chains to face the had progressed in leaps n bounds as far as Airlines; Business rivalry; Marketing; future. In 2004-05, three of the thirteen management education was concerned. In Strategies. manufacturers namely, Maruti Udyog, the years to come, it would be interesting Hyundai and Tata Motors have12 www.ibscdc.org
  • 13. to observe whether China would be keywords years. This deal adds one more controversy S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIsuccessful in creating world-class MBA to a project already marred by numerous S T R A T E G Y – III S T R A T E G Y – IIIprogrammes to challenge the strong holds Film Industry; Indian Film; Bollywood; controversies over vital issuesof the Kelloggs, Whartons, and Harvards Industry status; film insurance; film finance; corporatisation; Entertainmentof the world. It seemed a long way to go, tax; Piracy; Film Exhibition; Film Pedagogical Objectivebut it also seemed important for the top-ranked US. B-schools to take a note of the distribution; multiplexes. • To understand the issues relating tonew Chinese scenario. public-private partnerships in infrastructure projects.Pedagogical Objective Independence Air: Industry Infrastructure Transformation from Regional Reference No. INA0038B• To understand the implications of Carrier to a Low Cost Carrier Year of Pub. 2005 emergence of Chinese management Teaching Note Not Available schools on US companies. For 14 years, Independence Air had Struc.Assig. Not Available operated as a regional carrier, under theIndustry EducationReference No. INA0041B name of Atlantic Coast Airlines (ACA). keywords However, in June 2004, ACA was re-Year of Pub. 2006 Infrastructure; BOT(Build/Own/Transfer); launched as a Low-Cost Carrier (LCC),Teaching Note Available Highway; Expressway; Contract; Public “Independence Air” under its CEO andStruc.Assig. Not Available Private Partnership (PPP); Traffic; Road; chairman Kerry Skeen (Skeen). The casekeywords discusses the steps taken by the Finance; Tolls; MSRDC. management to transform the regionalChinese B-Schools; Chinese MBA; US- carrier to a LCC focusing on theChina educational tie-ups; Symbiotic operational, marketing and branding Audi’s Intended Accelerationrelationship; CEIBS; Tsinghua University; aspects. The case also focuses on theExecutive MBA (EMBA); International competitive landscape in the US airline In late 1986, ‘Audi AG’ was accused by aMBA (IMBA); Management Education. industry. popular television show for a flaw in the Audi 5000 sedan that caused the vehicle to accelerate instead of braking, thereby Pedagogical ObjectivesCorporatisation of the Indian Film causing fatal accidents. The allegation was • The challenges that the airline might followed by a sharp decline in the sales of Industry face transforming from a regional to a Audi cars in America and the company wasThe case attempts to explore the efforts low cost carrier nearly wiped out from the market.of the industry and the government to Although subsequent investigations proved • The feasibility of the model being used that it was drivers’ error that caused thecorporatise the Indian film industry. The by Independence Air of using both accidents rather than vehicularIndian film industry in 2005 was the largest smaller Regional Jets and larger Airbus malfunction, the damage had been inflictedproducer of films in the world, but its global to operate a low cost airline on the company. Faced with the dauntingshare of revenues accounted to just 1%. Itwas granted ‘industry’ status in 2000 and • The strategy being employed by the task of rebuilding the company’s image andsince then corporatisation had begun in airline to stimulate traffic in the regional re-capture lost market shares, Audi took athe form of banks lending against film and major cities number of steps that revived its sales. Byprojects, film insurance, and emergence of the end of 2004, Audi re-emerged as amultiplexes. The industry was no doubt set • The competitive challenges it might strong player in the US luxury car market.for growth, but was facing hurdles in the face from the low-cost and legacyform of high entertainment tax, financing, carriers. Pedagogical Objectivepiracy, poor distribution and lack of Industry Airlinestraining schools. The government had • To examine the steps taken by the Reference No. INA0039B company to revive its brand image.initiated efforts to curb piracy, encourage Year of Pub. 2004co-production treaties with other countries Teaching Note Not Available Industry Automobile manufacturingand reduce entertainment tax. In spite of Struc.Assig. Not Available Reference No. INA0037Ball this, industry insiders shrugged off Year of Pub. 2005corporatisation as a fad and suggested that keywords Teaching Note Not Availablethe industry will continue to work the way Struc.Assig. Not Available Independence Air; Atlantic Coast Airlines;it used to be. Kerry Skeen; Hub; Regional Airline; Low- keywords Cost Carrier; United Airlines; US Airways;Pedagogical Objectives Low-Cost Business Model; ICLUBS; IJETS; Audi AG; Audi of America; World of Audi;• To understand the structure and the FLYI; Regional Jets; Transformation. New World of Audi; Unintended business model of the Indian film industry Acceleration; Sudden Acceleration; 60 Minutes; NHTSA; Audi 5000; Audi A6; US• To study the changes after luxury car market; Luxury car corporatisation in the business model The Road from Mumbai to Pune manufacturers; Quattro; SUV; Trendsetter In April 2004, the Mumbai-Pune Programme.• To analyse whether corporatisation can increase the revenues of the industry. Expressway, India’s first infrastructure project built to global standards, was soldIndustry Entertainment/Film to a private party, along with the Mumbai- Diesel Dilemma in the USReference No. INA0040B Pune section of NH4, the only otherYear of Pub. 2006 existing link between two commercial hubs In 2004, diesel vehicles accounted for onlyTeaching Note Not Available of India, Mumbai and Pune. The sales deal 2% of the US auto market. In the US, dieselStruc.Assig. Not Available gives the private party the right to toll engines carried a bad image of being a ‘dirty and maintain both the highways for 15 fuel’. Though diesel engines offered better 13 www.ibscdc.org
  • 14. mileage they emitted more smog forming producers’ operations unprofitable. As a Pedagogical Objectives nitrogen oxides than gasoline engine which result steel producers were resorting to Industry Analysis caused serious health problems. In order to various strategies, including consolidation, • To analyse whether the luxury industry bring back diesel in the US, several to sustain in the industry. The case describes should enter China initiatives were taken by the federal how POSCO sustained and grew in such • To analyse whether the presence of government and the OEMs. In this regard, conditions, achieved its position of counterfeiting is a threat to the luxury several regulations and standards were leadership and the strategies it adopted on goods industry. passed to reduce the diesel emission and to its way. Specifically, the case talks about improve the quality of the diesel sold in POSCO’s product-market choices, Industry Luxury Goods the US. The case discusses about the technology initiatives, joint ventures, and Reference No. INA0034B difference between gasoline and diesel its organisational structure. The case also Year of Pub. 2005 engines and reasons for the failure of diesel briefly touches upon the challenges faced Teaching Note Not Available vehicles in the US. The case further by POSCO in sustaining its position. Struc.Assig. Not Available highlights on the potential of diesel in the keywords US market. The case also discusses about Pedagogical Objectives clean diesel and its acceptance in the US Luxury Goods; China; Counterfeiting; market. • Discuss POSCO’s advantages and Fake; Pirated; Country of Origin; Luxury disadvantages based on key success Retailing; Market Potential; Tourism and Pedagogical Objectives factors in steel industry in 2004 Luxury Industry; Local Partnerships; • Analyse POSCO’s position vis-à-vis the Brand Image; LVMH. Gucci; Richmont; • The importance of global warming and Yuan. its impact on the automobile industry other players in the industry • The state of the automobile industry in • Discuss if POSCO’s strategies are replicable by other players in the industry the US market with specific reference Future of Hybrid Cars in the US to diesel vehicles • Discuss the strategies for sustaining and In the recent years in the US, the prices of • The initiatives taken by the Original improving POSCO’s position in the gasoline were increasing at an alarming rate Equipment Manufacturers (OEMs) in industry and had reached a record high level of $2 order to bring back diesel in the US • Building competitive advantage in a per gallon in 2004 and the demand for market commoditised industry such as steel. gasoline was projected to average around 20.9 million barrels per day by the end of • Discuss the various regulation passed by Industry Steel 2005. This created a lot of pressure on the federal government to offer clean Reference No. INA0035B the consumers in general, and the diesel Year of Pub. 2005 automobile manufacturers in particular, to Teaching Note Not Available reduce the dependence on foreign oil. The • Will diesel be able to shed its dirty image Struc.Assig. Not Available manufacturers were forced to produce fuel in the US market? keywords efficient cars and advanced diesel and Industry Automobile hybrid technology was considered as an Reference No. INA0036B Steel Industry; Mini-mills; Steel marketing alternative. The case discusses the Year of Pub. 2005 technology; Finex technology; anatomy of the hybrid cars and the issues Teaching Note Not Available Technology innovations; Mass production; for the success of the hybrid cars in the Struc.Assig. Not Available Location; advantage; Joint ventures and US. The case further highlights the keywords strategic partnerships; value added challenges faced by hybrid cars in the US, products; Centralised management; Steel for acceptance Diesel Engine; Global Warming; Gasoline consumers; Steel production; Raw material Engine; Original Equipment Manufacturers; sources of steel; Iron ore; Scrap steel. Pedagogical Objectives Emission; Clean Diesel; Federal Regulations and Standards; Ford; GM; DaimlerChrysler; • This case can discuss where the US Miles per gallon; US car industry; Fuel automobile industry is heading to. Will The Chinese Luxury Goods Hybrids out run the gasoline cars in the efficiency; Miles traveled. Industry in 2005 future? The case highlights the tremendous growth • The increasing oil dependency of US and POSCO in 2004 – The World’s potential for the luxury goods market in its impact on its economy Most Profitable Steel Maker China. The case also focuses on the luxury industry in 2005 and the top 3 players. • How hybrids can mitigate the growing The case is set in the year 2004 and talks The booming economy in China coupled environmental pollution about POSCO, the South Korean steel with increasing disposable incomes of the • The challenges and strategies hybrid car maker that was the leading steel company Chinese is making China a market that makers have to face and pursue to sell in terms of profitability. The case starts cannot be missed out by the luxury goods more hybrids. with the evolution of the world steel players. But the luxury players have to industry, the major technology shift (Basic face the problem of counterfeiting which Industry Automobile Industry Oxygen Method to Electric Arc Furnace has reached to the extent of contributing Reference No. INA0033B (EAF) Method) that changed the industry to China’s GDP and supporting local Year of Pub. 2005 economics, and talks briefly about the economies. The luxury goods firms are in Teaching Note Not Available evolving demand-supply conditions. By a dilemma, whether to enter the Chinese Struc.Assig. Not Available 2004, steel industry was considered old market and face the problem of economy and steel was commoditised. The counterfeiting or play safe by staying away keywords increasing competition from mini-mills from China and let go the opportunity of US automobile industry; Hybrid cars in the (companies using the EAF technology to a strong potential market which is all set US; Hybrid Anatomy; Oil dependance; produce steel) left some of the major steel to be the No.1 in the near future Global Warming; Fuel Efficiency; Toyota14 www.ibscdc.org
  • 15. Prius; Zero Emission Vehicles; Advanced to raise a debate on which technology would dispora; globalisation; development; S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIdiesel; US auto Manufacturers; CAFÉ piracy; plagiarism; finance. S T R A T E G Y – III S T R A T E G Y – III come to dominate the US Radio IndustryStandards; US environmental Protection in the near future.Agency; Emission Levels; Ford; HondaInsight; DaimlerChrysler. Pedagogical Objectives Are Hybrid Cars the Answer to • To discuss about the terrestrial and Soaring Oil Prices in the US? satellite radio Gucci in 2005: On the Rising Oil prices always raised global Comeback Trail • To discuss about the developments in concern and alarm, both for the the US radio industry. governments and also for the commonThe Italian company, Gucci was a small man. But it meant something more for theluxury leather goods store when started, in Industry Radio Broadcasting US since they were the biggest importer1921. But in 2005, it has grown into a Reference No. INA0031B and consumer of oil in the world.multi-brand conglomerate with a colorful Year of Pub. 2005 Economists forewarned that if the USpast and a bright future to look forward to. Teaching Note Not Available doesn’t wake up to this, the common manGucci is the third-largest luxury goods Struc.Assig. Not Available will be left with two options, feed theircompany in the world after Louis Vuitton cars with oil or feed themselves with food. keywordsMoet Hennesy (LVMH) of France and the Nevertheless experts said that, thoseSwiss group Richemont. US Radio Industry; Terrestrial Radio; vehicles that run on alternate fuels like, Satelite Radio; Sirius Satelite Radio; hybrid cars could save the US from thisOwing to an economic slump and a series predicament. Even though the hybrid carof other global events, Gucci along with Internet Radio Technology; Satelite Radio market in the US was in its nascent stage,other luxury goods companies saw a bad Technology; HD Radio Technology; Future the people concerned were very muchrun in recent years. But since 2004, when of US Radio industry; Sirius vs XM; Hertz. optimistic that the cars of the future wouldRobert Polet has taken over as the CEO of be hybrids. This case discusses the perils National Association of Broadcasters;the group, things have started looking up and the panacea, to the problem thatfor the group. Polet has drawn up ambitious Federal Communications Commission; AM/FM radio. seriously affected the US.plans for the expansion of the company.Experts wondered whether the companywill be able to bounce back as envisaged by Pedagogical ObjectivePolet. Or are his plans too ambitious? Globalization of the Indian Film • To discuss the need for hybrid cars in Industry: Reel or Real? the US.Pedagogical Objectives The Indian film industry is one of the Industry Automobile• To discuss about the luxury goods largest industries in the world. Over the Reference No. INA0029B industry years it has witnessed considerable Year of Pub. 2006 improvement in the art of film-making, Teaching Note Not Available• To understand about the Chinese leather Struc.Assig. Not Available distribution and exhibition as a result of market globalisation and recent technological keywords• To discuss about Gucci’s performance innovations. Such changes have led to the under different leaders. industry getting noticed by people in the Hybrid cars; oil; oil dependency; oil imports; west, especially Hollywood. This raises automobile industry; Toyota; OPEC; oilIndustry Luxury Goods Sector issues on the future of the industry in the price; Federal Reserve; Trade deficit; greenReference No. INA0032B international circuit and the challenges that house effect; environment pollution;Year of Pub. 2005 are to be confronted to make it a reality. mileage; fuel efficiency.Teaching Note Not AvailableStruc.Assig. Not Available Pedagogical Objectiveskeywords Drive-in Theaters in the US – On • To discuss about the trends in the IndianLuxury goods industry; Gucci; LVMH; film industry the comeback trail?Richmont; Robert Polet; Mark Lee; • To understand how globalisation has Once considered obsolete, drive-in theatersGuccio Gucci; PPR; SARS; Fashion influenced a creative industry in the US are seen as a family-friendlyaccessories; Luxury goods in Asia; Luxury alternative to multiplexes and other formsgoods in Asia; Luxury Goods in Europe; • To understand how the growth in of commercialised entertainment. Once atSlump in sales; Cosmetics; Jewelry. Bollywood is challenging Hollywood the brink of extinction in the 1980s, drive- • To understand the growth of India’s in theaters were on the path of revival. entertainment industry in the world They reached their peak in the 1950s. With The US Radio Industry market. the advent of the cable TV and VCR coupled with the rising costs of real estate and aThis case study takes a look at the Industry Film growing reputation of drive-ins as ‘passiontechnological changes that have happened Reference No. INA0030B pits’, the popularity of the drive-insin the US Radio Industry over the last Year of Pub. 2005 declined in the 1970s and 80s. The 1990scentury. It explains various phases of Teaching Note Available saw new flickering of life in the industry.development in radio technology starting Struc.Assig. Not Available Since 1990, about 40 new drive-ins sprungfrom the traditional AM/FM terrestrial up, and 20 existing ones added new screens.radio to digital technologies like Satellite keywords By 2005, about 400 were in operation.Radio, Internet radios and High Definition Cinema; Film industry; Hollywood;(HD) Radios. All these technologies had However, the greatest threat seemed to be Corporatisation; technical advancement;certain advantages as well as limitations the US government’s decision to extend production collaborations; marketing;associated with them. The case endeavours daylight savings time by a month each year Bollywood; international awards; Indian as part of a sweeping new energy plan, 15 www.ibscdc.org
  • 16. which would mean pushing the clock • To debate whether the advent of Neotel keywords forward by an hour. From 2007, 48 US would bring true choice to South African Industry Analysis states would turn their clocks forward one telecom users who were dependant on a Reinsurance; China’s Reinsurance Market; hour in March, instead of April, and turn monopolistic service provider. Business Environment; Market Entry back in November instead of October. This Strategies; Market Development; Risk would force families to head to a multiplex Industry Telecommunications Management; Reinsurance Products; rather than keep their children awake for Reference No. INA0027 Property and Casualty (P&C) Reinsurance; an extra hour. This would mean a huge loss Year of Pub. 2006 Life and Health (L&H) Reinsurance; China for drive-in theaters. Does this spell doom Teaching Note Not Available Re; Swiss Re; Munich Re; Cologne Re. Struc.Assig. Not Available to the drive-in theaters? keywords Pedagogical Objectives The Making of ‘The Da Vinci Telecom industry in South Africa; Telkom; Code’: The Recipe for • To discuss how drive-in theaters in the Telecom Tariffs in South Africa; US can be an alternative for multiplexes Liberalisation of South African Telecom Blockbuster? and other entertainments Industry; Fixed line telephony in South In 2006, The Da Vinci Code registered itself Africa; BPO Industry in South Africa; among those rare genre of films whose • To understand the role of US government Second National Operator; Shareholding popularity have been found to be on par in the success of drive-in theaters. of Neotel; Telecom Tariffs and South with the novels from which they have been Industry Entertainment/Movie African GDP Growth; Competitive adapted. By May 2006, The Da Vinci Code, Reference No. INA0028B Strategies of Neotel. a historical fiction written by Dan Brown, Year of Pub. 2006 had achieved an all-time international best- Teaching Note Not Available seller status with 60.5 million print Struc.Assig. Not Available Reinsurance Industry in China: editions. The extensive research that went Opportunities and Threats for behind writing the book resulted in an keywords absorbing concoction of fact and fiction. Foreign Reinsurers The book’s sensational theme that Jesus Drive-in theatre; Movie; Baby Boom; Films; Daylight saving Time; Camden; In 1998, nine foreign reinsurers together Christ was married to Mary Magdalene and RCA; Concession Stand; AM/FM; did business of RMB 52 billion in China, had sired a bloodline that still exists has Attendence; ticket; Frequency; Family; which was mainly from the placement of been instrumental in its grabbing global Comeback; Intermission ads. the business in the international market readership across faiths. It is opined that by the Chinese insurers. By 2005, these the innovative promotional efforts by the nine foreign reinsurers were doing business publisher and the author have also been a to the tune of RMB 300 billion. China’s major driving force behind the novel’s South Africa’s Telecom Industry: phenomenal success. accession to the World Trade Organisation Neotel’s Foray and the New (WTO), and the subsequent liberalisation Competitive Landscape of the insurance and reinsurance sectors, Pedagogical Objectives The South African telecom market had had ushered in vast business opportunities for foreign reinsurers in a market where • To understand the factors that create a been the monopoly of the state controlled blockbuster out of a fictional novel Telkom, which was the sole provider of China Re was the only major domestic fixed line telecommunication services. player. But the business potential does not • To analyse the basic elements that High tariff rates of Telkom hampered the discount the threats and challenges for contributed to the global success of The nascent BPO industry, which the South reinsurers. Da Vinci Code African government was promoting to • To debate whether controversies and boost employment in the country. Under Pedagogical Objectives criticisms are the perennial add-ons for such circumstances, the telecom market any blockbuster novel or a movie based • To understand the concept of reinsurance in South Africa was deregulated and Neotel on it. and its importance was launched in August 2006 as the Second National Operator (SNO), which is 51% • To understand the dynamics of the Industry Entertainment Industry owned by a consortium headed by India’s reinsurance industry in China Reference No. INA0025 Tata group. It is believed that Neotel would Year of Pub. 2006 give stiff competition to Telkom, whose • To discuss the business opportunities for Teaching Note Not Available monopoly was characterised by high tariffs foreign players in the reinsurance market Struc.Assig. Not Available and delayed services. As Neotel is the first in China company to be launched after the keywords • To understand the various reinsurance liberalisation and deregulation of the products developed for the Chinese The Da Vinci Code; Dan Brown; Opus telecom industry in South Africa, other market Dei; Hollywood Blockbusters; Leonardo Da African nations would be monitoring its Vinci; Oscars; Ben-Hur; Google; The progress as a prelude to liberalising their • To discuss the challenges and threats in Vatican; Mary Magdalene Robert Langdon; own telecom markets. operating in the Chinese reinsurance The Vitruvian Man; The Last Supper; industry Louvre; Sony Pictures. Pedagogical Objectives • To discuss what foreign reinsurers are • To understand the major forces shaping doing to mitigate these threats. the telecommunication market in South Industry Reinsurance Low Cost Carriers in India Africa Reference No. INA0026 The aviation industry in India underwent a • To analyse the impact of the launch of Year of Pub. 2006 major change in 1994, after the private Neotel on the South African telecom Teaching Note Not Available operators were allowed to operate on industry Struc.Assig. Not Available scheduled routes. Although seven airlines began their operations soon, but only two16 www.ibscdc.org
  • 17. players survived. The case discusses in detail Pedagogical Objectives Switzerland-based Roche Group merged its S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIhow the private airlines and the low-cost Japanese operations with one of Japan’s S T R A T E G Y – III S T R A T E G Y – IIIcarriers are trying to tap the huge potential • To understand the evolution of China’s leading pharma companies, Chugai. Despiteavailable for them in India. Finally, the economic growth the low success rate of cross-bordercase highlights the challenges faced by these • To debate on the inequalities between alliances, with a Swiss parent company andnew entrants. the geographical regions in China a Japanese management team, the Roche- Chugai partnership successfully achievedThe case includes a note on the low-cost • To analyse and understand the housing the estimated R&D, revenue and costairlines of US and UK. reforms in China synergies. The outlook for the company’s • To analyse China’s home improvement future was also very bright.Pedagogical Objectives market industry to understand the• To illustrate the success and growth of opportunities and challenges for home Pedagogical Objectives low-cost carriers in developed countries improvement retailers in China • To identify and discuss the strategic and India inflection points in the pharmaceutical • To debate whether Home Depot should• To discuss and understand Porter’s 5 enter China or not industry force analysis in LCC industry. • To discuss the underlying reasons, which • To discuss whether Home Depot’s lateIndustry Aviation entry would be an advantage or a have spawned strategic alliances amongstReference No. INA0024A disadvantage. competitors in the pharmaceuticalYear of Pub. 2006 industry Industry Home improvement RetailingTeaching Note Not Available Reference No. INA0023 • To discuss the critical success factors inStruc.Assig. Not Available Year of Pub. 2006 cross-border allianceskeywords Teaching Note Available • To analyse the reasons for the success Struc.Assig. AvailableLow-Cost Carriers; No frills airlines; of the Roche-Chugai partnership inAviation Industry; Strategic Management; keywords Japan and the factors that contribute toair travel in India; Core Competence; its sustainability.Competitive tariff; airline market Foreign home improvement retailers in China; China’s home improvement Industry Pharmaceuticalspotential; Indian Middle class; Reference No. INA0022infrastructure; aircraft maintenance; industry; Do-it-yourself (DIY) and buy-it- yourself (BIY); Late-mover disadvantage Year of Pub. 2006aircraft fuel; Indian Airlines; Jet Airways; Teaching Note Not AvailableAir Deccan; Kingfisher Airlines; SpiceJet; and first-mover advantage; Home Depot, B&Q and IKEA; China’s housing reforms; Struc.Assig. Not AvailableGoAir. China’s economy; real estate; property keywords market; Joint ventures/strategic alliances and partnerships; Market entry strategies; Global pharmaceutical industry; Business China’s Home Improvement China’s urban-rural divide; Orient Home, environment; Generic drug manufacturers; Market: Should Home Depot Homeway and Home Mart; Income Pfizer Merck GSK (GlaxoSmithKline);Enter or Will it Have a Late-mover disparity; GDP (gross domestic product) Patent protection patent expiry; Clinical (Dis)advantage? and purchasing power parity. trials; New drug development process; Research and development investment,Since the mid-1990s, the home research and development productivity;improvement market in China is growing Blockbuster drugs; Consumer behaviour;rapidly. Besides housing reforms, rise in A Successful Cross-border Promotional advertising expenditure; Newpeoples’ incomes, purchasing power and Partnership in Pharmaceutical chemical entity (NCE); Food and Drugproperty investment encouraged private Industry: The Case of Roche- Administration (FDA); Cross-borderhome ownership in China. Homeownership Chugai in Japan alliances; Mergers and acquisitions.in China, which was non-existent twodecades ago, has increased to 70% today. After its early stage of development priorNew homeowners have to fit up the basics to the 1970s, the global pharmaceuticallike flooring, plumbing and furniture, as industry witnessed an accelerated growth India’s No-frills Airlines: No-profitthe houses are unfinished ones. This has due to huge investment in R&D, adoption Airlines?encouraged consumers to engage in do-it- of innovative technologies and the discovery of new drugs. Blockbuster drugs Although the private sector laid theyourself (DIY) and home improvement/ foundation of India’s aviation industry withdecorating activities. Coupled with this huge created multi-billion dollar companies called the Big Pharma that dominated the the setting up of Tata Air Lines in 1932,potential growth and market liberalization, for a substantial period (1953-1994) theChina’s home improvement market pharmaceutical industry, which was one of the most profitable industries in the world. aviation industry had been highly regulatedattracted many domestic and foreign home with abysmal government participation.improvement retailers like IKEA and B&Q. However, at the turn of the 21 st century, falling productivity of R&D investment However, subsequent deregulation of theChina, with a population of 1.3 billion and industry in 1994 witnessed the entrance ofa rapidly growing economy, has become and tough government regulations had resulted in scarcity of new drugs and private players. The Indian aviationan attractive market for many foreign industry evolved further with the entry ofcompanies. Atlanta-based Home Depot, spiraling new drug development costs. In addition, a slew of patent expiries, rising the No-frills or low-cost airlines in 2003the world’s largest home improvement with the advent of Air Deccan. Other low-retailer, is weighing its China options: competition from generic drug manufacturers and declining consumer trust cost competitors too joined the fray, notshould it enter or not. Some analysts are only taking competition to a new level butsceptical about its late-mover had created a difficult business environment. These conditions also expanding the market as a whole. Butdisadvantage? Or does this delay help in certain domestic policies like highershortening its learning curve and rise precipitated a trend of strategic alliances amidst pharma companies to control costs aviation fuel charges and airport chargesrapidly. were hindering the low-cost airlines from and ensure market positions. In 2001, 17 www.ibscdc.org
  • 18. reducing prices or increasing profits. It Pedagogical Objectives Year of Pub. 2006 remains to be seen as to how the Indian Teaching Note Available Industry Analysis low-cost carriers would take on the • To understand the development of Struc.Assig. Available challenge. private banking industry in Japan keywords • To discuss the role of Citibank in the Pedagogical Objectives development of private banking in the Foreign carmakers in China; China’s country automobile industry; Chinese automobile • To discuss how the introduction of brands; China as an automobile revolutionary business concepts in an • To discuss the competitive scenario in manufacturing hub; Low-cost industry affect the business prospects of the private banking industry in Japan manufacturing countries; Localisation; traditional players High value added activities; Branding of • To discuss the opportunities available • To discuss the business and revenue to various players present in the ‘Made in China’ products; Expansion model of low-cost airlines Japanese private banking industry, strategies of Chery; Country as brand; especially after the withdrawal of Challenges for Chinese carmakers. • To discuss how the Indian low-cost Citibank from the industry airlines were competing to reduce costs and increase profits • To debate whether various foreign and domestic financial institutions were Indias Luxury Car Market: The • To discuss the challenges the Indian low- taking the right step by taking increasing Competition Heats Up cost airlines face and debate on the exposure to the private banking industry possible solutions. The impact of India’s initiatives on in Japan. economic liberalisation and globalisation Industry Indian Aviation Industry (post 1991) was most apparent in the Industry Private Banking Reference No. INA0021 automotive sector. The economy was Reference No. INA0020 Year of Pub. 2006 growing at 7% per annum and the Year of Pub. 2006 Teaching Note Not Available information technology revolution in Teaching Note Not Available Struc.Assig. Not Available India had created a sizable professional class Struc.Assig. Not Available keywords with huge purchasing power. Moreover, the keywords new age Indian was becoming more Low-cost airlines; No frills airlines; Indian Private banking; Japan; Citibank; comfortable with his riches and flagrant aviation industry; Air Deccan; Business Competition; High net worth individuals; display of wealth, which ushered in model of low-cost carriers; Point-to-point; Government financial institutions; Postal opportunities for global luxury carmakers Hub-and-spoke; Full-service airlines; savings system; Foreign banks; Japanese in India. Analysts estimate that the luxury Business design for low-cost airlines; Cost financial system; Reforms; Baby Boomers; car segment would be growing at a rate of structures; Internet-based distribution. Wealth management services. 28% annually. More than 7,000 luxury cars were sold in India every year and nearly 20 global luxury brands were competing Japan’s Private Banking Industry: for the market share. Automobiles: Made in China, The Competition Sold in America? Pedagogical Objectives Although Japan is considered as one of the China, with a vast skilled and low-cost labour • To highlight the strategies adopted by fastest growing markets for private force, has transformed itself into a hotbed global luxury car markers for India banking in Asia, the concept of private of automobile manufacturing for both banking was alien to the Japanese for many • To discuss the competitive scenario and multinational and domestic companies. years. Citibank was the first financial the future of the luxury car market in Chery, a state-owned carmaker, is one of institution that introduced private banking India. the fastest growing domestic automobile to the Japanese and played an important manufacturers. Like a few of its domestic Industry Automobile role in the development of private banking competitors, Chery also plans to export its Reference No. INA0018 in the country. Following Citibanks cars to the developed markets, especially in Year of Pub. 2005 success, many other financial institutions, the US. However, the traditional notion of Teaching Note Available both domestic and foreign, entered the American customers that ‘Made in China’ Struc.Assig. Available industry. However, the private banking goods are of inferior quality, might affect industry in Japan received a blow in the keywords Chery’s prospects in the US. year 2005, when Citibank was issued a notice to close down its private banking operations Indian luxury car market; Premium car in the country, for violating the rules and Pedagogical Objectives manufacturer; Indian economy; Indian car regulations of the Japanese financial • To understand the dynamics of China’s industry; Quantitative restrictions; systems regulator Financial Services automobile market Economic liberalisation and globalisation; Agency [FSA]. After Citibank pulled out De-licensing of automotive sector; of private banking in the country, the • To discuss how the ‘country as a brand’ Consumer behaviour; Marketing strategies; competition among the other financial affects the sales of its products in foreign Brand awareness; Dealer networks; institutions providing private banking markets Customs duty. services intensified. The economic reforms • To discuss Chery’s international undertaken by the Japanese government expansion strategies and how it is making also encouraged many financial institutions efforts to cope with the regulatory and The Advent of Personalised to provide private banking services to their clients. Analysts expect demand for private technological challenges to establish its Medicine: New Business Model banking services in Japan to increase brand in the US market. for Pharmaceutical Companies? manifold in the coming years. Industry Automobile Manufacturing The pharmaceutical industry’s blockbuster Industry business model seems to be fading off. Reference No. INA0019 Innovation is resulting in just a trickle of18 www.ibscdc.org
  • 19. new drugs, Big Pharma is losing its patents Mexicana started their own low-cost Big Pharma; Innovation in S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIand lawsuits are shaking up the industry. In airlines. However owing to some concerns pharmaceuticals; Drug marketing; S T R A T E G Y – III S T R A T E G Y – IIIAugust 2005, a Texas jury ordered the US analysts are divided on the prospects of Advertising for drugs; Blockbuster drugs;drug company Merck, to pay US$253 low cost carriers in Mexico. Patent laws for drugs; Cost components ofmillion (£141 million) to the wife of a drug companies; Research and developmenttriathlete who died after taking the firm’s Pedagogical Objectives in drug companies.blockbuster Vioxx. That was only the firstof thousands of lawsuits filed against Merck • To discuss the evolution of the Mexicanon the same charge, the situation of Merck airline industry over the decades, and the growth of low-cost carriers in the Mobile Information Technologycan well be extrapolated to the industry.What went wrong with the Big Pharma? country and Communication Devices:Are the problems self-inflicted? For too The Energy Crisis • To discuss the growth prospects andlong the industry relied on a belief that a concerns for the low-cost airlines in Mobile information and communicationsingle drug can cure a particular ailment in Mexico. devices are instrumental in fulfilling theall the affected people across the globe. modern day needs of flexibility, mobility,This belief stands refuted by the genetic Industry Airlines communication and convergence.mapping and the research thereof. New Reference No. INA0016 Conceding to the customer demands forfindings suggest that every individual’s Year of Pub. 2005 more sophistication and convenience, thereaction to a particular drug is unique, based Teaching Note Not Available mobile device manufacturers areon their unique genetic setup. Every disease Struc.Assig. Not Available incorporating advanced features resultinghas a number of variants, again based ongenetic variations, and therefore demands keywords in the emergence of mobile phones with camera, music player and colour screen,unique medication called personalised Mexican airlines; Low-cost carrier; Code- laptops and notebook computers withmedicine. Clearly, analysts say that the sharing agreement; Mexicana; powerful microprocessors. But thedays of the mass model of drugs have come Restructuring plan; Breakeven; technology of rechargeable batteries,to an end. Aeromexico; Crossair; Loss-making routes; required to power these features, is not Incompetent managers and poor decisions; progressing equally, thus creating a powerPedagogical Objectives Market share; Structural problems; Growth gap. The insufficient power supply is strategies; Mexican airline industry; United gradually emerging as the Achilles heel in• To highlight the rise of personalised airlines. the progress of the communications medicine industry. The delay in development of• To discuss whether the seasoned players other viable alternatives to meet this power in the pharmaceutical industry should Global Pharma Industry: In Need gap is further worsening the situation, adopt this, and the payoffs therewith. of a New Business Model? posing the threat of an energy crisis for the future that could lead to stagnation ofIndustry Pharmaceuticals Manufacturers advancements in mobile devices. Once celebrated as the engine of modernReference No. INA0017 medical innovation, pharmaceutical firmsYear of Pub. 2005 are lambasted for the low productivity of Pedagogical ObjectivesTeaching Note Not Available their research, their wasteful marketing and,Struc.Assig. Not Available • To highlight the technological above all, for the high prices that their advancements in the mobile informationkeywords products command. The drug companies defend their prices, and their profits, by and communication devices, thePersonalised medicine; Business model of citing the high cost of making new drugs, evolution of rechargeable batteries thatpharmaceutical companies; Human more than US$800 million. This infuriates power the mobile devices, and theGenome Project; DNA sequences; Big critics, who argue that the firms could easily reasons for an impending energy crisisPharma companies; Blockbuster drugs; lower prices and find savings on • To discuss the viable measures to dealInnovation in pharmaceutical companies; promotions without touching their precious with the impending energy crisis.Research and development in research and development budgets. To meetpharmaceutical industry; Patents on this end they propose a new business model Industry Mobile Electronic Devicesblockbuster drugs; Pharmacology; Merck; for the pharma giants, which will focus on Reference No. INA0014Drug development process. lowering marketing budgets and embracing Year of Pub. 2005 innovative methods in dealing with high Teaching Note Not Available costs of drug making. Struc.Assig. Not Available Low Cost Carriers in keywords Mexico:Growth Prospects and Pedagogical Objectives Concerns • To discuss the pros and cons of the Mobile communication electronic devices; Mobile information technology devices;Mexico’s flagship air carriers are Mexicana existing business model Energy sources for electronic devices;and Aeromexico. Though the two airlines • To discuss the essence of the proposed Battery technologies; Rechargeablecontrolled 80% of the Mexican market, business model. batteries; Nickel metal cadmium batteries;since 2000, due to the high prices they Lithium ion polymer batteries; Fuel cellcharged, they started losing market share Industry Pharmaceuticals technology; Power-hungry mobile devices;to other domestic and US airlines. In Reference No. INA0015 New generation portable devices; Portableaddition, many US low-cost carriers entered Year of Pub. 2005 power sources; 3G (third generation) andthe Mexican aviation market and Teaching Note Not Available 4G (fourth generation) communicationpopularised the concept of low-cost air Struc.Assig. Not Available technologies; Advanced features intravel, which resulted in the rise in air electronics; Power gap and energy crisis; keywordspassenger traffic in Mexico. To benefit Battery technology innovation.from this growth, several new companies Global Pharmaceutical Industry; Businessand existing Mexican airlines, including model of drug companies; Drug industry; 19 www.ibscdc.org
  • 20. Pharma Majors in Developing last four decades of the 20th century had Teaching Note Not Available Countries: An Extended seen per capita domestic consumption of Struc.Assig. Not Available Industry Analysis Corporate Social Responsibility wines reducing from 126 litres in 1960 to keywords just 56 litres by 2000. The import of French The developing countries have always had wines in America and Britain had also Detroit big three; Mass production; Build- a crisis when it came to disease and reduced considerably since the mid-1990s. to-stock; Dell’s mass customisation; Entry medicine. With twelve major infectious With a vast stock of unsold wines, the barrier; Economies of scale; General diseases afflicting them and non-availability French wine industry was plagued by a huge Motors buy-power; Fuel-efficient cars; of drugs, their woes worsened due to financial crisis. Henry Ford; Alfred Sloan General Motors; pharmaceutical neglect of developing End of Detroit; Zero inventory; e- countries. Questions arise as to whether Pedagogical Objectives Commerce; Five-day-car; Lean the pharma giants of developed countries manufacturing. were actually serving the people in such • To highlight the myriad problems faced poor countries, where diseases like HIV by the French wine industry (Human Immunodeficiency Virus)/AIDS (Acquired Immune Deficiency Syndrome) • To discuss the initiatives taken by the The South African Car Industry: French government to bail out the The Resurgence and tuberculosis kill millions each day. industry from the crisis. Meanwhile the pharma majors were The South African car industry has always criticised for their profit-oriented business Industry Wine attracted the major carmakers in the world practices undermining social responsibility. Reference No. INA0012 since the 1920s. Although the industry In an effort to make drugs available, the Year of Pub. 2005 managed to overcome the turmoil of the governments of these countries took some Teaching Note Not Available Great Depression and the Second World War, initiatives, which led to reduction of prices Struc.Assig. Not Available due to the Apartheid policy of its of the patented drugs and the onset of keywords government, there was an international generics in these markets. boycott of South African trade. After the France; French wine industry; Varietals; new democratic government came to power Pedagogical Objectives Appellations; Bordeaux; French wine in 1994, the country started taking export; Appellation d’Origine Controlee initiatives to bring back its past glory as the • To highlight social responsibility factor (AOC); Institut National des Appellations of the global giants and how crucial it car-manufacturing hub of Africa. By the end d’Origine (INAO); New world; Evin Law; of 2000, the auto industry was contributing can become for their survival in the Fermentation; Varietal labelling; Alcohol future 5.4% to the GDP of South Africa. advertising; Industrial distillation of wines. • To discuss significance of the WTO’s Pedagogical Objectives (World Trade Organisation) Doha declaration, which outlined the inclusion Global Automobile Industry: • To highlight the initiatives taken by the democratic South African government of compulsory licensing and parallel From Mass Production to Mass to reclaim the status of Africa’s car- importing to serve the interests of the Customization manufacturing hub common man in such developing countries By the end of the 1990s, the global • To discuss the effects of such initiatives. automobile industry began to see flaws in • To discuss the various drug donation Industry Automobile its much acclaimed mass production model. programmes, private-public partnerships Reference No. INA0010 Henry Ford’s mass production model and the price war initiated by the Year of Pub. 2004 brought about manufacturing excellence introduction of generics in the Teaching Note Not Available through economies of scale and cost developing countries. Struc.Assig. Not Available efficiencies in automobile industry. Industry Pharmaceuticals However, with the changing market keywords Reference No. INA0013 scenario, the ‘Big Three of Detroit’, along Year of Pub. 2005 with other top manufacturers were feeling South Africa; Delta Motor Corporation; Teaching Note Not Available the pressure of meeting the sophisticated General Motors; Volkswagen; Ford; Struc.Assig. Not Available and ever-changing consumer preferences Mercedes Benz; Completely knocked down in the market. Consumers had become versions; Apartheid; United auto workers; keywords choosy about the color and styles of the Democratic Republic of South Africa; Social responsibility; Third World diseases models they purchased. Mass BMW; Nelson Mandela; Toyota; Nissan; and market; Drug patent regime; customisation-making cars to-order and Albert Wessels. Intellectual property rights; Uruguay round operating in niches like environmental of GATT (General Agreement of Trade friendly cars are being considered as a possible solution to the problems that and Tariffs); Pharmaceutical neglect; The Demise of Detroit: Why the Pursuit of profit maximisation; NGO’s besiege the industry. Big Three Lost (Non-governmental organisation) criticism against pharma giants; Doha Agreement; Pedagogical Objectives Detroit’s Big Three - ‘General Motors’, Lawsuits and governments; The social ‘Ford’ and ‘Chrysler’ reigned supreme in • To highlight the shift from the mass front. the US automobile market all through the production model to niche segments in 1960s and 1970s. But the Japanese, the global automobile industry German and Korean car manufacturers, who France’s Wine Industry: In Need • To discuss the initiatives taken by the gradually eroded the Big Three’s US market big three of Detroit. in the 1980s, challenged their supremacy. of Better Marketing The invasion started with the small-car Industry Automobile segment and by the end of the 1990s, the In the early 21st century, the wine industry Reference No. INA0011 SUV and the luxury car segments had also in France, an icon of French culture, has Year of Pub. 2004 been captured. The Big Three had been passing through a troubled phase. The20 www.ibscdc.org
  • 21. underestimated their competition and AirAsia; Orient Thai; Tiger Airways; One- Pedagogical Objectives S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIfailed to understand the pulse of the market. Two-Go; Anthony Fernandes; Udom S T R A T E G Y – III S T R A T E G Y – IIIWith its inflexible plants, high legacy costs Tantiprasongchai; Singapore Airlines; Air • To highlight the growth of Indian autoand their looming labour problems, Detroit Deccan. components industry in the context ofwas in deep waters. liberalisation • To discuss the challenges faced by thePedagogical Objectives Japan’s Tech Industry: The industry.• To highlight the gradual erosion of the Comeback Trail Industry Automobile and Transport Big Three’s US market Japan’s technology industry, which had Reference No. INA0006 Year of Pub. 2004• To discuss the reasons for such erosion. been weak since the bursting of the IT Teaching Note Not Available bubble, has suddenly been rejuvenated.Industry Automobile Struc.Assig. Not Available Earlier Japanese companies like Sony,Reference No. INA0009 Sanyo and Matsushita were considered to keywordsYear of Pub. 2004 be the benchmark for tech goodsTeaching Note Available worldwide. The recent development in Low-cost auto components; AutoStruc.Assig. Available other Asian countries like China, Korea component makers; Maruti Udyog Limited; and Taiwan had brought them at par with Mahindra & Mahindra; Phasedkeywords manufacturing programme; Automotive Japan. Companies like LG of Korea startedGeneral Motors; Ford; DaimlerChrysler; giving tough competition to their Japanese Component Manufacturers AssociationToyota; Honda; BMW; Volkswagen; counterparts. But the demand for Japanese (ACMA); Product liability clause; Tier 1Detroit; Motown; United Automobile, electronics and other goods in recovering suppliers; Original equipmentAerospace and Agricultural Implement world markets had helped lift the economy manufacturers.Workers (UAW); Hyundai; Market share out of a 10-year slump. Digital applianceof Big Three; Big Three; The end of products such as mobile phones and digitalDetroit; US automobile industry. versatile disc (DVD) devices were India: An Automobile Hub in the propelling this movement. Making Low-Cost Carriers in Asia Pedagogical Objective Forty years ago when Peter Drucker phrased the auto industry as the ‘industryThe concept of a Low-Cost Carrier (LCC), • To highlight the effect of the of industries’, little did the carmakers knowthat got instant popularity in the US in technological industry on the Japanese about outsourcing and technology sharing.1970s, was adopted in Europe in the 1980s. economy. Now, when most of the markets areAsia was a little slow in picking up the Industry IT brimming with competition from acrosstrend. The first LCC in Asia, the ‘Orient Reference No. INA0007 the globe, carmakers had no option but toThai’, started in the mid-1990s in Thailand, Year of Pub. 2004 keep their costs low. In this context, Asiafaced lot of problems as the government Teaching Note Not Available first emerged as a manufacturing hub withof Thailand saw it as a threat to its national Struc.Assig. Not Available countries like India, South Korea and Chinacarrier, ‘Thai Airways International’. becoming outsourcing destinations. TheSubsequent deregulation of the domestic keywords Indian context is particularly striking asaviation industry in Thailand came as a the country opened its doors to foreign Japanese tech. industry; Japanese economy; automakers only in 1992. After a littlebreather for ‘Orient Thai’. Following this South East Asian financial crisis; Japanese more than a decade, Indian automobileexample many other LCCs sprang up in exports and imports; Southeast Asian industry stood as a shining example ofdifferent Asian countries like the ‘Cebu countries; Lucky Goldstar (LG); Samsung; producing low-cost cars with internationalPacific Air ’ (Philippines), ‘Air Asia’ Digital appliances; Liquid crystal displays; quality norms. From DaimlerChrysler to(Malayasia) and Deccan Air (India). Yen appreciation; Plasma TV; Sony; Ford to Hyundai, most of the globalSeeking to tap the potential of LCCs, even Matsushita; Sanyo; Semiconductor industry. carmakers today see India as the globalthe national carriers jumped into the frayin 2003. In December 2003, Singapore hub of car manufacturing and componentAirlines (SIA) announced the launch of its outsourcing. Even indigenous carmakersforthcoming LCC – ‘Tiger Airways’. Thai Indian Auto Components like Tata Motors and Mahindra &Airways was also planning to launch its Industry Mahindra have made inroads into the globalown LCC , ‘Nok Air’, by mid-2004. markets. Recently, Tata Motors reached Contrary to popular perception that an agreement with MG Rover of Britain to liberalisation stifles the growth of domesticPedagogical Objectives supply 100,000 of its ‘Tata Indica’ to manufacturers, Indian auto components Europe.• To highlight the emergence of low cost industry has evolved to compete with carriers in Asia global companies. During this process of Pedagogical Objectives evolution, the industry produced some of• To discuss the increased competition the world-class component manufacturers • To highlight Asia’s emergence as a from the national carriers. like Sundaram Fasteners and Bharat Forge manufacturing hub in the increasingIndustry Airlines Ltd. Not just domestic manufacturers, even competition and the pressure to keepReference No. INA0008 global giants like Delphi and Visteon have the costs lowYear of Pub. 2004 set up their manufacturing bases in India. • To discuss the outsourcing in the IndianTeaching Note Available But the industry had its own challenges in automobile Industry.Struc.Assig. Available terms of meeting quality norms, sound logistics and the like. These problems were Industry Automobilekeywords further coupled by the fewer number of Reference No. INA0005 tier 1 suppliers. Analysts attributed the Year of Pub. 2004Low-cost carriers (LCC); Asia; Malaysia; problems to the nascent state of the Teaching Note AvailablePhilippines; Thailand; Singapore; India; industry. Struc.Assig. Available 21 www.ibscdc.org
  • 22. keywords Pedagogical Objectives aviation industry; First transatlantic alliance, 1993; SkyTeam; Hub and spoke Industry Analysis Liberalisation; Foreign direct investment • To understand the low-cost carriers’ system; Deregulations in the airline (FDI); Maruti Udyog Limited; Hyundai business model industry; Strategic alliances between Motor India; Tata Motors; MG Rover; Auto airlines; Open skies; Aviation networks; ancillary industry; Original equipment • To discuss the emerging scenarios in the American airline industry in the light of Aviation industry after September 11, manufacturers (OEMs); Export 2001; Consolidation of the aviation destinations; Product liability clause; major carriers’ entry into the low-cost arena. industry. DaimlerChrysler AG; Economic reforms; Outsourcing strategies; R&D gap; Delphi Industry Airline India Reference No. INA0003 Year of Pub. 2004 Mercedes-Benz: Quality Teaching Note Available Concerns Big Pharma R&D: Is it worth Struc.Assig. Available By the end of 1990s, Mercedes-Benz, the spending? keywords car that had been adored by Presidents and Popes for seven decades, was witnessing Big Pharma like Pfizer, Glaxo and Novartis Low-cost carriers in USA; Cost structure rising customer complaints regarding its spend as much as $30 billion a year on in aviation industry; Regular carriers in quality. Mercedes, which ranked No.1 in R&D. But the number of new molecular USA; Losses in the US aviation industry; the first ‘Vehicle Dependability Survey’ of entities resulting from such R&D spend is Deregulations in the aviation industry; Hub J.D. Power and associates in 1990, saw its shrinking. and spoke system; Market share of low- rank slipping to No.3 in 1999 and then to cost carriers; Operating costs in the aviation No.26 in 2003. Pedagogical Objectives industry; Business models of low-cost carriers; Southwest Airlines; On-line air • To highlight the decreasing number of ticket reservation; Cost-cutting measures Pedagogical Objectives new molecular entities at Delta Airlines; Cost-cutting measures at • To discuss the reasons for the quality • To discuss the other challenges faced by American Airlines; Song and Delta; Big problems of Mercedes A-Class and M- today’s Big Pharma. carriers fighting back. class cars Industry Pharmaceuticals • To discuss how in turn this affected the Reference No. INA0004 overall brand image of Mercedes. Transnational Alliances in Civil Year of Pub. 2004 Teaching Note Not Available Aviation Industry Automobile Reference No. INA0001 Struc.Assig. Not Available Since its inception as a means of mass Year of Pub. 2003 keywords transport in the 1940s, the civil aviation Teaching Note Not Available industry worldwide has always been under Struc. Assign. Not Available Big pharma; R&D; Pfizer; Novartis; New stringent government regulations. Due to molecular entities; Eli Lilly; Astrazeneca; the fragmentation of the industry, it Keywords Bristol-Myers Squibb; Sanofi-Synthelabo; suffered from operational inefficiencies, Mercedes-Benz; History of Mercedes; Schering-Plough; Merck; Pharmaceutical; financial losses and poor customer services. Trademark of Mercedes; Quality ratings GlaxoSmithKline; USFDA; Drugs. This led to changes in business models of of Mercedes; JD Power; Quality problems the industry from time to time – at Mercedes; Firsts at Mercedes; Quality deregulations in domestic aviation in many concerns at Mercedes; Quality checks at Cost Advantages of Low Cost countries followed by strategic Mercedes; Vehicle dependability study; international alliances between major Carriers in USA Initial quality rankings; Customer airlines of different nations. In September complaints at Mercedes; Suppliers of In the1970s, the deregulation of the US 2003, a new business model emerged when Mercedes in the US; Grievances about domestic aviation gave rise to a new kind KLM (Royal Dutch Airlines) merged with Mercedes; MCG Best. of airlines - the ‘No-frills’ or ‘Low-Cost’ Air France to mark the first merger of two carriers. The low-cost carriers had an national flagship carriers. entirely different business model from the regular or the traditional carriers. The first Pedagogical Objectives low-cost carrier to start operations was Southwest Airlines in 1971. Since the • To highlight the need for change in the 1970s, the low-cost carriers have always business model of the civil aviation industry clocked profits. Even in the aftermath of San Lu, The Chinese Milk the September 11 terrorist attacks in the • To discuss the significance and effects Products Manufacturers Product US, while traditional airlines had together of the new model. lost $10 billion in 2002, Southwest earned Failure: Managing the Crisis? $418 million for its 30th consecutive year. Industry Airline This case studys primary objective is to As the traditional airlines suffered from Reference No. INA0002 trigger a discussion on how to manage a high operational costs for long, they also Year of Pub. 2004 crisis keeping in mind three very important decided to enter the low-cost game to Teaching Note Not Available facts: a) the crisis emanated from a product sustain their profits and to regain the Struc.Assig. Not Available failure, b) the product is highly sensitive, market share they had ceded to their low keywords i.e. its a food item and c) when the cost counterparts. On April 15th 2003, Delta company in question comes from China, Airlines launched its low-cost arm, ‘Song’, Aviation alliances; Mergers in aviation which has recorded serial product failures. followed by ‘Ted’ by United Airlines in late industry; Regulations on airlines; Chicago Since the 21st century, China has been 2003. convention, 1944; KLM-Air France known for its food crises ranging from fake merger; Code sharing agreements in milk powder and pet food to duck eggs and22 www.ibscdc.org
  • 23. toothpaste. In September 2008, the massive promotional campaigns, (HTIL) offered to sell off its majority stake S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIcountry witnessed another milk powder infrastructure sharing with other network in Hutchison Essar. With a backdrop of a S T R A T E G Y – III S T R A T E G Y – IIIcrisis that sickened and killed many babies. operators and others that are exclusively chronology on Indian telecommunicationsThe case delves into the reasons for why focused on reaching the low-end customer industry and Hutchison Essars presence inthe country is so prone to food crises. The segments. However, Sarin decides to quit India, the case study highlights Vodafoneslatest crisis involved San Lu, one of the the company leaving his successor, dilemma in joining the race for HTIL bid.largest domestic dairy firms. In spite of Vittorio Colao, with a pile of unfinished Should it wait for increasing its minoritybeing one of the largest and the most trusted businesses. Given the scenario, can stake in Indias leading telecom operator,dairy firms, San Lus milk powder was found Vodafone succeed in the Indian market Bharti AirTel or join the race for HTILsto be contaminated with an industrial amid stiff competition from large family- bid? Amid this situation, it remains to seechemical, melamine. Unfortunately, there run companies like Bharti, Reliance and whether the Indian-born CEO routeswere other 22 firms involved in the crisis. Tata groups? Can its growth in Indian Vodafones new growth map to his homeTo manage the crisis, San Lu made a much market compensate for its stalled growth country or find out a new way to flourishdelayed product recall and issued a public in Europe? What are the challenges Colao in the market.apology. However, are these measures would face in the future?sufficient to undo the damage and rebuild Pedagogical Objectivescustomer trust in a country where food Pedagogical Objectivessafety is consumers first priority and • To discuss the intricacies of operatingcutting back on dairy purchases is • To justify Vodafones decision to acquire in an emerging marketunavoidable? The case delves into the controlling stake in Hutchison Essar • To examine Vodafones foray intochallenges that San Lu, the dairy industry • To evaluate Vodafones strategies to win emerging markets and its way of handlingand China would face in refurbishing its the Indian customers the challengestainted image. • To examine Vodafones rebranding • To discuss the development trends inPedagogical Objectives strategies in India the Indian telecom industry and its growth potential• To understand and analyse the reasons • To emphasise Vodafones successful for serial product failures and frequent performance in Indian markets • To examine the growth strategies of food crises in China Hutch in India • To analyse the growing competition and• To analyse the San Lu milk crisis and other challenges to Vodafone in India • To analyse whether Sarins Indian understand the reasons behind it nativity would help him chart • To examine Sarins exit from the Vodafones new growth map in India• To explore the ways and means available company and potential challenges for for San Lu to manage the crisis in the his successor • To resolve Vodafones dilemma – short term as well as the long term. whether to bid for HTIL offer or to wait • To suggest how Vodafone can gain for further stake in Bharti AirTel.Industry Dairy industry sustainable competitive edge inReference No. TRT0136 developing countries like India. Industry TelecommunicationYear of Pub. 2009 Reference No. TRT0134 Industry TelecommunicationTeaching Note Available Year of Pub. 2008 Reference No. TRT0135Struc.Assign. Available Teaching Note Available Year of Pub. 2008 Struc.Assign. AvailableKeywords Teaching Note Available Struc.Assign. Available KeywordsFood supply chain, Crisis management,logistics, Brand image, Quality control, Keywords Vodafone; Emerging Markets; CostRegulatory system, Business ethics, Reduction; Monopoly; Telecom Circles; Mobile; Hutchison Essar; Rebranding; Licensing Agreements; BSNL; MTNL;Corporate Social Responsibility, Made in Managing in Troubled Times Case Studies;china, Corporate image, International Managing in Troubled Times Case Studies; Vodafone; Acquisition; Infrastructure; VSNL; Bharti AirTel; Reliance; Hutchison;trade Bundling; 3G; GSM; CDMA; Spectrum; Market Entry; ARPU Tariff; Wars; MVNOs; Vittorio Colao; DoT; COAI; and TRAI Vodafone (C): Sarin Follows Pug Vodafone (A): Sarin Gets Vodafone (B): Sarin Finds His Desi Stumped!To quickly recoup from the growth crisisand capitalise on the fastest growing mobile Routes? Vodafone, one of the leading wirelessmarket in India, Sarin found his desi routes companies was lurching in losses – biggest Stalled growth in major markets amid ever in the European corporate history –through HTILs bid. Third in the Vodafone declining profitability could no longercase series, this case study presents Sarins owing to its legacy of expensive buyouts, justify Vodafones investments in ill-timed exits and its own strategic flaws.signature deal in clinching Hutchison Essars acquisitions. Hence, the new CEO, Arunmajority stake. Not every day that one At a time when rivals were moving towards Sarins immediate task in hand was to convergence of Information,gets to control a big player in a highly integrate the far-flung empire. A sequel toregulated and competitive environment. Communications and Technology, the case study, Vodafone (A): Sarin Gets Vodafones mobile-only approach was aThereby, Vodafones acquisition of Stumped!, this case study emphasisescontrolling stake in Hutchison Essar was spectacular failure. Aggressive expansions Vodafones foray into emerging markets amid growing market saturation, strugglingvery crucial for its growth in emerging like Turkey, Romania, Africa and India. Atmarkets. The case study highlights Sarins unit and failure to make a mark in the US, a time, when Vodafone was eager to make brought Vodafones growth engine to a halt.strategic efforts in establishing its presence a mark in India – worlds fastest-growingin India like rebranding initiatives to Amid such situations of crisis, Arun Sarin mobile market – Hutchison succeeded Christopher Gent. Given theincrease its brand awareness through Telecommunications International Ltd. 23 www.ibscdc.org
  • 24. scenario, is the shine wearing off for competitiveness and stay ahead of its meticulously Goldman has averted the crisis Vodafone? What challenges do Sarin face? competitors? This case study is the first in and reported revenues amidst the massive Managing Troubled Times/Managing a Crisis Can he revive the company back to its a two part series on Nokia and provides a mortgage melt-down. glory days? Where should Vodafone look thorough outlook on the mobile handset for growth now? industry and the changes therein. It details Pedagogical Objectives the changes in the mobile handset value Pedagogical Objectives chain and then enables a discussion on what • To trace out the reasons behind the US do these changes imply for the incumbent mortgage crisis • To discuss the intricacies of intensifying Troubled Times/Managing players. The discussion centres on what • To analyse the impact of the crisis on competition in the telecom industry and have been Nokias strengths and based on ways to gain competitive edge over Global financial market the industry analysis, what are the others opportunities and threats to the company. • To discuss Goldman Sachs pro-active • To discuss the role of mergers and Based on this, what should be Nokias strategies in mitigating the market risks acquisitions as an important strategy for strategy and what course of action should and reporting profits. aggressive growth plans, particularly in the company take to maintain its Industry Banking the case of international expansions competitiveness? Reference No. TRT0131C Year of Pub. 2008 • To discuss the success story of Vodafone Pedagogical Objectives Teaching Note Available in the global telecom industry and • To understand the telecom industry based Struc.Assign. Available identify the factors that has stalled its growth in its major European markets on Michael Porters Five Forces analysis Keywords • To examine the leadership traits of Gent • To analyse the emerging trends in the Goldman Sachs; Investment Banks in the and Sarin during situations of crisis as telecom industry and the critical success US; Mortgage Crisis; Sub-prime crisis; US well as growth opportunities factors for the handset makers housing market; Securitisation; Mortgage- • To identify the various challenges faced • To understand the changes in the mobile backed securities (MBS); Collateralised Debt by Sarin in carving out a successful handset value chain and the evolving Obligation (CDO); Collateralised Mortgage growth path for Vodafone product concept and its significance for Obligation (CMO); Credit Crunch; Special the incumbent players Purpose Vehicle; Troubled Times Case • To suggest different options for Studies; Pass-Through-Certificates (PTCs); Vodafones sustainable growth in matured • To understand the strategies that Nokia, Poor Credit Rating; Short selling; Credit- markets. the industry leader, should follow to default Swaps maintain its competitiveness. Industry Telecommunication Reference No. TRT0133 Industry Telecom Year of Pub. 2008 Reference No. TRT0132 Will the Red Envelopes at Netflix Teaching Note Available Year of Pub. 2008 get Obsolete? Struc.Assign. Available Teaching Note Available Struc.Assign. Available Since the time it was launhed till the present Keywords (2008), Netflix has been the leading player Keywords in the online video rental market. Its Telecom; Convergence; Europe; Mobile; Success; Value Chain; revolutionary business model heightened Consolidation; 1G; 2G; 3G; GSM and Segmentation; Total Product; Industry the industry competition. But, with the CDMA; Value Chain; Market Penetration; Analysis; Scenario Analysis; Porter; Nokia; movie download service launched by Competitive Advantage; Expansions; SWOT; Competitive Advantage; Managing powerhouses like Apple and Amazon, Managing in Troubled Times Case Studies; in Troubled Times Case Studies; Growth; industry veterans speculated about the Acquisitions; MVNO; Takeover; Theodore Levitt; Samsung; Motorola certainty of Netflix to retain its market Leadership; Arun Sarin position. It was felt that, if Netflix did not experiment with the movie download technology, it might end up losing its Nokia (A): A Stable Player in a How Goldman Sachs Survived position in the industry ladder. Finally, in Turbulent Industry the US Mortgage Crisis late 2007, Netflix entered into the movie download market. It differentiated its With an estimated global market volume The massive financial cataclysm triggered offering through a technology called of 1.15 million units in 2007, the mobile by the US subprime mortgage lending streaming movies. This technology did not handset industry is the largest consumer during the year 2006 forced many leading turnout to be a big hit as it was not feasible electronics market in the world. However, mortgage lenders in the US to close their for offline viewing and on high definition from 2008, growth has slowed down for operations and file for bankruptcy. It also screens. In order to make-up for its the industry that till now has enjoyed a resulted in the investment banks, engaged drawbacks, Netflix partnered with LG double digit growth. Added to the woes is in securitising subprime loans into Electronics in early 2008. Netflixs the increase in demand for low-priced marketable securities, running the risk of founder, Reed Hastings stated that the firm handsets, which means lower margins for insolvency. Hit by the market turbulence, also had similar partnership plans with few the handset manufacturers. Nokia is a leading global investment banks, including other companies in the digital landscape. dominant industry player and has held the Lehman Brothers, Merrill Lynch, Reed expects that the Netflix-LG top position since 1998, after upstaging Citigroup, UBS, Bear Stearns and Morgan partnership will help the firm rectify its Motorola. The company till now has Stanley, registered a total loss of $136 shortcomings in streaming movies managed to stay ahead of rivals. Now, with billion in 2007 for their subprime technology. Analysts on the other hand Samsung challenging Nokia in the low-cost exposures. However, Goldman Sachs Group are skeptical about the success of the handset market, there is impending Inc., one of the worlds largest investment technology and feel that in the longrun it saturation as the industry matures and banks, reported net earnings of $11.6 might lead to shrinking of Netflixs core margins are expected to go down. In such a billion in 2007 despite the credit turmoil. service of DVD-by-mail. It remains to be scenario how can Nokia maintain its This case facilitates discussion on how seen if the technology convergence at24 www.ibscdc.org
  • 25. Netflix will succeed and render its red unnaturally close relationships between store expansion has wrought many troubles S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIenvelopes obsolete. management and employee leaders. Piech, for the company. The company has S T R A T E G Y – III S T R A T E G Y – III a powerful shareholder with his "Faustian experienced declining customer traffic andPedagogical Objectives pact" was all out to get his way. Despite slow down in sales in their core domestic having hired groomed and nurtured market. In an effort to cope up with theThe case study helps the students to analyse Pischetsrieder (to streamline the company situation, Starbucks announced the returnand understand: in the face of withering global competition) of Schultz as the CEO who laid out plans• The importance of innovation to take his place at VW when he himself to transform the company and bring it back (technology convergence) in the success moved up as the Chairman of the to its success path. The case study of Netflix through years supervisory Board, he axed him. Before highlights the problems of Starbucks and being forced to resign Pischetsrieder was facilitates discussion on whether Schultzs• How Netflix gained popularity with its given a five year extension till 2012. return as a leader can take Starbucks towards DVD-by-mail service Volkswagen shares dropped as investors recovery or not. took in the depth of problems facing the• The future of Netflixs idea to partner with firms in the digital landscape. company. There was unrest at VW. Was Pedagogical Objectives there more to be read between the lines ofIndustry Online DVD rental Industry Pischetsreiders resignation? Was there an • To understand entrepreneurial leadershipReference No. TRT0130B undue union influence at Volkswagen? Who • To analyse the hindrances of rapidYear of Pub. 2008 took the decisions? expansionTeaching Note AvailableStruc.Assign. Available Pedagogical Objectives • To analyse leadership change in troubled time of the company.Keywords • To understand the dynamics of corporate governance, by evaluating its merits and Industry Specialty Retailing/BeveragesRed Envelopes; Netflix; Amazon; Apple; demerits and the impact on managerial Reference No. TRT0128ADVD-by-mail; technology convergence; behaviour in German automobile Year of Pub. 2008Reed Hastings; Netflix-LG deal; companies Teaching Note Availablemoviedownload service; streaming movies; Struc.Assign. Not Availableinnovation; online DVD rentals; • To evaluate the importance ofsubscription based business model; pay-per shareholder and stakeholder-oriented Keywordsrental; late fees governance systems Starbucks Corp., Speciality Coffee • To evaluate the various management Industry; Howard Schultz; Leadership styles adopted in automobile companies Change; Turnaround; Transformation; Unrest at Volkswagen: Who Return of Founder; Managing in Troubled Takes the Decisions? • To discuss and understand the impact of Times Case Study; International executive intelligence on business Expansion; McDonalds; Dunkin’ Donuts;For decades Volkswagen, Europe’s largest leaders. Brand Building; The Starbucks Experience;carmaker, had enjoyed a reputation for Entrepreneurial Leadership; Industry Automobile Industryhaving one of Germany’s most highly- Transformational Plans; Reference No. TRT0129Bdeveloped systems of labor/management Transformational Initiatives Year of Pub. 2008co-operation, with managers involving Teaching Note Availableemployee representatives in crucial Struc.Assign. Availabledecisions. Germany’s co-determination law, Motorola – Losing its Razrs Edgeunder which VW functioned, started out Keywordsconceptually as a law to ensure a balance Motorola, worlds second largest player inbetween the interests of management and system of cross-holding;industrial co- Cellular Industry, gained a significantlabor in the company but had morphed determination; company-centric market share in 2004 backed by itsinto an insidious alliance aimed at "keeping management; inflexible workforce; history successful products and managed to sustainappearances", "being the favorite" and "not of intransigent leaders; union bureaucracy; growth for a while with new versions androcking the boat". CEOs and top managers co-opted with insiders; state ownership; derivatives of Razr, one of its mostdepended on votes from labor dynamics of corporate governance in VW; successful cell phone models. However, therepresentatives to be reappointed. Instead managerial behaviour in VW; Ferdinand company failed to develop innovativeof making tough decisions on restructuring Piech; Volkswagens supervisory board, products that could replicate Razrs successor job cuts, VW managers were inclined to shareholder/stakeholder-oriented and lost out to its competitors whodelay or avoid change and instead curry governance; Unrest and organisational developed innovative products. The casefavor with union bosses sitting on their instability at VW; impact of executive outlines the dynamics of the global mobileboards, often to the detriment of the intelligence phone/cellular Industry, Motorolas earliercompany. And with the resignation of turnaround, its earlier success with RazrBernd Pischetsrieder, the chief executive phone, causes for its decline in phone/of VW it seemed that life in Germany for Trouble at Starbucks: Will the cellular industry, its initiatives to stem thecorporate bosses seemed to have become Visionary Founder Howard decline and its new growth strategy.treacherous. Pischetsrieder was forced out Schultz be Able to Transform theafter lengthy struggles with Ferdinand K Company? Pedagogical ObjectivesPiech VWs Chairman and chief of thecompany’s supervisory board and a highly US based Starbucks Corp. (Starbucks), • The dynamics of global cellular industryinfluential figure (being the grandson of worlds largest chain of coffee houses hasFerdinand Porsche). Piech had an agenda • Importance of product innovation in cell become one of the most admired brands phone industryof his own and Pischetsrieder was caught worldwide under the leadership of itsbetween aggressive investors and VWs set visionary founder Howard Schultz • How innovation helped Motorola gainof problem. VW had been hobbled by (Schultz). However, after Schultzs an edge over its competitorsanemic sales, deteriorating quality, and departure as CEO, Starbucks focus on rapid 25 www.ibscdc.org
  • 26. • The reasons behind marketing failures during Christmas season, how would it • To suggest different ways of handling of Motorolas Razr phone. regain its lost consumer trust? With Mattel’s crisis. Managing Troubled Times/Managing a Crisis majority of its toy production coming from Industry Telecom Industry Toy Industry China, how would Eckert revive the tainted Reference No. TRT0127P Reference No. TRT0124 image of China-made products? Year of Pub. 2008 Year of Pub. 2008 Teaching Note Available Teaching Note Available Struc.Assign. Available Pedagogical Objectives Struc.Assign. Available • To analyse Mattel’s method of crisis- Troubled Times/Managing Keywords Keywords handling Motorolas Decline; Telecom Industry; Liability Accusations; Consumer Product Motorola Razr; Managing in Troubled • To understand the role of public relations Safety Commission (CPSC); Tainted ‘Made Times Case Study; Handset Market; CEO and media, as an effective tool in in China’ image; Barbie; Fisher Price; Hot Edward Zander; Razrs Rise; Razrs Decline; communicating the recall information Wheels; Age Compression; Shorter Product New strategy of Motorola • To examine the role of leadership in Lifecycles; Supply Chain Issues; managing the crisis Outsourcing Manufacturing Operations; Toy sales in Holiday Shopping Season; • To identify effective ways of handling Robert Eckert; Managing in Troubled Image Crisis at BP such crisis. Times Case Study; Lead Contamination in BP, the London-based oil company is one Industry Toy Industry Surface Paint; Design Flaws; Crisis of the six global energy super majors with Reference No. TRT0125 Management interests in exploration, production Year of Pub. 2008 refining and marketing of oil, gas, power Teaching Note Available and renewables. In 2006, BP suffered a Struc.Assign. Available Microsoft: Struggling in China? series of mishaps that tarnished its image. Among the mishaps were pipeline Keywords Since entering into China, Microsoft corrosion at Prudhoe Bay in Alaska leading struggled for gaining market share and Robert Eckert; Public Apology; Design to oil leakage, a civil complaint filed against make profits in the mainland. The problem Related Recalls; Manufacturing Related BP for manipulating the propane market it seemed was not with its brand, as Recalls; Safety Check and Quality Control and a gas oil leakage in the port of Long everyone was using Microsoft’s Operating Systems; Media and Public Relations in Beach, California. All these mishaps and System (OS). The problem was that of Handling Crisis; Renaissance of ‘Made in scandals had an adverse impact on BPs piracy. Microsoft tried various ways to get USA’; Tainted ‘Made in China’ Image; reputation. Analysts were skeptical if BP the government to crack down on piracy, Crisis Management; Role of Leadership in would resurrect its stained image. but instead the government supported Managing Crisis; Managing in Troubled Linux, the low-cost competitor of Times Case Study; Recall Impact on Pedagogical Objectives Reputation and Performance Microsoft’s Windows. Linux’s presence and the lack of Government support left • The dynamics of the oil industry Microsoft in a weak position in China. The • The crisis management strategy at BP case study also highlights various initiatives Mattel’s Product Recalls (A): The taken by Microsoft in China to strengthen • The importance of crisis management Chinese Imbroglio its position in the growing Chinese software on the brand image of companies. market. It also focuses on the measures The case study tracks Mattel’s history of taken by the company to develop strong Industry Energy and Utilities liability accusations and product recalls, for relationships with the Chinese government. Reference No. TRT0126P more than two decades. It was regularly Year of Pub. 2008 clashing with regulatory agencies like CPSC, Teaching Note Available Pedagogical Objectives regarding disclosure of existing or potential Struc.Assign. Available hazards in some of its toys. Amid such The case has been structured to circumstances, Mattel was once again comprehend and explore: Keywords accused of defective toys - owing to design, Energy; BP; crisis management; oil spills; as well as, manufacturing flaws in August • The dynamics of the Chinese market Texas refinery; Managing in Troubled 2007. In fact, industries across the globe • The challenges faced by MNCs in Times Case Study; Helios; green image; witnessed a spate of recalls of China-made developing economies reputation crisis products that included every thing from pet food and toothpaste to clothes and toys. • Analyse strategies adopted by Microsoft What then should Mattel do to handle the in China. crisis? How can it successfully leverage on Mattel’s Product Recalls (B): Industry Software China’s cost-efficient production, without Managing the Crisis affecting its reputation and profitability? Reference No. TRT0123B Year of Pub. 2008 A sequel to Mattel’s Product Recalls (A): Teaching Note Available The Chinese Imbroglio this case study deals Pedagogical Objectives Struc.Assign. Available with Mattel’s series of recalls in August- September 2007, just before the peak • To discuss Mattel’s emergence as the Keywords world’s premier toy-maker holiday-selling season. It highlights the Piracy; MNCs; Linux; Chinese market; media and public onslaught, the initial • To critically examine the reasons behind Gaunxi; local partners; ZTE blame-game between Mattel and the Mattel’s product recalls for more than telecommunication; developing Chinese manufacturers, its CEO, Robert two decades economies; Price; Managing in Troubled Eckert’s public apology and his personal Times Case Study; operating system; Mao handling of the crisis. What is interesting • To identify the problems in outsourcing manufacturing operations to suppliers Zendong; Deng Xeoping; Deregulation; to discuss here is that with a significant integration impact on Mattel’s reputation and sales in low-cost countries26 www.ibscdc.org
  • 27. Troubled Carmaker Chrysler (B): and Chrysler turned out to be a complete • To assess whether fund-raising from Can Robert Nardelli Resurrect S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III failure. Changing trends of US auto industry, private corporate investor is desirable S T R A T E G Y – III S T R A T E G Y – III the Company? huge legacy of health-care cost, shift in at this stage of operation. consumer demand, increasing fuel prices Industry AviationOne of the leading private equity firms, and competition from Asian carmakers are Reference No. TRT0120Cerberus Capital Management, L.P. some of the factors saddling down Chrysler. Year of Pub. 2007(Cerberus), acquired American auto icon At the time of takeover Chrysler was Teaching Note AvailableChrysler, amidst its turnaround efforts. already in the midst of a turnaround plan Struc.Assign. AvailableCerberus agreed to keep Chrysler ’s that includes the elimination of 13,000management intact, but surprisingly, jobs and a huge investment for new Keywordsreplaced the chairman and CEO, Thomas improved product offering to meet shiftingLaSorda with Robert (Bob) Nardelli in consumer demand. Kingfisher Airlines; UB Group; VijayAugust 2007. Cerberus’ logic behind hiring Mallya; Anil Dhirubhai Ambani GroupBob Nardelli, a former General Electric Pedagogical Objectives (ADAG); Texas Pacific Group (TPG);(GE) high ranking executive and former Irelandia Investments; Equity dilution;CEO of The Home Depot Inc., was that • To analyse the private holding of Fund raising; Financial and strategiche could bring a fresh perspective to Chrysler, its consequences and issues for investor; Vision alignment and cultural fit;privately held Chrysler with his result- its new parent, Cerberus Competition; Premium value carrier;driven aggressive leadership and proven Managing in Troubled Times Case Study; • To discuss on what possible strategies Cash depletion; Low cost modeltrack record of successful turnarounds. can Cerberus adopt for Chrysler andHowever, Bob Nardelli’s functioning at would this private equity firm be able toHome Depot had been criticised despite turnaround the distressed Chrysler andachieving increase in sales. Nardelli had to be its holy grail? Air Deccan (A): The Captain’sleave Home Depot in the wake of sliding Cocktailstock price, anger over his hefty pay and Industry Automobileproblems with employees and shareholders. Reference No. TRT0121A The case study tracks the journey of AirBob Nardelli’s controversial background, Year of Pub. 2007 Deccan, a pioneer low-cost carrier (LCC)lack of experience in the automobile Teaching Note Available in the Indian skies since 2003. With abusiness and manage-through-fear style Struc.Assign. Available passion for reaching out to the commoncould make or break the already troubled man and a vision of making every Indian KeywordsChrysler. fly, Captain G. R. Gopinath built Air Deccan Chrysler; Daimler Benz AG; Automobile - blending his experience in aviation withPedagogical Objectives Industry; American Auto Industry; Big an emotional connection to reach down Three; Cerebrus Capital Management; into the society. Despite its initial success• To discuss the leadership change at Private Equity; Challenge for Chrysler and in revolutionising Indian civil aviation with Chrysler Cerebrus; Asian Automakers; Private its significantly lower fares, Air Deccan• To analyse whether the highly autocratic Equity Firms; Turnaround; Takeover; was mired in continuous losses - owing to leader Bob Nardelli is the right leader UAW; International Expansion; Mergers technical and operational snags, coupled for Chrysler or not and can he resurrect and cquisitions with aggressive expansions. The expansion Chrysler’s past glory? came in for a scathing attack from various quarters including airline industry expertsIndustry Automobile in India. Thereby, given the costReference No. TRT0122A Air Deccan (B): The Captain, The complexities, industrial constraints andYear of Pub. 2007 Baron and The Unknown competitive scenario in the Indian aviationTeaching Note Available As a sequel to “Air Deccan (A): The industry, can Air Deccan revive itsStruc.Assign. Available Captain’s Cocktail”, this case study profitability with relentless low fares and sustain competition in the long run?Keywords explores the options to revive Air Deccan - particularly the fund-raising initiatives.Chrysler; American Auto Industry; It highlights Air Deccan’s search for a Pedagogical ObjectivesCerebrus Capital Management; Private financial, as well as a strategic, investor -Equity Firms; Turnaround; Takeover; • To discuss Air Deccan’s business model without diluting its low-cost image and as an LCC in the Indian civil aviationUAW; International Expansion; Robert vision of reaching the common man.(Bob) Nardelli; Thomas (Tom) LaSorda; Given the various international and • To identify the factors that led to AirLeadership Change; General Electric (GE); domestic contenders bidding for a 26% Deccan’s losses and analyse whether theyHome Depot Inc.; Managing in Troubled equity stake in Air Deccan, participants are controllable or notTimes Case Study; Leadership Styles; can debate on who would make a betterAutocratic Leadership investor-partner for Air Deccan - • To critically examine the value chain considering each one’s possible synergies and cost structure of Air Deccan’s and adversities. operationsTroubled Carmaker Chrysler (A): • To analyse the options for Air Deccan’s Can Cerberus be its Holy Grail? Pedagogical Objectives survival, amid financial crunch and operational inefficiencies.The decade old merger of German • To identify the right investor-partnerautomaker Daimler Benz AG and American for Air Deccan’s equity investment - in Industry Aviationauto icon Chrysler Corp. ended in May the light of its vision, cash crunch, cost Reference No. TRT01192007, when in an unprecedented auto deal, complexities and operational Year of Pub. 2007majority stake was acquired by New York inefficiencies Teaching Note Availablebased private equity firm Cerberus Capital Struc.Assign. Available • To help solve Air Deccan’s dilemma inManagement, L.P. Hailed as ‘the merger choosing the right investor-partnermade in heaven’, the deal between Daimler 27 www.ibscdc.org
  • 28. Keywords telecom; Structure of the UK telecom • To discuss Krafts early growth strategy industry; Evolution of UK’s telecom and its following decline Managing Troubled Times/Managing a Crisis Low-cost Carriers (LCCs); No-frills service; industry; Privatisation of British Telecom Managing in Troubled Times Case Study; • To discuss Krafts revival strategy. Traditional Network Carriers; Global Civil Industry Food & Beverage Industry Aviation; Profitability vs Expansions; Value Chain Analysis; Load factor and Taco Bell and the Ecoli Crisis Reference No. TRT0116P Year of Pub. 2007 capacity utilisation; Operational Taco Bell, a subsidiary of Yum Brands Inc Teaching Note Not Available efficiencies; Cost structure analysis; Price Troubled Times/Managing is a leading Mexican style fast food Struc.Assign. Not Available wars; Financial crunch; Competition; restaurant chain and one of the best Business model; Industrial constraints; G.R. performing brands of Yum. An e-coli Keywords Gopinath outbreak has hit Taco Bell restaurants in US food industry; Managing in Troubled November 2006, affecting people in six Times Case Study; Kraft Cheese; Oscar US states. Taco Bell is now left with a major Mayer; Philadephia; Jacobs; Cool Whip; 3 UKs Profitability and Regulation damage control challenge of convincing Orea; Itene Rosenfeld Concerns: Can its CEO, Kevin its customers that its restaurants are safe Russell Pull it off? to eat even as the cause of the outbreak remains a mystery. 3G UK Limited (3 UK), a group company Sonys Battery Recall: Troubled of global conglomerate Hutchison The case outlines the damage control Times at Sony Whampoa Limited, forayed into UK strategies adopted by Taco Bell restaurants mobile telecom market in 2003 - by rolling to regain market share and retain its In August 2006, Dell Inc. and Apple out first 3G services there. However, it customers in the wake of its ecoli outbreak Computer Inc. announced the recall of couldn’t make profits – in spite of having incident. It focuses on the company’s crisis about 6 million lithium-ion batteries fitted no competition in 3G services. Later, management and repercussions of the in their laptop computers and sold Ofcom, UK’s telecom regulatory authority, outbreak. throughout the world. The companies said ordered to cut termination charges by 45%. that the faulty batteries made by Sony But 3 UK was till then a net payer of Pedagogical Objectives Corporation could overheat and, in rare termination charges. This order, company cases, catch fire. Sony acknowledged the • To discuss the dynamics of crisis problem and offered to assist the sources fear, would further worsen the management companies by sharing a part of the recall bottom-line and so they are appealing against the order. Kevin Russell, appointed costs. Later, other notebook manufacturers • To analyse the crisis management as the new CEO in early 2007, has his also recalled Sony-made batteries taking strategy adopted by Taco Bell in the hands full – in steering the company the count to around 9.6 million batteries. wake of ecoli outbreak at its restaurants. through its regulatory battles and staying Analysts expected that the recall would closer to its advantages. Can he pull it off Industry Fast Food Industry cost Sony approximately $500 million. or would his plans misfire? Reference No. TRT0117P They also opined that the recall came at a Year of Pub. 2007 time when Sony was busy turning around Debates can rage whether 3 UK can grow Teaching Note Not Available its loss-making consumer electronics on its first mover advantage as the first 3G Struc.Assign. Not Available division. While the investors were operator, or will it languish as a late entrant panicked by the cost burden, analysts raised into the market dominated by 2G Keywords questions about Sonys product quality. operators. Even the role of regulations in Crises Management; Public Relation; Taco the company’s profitability can be The case deals with how Sony responded Bell; Yum; Brands; Managing in Troubled and handled the massive battery recall. It discussed. Times Case Study; Brand Reputation; also highlights the corrective measures Damage control taken by Sony to overcome the problems Pedagogical Objectives and save its reputation. • To discuss the critical success factors in the telecom industry Kraft Foods: Arresting Fall in Pedagogical Objectives Growth Rate • To analyse UK telecom industry’s • To get an idea of the global rechargeable competitive dynamics Kraft is the second largest manufacturer battery market as well as Sonys battery of packaged foods in the US. It has several business • To understand first-mover and late- brands which contribute over $1 billion mover advantages and disadvantages in • To understand what triggered the massive dollar each to revenues of Kraft. Kraft was the telecom sector. battery recall and its implications on registering below the target growth in sales Sony Industry Telecom in 2006. To arrest the fall in the growth Reference No. TRT0118 rate, Krafts C.E.O. Irene Rosenfeld • To assess the steps taken by Sony to Year of Pub. 2007 (Rosenfeld) was launching several manage the entire recall process Teaching Note Available initiatives. Struc.Assign. Available • To debate whether Sony would be able The case discusses these initiatives and also to overcome the problem and save its Keywords discusses Krafts earlier problems and reputation. initiatives to overcome these problems, Third generation mobile companies; 3G US food industry, future potential for Industry Consumer Electronics cellular communications; 3G growth of Kraft. Reference No. TRT0115K communications in UK; Hutchison Year of Pub. 2007 Whampoa Limited; 3 UK; Managing in Teaching Note Not Available Pedagogical Objectives Troubled Times Case Study; Cellular Struc.Assign. Not Available operators in UK; Mobile communications • To anlayse the dynamics of the US food in UK; Regulatory authorities in UK industry28 www.ibscdc.org
  • 29. Keywords MySpace and Lifestyle Media: designs and manufacturing patterns were Critical Issues S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III identical to the Japanese brands. S T R A T E G Y – III S T R A T E G Y – IIISony battery recall; Lithium-ion battery;Global battery market; Global battery With 82% of the market share in its The case, while providing an overview ofmanufacturers; Managing in Troubled category, MySpace was the leading social the Chinese motorcycle industry, discussesTimes Case Study; US battery supply and networking website where people could the broad challenges faced by the Japanesedemand; Demand for secondary battery; share photos, music, videos and other motorcycle manufacturers in China.Market share of notebook vendors; interests with a growing network of mutualFinancial implications on Sony; Battery friends. MySpace helped users create a Pedagogical Objectivesoverheating; Recall cost; Sony consumer virtual world where people couldelectronics; Playstation3; Global voluntary • To discuss about the Chinas motor cycle communicate and socialise through theirreplacement programme industry membership profiles without actually meeting them in reality. The rise of • To understand the restrictions imposed MySpace exemplified the emergence of on Chinese motorcycle marketApple Computer: Grappling with lifestyle media as the most sought-after • To discuss the challenges faced by Challenges communication medium, particularly Japanese bike manufacturers in the among the teenagers. Lifestyle media hadIn the second half of 2006, Apple computer evolved as a combination of personalised Chinese marketInc. (Apple) was engulfed in controversies. media experience, empowering consumers • To debate on the survival strategy forAt first, some irregularities were revealed to utilise their productive, leisure and social the Japanese manufacturers in thein stock options grants made between time around converged media experiences. Chinese market.1997 and 2001, creating a furore amongApple shareholders. Secondly, in August, it The case, while providing an overview of Industry Motorcycleannounced the recall of 1.8 million MySpace and lifestyle media as a whole, Reference No. TRT0112Kbatteries fitted in its laptops, saying that underscored the meteoric rise of the social Year of Pub. 2007the batteries could, in rare cases, overheat networking websites and its impact on the Teaching Note Not Availableand burst into fire. Though Apple said that society. Struc.Assign. Not Availablethe recall would not have any financial Pedagogical Objectives Keywordsimpact on the company, theannouncement panicked the customers as China’s motorcycle industry; Honda; • To discuss the emergence of lifestylewell as shareholders. While the company Yamaha; Suzuki; Vehicular restriction; media and its business perspectivewas busy settling both the issues, analysts Tariff barriers; Piracy; Modularisationwondered how Apple was going to save its • To understand the evolution of MySpace strategy; Managing in Troubled Times Casereputation with customers and calm the and its pitfalls Study; Open architecture; Joint venture;shareholders. World Trade Organisation (WTO); • To analyse whether MySpace would able Intellectual property rights (IPR)The case deals with the problems that to sustain its popularity in the long run.Apple is facing and the steps taken by thecompany to overcome them. Industry Internet Content Provider Reference No. TRT0113K Airbuss A380: Stalled on the Year of Pub. 2007Pedagogical Objectives Runway Teaching Note Not Available• To discuss the problems facing Apple Struc.Assign. Not Available The global civil aviation market was a Computer duopoly between Boeing and Airbus and Keywords the competition was featured by bitter• To analyse the accounting and financial rivalry among these two companies. Myspace; Lifestyle media; Social implications arising out of the problems Though, both the companies predicted networking website; Friendster;• To understand the corrective measures FriendSpace; Convergence; Millennials; almost same growth of the civil aviation taken by Apple Computer to overcome MySpace Music; MySpace Records; Rupert market during 2005-2010, two companies the problems Murdoch; On-line advertising; Viral had contrasting view for the future nature marketing; Video content; Mass media; of the growth. While Boeing was a• To debate whether Apple would be able Managing in Troubled Times Case Study; protagonist of fragmentation in network to win customer as well as shareholder Sexual assault and point-to-point traffic concept and confidence. therefore, supported the development ofIndustry Personal Computers smaller aircraft, Airbus favored the hub- and-spoke model of operation, networkReference No. TRT0114K Japanese Motorcycles: Facing consolidation and believed in the conceptYear of Pub. 2007 Challenges in China of larger aircraft. Airbus projected aTeaching Note Not AvailableStruc.Assign. Not Available Despite controlling over 50% of the global demand of 1144 super jumbos by 2020 market, with a cumulative world production while Boeing predicted a demand of 320Keywords of 38.9 million units in 2005, leading super jumbos. In 2000, Airbus announced Japanese motorcycle manufacturers like Project A380 to develop the largestApple Computer; Apple battery recall; commercial aircraft with an investmentStock options; Li-Ion Battery; Backdating; Honda, Yamaha and Suzuki, failed to have a considerable market share in China – the of $13 billion. The aircraft was positionedManaging in Troubled Times Case Study; against Boeings 747 models in super jumboCPSC (Consumer Product Safety biggest motorcycle market in the world. Local brands in China controlled over two- category, and the company planned toCommission); Notebook market share; airborne first A380 within 2005. TheDell; Sony; Rechargeable lithium battery; thirds of the market and foreign brands were continuously outdone on price. The model was highly acknowledged by leadingLaptop computer; Steve Jobs; iPod; commercial airlines operators, like,Securities and Exchange Commission Japanese bike manufacturers also faced stiff competition from pirated bikes, whose Emirates and Singapore Airlines. But the company failed to deliver the aircraft on 29 www.ibscdc.org
  • 30. the stipulated date and when on 3rd to encourage foreign trade in Japan, a few Vodafone lagged behind its competitors in October 2006, the company announced a players like Carrefour and Costco to enter introducing new technology or services in Managing Troubled Times/Managing a Crisis further delay of six months leading airlines Japan. To encourage more foreign the Japanese market. By 2005, Vodafone operators felt bad about the company. investment, the Japanese government in Japan had lost a substantial number of Leading airline operators like, Singapore abolished the LSRSL in 1998 and a few customers to its competitors, who were Airlines cancelled the order for A380 and companies like Wal-Mart and Tesco offering superior handset features and opted for alternatives. As a consequence started studying the Japanese market to services. Vodafone seemed at a loss to gain of the delay of A380, Boeing marketed make an entry into Japan. In 2002, Wal- a foothold in the Japanese market and Troubled Times/Managing aggressively for its 747-8 model, which Mart entered Japan through an alliance finally, in 2005, it sold its Japanese mobile the company planned to launch by 2007. with a local player, Seiyu. In spite of Wal- business Softbank. A few Airlines, like, Emirates, cancelled Marts efforts, it witnessed loss the order for A380 and opted 747-8 of consecutively from the time it entered the Industry experts attempted to analyse the Boeing. This case gives a glimpse of global Japanese market. It was pointed out that reasons for Vodafones exit from Japan. In civil aerospace market, the trends, the decline was due to its low pricing this context analysts debated that Vodafone competitive fight between two competing strategy which proved ineffective in Japan. failed to understand the competition and aircraft manufacturers and two competing Seiyus ineffective management was also the Japanese market and hence made an models from two manufacturers. This case cited as another reason for Wal-Marts exit which could have been avoided. It was also provides an insight about why Airbus downfall in Japan. To strengthen its felt that Vodafone would have to re- lacked in project management skills, why position as a leading retailer, Wal-Mart evaluate its global strategy. it failed to meet the deadline of the delivery implemented several strategies. It increased of its A380 model, airlines operators its investment in Seiyu to more than 50% Pedagogical Objectives reaction about the delay, how Airbus and made the local player a subsidiary of • To understand Vodafones global strategy planned to make over the image, strategy Wal-Mart. The retailer also implemented adopted by Boeing to leverage the delay of several inventory management practices • To gain an insight into the competitive Airbus and the future scenario of global and attempted to streamline their supply environment of the Japanese telecom civil aerospace market. chain operations. In 2006, to succeed in market the Japanese retail market, Wal-Mart • To analyse the reasons for Vodafones Pedagogical Objectives decided to introduce both high and low exit from Japan priced items as its popular selling strategy • To understand the market dynamics of Everyday Low Pricing did not seem to • To consider the strategies that Vodafone civil aerospace industry take off.. Despite Wal-Marts attempts, it should have adopted to remain in the • To analyse competitive position of remained to be seen whether the giant market. Airbus vis a vis Boeing retailer would succeed in Japan or make an exit like it did in Germany and South Korea. Industry Telecommunications • To discuss the importance of project Reference No. TRT0109B Year of Pub. 2007 management in companys overall Pedagogical Objectives strategy. Teaching Note Not Available • Wal-Marts strategies to enter the Struc.Assign. Not Available Industry Aircraft Manufacturing Japanese retail Industry Reference No. TRT0111K Keywords Year of Pub. 2007 • Wal-Marts Inventory management and Vodafone; Japan Telecom Company; Teaching Note Not Available supply chain management practices Softbank; Racal Telecom Limited; Struc.Assign. Not Available • Wal-Marts sales strategies through high DoCoMo; Sarin; KDDI; Ripplewood Keywords priced and low priced products. Holdings; Managing in Troubled Times Case Study; Robin Hearn; Global Strategy; Boeing; Airbus; Hub-and-spoke; Point-to- Industry Retail Ovum; bigger is better strategy; traditional point; Project A380; Global civil aviation Reference No. TRT0110B market; Telecom; Christopher Gent market; Global civil aerospace market; Year of Pub. 2007 Bombardier; Managing in Troubled Times Teaching Note Not Available Case Study; EADS (European Aeronautic Struc.Assign. Not Available Defence and Space Company); Airlines Problems Galore at Dell: Signs of Keywords a Downfall? operators; Boeing Dreamliner; Emirates; Singapore Airlines; BAE Systems plc; Japan; Retail; EDLP; LowPrice; Rollback; Since 2001 Dell had been the undisputable Original Equipment Manufacturers (OEMs) Seiyu; Daiei; Aeon; SMART; Managing in leader in the US PC market. Dell had been Troubled Times Case Study; Supplier; so enamored with its PC business that it Japnese Consumers; Discount; Inventory failed to notice what its competitors Wal-Marts Struggle in Japan pursued. Dell failed to innovate while IBM and others turned to consulting and In the 1980s, the Japanese retail market Vodafone: Losing Connectivity in development. IBM sold out its PC business was dominated by local players like Daiei, Japan to Lenovo since it realized that PC Aeon and Ito-Yokado. The Japanese manufacturing did not fit into their core government started to encourage foreign Vodafone Group Plc is the worlds leading business agenda. Later it seemed that Dell trade and foreign retailers. With the entry mobile telecommunications company with developed a streak of complacency in its of these retailers, the domestic retailers a total market capitalization of attitude. PC market saturation in the US witnessed decline in their sales. To protect approximately UK £72 billion in 2006. and other developed economies, along with the interests of the local players, Large Vodafone entered the Japanese market in investor impatience, fierce competition Scale Retail Store Law (LSRSL) was 1999 through the acquisition of J-Phone and product quality deterioration saw Dell amended by the Japanese government in and went on become the second largest missing its expectations in 2006. Their the late 1980s which restricted the entry wireless telecom company in Japan. But entry into portable music players and PDAs and expansion of foreign retailers in Japan. eventually it could not retain the position did not strike much luck since Apples iPods In the 1990s, when the LSRSL was amended in the Japanese market. It was felt that outsold every other brands in the US30 www.ibscdc.org
  • 31. market. This case discusses the problems remembered all components of the by several analysts. Since its acquisition of S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIthat Dell faced and what Dell has to do in products. The recall hence had a longer Kraft Foods in 1988, Altria was accused of S T R A T E G Y – III S T R A T E G Y – IIIorder to avoid a downfall. lasting negative impact on Dell rather than using its Food division to hide its tobacco Sony. negatives.Pedagogical Objectives Sony though willing to lend a hand Kraft Foods performance was declining and• To understand the US PC market financially also stated that it did not have Altria announced the possibility of the manufacturing capacity to produce so spinning off Kraft in 2004 and was planning• To understand Dells strategy of selling many batteries within the time required to restructure its operations since then. PCs for its replacement. This meant that an Kraft Foods was also contemplating to be• To understand problems for Dells growth outsourced contract was being sub- independent of its tobacco tainted parent in recent times. contracted to yet another supplier. What Altria Group Inc which had 88% of its stake. would happen to the customer? The ALG alike many other tobacco giants facedIndustry PC Industry average customer had already lost large amount of tobacco litigations for longReference No. TRT0108B confidence in Dell, with new batteries not and was waiting for its legal liabilities to beYear of Pub. 2006 necessarily manufactured by Sony but some cleared before proceeding with anyTeaching Note Not Available unknown manufacturer how did Dell restructuring. In 2006, ALG had favorableStruc.Assign. Not Available propose to satisfy its customers on quality rulings for its three major tobacco cases and more important how did it propose to and some analysts expected anKeywords attractive new clientele. announcement of Kraft spin-off as the legalPersonal Computers; Dell; PC Direct environment seemed to be improving. But How would Dell handle this crisis? What Altria did not proceed with Kraft spin-offSelling; US PC industry; LINUX; Microsoft; would happen to Dells image andIBM; Lenovo; Managing in Troubled Times as according to the company still huge legal reputation with the recall? And would Dell risk existed for the company. The caseCase Study; Chinese computer market; and Sony continue their relationship afterlaptop explosion; AMD; product quality talks about the corporate portfolio this third fiasco? structure of ALG and the challenges thatdecline; Product recalls; Michael Dell the conglomerate faced like increasing Pedagogical Objectives health consciousness, government regulations, excise taxes and tobaccoDells Recall of Batteries: Would it • To discuss about the world PC market litigations. Taint Dells Image? • To understand Dell Inc as the largest PCDell, one of the largest PC makers in the makers in the world and its competitive Pedagogical Objectivesworld, on 14th August, 2006 recalled 4.1 strategy • To discuss Altria as a corporate and itsmillion notebook batteries. The recalled • To analyse the impact of Dells recall of entitiesbatteries were manufactured by Sony Corp., its batteries on its image and reputation.Japan. The batteries were defective and • To understand the legal liabilitiesDell felt it best to recall and replace the Industry Hardware Industry involved for tobacco companiesbatteries free for all affected customers. Reference No. TRT0107BDell was a proprietary parts manufacturer. Year of Pub. 2006 • To discuss the importance of corporateThis recall which was the third such was Teaching Note Not Available restructuringDells nemesis. Dells customer perceptions Struc.Assign. Not Available • To understand the importance of rightand its after sales service had much to be Keywords mix of companies in a corporatedesired. Confidence in Dells notebooks portfolioremained a big question mark when the Dell Inc.; Sony Corp.; Largest Batterythird incident occurred and the company recall; Notebooks; Lithium-ion Batteries; • To understand the role of a corporateseemed not to have taken action or the Consumer electronics; Consumer Product parent in managing its portfolio andaction that was to be taken of returning Safety Commission; Managing in Troubled restructuring.the faulty batteries were seen by some as a Times Case Study; Faulty Batteries; Industry Tobacco & Food Conglomeratedilute method of appeasing customers as Hardware Industry; Burnt Laptops; Crisis Reference No. TRT0106Athey expected a company like Dell to management Year of Pub. 2006double check their quality especially since Teaching Note Availablethe batteries were outsourced. Dell with its Struc.Assign. Not Availableunique marketing philosophy of not Altria: The American Tobaccoretailing their products needed to have Keywordsdouble insurance as far as winning and Giants Troubled Portfolio Kraft Foods; Altria; Food and Beverageretaining customers were concerned. New York based Altria Group Inc.(ALG), Company; Tobacco Company; TobaccoDell had recalled batteries in 2001 and in the parent of the worlds second largest litigations; Corporate Restructuring;2005. Dell seemed to know what exactly consumer packaged-food company Kraft Corporate Portfolio Management;was wrong with its batteries, but behaved Foods, was a leading Food and Tobacco Reasons for troubles at Kraft Foods;like an ostrich and buried its head in the Conglomerate. In addition to Kraft Foods, Reasons for Spin-off of Kraft Foods;mud and continued to market the same ALGs portfolio of operating companies Tobacco Liabilities for Altria; Managingbatteries. The recalled batteries were included Philip Morris International, Philip in Troubled Times Case Study; Lawsuitsexpected to cost at least $246 million to Morris USA-producers of the worlds for Altria; Liabilities to TobaccoDell. Sony agreed to share a part of the popular Marlboro brand of cigarette and Companies; Ethical Issues for Tobaccocost. The financial aspect was one part of also had a financial services division Philip Companies; Philip Morris International;the recall but unquantifiable was the Morris Capital Corporation. Altia Group Philip Morris USA; Philip Morris Capitalreputation of the company that went along was known as Philip Morris Companies Corporation; Second Largest Consumerwith the recall. While people would buy and changed its name to Altria in the year Packaged-goods Company; Marlboro;products for the brand name and what it 2003, which was considered to be an effort Cigarettesrepresented it would be rare if one of image change or a mere PR campaign 31 www.ibscdc.org
  • 32. Crisis Management – The Jet at a value of $75.1 billion. Unable to is facing new challenges. People no longer Blue Way commence supply of A380, a futuristic search for hours for greeting cards that Managing Troubled Times/Managing a Crisis double decked jet, it suffered 34 order suit the occasion and the personality of In February, 2007 JetBlue, a leading low- cancellations. With two years behind the recipient, or write warmly worded cost airline of US cancelled around 1096 schedule and $2 billion over budget on the personalised messages on each card and flights in a week leaving hundreds of project, Airbus also faced a revenue loss of post them. People simply send an SMS passengers and aircraft grounded due to an $6.6 billion, which could make the (short message service) from their cell ice storm and enormous operational company financially extinct. The case phones. Or they log onto the Internet, Troubled Times/Managing shortcomings. During the ice storm when describes the events which led to the delay. visit greeting cards websites and send e- most other airlines responded by canceling The first was the fuselage wiring issue which greetings to their beloved. The number of more flights earlier, JetBlue did not follow was caused by the different software people who prefer to shop for greeting the same path. It did not cancel the flights versions used by Airbus German and French cards is declining. To stay relevant, Archies well in advance and as a result, thousands engineers. Wake vortexes, the air has to attract customers and retain them. of passengers ended up trapped at New tornadoes developed by an aircraft behind What can Archies do to reverse this trend Yorks John F. Kennedy International it, was very powerful in the case of an of declining sales? Airport, the hub of its operations. While A380, because of its huge size and four other airlines took just a day or two to get high thrust engines. The ICAO, Pedagogical Objectives back to the schedule, JetBlue took a week recommendation that additional nautical and affected around 130,000 passengers. miles be used to separate other aircraft and • To discuss the segmentation-targeting- A380, was a blow to Airbus, since already positioning strategy followed in strategic The flight delays, cancellations and marketing management strained airports could not offer additional ambiguity in operations caused customer space to an A380, which cancelled its • To discuss the diversification strategy dissatisfaction and affected its brand image. benefit of carrying passengers almost twice and strategy of entering into new However, JetBlue aggressively put in that of its nearest rival B 747. segments efforts to mange the crisis and regain customers trust. The Founder and CEO of The case describes the political turmoil • To discuss how innovation plays a key JetBlue, David Neeleman apologized in regarding the Airbus restructuring plan factor in strategic marketing public and tried to convince people, Power8. 10,000 job cuts, hiving off six management investors and customers that the airline manufacturing plants spread over three would recover. JetBlue announced to countries and cost cutting are few measures • To discuss the trends and patterns of reimburse 130,000 passengers which would which Airbus planned to implement hoping social expression industry in India cost it more than $30 billion. After the to revive its fortunes, amidst stiff crisis, to restore is stained reputation the • To discuss how technology played a key opposition from participating company introduced "customer bill of differentiator in the marketing game governments and labor unions. rights", the first of its kind in the industry. • To discuss the concept of niche The case discusses about the crisis Pedagogical Objectives marketing. management and issues highlighting • Project Management and Product Industry Social Expression JetBlues tactics to manage the crisis and Development Cycle Reference No. TRT0103K restore its corporate image. The case also Year of Pub. 2005 talks about Neelemans leadership in crisis • Dynamics in Aviation Industry Teaching Note Not Available management. Struc.Assign. Not Available • Political and Social factors in Business environment. Keywords Pedagogical Objectives Industry Aviation – Aircraft • To discuss crisis management at JetBlue Archies; Anil Moolchandani; Greeting card Manufacturing industry; Jagdish Moolchandani; Managing • To understand the role of leadership in Reference No. TRT0104C in Troubled Times Case Study; Archies times of crisis. Year of Pub. 2007 Greetings and Gifts Ltd; Disney character; Teaching Note Available Retail Disney; e-Greetings; Indian social Industry Aviation Struc.Assign. Available expression industry; Heart warmers; Reference No. TRT0105A Year of Pub. 2007 Keywords Distribution network; Brand equity Teaching Note Available Airbus A380; Boeing 787 Dreamliner; Struc.Assign. Available Catia V5 CAD Software; Wake Vortex of Airbus A380 Delay: What Went Keywords A380; Managing in Troubled Times Case Study; ICAO recommendations on A380; Wrong? Managing in Troubled Times Case Study; EADS; A380 order cancellations; Power8 After Airbus announced a delay in the Jet Blue; Low-cost carriers (LCCs); Issues Restructuring plan; Long haul aircraft deliveries of its forthcoming A380, the and crisis at JetBlue; Crisis Management; biggest passenger jet ever made, in June Leadership; David Neeleman; Brand Image; 2006, it raised an alarm for the aviation Brand Building; Regaining Corporate Image; Customer Bill of Rights; Customer Archies - Time to Reinvent world, especially for the customers of A380. Prior to this, in 2005, the European plane Satisfaction; Aviation Industry in US; Greeting cards have become a part of the manufacturer had already extended its Business model of LCCs cultural and social life of people worldwide. delivery schedule by six months. The In India, people send cards on the eve of company cited some production issues as festivals and occasions such as Diwali, Holi, reason for the delay. However, industry Airbus: Flying through Pongal, Durgatsov, Christmas, and New watchers suspected that there was more to Turbulence Year etc. The social expression industry the story than mere production issues. has grown to 12 billion in number and US$ While the panicked customers were In 2006, Airbus booked 824 new orders for 14 billion in revenue worldwide by 2004. considering claiming compensation for the aircraft, representing a 44% market share But currently, the greeting cards industry delay (some even were planning to cancel32 www.ibscdc.org
  • 33. the orders), analysts wondered what caused • To discuss the localisation strategy of 825 billion won ($882 million), subject to S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIthe crisis and how Airbus was going to Coca-Cola with modifications to its approval from South Korean regulators. S T R A T E G Y – III S T R A T E G Y – IIIovercome it. Some also believed that the global marketing-mix variables. Wal-Mart said that its decision to withdrawcrisis at Airbus was a golden opportunity from South Korea was in keeping with its Industry Carbonated Beveragesfor Boeing to regain its leadership position. global growth strategy to expand in Reference No. TRT0101K markets where they could realise the desiredThe case tries to highlight Airbus’ problems Year of Pub. 2006 economies of scale. Wal-Mart’sand raises a question regarding how it could Teaching Note Not Available performance in the South Korean marketsort out its problems. It also discusses about Struc.Assign. Not Available which was considered highly competitiveBoeing’s ability to capitalise on theopportunity. Keywords and demanding had not been encouraging. Analysts blamed Wal-Mart’s failure to Coca-Cola; Germany; German Recycling localise as the main reason for its exit.Pedagogical Objectives Law; Store brand; Discounters. They argued that Wal-Mart had not• To understand the reasons that caused tailored its stores and offerings to suit the delay in launching the new aircraft A380 needs of the Korean consumer. Analysts GM in 2005: Facing Challenges wondered why the world’s largest retailer,• To understand the implications of delay in North America with annual total sales of $312.4 billion, in launching new products and the as of January 2006 and serving more than complexities involved therein In the face of intense competition from 175 million customers weekly in 15 its Japanese rivals such as Toyota and countries worldwide decided to pull out of• To know in detail about the development Honda, GM was losing its market share in a growing economy like South Korea. of A380, the world’s largest passenger North America. Analysts pointed out a aircraft While the majority blamed Wal-Mart’s number of reasons for the downslide. GM’s health care benefit costs for existing failure to localise its strategies as the reason• To assess how Airbus planned to deal for the debacle many felt that the with the situation. employees and the legacy costs, in terms of pensions for retirees, were steadily environment in South Korea was notIndustry Aviation increasing. Skyrocketing gasoline prices conducive to foreign brands. Hardly aReference No. TRT0102K caused a decline in the demand for GMs month before Wal-Mart’s announcement,Year of Pub. 2006 gas guzzling Sports Utility Vehicles (SUVs) Carrefour of France, world’s second-largestTeaching Note Not Available and trucks. The share prices, which were retailer quit the South Korean market.Struc.Assign. Not Available more than US$80 even five years back, Many international brands like Nokia, came down and were hovering around Nestlé and Google, struggled in the SouthKeywords Korean market. While analysing the reason US$28 to US$30 on the New York Stock747-8; A380; Hub&Spoke; Point to point; Exchange, by March 2005. In April 2005, for its withdrawal, experts felt that Wal-Freighter; Inter continental. GM posted a net loss of US$1.1 billion for Mart should use this failure to its advantage the first quarter, the biggest quarterly loss in other Asian economies like Japan and since 1992, when the company almost China. How it would do this was to be seen. went bankrupt. The Case discussed causes The case offers scope for discussion on Coca-Cola – Struggling in localisation strategies to be adopted by for the problems in detail and analyzed the Germany possibilities of GM’s turnaround. retailers in overseas markets and the impact of failure to localise.In late 2004 and early 2005, Coca ColaCo. (Coke), the leading soft drinks Pedagogical Objectivesmanufacturer in the world, faced a massive Pedagogical Objectivesdecline in sales in Germany due to the • To understand the concept of generic competitive strategies • To teach localisation strategiesimpact of the newly enacted RecyclingLaw. The company was forced to make • To understand the structure of Auto • To discuss the outcome of a company’suse of recyclable bottles, abandoning its manufacturing industry failure to understand and tailor localisedtrademark packaging as well as to alter its strategies.distribution system in Germany in order to • To analyse competitive strategies along Industry Retailmake a turnaround in the country. with industry life cycle with reference Reference No. TRT0099C to GM.The case, while highlighting the challenges Year of Pub. 2006faced by Coke in Germany, also focuses on Industry Auto Manufacturing Teaching Note Availablethe initiatives taken by the company to Reference No. TRT0100K Struc.Assign. Not Availablerestore its former position in the German Year of Pub. 2006 Teaching Note Not Available Keywordsmarket. Struc.Assig. Not Available Wal-Mart; Localisation strategy; SouthPedagogical Objectives Keywords Korea; Asian markets; Consumer behaviour; E-Mart; Shinsegae; Samsung• To understand the structure and GM; Automobile Industry in US; Ford; Tesco HomePlus; Retail Industry; competitive forces in the German soft Toyota; SUV; Cost Competitiveness. Multinational brands; Trade Unions; drinks industry Carrefour Korea; Competitive Markets.• To understand the regulatory framework in Germany and the challenges faced by Wal-Mart’s Withdrawal from soft-drinks manufacturers due to strict South Korea Canon Digital Cameras: Will it German Recycling Law Continue to Click? In May 2006, Wal-Mart, world’s largest• To discuss the turnaround strategies of retailer announced its exit from South The case describes the challenges that the Coca-Cola, with reference to the German Korea selling its 16 stores to Shinsegae Canon digital camera business faces. The market Co., the country’s top discount chain for case aims at providing discussion points 33 www.ibscdc.org
  • 34. regarding Canon’s present strategies and manufacturer, based on the number of PCs faced by the company. Counterfeiting what more can it do to improve its market shipped. became a serious problem for YKK since it Managing Troubled Times/Managing a Crisis position. The case traces the growth of caused financial losses and also adversely the digital camera industry and reasons for While Dell’s competitors struggled to keep affected its brand image. The case focuses retardation of the growth. It also intends up with Dell’s low-cost PCs and efficient on the measures undertaken by YKK to to raise debate on the growing camera supply chain, Dell progressed from prevent counterfeiting and increase the phone industry and its impact on the digital strength to strength. But with the turn of awareness of its brand. camera business as a whole. It also highlights the 21 st century, the fortunes of the industry players seemed to change. Dell’s Troubled Times/Managing Canon’s strengths in the digital business growth rate started declining. Changing Pedagogical Objectives and the areas from where is it facing competition. The case is designed to help elements in the business environment like • To discuss the counterfeit problems faced understand the digital camera industry, the maturing US market, resurgence of HP by YKK and the effects it had on the Canon’s position as a camera and Apple Computer, rise of low-cost Asian company’s finances manufacturer, competition faced by Canon players like Lenovo and Acer, and high growth in the household demand for PCs, • To discuss the strategies adopted by YKK and impact of its strategies on its business. to overcome the problem and spread a segment where Dell was not focused, led the company to miss earnings and sales awareness about its brand. Pedagogical Objectives projection several times during 2005-2006. Industry Zipper Manufacturing • To help understand the digital camera Dell’s apparent inability to successfully Reference No. TRT0096P industry respond to these environmental changes, Year of Pub. 2005 led the market experts to doubt whether Teaching Note Not Available • To discuss Canon’s position as a camera Dell’s revered business model was equipped Struc.Assig. Not Available manufacturer to provide Dell with a competitive • To discuss competition faced by Canon advantage in the long-term. keywords and impact of its strategies on its YKK; Zipper manufacturing industry; business. Pedagogical Objectives Counterfeit zippers; Japan; Zipper; Industry Consumer Electronics-Digital • To discuss the evolution of the PC Fastening products. Cameras industry Reference No. TRT0098C • To analyse the traditional business model Year of Pub. 2005 adopted by the PC industry vis-à-vis Maytag: In Need of Repair Teaching Note Not Available Dell’s business model and business Maytag Corporation, a $1.4 billion Struc.Assign. Not Available philosophy company is ranked fifth in the home and Keywords • To discuss Dell’s culture and its effects commercial appliance business. It has a long thereof history of producing high quality products Canon; Cameras; Digital cameras; Digital and owned famous brands like Hoover imaging camera phones; Mobile/ • To analyse the internal and external vacuum cleaner, Admiral, Magic Chef, Cellphones; Cellphone cameras; Global factors that affected Dell’s growth in Jenn-Air and Amana. However in 2005, it digital camera market; Canon strategies; the 21st century suffered a loss of $75 million in the fourth Film cameras; Fujio Mitarai Sony; Kodak; quarter and its market share fell by 55%. consumer electronics; Digital Slrs. • To discuss the strategy adopted by Dell The case study discusses the reasons behind in response to its problems and its the fall of Maytag, rising competition in effectiveness. the home appliance market and Maytag’s Dell’s Direct Model: Change of Industry Personal Computers attempts to make a comeback. Direction? Reference No. TRT0097 Year of Pub. 2006 Pedagogical Objectives The launch of IBM’s Personal Computer Teaching Note Available (PC) in 1981, was a boon to the PC industry. Struc.Assig. Available • To discuss the dynamics of the US During the following years, both the PC consumer durable market hardware and software markets flourished. keywords Dell was one of the many start-ups which • To discuss the factors leading to decline Business model innovation; PC industry of Maytag entered the market during this period of evolution; Michael Dell; Kevin Rollins; high growth. Since its inception, Dell • To discuss Maytag’s strategies to make Direct to consumer business model; adopted a business model which was a comeback. Customer segmentation; Organisation contrary to the established norms of the culture; Business philosophy; Strategic Industry Consumer Durable Industry industry. The company bypassed inflection points; IBM; HP; Apple Reference No. TRT0095P traditional distribution channels and sold Computer; Lenovo; Acer; Competitive Year of Pub. 2006 PCs directly to customers. This helped the strategy; Growth strategy. Teaching Note Not Available company to save on costs like reseller margins and high inventories. While the Struc.Assig. Not Available industry followed a ‘build-to-forecast’ keywords approach, Dell followed a ‘build-to-order’ YKK – Countering the Counterfeit model. Established players believed in Dragon Maytag; Maytag’s deadline; US consumer vertical integration whereas Dell ‘virtually’ durable market; Neptune drying centre; integrated itself by building close YKK is the largest manufacturer of zippers Accellis oven; De’Longhi; Dyson; Lowe; relationships with its suppliers and and fastening products in the world. The Try-out stores; Amana appliances; Sport customers. The result was that Dell company though remains almost unknown utility vacuum; Steam Vac; Ripplewood experienced stupendous growth during the because of the nature of its product which holdings; Whirlpool-Maytag tieup; Hoover 1990s. In the year 2001, the company forms a very small part of the final product. vacuum cleaners. became the world’s largest PC This case discusses the brand YKK, its operations, and the counterfeit problem34 www.ibscdc.org
  • 35. Kraft: Deromedi’s Dilemma keywords players like GM, Toyota and Chrysler S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III recalled their vehicles to revamp defects, S T R A T E G Y – III S T R A T E G Y – IIIWhen Roger Deromedi (Deromedi) is Swissair; Commercial aviation sector; Ford recalled its vehicles 17 times .brought on board as Kraft’s CEO in Swissair’s bankruptcy; Swissair’s businessDecember 2003, all Kraft’s flagship strategy; Effects of liberalisation on Ford had quality problems in the past years,businesses – cheese, biscuits, cold cuts, and Swissair; Swissair’s turnaround; European but in 2005, it was facing a crisis ofcoffee – are losing market share and sales economic area; Alcazar project; Hunter confidence. The National Highway Trafficvolumes. Kraft, the icon of Oreo and Mac strategy; Qualiflyer alliance; Hub and Safety Administration was grilling Ford forand Cheese innovation, has not launched a spoke; Crossair. details of problems in Ford vehicles thatsignificant new brand since DiGiorno pizza had resulted in fire accidents in the Middlein 1995. Deromedi has introduced a series East, South America, and Southeast Asia. In order to regain its position in the USof initiatives hoping to arrest falling Jet Blue: Too much Turbulenceprofits. He is reinventing the brand automobile market, Ford planned toportfolio and divesting laggard and Established in 1999, JetBlue was a low cost revitalise its brands and to improve theperipheral product lines that account for start-up airline. After the 9/11 terrorist quality of its vehicles. It also planned toless than 5% of total revenues and attacks while the airline industry suffered introduce low cost models in segmentsconcentrating on blockbuster brands that losses and struggled to survive in the tough where the auto makers had been largelyare or can be market leaders in their business environment, JetBlue continued absent. With the entry of automakers likecategories worldwide. He has narrowed to grow and gain market share due to its Chery and Geely, into the US automobileKraft’s thrust to four core areas: coffee, innovative marketing strategies. However, market, apart from local competitors likecheese and dairy. To transform the in 2005 JetBlue’s profits were under GM and Chrysler, would Ford regain itsportfolio, Kraft accelerates the shift pressure as it registered its first ever losses credibility in US market in the near future?towards growing categories and geographies in the fourth quarter. This case study, whilewhere it can leverage its sustainable highlighting the formation and growth of Pedagogical Objectivescompetitive advantages and scale. The JetBlue against the backdrop of theOctober 2004 launch of the Tassimo is September 9/11 attacks, offers the scope • To understand how Big Three in the USexpected to give Kraft a chance to prove to discuss the situation of the US aviation automobile industry dominated thethat it can be more than just a commodity industry and JetBlue’s strategy for a marketbroker. turnaround. • To understand how deterioration in quality affected FordPedagogical Objective Pedagogical Objectives • To analyse the turnaround strategies of• The case highlights how once considered • To discuss the dynamics of the low-cost Ford. a ‘category captain’, Kraft’s acquisition airlines in the US strategy, brand extension strategy and Industry Automobile • To understand JetBlue’s low-cost Reference No. TRT0091B its product portfolio management has business model Year of Pub. 2006 stagnated its growth. Teaching Note Not Available • To discuss the market factors affectingIndustry Food and Beverage Struc.Assig. Not Available low-cost airlines.Reference No. TRT0094PYear of Pub. 2005 keywords Industry Airline SectorTeaching Note Not Available Reference No. TRT0092P Quality; Big Three; Accident rate;Struc.Assig. Not Available Year of Pub. 2006 Suppliers; Turnaround; Layoff; Closure of Teaching Note Not Available factories; Toyota; Recall of vehicles.keywords Struc.Assig. Not AvailableMarket leadership; Growth; Turn-around. keywords New York in 2004: Recovering JetBlue; Commercial aviation sector; from 9/11? Keeping Swissair in the Air JetBlue’s low-cost business strategy; JetBlue’s losses; Aviation industry scenario; New York, probably the best known citySwissair was an award winning European Increasing fuel costs; JetBlue’s turnaround in the world, was devastated by the terroristairline owned by SAir group. This case strategy; Fuel hedging; Embraer; TrueBlue attack on its symbol, the World Tradepresents the history of Swissair and the frequent flyer programme; Rockwell Center on September 11th 2001. With theissues that resulted in its downfall. The Collins guidance system. city already under recession, the attacksstrategies adopted by Swissair have been compounded the misery. Apart from thepresented in the case. economic impact, the trauma resulting Ford: Built for the Road Ahead from the attacks caused a severe healthPedagogical Objectives and environmental problems. Questions In 2004, with the entry of Japanese, were raised about the city’s ability to cope• To discuss the dynamics of the Chinese and Asian automakers into the US up with such tragedy. commercial aviation industry automobile market, the Big Three-GM, Ford and Chrysler experienced a decline in But on the eve of September 11th 2004,• To understand the factors leading to things seemed to have turned around. The collapse of Swissair their market share and sales. Their warranty and pension costs had increased economy was picking up. Long standing• To discuss the attempts made by Swissair and consumers complained of low quality problems of New York were being addresses. to make a turnaround. parts used in their vehicles. GM and Ford But question marks remained over issues were downsizing their work force to like disaster preparedness, co-ordinationIndustry Airlines among agencies, etc. The case highlights compensate over their lost sales. The yearReference No. TRT0093P the journey of New York’s recovery and 2005 turned out to be a major shake-upYear of Pub. 2006 the challenges that are yet to be addressed. for Ford as it had to recall about 6 millionTeaching Note Not Available vehicles to rectify defects. Though keyStruc.Assig. Not Available 35 www.ibscdc.org
  • 36. Pedagogical Objectives keywords chains. Moreover, the café culture of France was much different from the culture Managing Troubled Times/Managing a Crisis • Disaster management in cities Coca-Cola; Coke; Coca-Cola in Germany; Starbucks was known for. Hence analysts German; Deposit Law; Consolidation of questioned whether Starbucks was aware of • Consequences arising out of disasters of bottlers; Sandy Allen; German Nationwide such magnitude and how administration the risk it was taking by entering into Recycling system; Waste Management in France and challenging the origin of café can best respond to it Germany; Pepsi Co.; Hard discounters in society. • Disaster recovery Germany; Local German beverages; PET bottles; Refillable bottles; Carbonated Troubled Times/Managing • Issues relating to urban society drinks; Non-corbonated drinks. Pedagogical Objectives • Management of city economy. • To highlight the need for adapting to the culture of a country to flourish in Industry Urban Management Starbucks: Turbulence in its business Reference No. TRT0090B Year of Pub. 2005 Overseas Market • To understand the coffee culture in Teaching Note Not Available France. Starbucks was a leading coffee giant, Struc.Assig. Not Available expanding the company globally. Since Industry Beverage/Coffee keywords 2003, Starbucks had to face problems due Reference No. TRT0087B to anti-Americanism in its overseas Year of Pub. 2004 Crisis management; Urban economics; market. Moreover stiff competition in the Teaching Note Not Available Disaster management; Urban planning; market posed a big challenge to Starbucks. Struc.Assig. Not Available Disaster recovery; Disaster Impact Starbucks is trying to overcome all of these Assessment; Environmental impact problems Will Starbucks succeed in its keywords assessment; Urban healthcare; Disasters attempts? Starbucks; French coffee culture; Howard; and trauma; Co-ordination among Schultz; Gourment coffee; Expresso bar; government agencies; Urban security; Pedagogical Objectives Cappuccino; Coffee beverage; Seattle; Public Policy; Urban project management; French coffee Market; Starbucks Government response and disasters; • To discuss about the effect of anti- experience; Italain Caffee; Arabica bean; Economy and terrorism. Americanism globally Hear Music; No smoking policy. • To understand the problems faced by Starbucks in the global market. Coca Cola in Germany (Part A) Hong Kong Disneyland: Industry Beverage Challenges due to Deposit Law Reference No. TRT0088B Appeasing the Dragon? The focus of the case is on the German Year of Pub. 2006 In 2005, The Walt Disney Company operations of the Coca-Cola Company. Teaching Note Not Available (Disney), the No.2 media and The company had pioneered the Struc.Assig. Not Available entertainment company in the world, carbonated soft drink market in Germany keywords opened its first theme park in China, the and had dominated the market throughout ‘Hong Kong Disneyland’ in Hong Kong. its 70 years of operations. But problems Starbucks; Overseas market; Anti- began to crop up in early 2000. Coca-Cola Americanism; Stiff competition; Strategy; Hong Kong Disneyland is the American had initiated consolidation of its bottlers Future-plan; Mergers; Football; Brands; group’s third international amusement in order to improve its global supply chain Olympic games. park, the other two being Tokyo management. In Germany, the company Disneyland and Disneyland Paris. In 1992, initiated the same by 2001 and planned to when Euro Disney (later Disneyland Paris) complete the process by the end of 2003. was opened in France, the French critics Starbucks In France: Teething termed it as an American cultural invasion But the introduction of the deposit law had a negative impact on the German Problems and the locals stayed away from it. Finally, Beverages and bottling industry. This also Disney made the park more culturally In 2005, Starbucks was the largest specialty affected Coca-Cola’s German operations. acceptable to the local visitors and the park coffee shop chain in the world. In 35 years As a result its market share started became Europe’s most visited place. of its operation, Starbucks emerged as the decreasing. In 2004, the new CEO, Neville world’s leading retailer, roaster, and brand So, in 2005, when the Hong Kong Isdell, took charge and began to evaluate of specialty coffee with coffeehouses in Disneyland came up, Disney made sure that the options available to improve the North America, Middle East, Europe, Latin it would be a feel-like-home experience situation America and the Pacific Rim. The company for the Hong Kong and Mainland China had outlets in more than 10,000 locations visitors. The company wanted to avoid Pedagogical Objectives around the world by the end of 2005. the mistake it made in its European foray. Also, as the Hong Kong Government, • To discuss why sales declined in Coca- The coffee multinational initially operated known to be very conservative, has a Cola’s German subsidiary in various locations of North America, controlling stake, Disney had to make starting its business in the US in 1971. In • To discuss the Deposit Law some modest concessions to local customs. 1996, Starbucks started its international But analysts questioned whether Disney • To discuss the options left before Coca- ventures as the US market reached would be able to transport the magic of Cola in increasing the sales and saturation by that time. It entered the Asian Disneyland brand to Hong Kong countering Deposit Law. market first. After receiving encouraging Disneyland. It tried hard to make the park responses in Asia, Starbucks entered Industry Beverage culturally acceptable to the Hong Kong Europe in 1998. In 2004, the coffee chain Reference No. TRT0089B and Mainland China population. But in this reached Paris in France. France, being the Year of Pub. 2005 attempt, will the aura and magic of birthplace of café society, already had Teaching Note Not Available Disneyland be lost? several well-established and reputed coffee Struc.Assig. Not Available36 www.ibscdc.org
  • 37. Pedagogical Objectives Coca-Cola in Japan: From Role the product in a statutory market for its Model to Role Reversal S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III sustenance. Apart from cheap cameras S T R A T E G Y – III S T R A T E G Y – III• To discuss about the specialty of Disney from China, camera phones added more Land The Coca-Cola Company’s Japanese woes to Olympus. In spite of a having a• To understand about Hong Kong operation, Coca-Cola (Japan) Co. Ltd. long history of operating in the camera Disneyland (CCJC), was considered to be a role model industry, Olympus wasn’t able to sustain for the company’s other global operations. the industry and rival pressure. Experts• To highlight the need for adaptability CCJC also contributed to one-fifth of The opined that Olympus should engage in on entering a new market. Coca-Cola Company’s annual profits. contract manufacturing (to China), However, the situation started changing strengthen its R&D rigorous or let downIndustry Entertainment Amusement from 2002, with a decline in the sales its business and concentrate on medical Park volume of CCJC. Since the beginning of endoscopes.Reference No. TRT0086B 2006, a number of steps have been initiatedYear of Pub. 2006 by the management of CCJC to turn the Pedagogical ObjectivesTeaching Note Not Available fortunes of the company around.Struc.Assig. Not Available • To study the competitive scenario ofkeywords Pedagogical Objectives OlympusDisneyland; Hong Kong; DisneyTheme • To discuss why CCJC was considered to • To study the challenges faced byParks; China; Feng Shui; Robert lger; be a role model for The Coca-Cola OlympusDragon; Entertainment; Attendance; Rides; Company’s other global operations • To analyse the future prospects ofCulture; Amusement Park; Disneyland Olympus.Resort; Mickey Mouse. • To analyse the factors responsible for the decline in the fortunes of CCJC Industry Digital Photography • To understand the strategies undertaken Reference No. TRT0083A Year of Pub. 2006 Obesity: Fading McDonalds’ by the company management to turn Teaching Note Not Available Image the fortunes of CCJC around Struc.Assig. Not AvailableSince 2002, McDonalds was targeted for • To debate whether CCJC would be able recover its position as a role model for keywordsthe soaring obesity and other healthrelated issues. Negative propaganda The Coca-Cola Company’s other global Olympus Inc.; Digital photography;highlighting the deterioration in its food operations. Olympus Corp.; Olympus imaging; Digitalquality of McDonalds ruined its image as Industry Beverages cameras; Camera phones; Canon; Sony;the most lovable brand in the US. In 2006, Reference No. TRT0084 Eastman Kodak; Digital SLR; industryin order to get away from negative publicity Year of Pub. 2006 decline.and to regain its lost reputation and sales, Teaching Note Not AvailableMcDonalds included nutritional Struc.Assig. Not Availableinformation in all its fast-food packaging Pitney Bowes in 2006and also started the McDonalds’ Global keywordsMoms Panel. It had plans to advertise Pitney Bowes (Pitney) which controlled Coca-Cola (Japan) Co. Ltd.; Role model;aggressively about its high-quality food and 60% of the worldwide postage-meter Marketing strategies for Japanese; Market;also to revamp 100 of its restaurants market and 80% of the US market ever Japanese beverage market; Market trends;according to the changing needs of its since, it was authorised by postal authorities Cultural Disparities; Role reversal; Georgiacustomers. Though McDonalds was in 1920, to rent postage meters, had marketing campaign; Managementconfident of regaining its image, analysts dominated the business. But in 1959, the changes; Population of Baby Boomers;argued that midst its challenges, it would US Department of Justice challenged Japanese culture; Innovative healthtake a long time for the company to Pitney’s monopoly. And by 1964, Pitney products; Strengthening Georgia coffeereclaim its lost aura. was facing sixteen competitors in the brand; Expanding tea portfolio. market. It gradually fell apart faced withPedagogical Objectives competition. Fred Allen’s leadership put Pitney back into business and George• To discuss how the fast food industry in Olympus in 2006 Harvey, who succeeded Allen, consolidated the US was affected by health related adopting new technologies and products. issues Tokyo based, Olympus was the world’s Now Pitney provided office technologies fourth best selling digital camera• To understand how McDonalds managed and services that helped companies gain manufacturer after Canon Inc., Sony Corp. to achieve growth through its strategies. efficiencies and capitalise on opportunities. and Eastman Kodak. Olympus also Pitney’s solutions included a wide range of manufactured medical endoscopes andIndustry Fast Food Industry mailing and document technologies, dominated the medical industry withReference No. TRT0085B efficiency management services and one- market share of 70%.Year of Pub. 2006 to-one management expertise.Teaching Note Not Available The digital camera business suffered fromStruc.Assig. Not Available Unlike other businesses the postal industry steep price falls, slow industry growth and was changing dramatically. It was driven the increasing popularity of camerakeywords by technological, social and regulatory phones. In March 2005, Olympus suffered changes. The competition intensified withMcDonald’s; Obesity; Fast food industry; a net loss of ¥11.8 billion compared to a each passing day and market segmentsWendys; Burger King; Market leadership; net income of ¥33.6 billion in 2004, largely began to fragment. As the postal businesslack of quality; Eroding image; Plan to win. due to the poor performance of the digital changed, operators responded by reshaping camera segment of the imaging business. their businesses. New technologies altered Olympus faced various challenges to grab the established industry standards and market share, make profits and to innovate market liberalisation opened the way for 37 www.ibscdc.org
  • 38. new competitors. There was a significant Time Warner. Though AOL was the Pedagogical Objectives shift in what was once sent by physical gateway to the Internet for many Managing Troubled Times/Managing a Crisis mail to other media such as financial Americans through the mid 1990s, of late • To analyse the Japanese jewelry market prospectuses were now posted on Internet the rise of high-speed Internet access from and discuss the reasons for Tiffany’s than sent by mail. telecommunication companies and cable troubles in Japan companies had shrunk its user base. • To suggest strategies that Tiffany should Pitney was in the final stage of a major makeover, turning from an old-fashioned Moreover, Carl Icahn, the billionaire formulate to regain its position in Japan US postal meter company into a cutting- investor who had 3% share in the company • To recognise the opportunities and Troubled Times/Managing edge global solution provider of integrated had been putting pressure on Time Warner challenges in store for a global jewelry mail and document management systems to split the company. He accused the Time retailer. and services. Michael J. Critelli, a 57 year Warner board of not taking enough steps old Harvard Law School graduate who to enhance shareholder value. Industry Jewelry Retail became CEO in 1996, had grown Pitney Reference No. TRT0080A Year of Pub. 2005 through quiet effective leadership had a Pedagogical Objectives daunting task to put a modern stamp on Teaching Note Not Available Pitney’s 85-year old business. • To discuss the impact of a single share Struc.Assig. Not Available holder on the entire company keywords Pedagogical Objectives • To discuss the future of Time Warner Tiffany; Mitsukoshi; Wholesaling; • To discuss the challenges and • To analyse the growth dilemma faced Retailing; Retailing strategy; Japan opportunities in store for the world by Time Warner. recession; Japanese jewelry market; postage system Japanese consumer; Segmenting; Targeting; Industry Media Conglomerate • To understand the concept of peripheral Positioning; Currency fluctuation; New Reference No. TRT0081A vision of corporate leaders Product introduction; Expansion strategy; Year of Pub. 2006 Competition; Consumer Behavior; Baby Teaching Note Not Available • To illustrate change management, 360 Boomers; Product management. Struc.Assig. Not Available degrees turnaround, re-branding strategies, quiet leadership, restructuring keywords etc. Leadership; Carl Icahn; AOL-Time Warner NBC Universal Inc.: Managing in Industry Business Equipment Merger; Media and entertainment; ISP; Troubled Times Reference No. TRT0082A Internet Business Dick Parson; Online Year of Pub. 2006 NBC Universal (NBCU) dominated US services; Shareholders value; American Teaching Note Not Available television from the 1970s till 2004 with its Online; Time Warner; Strategy. Struc.Assig. Not Available highly popular serials like Friends, Cheers, Seinfeld and Frasier. However, due to its keywords failure to offer new entertaining shows since Trouble at Tiffany in Japan 2005, the company witnessed a decline in Peripheral vision; Postal meters; Franking; its viewership and was ranked fourth behind Stamps; Document technologies; Office The internationally renowned jewelry its competitors like FOX, ABC and CBS solutions; Fax machines; Business company, Tiffany had been facing networks. In December 2005, NBCU made communication; e-mail; Snail mail; Quiet problems in their second largest market, major changes in its top-level management leadership; Mail; Postal reform; Digital Japan, since 2002. After performing and appointed Jeff Zucker as the CEO. It stamps; USPS; 360 degrees; Mail-sorting; commendably even during the times of also planned to market its new shows through Re-branding; Restructuring; World; Global deep economic recession in Japan, digital technology to reclaim its leadership postal systems; Document delivery. Tiffany’s sales in Japan was slipping since position. the last couple of years, while other jewelry retailers were flourishing. Pedagogical Objectives Time Warner: Dick Parson’s The case explores the probable reasons for Dilemma Tiffany not performing as per their • To understand the dynamics of the US television market and the critical success expectation. Tiffany’s core customers had Time Warner had interests in publishing, factors in that market remained the affluent class, but to attract cable systems, filmed entertainment, younger and less affluent customers, it also • To analyse the reasons behind the loss interactive services and television introduced and promoted less expensive of viewership of NBCU networks. It owned a collection of brands products which had tarnished its elite image. like America Online (AOL), Time Inc., • To debate whether Jeff Zucker’s revival Their retailing strategy of opening majority Home Box Office (HBO), New Line strategies would help NBCU to reclaim stores in department stores through which Cinema, Turner Broadcasting System, its leadership in US television. traffic of their target customers was Warner Bros. Entertainment and Time decreasing, had backfired. Tiffany’s Industry Television Warner Cable all under one roof. principal strategy in Japan had been to Reference No. TRT0079 In 2000, Time Warner merged with AOL. focus on their expensive bridal jewelry Year of Pub. 2006 It was called ‘historic’ as it brought together especially traditional engagement rings. Teaching Note Not Available an online service company and a media With changes in the Japanese traditions, Struc.Assig. Not Available and entertainment services provider. With preferences of Japanese consumers and the merger, Time Warner’s stocks went up with the aging of the Japanese population keywords by 39%, $25.31 to $90.06 in 2000. The their strategy has turned questionable. American Television Industry; Nielsen deal represented a major change in Time Managing the fluctuation in the Yen-Dollar Television Ratings; Friends; HANA; Warner’s approach to become a Net player. exchange rate, also became a matter of Ivillage; GE’s Imagination Breakthrough; But the value of AOL had dropped from its concern. Jeff Zucker; Turnaround Strategies; $200 billion high, since its merger with Webisodes; Martha Stewart.38 www.ibscdc.org
  • 39. Yahoo!: Challenges in its Online shareholder. Temasek, like the other GLCs • To discuss the limitations associated with Entertainment Ventures S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III of Singapore, had played a vital role in the Dells direct selling model S T R A T E G Y – III S T R A T E G Y – III country’s spectacular economicWith growth in the global entertainment development. Saturation in the local • To analyse the possible reasons behindand media industry, many Internet economy resulted in Temasek to look Dell missing its revenue forecastscompanies are making efforts to increase beyond the borders and invest globally. • In the light of impending challenges, totheir presence in diversified online However, Temasek’s government-linked debate whether it is time for Dell tobusinesses like digital entertainment. factor was coming in the way of its reinvent its business model.Yahoo!, one of the leading web portals investment strategy.providing a variety of services like online Industry Personal Computerschat, online music and online sports, also Reference No. TRT0076 Pedagogical Objectivesventured into the online media business by Year of Pub. 2006forming the Yahoo! Media Group in January • To discuss, the evolution and role of Teaching Note Available2005. To offer its users different television Government Linked Companies in Struc.Assig. Availableprograms on the Internet, Yahoo! Media Singapore’s economic development keywordsGroup partnered with Hollywood and other • To discuss, Temasek’s investmentmedia companies like Mark Burnett Competitive scenario of the global strategyProductions to launch reality shows like personal computer (PC) market; Dell’sThe Runner and Wow House. However, • To discuss the problems that Temasek is direct selling model; Dell’s strategies tothese programmes had to be shelved due to facing regarding its global investment keep costs low; Dell’s business model vis adeclining viewership. Besides, Yahoo! faces strategy and their causes vis other PC makers; Growth of Dell; Dell’stough competition from AOL, MSN and business challenges; Dell’s logisticsGoogle in online media business. • To discuss, Temasek’s strategy of turning management; Dell’s supplier management; itself around to face the challenge and Dell’s support centres across the globe; possibilities of success.Pedagogical Objectives Dell’s leadership in the global PC industry; Industry Financial Services Dell’s competition with Lenovo; Dell’s• To understand the importance of new business strategy for retail customers. Reference No. TRT0077 technologies in converging traditional Year of Pub. 2006 media like the radio and television with Teaching Note Not Available emerging medium like the Internet Struc.Assig. Available Cendant Corp., the Travel and• To analyse Yahoo!’s gradual expansion keywords Real Estate Conglomerate: into the online media business amidst Troubles and Responses competition from Google, MSN and Temasek Holdings; State supported Time Warner/AOL capitalism in Singapore; Entrepot In 1998, Cendant Corporation, a US-based economy; State supported model of travel and real estate conglomerate was• To discuss the initiatives of Lloyd Braun development; Government linked hit by one of the largest accounting frauds to enable Yahoo! Grab a bigger market corporations; Manufacturing sector’s share in the US history and its stock value share in the global online media business of Gross Domestic Product (GDP); dropped by $14 billion in a day. The• To focus on the inherent challenges an Singapore Inc.; Policy of regionalisation; company was forced to pay $3.2 billion to Internet company has to face when it Temasek’s investment strategy; Strategic its shareholders on account of this fraud. tries to foray into online media business development; Corporate development; The company also faced challenges and competes against well established Capital resources management; Building up ranging from low returns from expensive television companies. corporate behemoths; Divestments; acquisitions and allegations of huge Return on investments. compensation to its CEO, to its beingIndustry Internet Search and Navigation undervalued and its ineffective share Services buybacks. To resurrect itself from suchReference No. TRT0078 troubles, Cendant realigned its businessesYear of Pub. 2006 Dells Business Model: Is it Time to and divested its non-core assets and splitTeaching Note Not Available Reinvent? up into four separate companies with eachStruc.Assig. Not Available company specialising in one of Cendant’s Dell Inc. has become the world’s largestkeywords PC manufacturer through its direct selling business lines – hospitality, real estate, business model. Despite criticism and travel booking and car rental.On-line entertainment industry; Yahoo!’s skepticism about its business model, it hasbusiness model; Yahoo!’s products and enabled the company to revive and Pedagogical Objectivesservices; Media companies in the US; reinforce its market leadership on differentBrand advertising of Internet companies; • To understand the growth strategies of a occasions. However, during FY 2005-2006,Yahoo!’s diversified growth; Google; company that has diverse businesses Dell missed its own revenue projectionsMicrosoft; Time Warner; America Online; under its brand for two consecutive quarters. This hasThe US film industry; Turnaround raised concern among analysts about the • To discuss the aftermath of the disclosurestrategies of Yahoo! viability of Dell’s business model in the of the accounting fraud on Cendant and maturing PC industry and whether Dell how it underwent a restructuring to would be able to sustain its sales growth. regain its lost ground Temasek Holdings, The • To highlight the core competencies of Singapore Government’s Pedagogical Objectives Cendant and how the company realigned Investment Agency: The • To understand the direct selling model its different businesses based on these Troubled Strategy? of Dell and identify the key drivers of strengthsTemasek Holdings was a Government the model that have enabled Dell to • To debate whether the responses areLinked Corporation (GLC), owned directly become the leader in the global PC strategic in nature or are mere reactions.by Singapore’s finance ministry - its sole industry 39 www.ibscdc.org
  • 40. Industry Residential Real Estate Paramount Pictures’ Troubled was arrested on charges of falsifying Brokerage Times: Can Someone Script a financial statements of the company. Managing Troubled Times/Managing a Crisis Reference No. TRT0075 Turnaround? Year of Pub. 2006 Pedagogical Objectives Teaching Note Not Available Paramount Pictures, founded in 1912 as Struc.Assig. Not Available Famous Players Film Company, is the last • To discuss the rise of Takafumi Horie of the major US film studios to be located and his style of operations keywords in Hollywood. The studio has an illustrious • To compare the operations of the Troubled Times/Managing CENTURY 21; Coldwell banker; Vehicle history of delivering some of the greatest traditional Japanese companies as rental and mortgage services; Real estate hits in Hollywood like The Ten compared to that of Livedoor services; Hospitality services; Travel Commandments, Roman Holiday, The distribution services; CUC International Godfather series, Mission Impossible and • To discuss whether Horie became a victim Inc.; Hospitality Franchise Systems Inc. Titanic. Since 2000, the absence of because of his flamboyant lifestyle when (HFS); Wright Express Corporation; Hebdo blockbusters has hit its finances. Adding to experts agree that a large number of Mag International; National Leisure its financial woes is the alleged link-up of companies are engaged in similar illegal Group; The Harpur Group Ltd.; ebookers; its chairman and CEO, Brad Grey with activities like Livedoor Gullivers Travel Associates. Anthony Pellicano, a former private • To discuss the impact of Livedoor scandal investigator, who was arrested on charges on the Japanese financial market. of illegal wiretapping and racketeering in early 2006. Despite the acquisition of a Industry Information Technology Perils of Going Global: WPP’s promising film studio like DreamWorks Services Italian Imbroglio SKG, the future of Paramount Pictures is Reference No. TRT0072 Since its inception in 1985 under the still uncertain. Year of Pub. 2006 stewardship of Sir Martin Sorrell, WPP, Teaching Note Not Available the world’s second largest advertising Pedagogical Objectives Struc.Assig. Not Available conglomerate, has rapidly expanded • To understand the evolution of the movie keywords through acquisitions and partnerships. It business in the US, from the studio era has 2,000 offices in 106 countries and Livedoor; Entrepreneurship; Takafumi to Hollywood in the 21st century employs 100,000 people. However, its Horie; Charismatic leadership; Corporate continuous expansion and globalisation • To discuss the strategic initiatives taken scandal; Financial scandal; Effect of scandal under a centralised management structure by Paramount Pictures to boost its on financial markets; New generation of led to a loss of control over the entire financial health Japanese entrepreneurs; Stock split; group. One such instance was the dismissal Poison pills; Livin’ on the edge. • To debate whether a major studio like of the Italian country head, Marco Benatti, Paramount can survive in the business who was fired due to allegations of fraud which is being increasingly characterised and other financial discrepancies, and a PepsiCo’s New Challenge: by small studios making small-budget subsequent investigation was launched in WPPs Italian arm. movies to cater to niche audiences. Transformation into a Health Food Company Industry Motion Picture Production Pedagogical Objectives and Distribution In early 2002, the growing concern about Reference No. TRT0073 health and obesity among Americans was • To understand the growth strategies of Year of Pub. 2006 taking its toll on fast food chains and WPP in the global advertising and Teaching Note Not Available companies. PepsiCo was among the first marketing industry Struc.Assig. Not Available few companies that tried to refurbish its • To discuss the managerial problems in a image as a health foods company. PepsiCo keywords rapidly expanding global company with initiated a series of efforts by partnering a centralised management. Famous players; Adolph Zukor; with reputed physicians and reviewing the MajesticMountain; Paramount antitrust entire product line. Industry Advertising and Marketing case; SIMPP (Society of Independent Reference No. TRT0074 Motion Picture Producers); Viacom Inc.; Pedagogical Objectives Year of Pub. 2006 The Paramount Library; Anthony Teaching Note Not Available • To discuss the series of initiatives that Pellicano; Brad Grey; DreamWorks SKG; Struc.Assig. Not Available PepsiCo has undertaken to transform CBS Corporation; Mission Impossible III; itself into a health foods company keywords George Soros; Tom Cruise. • To discuss how an industry came under Wire and plastic products; Advertising and fire due to the rising concern about marketing services; Global advertising companies; WPP’s problems in Italy; Sir Takafumi Horie and Livedoor: An obesity and health. Martin Sorrell; Marco Benatti; Mediaclub Opportunist or a Victim? Industry Beverages Italy; Grey Global; Management problems Reference No. TRT0071 In sharp contrast to the genteel, dark-suit in global companies; Ogilvy & Mather; Year of Pub. 2004 wearing Japanese business elite, Takafumi Specialised and interactive communication Teaching Note Available Horie (Horie), the CEO of Livedoor, was services; Investigations into WPP Italy. Struc.Assig. Available flamboyant and informal. Horie symbolised the new generation of Japanese keywords entrepreneurs who dared to challenge the status quo in the conservative business PepsiCo; Health foods; Good for you; community. His rapid rise to fame largely, Better for you; Fun for you; Steve because of his acquisition spree, had shocked Reinemund; Food industry and obesity; Dr. many. Greater was the reaction when he Kenneth Cooper; Dr. Dean Ornish; Trans40 www.ibscdc.org
  • 41. fats; Health food company; Pepsi edge; job cuts, outsourcing and sub-contracting. keywords Finally on October 17 th 2005, GM S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIGreen dot; Tropicana; The Quaker Oats S T R A T E G Y – III S T R A T E G Y – IIICompany. announced its deal with the UAW, which Growth strategy; Triple A’s - Acquisition; agreed to reduce its healthcare costs for Activation; Activity; World’s on-line retirees by $15 billion and its annual marketplace; Pierre Omidyar; Meg employee healthcare expenses by $3 billion Whitman; e-Commerce; Reputation Japan Airlines Corporation: management system; Paypal Kijiji; Zero a year. Other than reducing costs, GM has Brand Building Strategies also planned to increase revenue by inventory system; Yahoo!; Microsoft; refocusing on sales, marketing and Google; Competitive strategies; Froogle;Established after the Second World War, Alibaba; EachNet; Peer-to-peer networks;Japan Airlines evolved into Japan’s leading development of new models. Business model.air carrier in a highly regulatedenvironment. After liberalisation of the Pedagogical ObjectivesJapanese airlines industry in 1987, JapanAirlines suffered losses due to a tough • To highlight the reasons for the recent Nissan in America: The Troubled losses at the North American operations Strategybusiness environment and inherentinefficiencies. Its merger with Japan Air of GMSystem created Japan Airlines Corporation After a turnaround that is worthy of being • To discuss the deal entered into by GM(JAL), which became one of the worlds called a miracle, Nissan saw its sales slipping and UAM and the effects of the deal.leading air carriers. However, in 2005 a in the very important US market and lostseries of safety lapses in JAL planes Industry Automobile Manufacturing a considerable market share. Lack of newseverely damaged customer confidence in Reference No. TRT0069 models is said to have hampered the salesthe airline and the company received a Year of Pub. 2005 growth. The next model will be released infirst-ever operational improvement order Teaching Note Not Available late 2006, by March of that year Nissanfrom Japan’s Transport Ministry. Struc.Assig. Not Available would have spent a year without releasing a new model – something unusual in the keywords hypercompetitive automobile industry,Pedagogical Objectives where new models, at best, or variations in General Motors; Rick Wagoner; Labour• To highlight the formation and growth cost; Legacy cost; Global auto motor the old models, at worst, are common of JAL against the backdrop of the industry; American auto motor industry; place. It is noted that by the time Nissan Japanese airlines industry United Auto Workers (UAW); Healthcare comes out with a new car, its market share costs; Competition; Car models; Sports would have fallen beyond recovery. Chief• To discuss its brand building strategies to executive officer Carlos Ghosn, often win back customer confidence. utility vehicles (SUVs); Ron Gettelfinger; Delphi; Detroit; Low-cost manufacturers referred to as the golden boy of theIndustry Airlines automobile industry, is confident andReference No. TRT0070 advocates that there is no problem that cannot be solved by a good car. He mightYear of Pub. 2006 eBay Celebrating Tenth be right, indeed he has revived the fortunesTeaching Note AvailableStruc.Assig. Available Anniversary: The Challenges of debt ridden Nissan by introducing two Ahead dozen new models since 1999. However,keywords pessimists would say ‘miracles do not work On June 23rd 2005, eBay, the worlds largest often’.Japan Airlines; Japan Airlines Corporation; on-line auctioneering company, celebratedJapan Air System; All Nippon Airways; its 10th anniversary. The company, whichToshiyuki Shinmachi; Japanese airlines Pedagogical Objective started its operations with the trade ofindustry; Civil Aviation Law; Japan Airlines candy dispensers, became a world leader in • To highlight the strategies adopted byCompany Limited Law; Brand building on-line business through its innovative Carlos Ghosn to revive Nissan.strategies; Building customer confidence; business model and consistentDeregulation liberalisation; Brand image; performance. While the company’s Industry AutomobileMinistry of Land, Infrastructure and management feels it is just the beginning Reference No. TRT0067Transport. of the success story, many industry experts Year of Pub. 2006 opine that the sector is heating up with Teaching Note Not Available the entry of other Internet heavyweights Struc.Assig. Not Available GM’s Growing Troubles: Labour like Yahoo!, Amazon, and Google, resulting keywords in several challenges for eBay. Driven or Market Driven? Automobile industry in the US; Nissan;General Motors (GM), which maintained Pedagogical Objectives Nissan in America; Carlos Ghosn; Nissan’sits number one position in Fortune strategy in the US; Carlos Ghosn’s strategy.magazine’s annual 500 list over the years, • To trace the evolution of eBay into anis into losses worth $1.6 billion in third on-line business giantquarter of 2005 mainly due to losses at its • To highlight eBay’s business model, its The American Institute ofNorth American operations. The GM competitive advantage and the growth Certified Public Accountantsmanagement cited rising healthcare and strategies adopted by eBay (AICPA): A Decade oflabour costs as major reasons for losses.But, the United Auto Workers (UAW) feels • To discuss the future opportunities and Challenge and Changethat vehicle design, product development challenges for eBay. By the turn of the 21st century, due to aand foreign competition are the major series of accounting scandals in companies Industry Internet Auctionsreasons for company’s losses. The like Enron and Worldcom in the US, Federal Reference No. TRT0068opposing positions between the two (GM Public Policy makers felt that the American Year of Pub. 2005and UAM) had hindered negotiations Institute of Certified Public Accountants Teaching Note Not Availableconcerning reduction of healthcare costs, (AICPA’s) authority to set accounting Struc.Assig. Not Available 41 www.ibscdc.org
  • 42. standards and their enforcement should be Industry Distilleries German and French shareholders failing to transferred to a government empowered Reference No. TRT0065 come to a consensus on the future Managing Troubled Times/Managing a Crisis body. Subsequently, the Sarbanes-Oxley Act Year of Pub. 2005 management structure of EADS, many established the Public Company Accounting Teaching Note Not Available strategic decisions of the company have Oversight Board (PCAOB), which has Struc.Assig. Not Available been put on hold. jurisdiction over every area of CPA practice keywords in relation to public companies. However, Pedagogical Objectives for the majority of practising CPA’s, who Diageo; European economy; US dollar • To highlight the power struggle within Troubled Times/Managing serve privately held business and decline; Consumer taste; Restructuring plan; individuals, AICPA retains its authority to Troubled times; Mergers and acquisitions; the EADS board set accounting standards, enforce Pernod Ricard; Competition; Competitive • To discuss how conflicting national professional ethics and monitor the quality advantage; Marketing and innovation; interests in a company with dual of the firm practices. Since 2003, AICPA Diversification; Weak demand; Taxes; command, might hamper its business has begun many initiatives, which include Future of Diageo. prospects. programmes that would help in implementing the Sarbanes-Oxley Act and Industry Commercial Aircraft rebuild investor confidence. Manufacturing Troubled Times at Morgan Reference No. TRT0063 Pedagogical Objectives Stanley: Strategic Missteps of Year of Pub. 2005 Philip J. Purcell? Teaching Note Not Available • To highlight the growth of AICPA Struc.Assig. Not Available Philip J. Purcell took over as the chief • To discuss the institution’s challenges executive officer (CEO) of Morgan Stanley keywords against the backdrop of major in 1997. Dean Witter Discover & Co. was accounting scandals that have rocked merged with Morgan Stanley in the same Global aerospace and defence business; corporate America. year. Although initially the company Global commercial aircraft manufacturers; recorded robust performance, post 2000 Strategic partnerships in the defence Industry Membership Organisations industry; European aerospace and defence the performance started deteriorating and Reference No. TRT0066 manufacturers; Ownership structure of the critics accused Purcell’s strategic Year of Pub. 2006 European Aeronautic Defence and Space missteps as the reason. As a result, Purcell Teaching Note Not Available Company NV (EADS); Relationships had to step down as the CEO of the Struc.Assig. Not Available between principal shareholders of EADS; company on June 13 th 2005. But his keywords supporters were of the opinion that his Voting rights at EADS board; Conflicting strategies would have been successful national interests at EADS board; Future American Institute of Certified Public eventually and he was merely a victim of business plans of EADS; Transnational Accountants (AICPA); Growth strategies; circumstances. ownerships and mergers; State ownership Sarbanes-Oxley Act; Security laws; in European defence manufacturers; Oversight Board; Financial Accounting Multinational ownership and leadership Pedagogical Objective Standards Board (FASB); Generally struggles; Franco-German alliance in accepted accounting principles (GAAP); • To discuss the challenges faced by Philips aerospace and defence manufacturing; Generally accepted auditing standards J Purcell in turning around the fortunes Dual-command structure at EADS. (GAAS); Public Company Accounting of the company. Oversight Board (PCAOB); Accounting Scandals; Enron; Accounting Standards Industry Capital Market Reference No. TRT0064 BSkyB: Troubled Times Board; Securities Exchange Commission (SEC); Challenges for AICPA. Year of Pub. 2005 In June 2005, the European Commission Teaching Note Not Available (EC) passed a directive that proposed to Struc.Assig. Not Available put an end to British Sky Broadcasting’s Diageo: World’s Largest Spirits keywords (BSkyB) exclusive rights over telecasting of FA Premier League football matches. Company in Troubled Times Morgan Stanley; Philip J. Purcell; Strategic The Commission proposed to split 20%- In 2003, Diageo, the world’s largest missteps; Discover credit card; Investment 50% of the rights with another buyer at producer of alcoholic drinks, was involved bank; Group of 8; Retail brokerage; Asset the next contract renewal due in 2007. in a controversy over its alleged role in management; Spin-off; Cultural Sentanta Sports, a Dublin-based Irish TV ruining the age-old reputation of the global differences; Consumer–corporate group, is vying for a part of the Scotch Whisky Industry. This was followed conglomerate; Dean Witter Discover & broadcasting rights to strengthen its by the decline in the sales of its Ready to Co.; Financial supermarket. portfolio of sport rights in and outside of Drink (RTD) beverages in the US and a Ireland. Analysts believe that the loss of sluggish economic growth in Europe, its exclusive rights of BSkyB will reduce the major market. Besides this it also started EADS: The Boardroom Battle at earnings of the clubs in the FA Premier League and may also lead to the bankruptcy witnessing stiff competition from other Europe’s Aerospace Giant global giants like the Pernod Ricard-Allied of some clubs. On the other hand, some Domecq alliance, William Grant’s and European Aeronautic Defence and Space analysts have opined that loss in exclusivity Chivas Regal. Company NV (EADS), Europe’s largest and by BSkyB would lead to a greater number the world’s second largest aerospace firm, of games being aired on ‘free-to-air’ Pedagogical Objectives has plans to venture into the US defence television benefiting fans across the UK. industry, which is dominated by US • To highlight the business hurdles being companies. Despite doing well on the Pedagogical Objectives faced by Diageo business front, EADS is mired in a boardroom battle, which stems from its • To highlight the different strategies • To discuss the strategies adopted by it to adopted by BSkyB in the wake of the unique organisational structure. With the retain its number 1 position in the world. directive by the EC42 www.ibscdc.org
  • 43. • To discuss the challenges that James transparency; Family-owned business to light various factors that CNN S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III Murdoch, chief executive of BSkyB faces enterprise; Indian conglomerate; Vimal overlooked in its broadcasting. Biased S T R A T E G Y – III S T R A T E G Y – III in trying to retain viewership and Hazira Jamnagar Naroda; Diversification reporting, a little-varied portfolio of maintain the company’s position in the strategies; Largest petroleum refinery. programmes and an inclination towards competitive broadcasting market. marketing rather than reporting quality, all made CNN vulnerable to competition.Industry Direct Broadcast Service Providers Walgreen Co.: The US DrugstoreReference No. TRT0062 Chains Survival Strategies Pedagogical ObjectivesYear of Pub. 2005 against the Drug Wars • To highlight growth strategies of CNNTeaching Note Not Available over the years and the challenges it facesStruc.Assig. Not Available Founded by Charles Walgreen in 1901, from rival channels Walgreen grew to become the largestkeywords drugstore chain of the US, by 2005. Ever • To discuss how CNN is dealing with the since its inception, Walgreen had expanded competition especially from Fox newsBSkyB; European Commission; Setanta by opening new retail pharmacy stores and channel by initiating changes to itsSports; FA Premier League; UK; Personal by 2005 it operated over 4,800 stores in programming and reporting style.video recorder; Competition law; Pay-per- the US. Though Walgreen had grown toview; Segmented pricing strategy; Industry Television Cable, Pay and become the largest chain of drug stores, itCustomer churn rate; Sky Mobile; IPTV Broadcast Networks had to face many challenges from the mail(TV over Internet protocol); HDTV (High Reference No. TRT0059 order operators since the mid 1990s. TheDefinition Television); English Cricket Year of Pub. 2005 competition from the mail order operatorsBoard (ECB); Digital television. Teaching Note Not Available had almost changed the business model of the retail pharmacy stores. The customers Struc.Assig. Not Available of Walgreen started purchasing their daily keywords The Reliance Group Split-up: medical requirements, on-line from theWhat Went Wrong with the Indian Internet sites operated by the mail order Cable News Network (CNN); Competition Conglomerate? pharmacies (also known as the Pharmacy among 24-hour news channels; Ted Turner; Benefit Managers). To retain its customers, Fox Channel; Rupert Murdoch;The Reliance Group, controlled and Walgreen started its own on-line drugstore Conservative and Liberal audience;managed by the Ambani family, is India’s called www.walgreen.com in 2000. Further Innovations in broadcasting; Biasedlargest business house. Started in 1958, in 2003, Walgreen initiated the programs; Image transformation; CNN’sReliance grew from a small trading Advantage90 programme providing its competitive strategies.company to a conglomerate with major customers the choice of purchasing frominterests in petroleum, petrochemicals, the retail stores as well as from the on-linepower, finance and telecom industries, sites. Amtrak: America’s Passengerunder the leadership of Dhirubhai Ambaniand his sons Mukesh and Anil. After the Rail Service Getting out of Pedagogical Objective Track?death of Dhirubhai, who was believed tohave died intestate, the elder son, Mukesh • To discuss the growth strategies of Amtrak was started in 1971 by the USassumed control of the family-owned Walgreen to deal with the challenges government to provide high qualitybusiness. Within two years, a major faced by it in adopting its business model intercity railroad passenger transportationownership battle for the control of according to changing industry trends. at economical rates. Although Amtrak wasReliance between the two brothers came expected to achieve operational self- Industry Drug Retailingto light. With both brothers hurling sufficiency by 1973 without the US Reference No. TRT0060accusations at each other the image of government subsidy, the company Year of Pub. 2005Reliance suffered until their mother, continued to receive federal subsidies, Teaching Note Not AvailableKokilaben Ambani, effected a settlement. which amounted to $29 billion by 2004. Struc.Assig. Not Available In mid-2005, the US governmentPedagogical Objective keywords introduced a bill in the Congress titled the• To highlight the growth of Reliance Walgreen Co.; Charles Walgreen; Organic Passenger Rail Investment Reform Act, group and the impact of split-up of Growth; Largest drugstore chain; which intended to privatise Amtrak. Reliance Group on the financials and Competition from mail order system; On- However, certain lobbies in the US growth. line drugstore; Pharmacy benefit managers; Congress are opposing the bill. Advantage90 programme.Industry Not Applicable Pedagogical ObjectivesReference No. TRT0061Year of Pub. 2005 • To highlight the challenges faced byTeaching Note Not Available CNN, The World’s First 24-hour AmtrakStruc.Assig. Not Available News Channel’s 25th Year: The • To discuss the implications of privatising Challenging Timeskeywords a passenger railroad, which has been Cable News Network (CNN) is the world’s losing $1 billion every year since theReliance group split-up; Dhirubhai Mukesh early 1990s. first ever 24-hour news channel launchedAnil Ambani; Reliance Industries Limited by Ted Turner in 1980. Until Rupert Industry Intercity Passenger Railroads(RIL); Indian Petrochemicals Limited Murdoch introduced Fox Channel in 1996, Reference No. TRT0058(IPCL); Reliance Energy Limited (REL); CNN dominated the cable news market Year of Pub. 2005Reliance Capital Limited (RCL); Reliance with its around the clock news broadcasting. Teaching Note Not AvailableInfocomm (RIC); Petroleum Apart from a decline in the viewership, Struc.Assig. Not AvailablePetrochemicals; Ownership and control the competition from Fox Channel broughtissues; Corporate governance and 43 www.ibscdc.org
  • 44. keywords brought a spate of troubles for the keywords company, from which it seemed hard to Managing Troubled Times/Managing a Crisis National Railroad Passenger Corporation; emerge. As the company kept reporting Wal-Mart; Germany; Retail industry; National monopoly; Amtrak’s operational dismal performance year after year since Hypermarket; Kay Hafner; Every Day Low self-sufficiency; Passenger Rail Investment 2002, concurrently the management was Pricing (EDLP); Interspar; Zoning Reform Act; Privatisation of Amtrak; also making efforts to stop the losses and regulations; Culture clashes; Restrictive American aviation industry; American achieve a turnaround. As part of the shopping hours; Supply chain and automobile industry; Interstate Commerce turnaround effort, a new Chief Executive distribution system; German retail laws and Commission; Intercity passenger railroads; regulations; Wertkauf; Merchandise Troubled Times/Managing Officer, Michael Lawrie, was appointed to Passenger network; Federal subsidies; revive the fortunes of the company. But vendors. Fastest mode of transportation; Global before he could completely implement his privatisation of railroads; Railpax strategies, in a sudden move, he was replaced with George Shaheen. The MG Rover: The Fall of an Iconic continuous losses, ongoing turnaround Brand – The Blame Game US Postal Service: Threats and efforts and the sudden change of leadership Continues Challenges at the helm raised questions about the health of the company and its future MG Rover was once Britain’s biggest car By 2004, the United States Postal Service prospects. manufacturer in terms of volume, (USPS) had established a network of 37,000 producing more than half a million cars post offices across the nation. Through Pedagogical Objective annually. Established in 1906, the company various cost cutting initiatives and supply experienced many setbacks in the form of chain improvements, USPS reduced its debt • To highlight turnaround efforts and ownership changes, industrial relation from $11.3 billion (in 2001) to $1.8 billion strategies adopted by Siebel Systems Inc. problems, low production and financial in 2004. However, with increasing usage constraints, which finally led to the Industry Information Technology of the Internet for personal and business downfall of the company. While some Services correspondences, the first class mail analysts held BMW, the owner of MG Reference No. TRT0056 service, which represents more than half Rover between 1994 and 2000, responsible Year of Pub. 2005 of the USPS revenues, has been declining. for the downfall, the others blamed the Teaching Note Not Available Besides, increasing competition from government for not rising to the situation Struc.Assig. Not Available private courier companies accompanied by on time when BMW sold the company to a potential workforce crisis and rise in keywords Phoenix Venture Holdings. The expenses has forced USPS to reduce its costs management of Phoenix Venture Holdings even further by adopting the latest Siebel Systems Inc.; Information headed by ex-chief executive officer of MG technologies to provide faster and more technology services; Business processing Rover, John Towers, faced criticism for cost efficient services. outsourcing services; Turnaround utilising the funds available at MG Rover strategies; Restructuring plan; Michael to fulfill their personal financial Lawrie and George Shaheen; Customer Pedagogical Objective requirements. Relationship Management (CRM); Tom • To highlight the challenges faced by Siebel; Sales Force Automation (SFA); Pedagogical Objective USPS to survive and retain its market Incompetent managers and poor decisions; share. Troubled times and leadership change; • To discuss the options available at MG Oracle; SAP; IBM; Salesforce.com; Rover to avoid the fiasco. Industry Postal Services Computer services and software; Reference No. TRT0057 Industry Automobile Turnaround specialist; Divestments and Year of Pub. 2005 Reference No. TRT0054 spin-offs. Teaching Note Not Available Year of Pub. 2005 Struc.Assig. Available Teaching Note Not Available Struc.Assig. Not Available keywords Wal-Mart in Germany: The Retailing Challenges keywords Postal Service in US; Automation techniques in postal service; Customer By the end of 2004, Wal-Mart had a Rover Group; Longbridge factory; Services at USPS (US Postal Service); On- marginal presence in Germany with 2% in Ownership changes; Phoenix Venture line postal services; First class mail; the retail food market. Even with 91 Holdings; Job cuts; The Mini brand; Automated postal centres; Cost control supercentres, Wal-Mart was facing Bankruptcy; Labour problems; John measures at USPS; Federal Express; problems trying to integrate its operations Towers; Tony Blair; Shanghai Automotive Workforce crisis at USPS; Threats from in Germany and was also finding it difficult Industry Corporation. the Internet; Bureaucracy in US to adapt itself to the local culture. Besides, government; US Postal Reorganisation Act strict government regulations in the retail of 1970. sector were hampering its expansion. American Car-parts Firms’ Growing Troubles: Delphi Leads Pedagogical Objective the Way Siebel Systems, Inc.: Troubles and Turnaround Efforts • To highlight the strategies adopted by The world’s largest auto parts maker, Delphi Wal-Mart to overcome the retailing Corporation, announced in March 2005 Siebel Systems Inc. was one of the fastest challenges in Germany. that it had overstated its profits by $166 growing companies in the information million and cash flows by $447 million Industry Discount and Variety Retail technology industry. It was known for its over a period of six years since 1999. The Reference No. TRT0055 ability to provide software solutions for accounting irregularities came to the fore Year of Pub. 2005 Customer Relationship Management at the time when Delphi was already mired Teaching Note Not Available (CRM) and Sales Force Automation (SFA). in other problems related to an increase in Struc.Assig. Not Available But the global economic slowdown in 200044 www.ibscdc.org
  • 45. commodity prices like steel, a decrease in Structural problems and cultural clashes; Ente Nazionale Idrocarburi (ENI): Succession Battle at the S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIproduction by Ford, DaimlerChrysler and Deutsche Lufthansa AG; Lufthansa-SWISS S T R A T E G Y – III S T R A T E G Y – IIIGM, as well as increased competition from merger; Future of SWISS. Italian Oil Giantforeign players. Ente Nazionale Idrocarburi (ENI) an ItalianPedagogical Objectives Marsh & McLennan: The state-owned company dealing primarily in oil and natural gas under Enrico Mattei,• To highlight the challenges faced by the Troubled Insurance Broker the founder of ENI, diversified into US car-parts industry businesses such as electricity, engineering, Marsh & McLennan (Marsh), the world’s• To discuss Delphi’s problems and its largest insurance brokerage company was construction and petrochemicals. After his future course of action under difficult mired in an insurance scandal in 2004. It sudden death in 1962, the company was business circumstances. was alleged by New York Attorney General mired in financial and operational struggles Eliot Spitzer, that it had been involved in and in 1992, Franco Bernabe, a strongIndustry Auto-Parts Manufacturing unethical and illegal practices to benefit supporter of privatisation was appointedReference No. TRT0053 its favourite clients through rigging of as chief executive officer. Under hisYear of Pub. 2005 insurance bids in their favour, manipulating leadership ENI not only became a jointTeaching Note Not Available prices of their insurance products and that stock company but also showed profits.Struc.Assig. Not Available it received extra commissions for those Vittorio Mincato succeeded Bernabe in favours. These allegations and the 1998 and he turned ENI into the world’skeywords sixth biggest oil producer, in terms of consequent investigation by the attorneyDelphi; US car-parts industry; general had a profound impact on the market capitalisation. With his termAutosuppliers; USA; Auto parts; company. It witnessed the erosion of its coming to an end in May 2005,Accounting; Outsourcing; Foreign auto market capitalisation by nearly 50%, a speculations about the succession plans isparts suppliers; Big Three; Ford; General decrease in earnings, downgrading by doing rounds in the industry circles. OwingMotors; Auto parts manufacturers; Steel international rating agencies and to the government’s 30% stake in ENI,price; Commodity price. resignation of the chief executive officer Silvio Berlusconi, Italy’s prime minister (CEO). The entire US insurance industry was also in search for a replacement to came under the scrutiny of investigators Vittorio. Moreover, though Vittorio and law enforcers. To protect the company announced that he was expecting a term Swiss International Airlines: extension, many within the industry circles from its falling reputation, the company Revival Plan to Yield Break appointed a new CEO Michael Cherkasky voted against him. even? who took up the task of reformation by anSwiss International Air Lines (SWISS), the $850 million settlement of the scandal, a Pedagogical Objectivesnew national carrier of Switzerland was change of business model, elimination of unlawful practices, and measures to • To highlight the impact of politicalformed in 2002, through the merger of influence on the management as well asbankrupt former national carrier SwissAir maintain transparency and better compliance. But the company still faces the company’s operations that led toand a regional carrier CrossAir. The financial problems at ENIcompany’s several attempts to reposition several other tougher challenges for theitself failed. In 2004, the airline’s future. • To discuss how privatisation efforts andmembership in the Oneworld Alliance and freeing the company from politicala partnership agreement with British Pedagogical Objective influence helped the company to emergeAirways went sour aggravating the as one of the leading oil producers in the • To highlight the flaws in the US worldcompany’s troubles. Also, the airline is yet insurance industry, which led to a majorto break even since its inception. Hence, scandal, and its impact on the insurance • To discuss the possible impact ofin early 2005, SWISS announced a industry. succession plan on the future of ENI.restructuring plan aimed at ending itstroubles and posting a net profit by 2006. Industry Insurance Industry Oil and Natural Gas Reference No. TRT0051 Reference No. TRT0050Pedagogical Objective Year of Pub. 2005 Year of Pub. 2005 Teaching Note Not Available Teaching Note Not Available• To highlight the reasons behind the Struc.Assig. Not Available Struc.Assig. Not Available continuous losses and failure of SWISS International Airlines alliance with keywords keywords British and other airlines. Marsh and McLennan Companies; Succession plans; Privatisation;Industry Commercial Aviation and Insurance brokerage firm; New York Government intervention; Vittorio Airlines attorney general, Eliott Spitzer; Michael Mincato; Political influence.Reference No. TRT0052 Cherkasky and Jeffrey Greenberg;Year of Pub. 2005 American insurance regulatory system;Teaching Note Not Available Insurance bid rigging; Price manipulating Vonage – The Pioneer in VOIP and fixing; US SMART (StateStruc.Assig. Not Available Modernisation and Regulatory Telephone Services: Futurekeywords Transparency) Act; Insurance scandal and ChallengesSwiss International Air Lines (SWISS); probe; Corporate transparency; Conflict US-based Vonage is the pioneer in the VoiceOneworld Alliance; Code-sharing of interests and investor confidence; Fraud Over Internet Protocol (VOIP) telephoneagreement; British Airways; Restructuring and anti-competitive activities; Secretive services. Through innovative services andplan; Breakeven; Swiss national air carrier; culture; Corporate governance; American promotion, it emerged as the leading playerCrossair; Loss-making routes; insurance industry. in the industry. But the increasingIncompetent managers and poor decisions; popularity of Internet services broughtHigh cost airline and low cost airline; major telecom, cable, and Internet 45 www.ibscdc.org
  • 46. companies into the VOIP market, creating Contamination; 35-hour workweek; Pedagogical Objective future growth challenges for Vonage. This French labour laws; Green bottle; Naturally Managing Troubled Times/Managing a Crisis case provides insights into the VOIP sparkling. • To discuss the challenges faced by technology, industry trends and the Vodafone in Japan. competitive strategies of various players Industry Wireless Network Operators in the fast expanding VOIP market. Mobile Phone Industry’s Safety Reference No. TRT0046 Concerns: Managing Troubled Year of Pub. 2005 Pedagogical Objectives Teaching Note Not Available Times Troubled Times/Managing Struc.Assig. Not Available • To discuss the future trends in VOIP Since the introduction of mobile phones industry keywords in the early 1980s, there have been • To highlight the challenges faced by concerns regarding the effects of the use Vodafone; Japan; Vodafone KK; 3G mobile Vonage to retain its leading position in of mobile phones on human health. There handsets; Japan Telecom; J-Phone; the VOIP telephone services. were allegations that the microwave Shamail; W-CDMA; NTT DoCoMo; radiation used to transmit conversations KDDI; Bill Morrow; Mobile industry; Anti- Industry Telecom Services between base stations and mobile phone spam; High Speed Downlink Packet Access Reference No. TRT0049 handsets could lead to health problems such (HSDPA); Vodafone Live! Year of Pub. 2005 as fatigue, reduced concentration and Teaching Note Not Available cataracts among others. Although, there Struc.Assig. Not Available was no concrete evidence that mobile Troubled Times at Unilever keywords phones posed a threat to human health, researchers warned people to take a After the failure of the five-year ‘Path to Vonage; Voice over Internet Protocol cautious approach to the use of mobile Growth’ programme that aimed at 5% to (VOIP); Diversification; AT&T; Comcast; phones. Meanwhile, mobile phone 6% annual growth, Unilever ’s pre-tax Cable Vision; US telecom industry; Skype; manufacturers initiated efforts to counter profit declined from £4.5 billion in 2003 Net2Phone and Delta Three; Business and the health fears. to £2.8 billion in 2004. The loss of £255 revenue model; Cable and telecom giants; million in the fourth quarter of 2004 was Telecom and Internet infrastructure; Pedagogical Objective the company’s first quarterly loss since Verizon; Internet phone industry; Wi-Fi 2000. This led to the abandonment of its (wireless fidelity) technology. • To highlight the efforts initiated by 75-year old dual chairmen structure and mobile phone manufacturers to mitigate paved the way for unification of the bi- the fears about the health risks national company. associated with the use of mobile phones. Troubled Times at Perrier Industry Telecommunications Pedagogical Objective In the mid-1980s, Perrier was the world’s Equipments best selling mineral water brand. In February • To discuss the challenges faced by Reference No. TRT0047 1990, after the detection of contamination Unilever to retain its market share. Year of Pub. 2005 in its bottled water, the brand was almost Teaching Note Not Available Industry Personal Care Products ruined. Nestle bought Perrier in 1992. After Struc.Assig. Not Available Reference No. TRT0045 several unsuccessful attempts to restructure Year of Pub. 2005 the company, in March 2004, Nestle keywords Teaching Note Not Available announced that Perrier was not profitable Mobile phone industry; Health issues; Struc.Assig. Not Available enough and proposed voluntary retirement Mobile phone industry’s safety concerns; for some of its workers. Perrier’s powerful keywords labour union, CGT (Confederation Generale Microwave radiation; Health risks and du Travail), opposed the proposal and mobile phones; Mobile phone base stations; Unilever; Troubled times; Personal care refused to accept job cuts. Nestle threatened Mobile Manufacturers Forum; products; Path to growth strategy; to sell off Perrier or move production Electromagnetic radiation; Mobile Consumer goods industry; Pricing power; elsewhere. With the Nestle management Operators Association; World Health Bureaucracy; Twin board structure; and the CGT at loggerheads, the French Organisation; Initiatives by mobile phone Management team; Performance targets; finance minister had to intervene to settle manufacturers; Specific absorption rates of Procter and Gamble (P&G); Slim Fast; the dispute. mobile phones; Radiation levels of mobile Restructuring; Cost cutting; Supermarket phones; Mobile Telecommunications chains. Health Research programme. Pedagogical Objective • To highlight the problems of Perrier and Pfizer: Dearth of New Products possible actions required to revive the Vodafone: Losing Connectivity in and Future Challenges company. Japan? Industry Water and Ice By the turn of the 21 st century, despite By January 2005, Vodafone in Japan had investing $7 billion a year on R&D, Pfizer Reference No. TRT0048 lost 59,000 customers to its competitors, has been witnessing constant decline in its Year of Pub. 2005 who were offering superior handset features productivity. Since 2001, Pfizer’s shares Teaching Note Not Available and services. This prompted Vodafone to have declined by 45% to $25 a share. Struc.Assig. Not Available re-organise its management structure by Analysts estimate flat earnings for Pfizer keywords recruiting a new president who had in-depth in 2005 and 1.5% annual decline in its sales knowledge of the Japanese market and also through 2010. Under such circumstances, Perrier; Nestle; Mineral water; Bottled planned to offer handsets that were tailor- Pfizer has initiated a comprehensive review water; CGT (Confederation Generale du made for the Japanese customers. of its business and the company is expected Travail); Labour relations; Nestle Waters to undergo a major restructuring in 2005. France; French mineral water industry;46 www.ibscdc.org
  • 47. Pedagogical Objectives phone services, and Internet access. A failed Industry Telecommunications S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III international venture led to a billion dollar S T R A T E G Y – III S T R A T E G Y – III Equipment• To highlight the challenges faced by write down resulting in losses and debts for Reference No. TRT0041 Pfizer the company. Rising costs and regulatory Year of Pub. 2005• To discuss the future strategies Pfizer issues added to its troubles. In order to Teaching Note Not Available would adopt to retain its market reduce its debts and turn the company Struc.Assig. Not Available position. around, the Australian government decided to privatise it. Besides enabling the students keywordsIndustry Pharmaceuticals Manufacturers to discuss the reasons for Telstra’s troubles, Nortel Networks Corporation; AccountingReference No. TRT0044 this case also triggers discussion on the pros mis-statements; Financial re-statement;Year of Pub. 2005 and cons of privatising Telstra and the Telecommunications equipment maker;Teaching Note Not Available possible alternatives to turnaround the John Roth; Frank Dunn; ControversialStruc.Assig. Not Available company. bonus plan; Return to profitability; Williamkeywords A ‘Bill’ Owens; Chief of ethics; Audit Pedagogical Objective Committee of the Board of Directors; BellPfizer; Pharmaceutical industry; Telephone Canada; Public and privateInnovations; Blockbuster drugs; • To highlight the Pros and cons of telecom networks; RegulatoryAcquisitions; Licensing; Regulatory privatising Telstra and its impact on the investigations; Securities and Exchangemeasures; Research and development; company. Commission (SEC).Lipitor; Food and Drug Administration; Industry TelecommunicationsPatent expiration; Generic competitors; EquipmentRanbaxy Laboratories Limited;Restructuring; Decentralisation. Reference No. TRT0042 General Motors in Europe: The Year of Pub. 2005 Challenging Times Teaching Note Not Available Struc.Assig. Not Available General Motors Europe (GME), the Unocal’s Embattled Strategy: European division of the world’s largest keywords A Soft Takeover Target? automobile manufacturer General Motors, Telstra Corporation; Privatisation; started reporting protracted losses andUntil the end of 2004, US-based energy Diversification; Restructuring; Regional declining market share from 1999 due tocompany, Unocal Corporation, was trailing telecommunications inquiry; REACH; the weak European market. New liberalisedbehind its peers in share price, production Pacific Century Cyber Works (PCCW); car dealership rules, an unsuccessfuland net income per barrel. But, on January Voice over internet protocol (VOIP); restructuring plan, a failed alliance with6th 2005, its share price jumped by 10% Wholesale voice; Data and internet Fiat Auto and the growing dominance ofwhen rumours spread about its probable connectivity services; Next Generation the Asian carmakers further worsened theacquisition by China National Offshore Oil Cost Reduction phase III (NGCR III); situation. GME’s position slid from secondCorporation (CNOOC), a leading energy Australian telecom industry; Management to fifth in the European market. In 2004,company in China. The company had faced turmoil; Sensis – directory business; Rising to save the ailing European division fromenvironmental problems, was accused of debts and operating costs; Telstra mobile further decline, its new chairman Frederickhuman rights abuses and also failed to meet satellite. Henderson, formulated a restructuring planits production targets. focusing on reduction of costs, plant capacities, downsizing and integration ofPedagogical Objective functional departments. But according to Nortel Networks: The Canadian the industry analysts the task of• To discuss the problems faced by Unocal Telecommunications Equipment restructuring is likely to be tough and the that makes it a potential takeover target. Giant’s Accounting layoffs expensive, with weak markets forIndustry Oil and Gas Refining, Controversies the next two years. Marketing and Distribution The management of Canada-based NortelReference No. TRT0043 Pedagogical Objective Networks Corporation, one of the largestYear of Pub. 2005 telecommunications equipment companies • To discuss the efficacy of the restructuringTeaching Note Not Available in the world, was forced to restructure due plans for General Motors in Europe.Struc.Assig. Not Available to the Internet bubble bursting. However Industry Sugarkeywords when it appeared that the company was able to come out of the downturn in its Reference No. TRT0040Unocal; China National Offshore Oil business by 2003, disaster struck the Year of Pub. 2005Corporation (CNOOC); Takeover; Energy company again in early 2004, when it Teaching Note Not Availablecompanies; Oil and natural gas company; announced that it would be re-stating its Struc.Assig. Not AvailableGlobal demand for oil and natural gas; financial statements for the years 1998 toConsolidation in oil industry; keywords 2003.Environmental problems; Human rights General Motors Europe; Fiat Auto SPA;violations; China’s oil imports; Acquisition. Pedagogical Objectives European automotive industry; Frederick Henderson; Layoffs and plant closures; • To discuss the reasons behind re- European automobile makers; Asian Telstra’s Growing Troubles: Is statements of financials between the automakers; European economic years 1998 to 2003 recession; Project Olympia; EU (European Privatization the Solution? Union) automobile dealerships regulations; • To highlight the impact of accountingTelstra, the Australian state-owned Adam Opel AG; Competitive strategies; controversies on the Nortel’s futuretelecommunications and information Acquisitions and mergers. growth prospects.services company, offers fixed and mobile 47 www.ibscdc.org
  • 48. Chuck Prince’s Biggest only six drugs between 2001 and 2003. Converium: The Swiss Reinsurer’s Challenge: Saving Citi’s The company’s sales have also declined Troubled Times Managing Troubled Times/Managing a Crisis Reputation taking it to number three position in the global pharmaceutical industry. Its net Switzerland based Converium Holdings, the Citigroup, formed in 1999 by a merger of income fell for two consecutive years 2002 ninth largest reinsurance company in the Travelers Group and Citicorp, is the largest and 2003 and it had to lay off 4,400 world, found itself in financial difficulty financial services conglomerate in the employees in 2003, the biggest ever in its due to the massive losses incurred by its world worth $100 billion in stock equity. 117 year history. North American subsidiary in the aftermath Troubled Times/Managing Under the leadership of its erstwhile CEO, of the 9/11 terrorist attacks in 2001. After Sanford I Weill, Citi acquired a reputation Pedagogical Objectives revealing its losses, Converium undertook for emphasising on the bottom-line and a reserve strengthening exercise, the pursuing aggressive sales practices to that • To discuss the reasons behind Merck’s magnitude of which shocked the end. In the process Citi’s reputation took decline reinsurance industry. In response, both a beating when a series of charges were Converium’s share price and investor • To discuss how competitive Merck can filed against it accusing it of fraudulent ratings tumbled jeopardising its existence. be in future. practices. In 200, Weill stepped down as the CEO, paving the way for Citi old-timer Industry Pharmaceutical Manufacturer Pedagogical Objectives Charles Prince, who took upon himself the Reference No. TRT0038 task of delivering profits and growth Year of Pub. 2005 • To discuss the position of Converium ‘responsibly and honestly’. But two Teaching Note Not Available and the various alternatives available to incidents in mid-2004 showed that the task Struc.Assig. Not Available deal with the crisis was incomplete. • To discuss the future of Converium as a keywords viable entity. Pedagogical Objectives Blockbuster drugs; ‘Me-too’ drugs; Contract research organisations; Industry Insurance Services • To examine the nature and causes of Prescription benefits management; In- Reference No. TRT0036 Citis regulatory and reputation problems house research; Drug development and Year of Pub. 2005 and the efforts made by Weill and Prince clinical trials; Generic manufacturers. Teaching Note Not Available to ensure that Citi’s size and diversity Struc.Assig. Not Available does not influence its business practices keywords • To discuss the dilemmas of businesses to Havas: Troubled Times at French Converium Holdings; Zurich Financial delicately balance the ever-increasing Advertising Giant Services; Reinsurance; Weak investment expectations of Wall Street in terms of financial performance and ensuring high By 2004, the advertising industry worldwide market; Spin-off; IPO; American ethical standards was in a consolidation phase as was felt Depository Share; Underwriting; Green that only the integrated global agencies Shoe option; Retrocessional stop-loss • To discuss how companies with diverse would remain profitable, following the policy; Reserves strengthening; Runoff; but related divisions can avoid conflicts economic downturn in the new millenium. Rights issue; Renewals; Securit. of interest. The case also provides For Havas, the largest adverstising agency information to assess Prince’s strategies in France, trouble ensued in 2004 when it to curb unacceptable business practices lost a bid to acquire Grey Global Inc. (the Troubled Times at AT&T at Citi. seventh largest in the world) as its last effort to stay independent. AT&T, a 125-year-old company that Industry Financial Services pioneered telecommunications in the US, Reference No. TRT0039 suddenly seems to have moved away from Year of Pub. 2005 Pedagogical Objectives its core business. After its exit from wireless Teaching Note Not Available • To discuss the reasons for the weak business in the US in 2004, the introduction Struc.Assig. Not Available financial health of Havas of VOIP (Voice Over Internet Protocol) keywords coupled with the deregulation of the US • To discuss the strategies adopted by the telecom industry is threatening to reduce Citigroup; Traveller’s Group; Sandy Weill; company to maintain its position in the the companys revenues from long distance Sanford Weill; Chuck Prince; Citigroup’s global advertising industry. calls by 20% per year. culture; Predatory lending; Associates first Industry Advertising & Marketing capital; Eliot Spitzer; Commercial bribery; Reference No. TRT0037 Pedagogical Objective Citigroup’s business practices initiatives; Year of Pub. 2005 Corporate governance; Citi’s London bond • To discuss the troubles faced by AT&T Teaching Note Not Available desk; Citi troubles in Japan. in a matured industry that is witnessing Struc.Assig. Not Available reduced price margins, increased keywords competition and ever-changing Merck: A Future Laggard in the Global advertising and communications technologies. Global Pharmaceutical business; GreyGlobal Inc.; Young & Industry Telecommunications Industry? Rubicam; History of Havas; Five year Reference No. TRT0035 financial summary of Havas; Year of Pub. 2005 Merck, voted as America’s most admired Organisational structure of Havas; Market Teaching Note Not Available company by Fortune for seven consecutive share of global advertising agencies; Struc.Assig. Not Available years (between 1986 and 1993), was facing Geographical distribution of revenues for a host of problems by 2003. Known for its keywords Havas Group. pioneering research in the pharmaceutical industry in the past, Merck had introduced US telecommunication industry; Telecom industry value chain; Federal48 www.ibscdc.org
  • 49. Communication Chain; Baby Bells; Long Eisner’s announcement of his departure council; Imaging and printing; S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIdistance carrier; Acquisitions and join from Disney fuelled the uncertainty. Management by walking around; HP and S T R A T E G Y – III S T R A T E G Y – IIIventures of AT&T; Price competition; Compaq merger; CompetitiveOver capacity and changing technologies; Pedagogical Objectives differentiation; Corporate proxy battle;Financials of AT&T; AT&T Wireless and Decentralisation; RestructuringCingular; Voice Over Internet Protocol • To discuss the changing dynamics of the programme; Enterprise and storage(VOIP). relationship between Miramax and business; Cost savings; Core competencies. Disney • To discuss the impact of interpersonal Mitsukoshi: The Japanese conflicts between the leaders of the Microsoft’s Biggest Threat: Retailer’s Troubled Times organisations Microsoft’s SuccessMitsukoshi, started in 1673, runs around a • To discuss the possible results of the By the end of the 1990s, Microsoft seemeddozen department stores and about 100 renegotiations in 2005. to be experiencing a crisis. As a major partsmaller stores in Japan and around 20 Industry Entertainment of its revenues came from Windows andoutlets in major European, North American Reference No. TRT0033 Office, Microsoft was busy makingand Asian cities. By the 1960s, it had Year of Pub. 2004 incremental improvements and persuadingbecome the best-stocked and prestigious Teaching Note Not Available customers to buy upgrades. As a result, itdepartment store, but since the mid-1970s, Struc.Assig. Not Available missed several opportunities of growth inMitsukoshi has been marred by decades of other areas. On top of it all, came themanagement problems and a struggling keywords security threats, antitrust lawsuits andeconomy. Linux open source software raising Harvey Weinstein; Bob Weinstein; questions about the growth prospects of Miramax Film Corp.; Disney; MichaelPedagogical Objectives Eisner; Dimension films; Independent the company.• To discuss how Mitsukoshi lost its share cinema; Oscar marketing; Fahrenheit 9/ 11; Interpersonal conflicts between leaders. Pedagogical Objectives to other retailers like supermarkets, superstores and discount stores • To discuss the major success factors of Microsoft in the PC software industry• To discuss the strategies adopted by Mitsukoshi to respond to Japan’s sluggish Hewlett-Packard: Losing the HP • To discuss the threats and opportunities economy and consumers’ changing Way for the company in the future behaviour Hewlett-Packard, started in 1938 by two • To discuss how the company’s success• To discuss how the company was electrical engineers Bill Hewlett and Dave and its strong foothold in the operating restructuring to avoid further troubles. Packard, had grown from a small electronic system and office management software, instruments company into one of the global with its flagship Windows and OfficeIndustry Retailing leaders in information technology products suite, was considered to be hindering itsReference No. TRT0034 and services by the end of the 20th century. growth.Year of Pub. 2004 The ‘HP Way’, a unique people-focused,Teaching Note Not Available consensus-driven work culture initiated by • To discuss the growth strategies of theStruc.Assig. Not Available the founders had been the driving force of company after Steve Ballmer took over its growth. But the culture had been losing as CEO.keywords its effectiveness due to the changing profile Industry SoftwareMitsukoshi; Department store; Retailing; of the company and the dynamics of global Reference No. TRT0031Restructuring; Economy bubble; Consumer competition. The new CEO (chief Year of Pub. 2004price index; Supermarket; Superstore; executive officer) Carly Fiorina, who took Teaching Note Not AvailableDiscount store; Japan’s economy; Japanese over the reins of the company in 1999, Struc.Assig. Not Availableretail stores. made radical changes in the ‘HP Way’ to rebuild the company, shifting the focus keywords from employees to customers. The merger with another leading player, Compaq, Microsoft’s monopoly; Steve Ballmer; Miramax: A Victim of Entry barrier; Windows; Office Suite; further diluted the culture. Interpersonal Conflict? Patents; The Internet tidal wave; Microsoft’s cash cows; Cost economies;Started in 1979 by the Weinstein brothers Pedagogical Objective Linux threat; Theory of increasing returns;to buy and release foreign and independent Upgrades to Windows; Microsoftfilms, Miramax Film Corp. was acquired • To discuss the restructuring strategies formulated by the new CEO to save the innovations; Microsoft matures; Saturationby Disney in 1993. Over the years, in PC market.Miramax released hits like Pulp Fiction company, her reasons for deviation from the ‘HP Way’, and the benefits and lossesand Shakespeare in Love, but relations of the change as debated by the analysts.between Harvey Weinstein and Disney’sCEO Michael Eisner had been Industry Computer Products and Euro Disney: Faileddeteriorating. Miramax’s decision to fund Services Americanism?Fahrenheit 9/11, a controversial Reference No. TRT0032documentary, against Eisner’s wishes Euro Disney SCA, the subsidiary of Walt Year of Pub. 2004strained the relationship further. The Disney Co., the No.2 media conglomerate Teaching Note Availablecurrent contract between the Weinsteins in the world, opened its first theme park Struc.Assig. Availableand Disney is to be renegotiated in 2005, under the name Euro Disney in 1992 inbut differences over financial performance, keywords France. Assuming that the success of itscontrol and compensation raised universal appeal in Florida, California and Hewlett-Packard (HP); PC manufacturer; Japan would work again, Disney replicateduncertainty over Miramax’s future. The HP Way; Computer products; Strategy the same formula of fantasy and magic 49 www.ibscdc.org
  • 50. kingdoms in Europe. However, in France • To discuss the competitive scenario that Capital); opportunity; Opportunity asset it faced huge resistance with the French prevailed at the time of Crestor ’s management; Kroll; JP Morgan Chase. Managing Troubled Times/Managing a Crisis likening it to an imperialism of American introduction multinationals on the country. Considering it a threat to their culture, the French press • To discuss the promotional and marketing initiatives of the companies Uniqlo Retail Stores in Japan: and intellectuals strongly opposed its entry and called it a ‘cultural Chernobyl’. As Euro involved. Turning Challenges into Disney tried to recover from the troubles Opportunities Industry Pharmaceuticals Troubled Times/Managing by reworking on the details inside the park, Reference No. TRT0029 Fast Retailing Co., owner of Uniqlo apparel revamping food, rides and the price Year of Pub. 2004 stores has revolutionised the Japanese structure for the international market, Teaching Note Not Available retailing market through its low price many observers still believed that the Struc.Assig. Not Available strategy. It kept costs low by bypassing cultural inadvertence still remained a threat Japan’s archaic distribution system and for the company’s long-term survival in keywords effectively making use of the low-cost the country. AstraZeneca; Cholesterol-lowering drugs manufacturing facilities in China. However (statins); Blockbuster drugs; Crestor; with competitors replicating its low-cost Pedagogical Objectives Lipitor; Baycol controversy; Negative strategy it was time for Uniqlo to devise sentiments; Pfizer’s marketing; Merck’s ways to remain at the top. The focus began • To discuss how the overlooking of Zocor; Bristol-Myers Squibb’s Pravachol; to shift from ‘high quality low price’ to cultural differences and language barriers Marketing budgets; FDA approvals (Federal ‘high quality, low price and more variety’. while pursuing internationalisation, Drug Administration); Merck’s Vytorin; The company also had to deal with hampers business The Lancet; Clinical tests. resistance from Japanese textile industry • To discuss the importance of associations against cheap imports from customisation in internationalisation of Japan. business, especially in the entertainment Telecom Italia: Troubled Times business because of the strong link in Brazil Pedagogical Objectives between culture of the country and entertainment. • To discuss the complexities of retailing The Rome-based telecommunications in Japan, how Uniqlo tasted success by Industry Amusement Parks, Arcades and company, Telecom Italia Group had grown deviating from the traditional way of Attractions from a loss-making state-owned telecoms distribution, and how the company Reference No. TRT0030 firm to Italy’s largest fixed-line operator employed a low cost strategy to succeed Year of Pub. 2004 and No.1 wireless provider. Although the in the price sensitive market, during the Teaching Note Not Available company was the market leader in Italy, economic downturn Struc.Assig. Not Available the revenues of the company had almost been flat. After the privatisation of the • To discuss the major challenges that are keywords company in 1997, it experienced problems ahead for Uniqlo and how the company on different fronts. When Marco is turning challenges into opportunities Cultural differences; Globalisation; Euro Tronchetti Provera was appointed as the for its business. Disney SCA; Walt Disney in France; chairman in 2001, his efforts put the American stereotype; McDonalisation in Industry Retailing company on the path to profits. Although France; Cultural Chernobyl; Euro Disney the company posted profits in 2003, the Reference No. TRT0027 parks; Disneyland Paris; Language barriers. company began to face other problems. Year of Pub. 2004 The company pinned its hopes for growth Teaching Note Not Available on the Brazilian market, which was the Struc.Assig. Not Available AstraZeneca’s Crestor: largest market for Telecom Italia outside keywords Challenges in the US Market Italy. However, its long-drawn battle with Brazil Telecom and Kroll Inc. slowed its Fast Retailing Co.; Uniqlo; Retailing in London-based drug maker, AstraZeneca, is expansion plans in Brazil. Japan; Distribution system in Japan; the fourth largest in the world and second Outsourcing to China; Speciality retailer largest in Europe. When the company Pedagogical Objectives of private label apparel; Merchandising; announced its plans to enter the Transitional safeguard; Victim of its own cholesterol-lowering drugs segment (also • To discuss the troubles faced by Telecom success. called statins) with Crestor in the US, it Italia after its privatisation received mixed responses from the industry and analysts. Though a lucrative segment, • To discuss the legal battles that the the sensitivity attached to statins’ safety company faced in Brazil, the stakes for Formula One and Ecclestone: and usage was of particular concern to the company and the challenges it is The Powershift? AstraZeneca. The drug faced a further facing in Brazil. Since its inception in the 1950s, Formula setback after the European regulators Industry Telecommunications Services One is called the soap opera of the sports demanded a labelling change and a reputed Reference No. TRT0028 world; the exotic locations, huge amounts medical journal raised doubts about Year of Pub. 2004 of money, and famous faces made it unique Crestor’s safety. This only complicated Teaching Note Not Available compared to most other world sports. In Crestor’s strategy as the established players, Struc.Assig. Not Available the late 1960s, Bernard Charles Pfizer and Merck, took advantage of the Ecclestone, a used-car dealer sensed a great negative sentiment. keywords opportunity to make money by getting Telecom Italia; Telecom Italia in Brazil; involved in the administration of Formula Pedagogical Objectives Roberto Colaninno; Marco Tronchetti One. Gradually, in the early 1980s, he began Provera; Telecom Italia Mobile; Olivetti; acquiring control of the racing series’ • To discuss the challenges faced by Pirelli; Edizione Holding; Benetton Group; broadcasting and merchandising rights, AstraZeneca in the process of taking Brasil Telecom; CVC (Citibank Venture which resulted in huge profits for him. In the drug to market50 www.ibscdc.org
  • 51. due course, Ecclestone emerged as the most Act (1978) of the US; ESOP (Employee Asia. Ho used his advantage to spread his S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIimportant person in Formula One racing, Stock Ownership Plan); Air Transport sphere of activities to every major industry S T R A T E G Y – III S T R A T E G Y – IIIas he owned major stakes in some key Stabilisation Board (ATSB) of the US; Top in Macau. In 2001, when Ho’s gamblingsubsidiaries of Formula One. However, the ten airlines in the world; Hubs of United monopoly expired and gambling licensescar manufacturers such as Fiat, Mercedes Airlines; Bankruptcy filing of United were awarded to two more companies, Hoand BMW, who financed Formula One Airlines; Restructuring efforts at United faced competition from world-classteams, felt that Ecclestone diverted too Airlines; 401(k) defined contribution plan. adversaries.much revenue to his own holdings whileFormula One’s popularity was declining. Pedagogical ObjectivesConsequently the carmakers decided to Succession Battles at Viacom • To discuss Ho’s rise to the status of ‘theabandon the Formula One series andplanned to start a new auto-racing series. Viacom is the holding company of CBS king of gambling’ and the challenges that (Columbia Broadcasting System) networks, confront him and his gambling businessPedagogical Objective Paramount Pictures, MTV (Music • To discuss whether the liberalisation of Television) and other media ventures and Macau’s gambling industry will spell the• To discuss the financial dominance of one of the top three media companies in Bernard Charles Ecclestone in Formula end for Ho’s empire or enable Ho to the world in terms of its $27 billion earn more money through diverse One, the initiatives taken by car turnover and scope of operations. Viacom’s manufacturers to start a rival auto-racing businesses. president and COO (chief operating officer) series and the threat to Ecclestones Mel Karmazin, who built Infinity Radio Industry Gambling Resorts and Casinos dominance. and CBS, before the CBS mega-merger with Reference No. TRT0023 Viacom, resigned abruptly from his post. Year of Pub. 2004Industry International Sports The chairman and CEO (chief executive Teaching Note Not AvailableReference No. TRT0026 officer) of Viacom, 80-year-old media Struc.Assig. Not AvailableYear of Pub. 2004 mogul Sumner Redstone, who controlledTeaching Note Not Available keywordsStruc.Assig. Not Available 70% of the company’s stock took charge of the company, appointed two executives Stanley Ho; Winnie Ho; Gambling andkeywords to share Karmazin’s responsibility and casinos in Macao; Competitive growth designated them as likely successors when strategy; Government granted monopoly;Formula One; Bernard Charles Ecclestone; he stepped down after three years. State monopoly or coercive monopoly;Formula One Constructors Association;Federation Internationale de L’automobile; Money laundering and triads; Sociedade deMax Rufus Mosley; Commission Sportive Pedagogical Objectives Turismo e Diversoes de Macau (STDM);Internationale; Allsopp; Parker & Marsh; Tourism industry in Macau; Las Vegas Sands • To discuss the difference in the and the Sands Macau casino; BusinessCommercial rights; TV rights; Broadcasting personalities of Redstone and Karmazinrights; Formula One Management Limited; ethics; Las Vegas of the Orient; Henry Fok and the disparity of their vision for the Ying-Tung; Entrepreneurship.Concorde agreement; Formula One companypromotions and administration; SLEC(SLavica ECclestone); Grand Prix World • To discuss the dynamics of succession inChampionship. companies that have one controlling Mitsubishi Product Recall: A Self- shareholder, and the effect of top made Scandal? management’s personal vision and attitudes In a growing automobile market, Mitsubishi United Airlines’ Growing Motor Corporation was losing ground very Troubles: Looking for Solutions • To discuss the clash between innovation badly. A series of scandals involving the and cost control, between expanding the company’s attempt to hide customerUnited Airlines of the US, the second largest company and enhancing shareholderairline company in the world, has been complaints on products and subsequent value and a power struggle between two product recalls had tarnished Mitsubishiswitnessing problems since the early 1990s. powerful and successful self-madeIts financial situation deteriorated by the brand image. A financial crunch, no new personalities. innovative models and tough competitionturn of the 21 st century due to risingoperational costs against declining Industry Media and Entertainment were pushing Mitsubishi towardsrevenues, which eventually led to its filing Reference No. TRT0024 bankruptcy.for bankruptcy in December 2002. Year of Pub. 2004 Teaching Note Not Available Pedagogical ObjectivesPedagogical Objective Struc.Assig. Not Available • To analyse the impact of quality• To discuss the myriad problems of United keywords problems and the recalls on the Airlines and its efforts to emerge from companys brand image Viacom; Sumner Redstone; Mel Karmazin; its bankruptcy. CBS (Columbia Broadcasting System); • To evaluate the company’s options toIndustry Airlines Infinity; Leadership style; Top turnaround its fortune.Available at www.ibscdc.orgwww.ecch.com management succession; Creativity; Industry Automobile Reference No. TRT0025 Advertising; Television; Radio. Reference No. TRT0022 304-424-1 Year of Pub. 2004Year of Pub. 2004 Teaching Note Not AvailableTeaching Note Not Available Stanley Ho’s Gambling Empire: Struc.Assig. Not Available Struc.Assig. Not Available End of a Monopoly? keywordskeywords Stanley Ho exploited a 40-year gambling Mitsubishi Motor Corporation; ProductDomestic airlines in the US; Transpacific monopoly in Macau to emerge as one of recalls; Toyota; Honda; AutomobileRoute Case (1969); Airline Deregulation the wealthiest and most influential men in industry; DaimlerChrysler; Competitive 51 www.ibscdc.org
  • 52. strategies; Restructuring strategy; Yoichiro bankruptcy owing to pressures from low- announced a 42% decline in its profits and Okazaki; Turnaround; Corporate social cost carriers and unions from then on profits kept on downsliding. Managing Troubled Times/Managing a Crisis responsibility; Growth strategies; Corporate The inward looking culture of the company ethics; Alliances and partnership. • To discuss the new industrial plan jointly and the absence of a strong leadership were developed by the government, Alitalia blamed for its poor performance. and the unions. Regal Entertainment Group: Industry Airlines Pedagogical Objective Managing Troubled Times Reference No. TRT0020 • To discuss the reasons behind the rapid Troubled Times/Managing Year of Pub. 2004 In the 1990s, the movie chains in the US Teaching Note Not Available decline of Marks and Spencer that has had spent billions on the construction of Struc.Assig. Not Available left it struggling for its existence. megaplexes. While the costs per screen Industry Department Stores rose fourfold, the audiences in the theatres keywords Reference No. TRT0018 did not increase proportionately. In the Industry-Academia rapport; UCSF Year of Pub. 2004 early 2000, most of the movie theatres fundamental research; Alitalia; Low-cost Teaching Note Available were uneconomical and were on the verge airlines; Ryanair; Alitalia team; Alitalia Struc.Assig. Not Available of bankruptcy. Taking advantage of the Express; European Commission; The situation, Denver-based billionaire Philip bailout; Trade union problems; Industrial keywords Anschutz acquired the three struggling plan; Restructuring; Giancarlo Cimoli; Job Marks and Spencer; British retailers; Retail theatre chains – United Artists Theatres, cuts; Fintecna; Finmeccanica; Business industry in Britain; Sir Richard Greenbury; Regal Cinemas, and Edwards Cinemas at a plan. Philip Green; Leadership in retail industry; very low price. He combined the assets of Troubled times at Marks and Spencer; St. the three companies to form a single Michael; Marks and Spencer apparel stores; entity – Regal Entertainment Group. The Low-carb Trend: Death Knell Marks and Spencer food stores; Floor for American Pasta Companies? management in retail stores; Boardroom Pedagogical Objective battles in Marks and Spencer; Decision The popularity of low-carb diets has led to making process in departmental stores; • To discuss the strategies taken up by Philip Anschutz to refurbish a chain of a decrease in the consumption of certain Conservative culture in retailing; Supply bankrupt theatre chains into the largest food categories like pasta and bread. Pasta chain management in Marks and Spencer. theatre chain in the US. makers in America saw sales decreasing by 7% in the first quarter of 2004. In America, while some companies like Dakota Growers Industry Movie Theatres Krispy Kreme Doughnuts: The Reference No. TRT0021 and American Italian Pasta have taken Year of Pub. 2004 steps towards creating low-carb versions Troubled Times Teaching Note Not Available of their pasta brands, others are waiting Krispy Kreme Doughnuts has satisfied US Struc.Assig. Not Available for what they call a ‘fad’ to pass out. consumers with its delicious offerings of keywords doughnuts for over a half a century. But Pedagogical Objective when its customers started becoming health Regal Entertainment Group; United Artists conscious, thanks to the low carbohydrate Theatres; Regal Cinemas; Edwards • To highlight the problems faced by craze, Krispy Kreme was forced to change Cinemas; Philip Anschutz; Bankrupt movie American Pasta companies to invest in its strategies and perform the trick again, chains; Movie chains; Oaktree Capital product development. this time with less sugar. Krispy Kreme’s Management; Digital projection; Regal Industry Food future is now on a very fine balance; even Cinemedia; Kurt Hall; Michael Campbell; Reference No. TRT0019 one grain of sugar can tip the scale against Live concerts; Dividends; Theatre chains. Year of Pub. 2004 it. Teaching Note Available Struc.Assig. Available Pedagogical Objective Alitalia: The Airline in Trouble keywords • To discuss the troubled times at Krispy The long-drawn crisis at Italy’s national Kreme and its strategies for a profitable Pasta makers under attack; The low future. airline, Alitalia, started during the mid- carbohydrate craze; Atkins diet; Impact of 1990s, when the low-cost revolution low carbohydrate foods on pasta makers; Industry Speciality Eateries invaded Europe. Even as the airline was Gearing up for an uncertain future; Outlook Reference No. TRT0017 fending off threats from the low-cost for pasta makers. Year of Pub. 2004 carriers, the September 11 attacks followed Teaching Note Not Available by the SARS outbreak and the war in Iraq Struc.Assig. Not Available was sounding a death-knell to Alitalia. Twice the Italian government ferried the Marks and Spencer: The keywords deteriorating airline out of bankruptcy – Downfall and Leadership Krispy Kreme; Doughnuts; Low in 1997 and in 2002. But, when the Vacuum carbohydrate diet; Troubled times; bankruptcy woes came back in 2004, the By the turn of the 21st century, Marks and Doughnut theatre; Beatrice Foods European Commission opposed the Spencer, the iconic British retailer, had Company; Montana Mills; Share price; government’s move for a third bailout, become vulnerable to hostile takeovers Nutrition facts; History of doughnuts; raising serious doubts about the airline’s with its ever-falling share prices and low Market for doughnuts in the US; survival. profit margins. Even as recently as 1997- Traditional advertisement of doughnuts; 1998, it was in competition with Wal-Mart Low carbohydrate craze in the US. Pedagogical Objectives to become the most profitable retail chain • To discuss how Alitalia, in spite of two in the world. However, it witnessed reverse bailouts, slipped to the verge of fortune the following year when it52 www.ibscdc.org
  • 53. Home Depot: Nardelli’s hard-to-find classics and a wide range of Costco: The Leaders Challenges Challenge S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III magazines. Its stores at airports and train S T R A T E G Y – III S T R A T E G Y – III stations provide reading material for the Since its inception in 1983, Costco has beenDuring the early 2000s, Home Depot travellers. In recent years, the increase in the leader in the warehouse club category ofchairman and CEO, Robert Nardelli competition from supermarkets and retailing. It has been growing steadily under(Nardelli), was under immense pressure as specialist retailers has caused a decline in the leadership of CEO, James Sinegal.the company’s growth rate had dropped WHSmith’s fortunes. According to analysts some of Costco’sbelow 20%, compared to its historic policies like running no frills stores andcompound annual growth rate of over 25%. selling a limited range of products Pedagogical ObjectivesTo that effect, he had chalked out an contributed to its growth. However, itselaborate plan to revive growth in late • To discuss WHSmith’s various problems leadership is being challenged by Sam’s Club,2001, which, if properly executed, would and the causes of those problems Wal-Mart’s own warehouse club. Costco’smake Home Depot a $100 billion company average annual sales per store are greater • To discuss various strategies for the than that of Sam’s Club. But Sam’s has moreby 2005 from $45.7 billion in revenues in reversal in WHSmith’s fortunes. stores worldwide. A rejuvenated management2000 (this meant a yearly growth rate ofabout 15%-18%). Following the Industry Retailing team under CEO Kevin Turner is cuttingimplementation of the plan, the company Reference No. TRT0015 costs and improving the performance ofgrew by 17% in 2001, 9% in 2002 and Year of Pub. 2004 Sam’s stores. As a division of Wal-Mart, it11% in 2003. Teaching Note Available is expected to get merchandise at cheaper Struc.Assig. Available prices than Costco. Already weakened byPedagogical Objectives price wars, Costco faces a formidable keywords competitor in Sam’s Club.• To discuss the problems faced by Home WH Smith PLC.; British retailing industry; Depot chairman, Nardelli News distribution; Publishing; Pension Pedagogical Objective• To discuss Nardelli’s plans to boost liabilities; School book funding crisis; • To discuss the challenges faced by Costco growth and the efficacy of his plans Hodder Headline; Kate Swann; Retailing when competing against Sam’s Club, who and distribution; Retail business; is part of a corporate giant, Wal-Mart.• To discuss the pros and cons of having Turnaround strategy; WH Smith stores; an entrepreneurial style of corporate Travel retail business; Net book agreement; Industry Retailing culture Price controls; Newspaper; Magazine Reference No. TRT0013• To discuss the importance of customer wholesaler. Year of Pub. 2004 service in creating a competitive edge Teaching Note Not Available in a retail format Struc.Assig. Not Available• To discuss Nardelli’s plan to focus on Hyundai in USA: The Quality keywords services in addition to selling of hardware Rides Costco; Competition from Sam’s Club; and whether this style is similar to that Hyundai, which forayed into the US car James Sinegal; Warehouse clubs; Sol Price; of General Electrics (GE’s) and would it market in the mid-1980s, always had an Jeffrey Brotman; Kirkland Signature; succeed in the retail format. image of a low quality carmaker. From the Discount retailing; Small business buyers;Industry Home Improvement and beginning, it had failed to live up to the Bill Dreher; No frills stores. Hardware Retail quality expectations of the Americans.Reference No. TRT0016 Hyundai’s cars were bought only as a lastYear of Pub. 2004 resort and the company used to feature at LSG Sky Chefs: Managing in the bottom of most of the quality surveys.Teaching Note Not Available Troubled Times Struc.Assig. Not Available The situation changed dramatically after Chung Mong Koo took over as the CEO In 2003, LSG Sky Chefs, a wholly-ownedkeywords of Hyundai in 1999. subsidiary of the German carrier DeutscheHome Depot - Robert Nardelli’s challenge; Lufthansa (AG), was the world leader inGrowth strategy; Store formats; Pedagogical Objective the airline catering industry. LSG derivedWarehousing; Retailing; Customer service; its revenues from the US and international • To discuss the initiatives taken by Chung airlines that have no flight kitchens of theirGlobalisation; Home improvement retail; Mong to build break the image ofMaintenance warehouse; Georgia lighting; own. However, after the September 11 Hyundai as a low quality car marker. terrorist attacks, the airline industryApex Supply; Home Depot learningcentres; Human resources; National Blinds Industry Auto Manufacturing witnessed a severe financial crisis due toand Wallpaper; Competitive strategy; Reference No. TRT0014 the decrease in the number of passengers.EXPO Design Centre stores; Landscape Year of Pub. 2004 This severely affected LSG Sky Chefs andsupply stores. Teaching Note Not Available other airline catering companies as many Struc.Assig. Not Available airlines cancelled complimentary meal services as part of their cost cutting keywords strategies. Adding to the company’s woes,WH Smith Plc.: The British Retailer the Severe Anti-inflammatory Respiratory in Trouble Hyundai Motor Company; Honda; JD syndrome (SARS) disease in Asia and the Powers initial quality study; Toyota; Six wars on Afghanistan and Iraq furtherEstablished in 1792, WH Smith PLC sigma campaign in Hyundai; Santa Fe; worsened the situation.(WHSmith) is a leading book retailer in Hyundai’s quality problems in USA;Great Britain. Its main businesses include Hyundai’s quality rating improvement;retailing, news distribution and publishing. Hyundai’s sales in USA; Hyundai’s quality Pedagogical ObjectivesFor over two centuries, book lovers have initiatives; Excel sub-compact. • To discuss LSG’s efforts to recover fromthronged its stores in search of bestsellers, the slump in the business post September 11 53 www.ibscdc.org
  • 54. • To discuss whether the new initiatives IDBI: An Ailing Goliath keywords ‘buy-on-board’ and ‘in-flight cafe’ that Managing Troubled Times/Managing a Crisis were considered as a shift from the old Since the late 1990s, the Industrial Diageo; Cardhu; Scotch whisky; Speyside paradigm where the foodservice was Development Bank of India (IDBI), which distillery; Malt whisky; Single malt whisky; dictated by what airlines could afford, was set up in the early 1960s by the Pure malt whisky; Guinness; Vatted malt would yield results. government of India as a development whisky; Scotch whisky association; Finance Institution (DFI), has been finding William Grant and Sons; Smirnoff; Industry Airline Catering it difficult to sustain its core function of Distilleries in Scotland; Aeneas Coffey; Reference No. TRT0012 industrial financing. Despite being the tenth Seagram. Troubled Times/Managing Year of Pub. 2004 largest development bank in the world, it Teaching Note Not Available is witnessing eroding profitability, loss of Struc.Assig. Not Available top rated corporate clients and attrition Poland Spring: Managing in of its top management. keywords Troubled Times LSG Sky Chefs; Lufthansa; Airline catering; Pedagogical Objective Since 1845, Poland Spring had been Buy-on-board; In-flight cafe; In-flight marketing its bottled water as the original management; Chef Solutions; Airport • To discuss the possible options being spring water from ‘the protected and gastronomy; Onex Corporation; Dobbs considered by IDBI and the government pristine sources of Maine’ in the US. After International; LSG Holding. of India to revive the financial being acquired by Nestle Waters North behemoth. America Inc. (NWNA) in 1992, Poland Industry Development Finance Spring continued to contribute significantly Infrastructure Development Institution to NWNA’s revenues in North America despite facing controversies regarding the Finance Corporation: The Reference No. TRT0010 authenticity of its spring water. Class action Controlling Battles Year of Pub. 2004 lawsuits were filed against it in 2002 based Teaching Note Not Available Infrastructure Development Finance Struc.Assig. Not Available on allegations that Poland Spring had been Corporation (IDFC) is the largest private deceiving its customers by marketing its keywords bottled water as spring water, when the sector development financial institution (DFI) in India. Post liberalisation of the original spring, from where the company Development finance institution; Non- banking sector, IDFC was created as a claimed to tap its water, had dried up 35 performing assets of the Industrial vehicle to channel private sector capital years ago. Development Bank of India (IDBI); into commercially viable infrastructure Universal banking; Industrial projects. Since its inception it had many Development Bank of India (IDBI); Pedagogical Objective credits, including that of being a DFI with Industrial Credit and Investment • To enable readers to understand how the zero non-performing assets (NPAs). Corporation of India; Liberalisation of the company, with its long-standing history, However, there was wide spread criticism Indian economy; Banking sector reforms is battling its way through the allegations. that its lending operations had been too in India; Banking companies; Non-banking conservative and thus had failed to fulfill financial institutions; Reverse Merger; Industry Beverages the infrastructure needs of the country. Commercial banks in India; Unit Trust of Reference No. TRT0008 This raised curtains to the series of India (UTI); IDBI bank; Stock Holding Year of Pub. 2004 controlling battles made by the pro and Corporation of India; Federation of Indian Teaching Note Not Available anti nationalist activists to gain control Chambers of Commerce and Industry. Struc.Assig. Not Available over the new-age development bank. keywords Pedagogical Objective Troubled Times at Diageo Nestle; Spring water; Maine; USA; Nestle Waters North America Incorporated • To discuss the various reasons that Diageo was formed in December 1997 (NWNA); Beverages; Poland Spring; compel IDFC to be nationalised. through the merger of Guinness and Grand Mineral water; Borehole; Ricker family; Industry Banking and Financial Metropolitan, the then leaders in the global Food and Drug Administration; Major Services liquor business. By 2003, Diageo had players in the US bottled water industry; Reference No. TRT0011 become the world’s largest scotch whisky Jan Schlichtmann; Natural catchment; Year of Pub. 2004 manufacturer with its world famous brands Bottlers. Teaching Note Not Available like Smirnoff, Johnie Walker, Guinness and Struc.Assig. Not Available Bailey’s. It had operations in 180 countries with a global workforce of 62,000 keywords Challenging Times of Japan employees. However by late 2003, it was alleged that Diageo was misleading Tobacco Nationalisation; Private capital; Development financial institutions; Non- consumers by marketing vatted malt under By 2003, Japan Tobacco (JT), the largest performing assets; Infrastructure the Cardhu label, which was supposed to be tobacco company in Japan and the world’s Development Finance Corporation a single malt whisky. third largest, had been facing challenging (IDFC); Long-term finance; Reserve Bank times. Since the late 1990s, due to a of India; Long-term operational funds; Pedagogical Objective decrease in the number of smokers in Japan Statutory liquidity ratio; Reverse merger; over rising health concerns, toughened • To understand the intricacies and Privatisation; Indian commercial banking tobacco regulations and economic dynamics of the scotch whisky industry. structure; New-age development bank; recession in Japan, the company saw a dip Refinancing; Flexi-bonds. Industry Distillers in its domestic sales revenue. Its domestic Reference No. TRT0009 market share also declined from 77.1% in Year of Pub. 2004 1998 to 72.7% in 2003. Another major Teaching Note Not Available concern for the company was the Struc.Assig. Not Available forthcoming expiry of its license54 www.ibscdc.org
  • 55. agreement with Philip Morris in 2005. As (BSE); Prions; vCJD; McDonald’s; company’s products attained a cult status S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIthe agreement had allowed JT to Australian beef; Japanese beef imports; among pre-teens. However, the company S T R A T E G Y – III S T R A T E G Y – IIImanufacture and market Marlboro, one Major exporters of beef in the world; Foot that heralded the gaming revolution in theof the most famous brands of Phillip and mouth disease; Sukivaki; Kyotaru sushi 1980s and 1990s, had to face severeMorris in Japan, the expiry of the shops. competition from Sony and Microsoft. Inagreement was believed to adversely affect spite of being an early entrant, NintendoJTs domestic sales and revenue. To sustain struggled to maintain its leadership at theits market share and fend off foreign turn of the millennium and hoped to Kodak: Fading Moments incompetitors in its domestic market, JT combat the competition with the releasewent ahead to launch many new cigarette Digital Photography of GameCube.brands in Japan in 2003 and early 2004. In conventional photography, Eastman Kodak Company is synonymous with Pedagogical ObjectivesPedagogical Objective photo-films and development. The • To discuss how Nintendo can combat company, which was a market leader, lost• To discuss whether the initiatives taken the competition it encountered in the its command over the market due to the by JT would keep it ahead of its rise of digital cameras in 1997. While on video games market, especially from competitors or not. one hand, Kodak had to deal with new Sony’s PlayStation and Microsoft’s competitors like Sony, Hewlett-Packard XboxIndustry Cigarettes and Tobacco Products and Canon who emerged as strong • To understand how the gaming marketReference No. TRT0007 contenders for leadership in digital assumed prominence in the 1990s andYear of Pub. 2004 photographic equipment, on the other how dominance of the establishedTeaching Note Not Available hand, it had to protect its turf in traditional players like Nintendo came under threatStruc.Assig. Not Available photography where Fuji Photo Film Co., with the entry of new competitors that waged a price war. To win back its lost sensed a big opportunity in the growingkeywords market share, Kodak’s the then chairman, market for video games.Japan Tobacco Incorporated; Japan George M.C. Fisher, came out with a string of initiatives to meet the requirements of Industry Electronic Gaming ProductsTobacco and Salt Public Corporation; Reference No. TRT0004Japan Tobacco International; Marlboro; digital photography market. Year of Pub. 2004Tobacco business law; Japan tobacco law; Teaching Note Not AvailableGlobal flagship brand; Japan tobacco’s Pedagogical Objectives Struc.Assig. Not Availabledomestic business; Phillip Morris; RJR • To discuss how large-scale changes inNabisco; Mild Seven; Lucia; Katshunhiko keywords the technology can catch even theHonda; Japan tobacco’s challenges; Japan market leaders unawares and result in a Nintendo; Sony; Microsoft; GameCube;tobacco’s brands. downward spiral GameBoy; GameBoy Advance; • To analyse Kodak’s initiatives to regain PlayStation; XBox; Gaming market; its supremacy in the photography Nintendo’s struggles in gaming market; Yoshinoya: Managing in Video games; Technology; Genre trends in industry against the backdrop of Troubled Times digitisation of photography gaming market; Satoru Iwata.By 2003, ‘Yoshinoya D&C Co. Ltd.’, • To discuss whether the initiatives of(Yoshinoya), which started as a small Kodak’s former chairman, George M.C.restaurant in Tokyo in 1899, had Motorola’s Lost Opportunities Fisher, and his successor Daniel A. Carptransformed into a global fast food chain. would lead the company out of trouble. Motorola that was once a dominant forceIt was famous for its beef bowl and had in the communication equipment market1,156 restaurants in the US, Japan, Industry Photographic Equipment seems more like a laggard than a leader.Singapore, Taiwan, Hong Kong and China. Manufacturer The company blew up some goldenIt was also planning to expand into Asia Reference No. TRT0005 opportunities when it misread consumerand Australia. However, due to the report Year of Pub. 2004 tastes, alienated telecom companies andof mad cow disease in the US in December Teaching Note Available faltered in bringing new products to the2003, Yoshinoya faced a major crisis, as Struc.Assig. Available market at the right time. Troubles escalated99% of its beef was imported from the US.Despite the ban, Yoshinoya announced keywords for the company in recent years and it lost its lead in the handset business to Finland-that it would continue to use US beef for Nintendo; Sony; Microsoft; GameCube; based Nokia. Christopher Galvin, theits products till the stocks lasted. GameBoy; GameBoy Advance; grandson of Motorola’s founder Paul V. PlayStation; XBox; Gaming market; Galvin was criticised for his hands-offPedagogical Objective Nintendo’s struggles in gaming market; approach and not taking timely action to Video games; Technology; Genre trends in put the company back on track. The• To discuss the strategy adopted by gaming market; Satoru Iwata. Yoshinoya to tide over the crisis of mad company’s constant struggle led to the cow disease in the US. resignation of Chris Galvin in late 2003. Edward J. Zander, former president of SunIndustry Food Retailing Gaming Market: Nintendo’s Microsystems replaced Chris Galvin amidstReference No. TRT0006 Struggles investors’ expectation to regain theYear of Pub. 2004 company’s past glory.Teaching Note Available Nintendo Co. Ltd., a pioneer and one ofStruc.Assig. Available the leading producers of video games in Pedagogical Objectives the world, rose to fame in 1989 after itkeywords introduced the first-ever portable handheld • To discuss reasons for Motorolas slideYoshinoya; Mad cow disease; US beef; Beef gaming device called GameBoy. After from leadership position in the handsetbowl; Bovine Spongiform Encephalopathy producing a series of video games, the market and to understand how, in spite of pioneering technologies in the 55 www.ibscdc.org
  • 56. handset market, the company lost so in deep financial trouble with an income emerging markets. The company, has since many opportunities of growth loss of $828 million in 2002. Events like a long time not only been chasing Managing Troubled Times/Managing a Crisis the SARS outbreak in late 2002, coupled opportunities in emerging markets but also • To discuss the need for companies to with the Iraq war in 2003, aggravated the started separate reporting divisions to understand the fast paced changes in the financial difficulties of the cash starved better concentrate on the opportunities market and change the course of action airline. On April 1 st 2003, with an there. Cisco has been following a strategy to suit the changing market dynamics. outstanding debt of $12 billion, Air Canada that enables it to expand in these markets Industry Wireless Telephone Handsets announced that it had filed for protection and ensures developing relationships with Troubled Times/Managing Reference No. TRT0003 under the ‘Companies’ Creditors the government, businesses and also its Year of Pub. 2004 Arrangement Act’ (CCAA) to facilitate its competitors. Cisco has been witnessing Teaching Note Not Available operational, commercial, financial and significant increase in its revenues from Struc.Assig. Not Available corporate restructuring. In late 2003, when emerging markets. However, now, the Air Canada was in desperate need of cash company is feeling the pressure of the keywords inflow to come out of its bankruptcy, Victor global slowdown because of the US Motorola’s lost opportunities; Competition Li, a wealthy businessman from Hong Kong Financial Crisis (2008) as the demand in handset market; Chris Galvin’s bought a 31% stake in the airline through orders from emerging markets started management style; Nokia; Spinoff of his company, Trinity Time Investments, declining. Adding to its woes, the number semiconductor product segment; Chris for $650 million. Although Victor Li’s of competitors are also increasing and Galvins resignation; Edward J. Zander. involvement in Air Canada was looked encroaching upon its turf. upon with suspicion by many, Air Canada welcomed it as a necessary step to Pedagogical Objectives rejuvenate its beleaguered business. Bailout of LG Card Company • To examine the potential of emerging Pedagogical Objective markets for Ciscos core business Since 1999, South Korea had been encouraging the usage of credit cards in • To discuss how Air Canada transformed • To elucidate and analyse Ciscos market order to improve tax collections and also from being Canada’s dominant airline entry strategies in emerging markets to achieve a rapid economic growth. LG to become a cash-starved and beleagured • To identify the challenges ahead for Card Company took advantage of the business. Cisco. favourable environment and pursued aggressive marketing and financing policies. Industry Airlines Industry Networking Hardware However, financial leverage turned out to Reference No. TRT0001 Equipments be a double-edged sword – good in good Year of Pub. 2004 Reference No. MES0101 times and very bad in bad times. Rising Teaching Note Not Available Year of Pub. 2009 credit card delinquencies coupled with a Struc.Assig. Not Available Teaching Note Available slowdown in economic growth did the Struc.Assign. Available keywords undoing for credit card companies in general and LG Card company in particular. Canadian Airways; Trans-Canada Air Keywords The company had a shy with bankruptcy (TCA); Canadian Airlines; The National Cisco System Inc., India, Networking twice but was saved due to government Research Council of Canada (CNR); Air equipment, Expansion, Low-cost intervention. Canada; Onex Corporation; PWA; Free engineering resources, Internet market, market problem; Deregulation of Canada’s Market Entry Strategies, Going Global, Pedagogical Objective aviation sector; Companies’ Creditors Emerging Markets, Deregulation of Arrangement Act (CCAA); Canadian Auto telecom industry, Small and Medium • To discuss whether the Korean Workers (CAW); Canadian Union of Public Businesses (SMB’s) government’s action was justified and Employees (CUPE); GE Capital; Victor Li; whether the LG Card bailout is a Trinity Time Investments. financially prudent decision. Cisco in Emerging Markets (A): Industry Financial Services Market Entry Strategies in China Reference No. TRT0002 and India Year of Pub. 2004 Teaching Note Not Available The first case in the series on Cisco Struc.Assig. Not Available Systems (Ciscos) growth strategies in Cisco in Emerging Markets (B): emerging markets, it details Ciscos entry keywords Looking Beyond China and India strategies and its subsequent growth in Bailout of LG (Lucky Goldstar) credit card A sequel to the case study Cisco in China and India. In 2008, the Asia-Pacific company; Financial leverage; Lucky Emerging Markets (A): Market Entry region emerged as an important destination Goldstar (LG) company; Bankruptcy; Strategies in China and India. This case for many foreign companies, especially for Credit card market; Asset backed securities; study delves into Cisco Systems (Ciscos) Cisco, a maker of networking equipment Financial supervisory service; Net interest market entry strategies in emerging for the Internet and Telecom, due to the spread; Household debt; BC card; Kookmin markets, other then India and China. rapid growth of China and India. card; Samsung card; Delinquency; Korean Cisco, the major beneficiary of the Internet The company, after initially focusing on Development Bank, Woori Bank; Kim Jin revolution and telecom deregulation in the US and Western European markets, Pyo and Lee Duk Hoon. emerging markets in the 1990s, provided had started tapping the emerging markets most of the equipment needed to create for further growth avenues. China and India networks. The company stayed ahead of were identified as important markets by Troubled Times at Air Canada its time by acquiring companies to enter Cisco. As these countries were witnessing into new product markets and even before an increase in the number of Internet users, Air Canada, which had remained Canadas mobile phone subscribers and demand for dominant airline since 1930s, found itself the demand in the developed markets saturated, it realised the importance of the networking equipment in different sectors,56 www.ibscdc.org
  • 57. Cisco started investing heavily. However, proposed launch of a new Hindi GEC Real Cooperation and the European S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIICisco had to change its strategy and adapt in March 2009. The case study debates on Commission emerged to become Asias top S T R A T E G Y – III S T R A T E G Y – IIIto the diverse and local conditions of these various issues concerning the launch of this B-school and worlds 11th best B-school inmarkets to succeed. channel: the timing of Reals launch vis- a span of 14 years. The only other B- a -vis the prevailing economic downturn school that could make it to the FT Global-New rivals that could upstage Cisco by and industry lifecycle. Does niche 20 B-schools within a much shorter timeproviding cheaper or more technologically positioning work for a GEC? How Real is Hyderabad-based Indian School ofadvanced equipment posed as a threat to can win over established players like STAR Business. What factors contributed toCisco, which had initially enjoyed Plus and emerging ones like Colors and CEIBS reckoning in global best B-schools?unhindered growth. Coupled with this, the NDTV Imagine? What did it do differently that catapultedcompany also faced the looming threat of it to the Ivy league of B-schools? The casea decline in demand caused by a slowdownin the global economy. Pedagogical Objectives study also explores, why after establishing itself as a sought after B-school in China, • To examine the nature of business for a CEIBS is going global, when very few ofPedagogical Objectives GEC and identify its critical success the top B-schools are doing so? Why factors among all other countries, CEIBS set up• To examine Ciscos growth through acquisitions and innovations • To discuss the need for a unique value its first overseas campus in Ghana? And proposition and right Segmentation, above all, whether CEIBS, which established• To compare and contrast Ciscos market Targeting and Positioning (STP) itself as a China-centric B-school with an entry strategies in India and China strategies to win over entrenched players international flavour, can replicate its in the GEC market success in a foreign land?• To debate on the sustainability of Ciscos position in the networking equipment market and identify the challenges • To examine Reals launch in the GEC Pedagogical Objectives market and its strategies to compete with ahead.Media and Entertainment established players as well as new entrants • To understand what are the criticalIndustry Networking Hardware success factors of a B-school in the light • To compare and contrast Reals of challenges that B-schools are Equipments positioning and marketing strategies constantly facingReference No. MES0100 with those of other GECs in the IndianYear of Pub. 2009 • To understand the factors that helped entertainment and media industryTeaching Note Available CEIBS in becoming one of the top-20Struc.Assign. Available • To debate on the possibilities of success global B-schools in a short span for Real in the cluttered Hindi GECKeywords market and to identify the challenges • To explore why CEIBS is going global,Cisco System Inc., India, Networking ahead. when very few of the top B-schools haveequipment, Expansion, Low-cost done so Industry Media and Entertainmentengineering resources, Internet market, Reference No. MES0099 • To analyse whether CEIBS would be ableMarket Entry Strategies, Going Global, Year of Pub. 2009 to replicate its success in a foreign land.Emerging Markets, Deregulation of Teaching Note Availabletelecom industry, Small and Medium Industry Education Struc.Assign. AvailableBusinesses (SMB’s) Reference No. MES0098 Keywords Year of Pub. 2008 Teaching Note Available Product Launch, Market Entry Strategy, Struc.Assign. Available Turner-Miditechs Planned Entertainment and Media industry in India, Launch of Real Channel in Alva Brothers, Sunil Lulla, General Keywords India: Will it Succeed? Entertainment Channels (GECs), Lifestyle MBA; B-Schools; China; Emerging; Channels – NDTV Good Times, STAR Plus, Success; Globalisation; Market EntryIn the backdrop of Indian entertainment Zee, Sony, 9x, NDTV Imagine and Colors,and media industry, the case study delves Strategies Case Studies; Ghana; Managers; Reality shows, Gross Rating Points (GRPs), Executive; Ranking; Positioning; Brandinginto the intricacies of Indian television Distinct positioning, Competitive clutter,market, particularly the General Target group – neo Indians, DifferentiatedEntertainment Channels (GECs). While content, Real Global Broadcasting (RGB)many factors changed the market dynamics McDonalds in Chinaof the industry, increase in the number ofGECs redefined the role of competition. McDonald’s, the leading US fast foodEach channel vied for more viewership, China Europe International retailer, entered China in 1990 by openingoffering a variety of content to include Business School (CEIBS): Going its first restaurant in Shenzhen. As ofeverything from fiction and mythology Global March 2008, there were more than 800to reality shows, music and movies. McDonald’s restaurants across China.However, inability to change according to Following the economic boom in the Yum! Brands, the main competitor forchanging consumer psyche made GECs lose 1990s, China demanded its business McDonalds had already established itstheir market dominance to other emerging managers to lead its economic growth. presence in China before McDonalds andgenres of specific content – news, lifestyle Many Chinese B-schools offering MBA and was the leader in the Chinese fast foodchannels, and only music and movie EMBA programmes have mushroomed market. McDonalds had launched severalchannels. during the years. However, many of them initiatives in China to adapt to local needs simply copied western styles and failed to and tastes in order to overtake Yum Brands.Amid this competitive and challenging produce skilled business managers who can It plans to open more than 1000scenario, on January 21st 2009, Real understand the local market, its needs and restaurants in China before the BeijingGlobal Broadcasting (RGB), a 50:50 joint problems. The void was filled when China 2008 Olympic Games. It is also focusingventure between Alva Brothers Miditech Europe International Business School on opening more drive-thru restaurants inand Turner International announced the (CEIBS), a joint venture between Chinese China. As one of the top official sponsors Ministry of Foreign Trade and Economic 57 www.ibscdc.org
  • 58. for the 2008 Beijing XXVIX Olympics, • To analyse the mass brand image of Keywords McDonalds is counting on a high-profile Ponds Market Entry Strategies presence in Beijing to build its brands in Mattel; Barbie; Fisher-Price; Outsourcing; the mainland and to win favor among the • To analyse Ponds entry into the Value Chain Management; Toy industry; Chinese consumers. McDonalds hopes that premium product range Crisis management; Market Entry the Olympics will bring in new customers Strategies; Case Studies; Production • To analyse the issues and challenges for capabilities and will give it a competitive edge over Ponds to succeed in the premium Yum! Brands. How the fast food scenario segment. in China will evolve, remains to be seen. Industry FMCG Reliance Branded Jewellery Pedagogical Objectives Reference No. MES0096C Retail Outlets: Will it Succeed? Year of Pub. 2008 • To analyse the fast food industry in Teaching Note Available Reliance Retail, one of the biggest retail China Struc.Assign. Available industries in India forayed into branded jewellery and introduced its brand Reliance • To analyse the market entry strategies Keywords Jewel. The main objective of the company of McDonalds in China Hindustan Unilever Limited; HUL; Market is to compete with the established branded • To analyse the competitive advantage Entry Strategies Case Studies; Ponds; Mass jewellery players, especially Tatas of Yum! Brands over McDonalds in Market; Premium Skincare Segment; Ponds Tanishq. To reach the No.1 position in China Age miracle Range; P&G Olay Total the branded jewellery market, the Effects; masstige; Price Sensitive Indian company plans to promote jewellery • To analyse consolidation strategies Market; Anti-ageing retailing in a big way by establishing more adopted by McDonalds to take on the branded jewellery retail outlets within 2 to leaders Yum! brands in China. 3 years. Industry Fast Food Industry Mattel in China: ‘The Outsourcing Pedagogical Objectives Reference No. MES0097C and the Recall’ Year of Pub. 2008 • To understand the dynamics of Indian Teaching Note Available Mattel Inc, USA is the worlds biggest toy retail jewellery market Struc.Assign. Available maker and is ranked 406th in the Fortune 500 in 2007. Some of the renowned brands • To study the critical success factors of Keywords like Barbie, Hot Wheels, Matchbox and Indian branded jewellery market McDonalds; Market saturation; Yum! Fisher-Price are from the house of Mattel. Mattel used outsourcing as a major tool in • To discuss the challenges faced by Brands; First drive-thru restaurant; China its value chain management with China Reliance from the competitors, Petroleum &Chemical Corporation; becoming a favoured destination. However, especially Tatas Tanishq Beijing Olympics; McDonalds Champion Kids; Chinese Fast Food industry; Market on August 14th 2007, Mattel recalled • To analyse the future prospects of Entry Strategies Case Studies; Franchising nearly 4,36,000 toys that were Reliance. Model; long-term strategy manufactured in China. This was the second major recall by Mattel of its toys that Industry Branded Jewelry contained impermissible levels of lead. Reference No. MES0094B Mattel recalled 20 million toys Year of Pub. 2008 Ponds Foray into the Premium manufactured in China twice in a span of Teaching Note Available Segment – Will the Miracle two weeks. Mattel was criticized for not Struc.Assign. Available Work? having tight quality control procedures in Keywords its supply chain of subcontractors. HUL’s Talc brand – Ponds - has moved up Although Mattel was known for having in Gems and Jewellery in India; Branded on premium imagery. In March 2007, it place a sophisticated inspection and testing Jewellery Market in India; Reliance entry launched its Age Miracle range in the system at many of its factories in China, it into Jewellery Business; Reliance forayed premium skin care anti-ageing category. could not avoid a quality scam. Mattel into Jewellery stores; History of Indias Earlier, HUL had tried to enter the undertook many measures to undo the leading jewellery brand; Tata Tanishq premium skin care segment by extending damage and it remained to be seen if it achievement; Marketing Strategy of Tata its Fair & Lovely (FAL) franchise, without could regain the trust of its consumers. The Tanishq; Reliance jewels to compete much success. The Indian skincare market case details Mattels recall of its toys and Tanishq; Future plans of Tata Tanishq; has been growing at around 16% a year, the impact of the same on its brand image. Timex entry into jewellery; Reliance out of which the anti-ageing products jewels plans to reach No.1 position; market accounts for close to INR 1 billion in sales. Anti-ageing skin care market is Pedagogical Objectives Market Entry Strategies Case Study; Tanishq as a first mover; Reliance as a late growing at a rate of 40% in India. As it • To understand the concept of mover now felt that the market is ripe enough, outsourcing and its rationale Ponds entered the premium skin segment. It had to bear large promotional costs to • To analyse the importance of succeed against the stiff competition from outsourcing in value chain management Porsches Expansion in India: A other players in this segment. Whether • To analyse the significance of quality Catch 22 Situation? Ponds can overcome its mass image and maintenance and supervision during The automobile industry of India was at a make a mark in the premium segment outsourcing. tipping point with the emergence of the remains to be seen. Industry Toy Industry small car segment in 2007. The domestic and international car makers eyed India Pedagogical Objectives Reference No. MES0095C Year of Pub. 2008 whose economy had reported a consistent • To analyse the market for premium skin Teaching Note Available growth of 9% in the past three years. The care products in India Struc.Assign. Available middle class market attracted many but58 www.ibscdc.org
  • 59. according to future estimates, the strongest people to offer collaterals and lack of Pedagogical Objectives S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIgrowth would come from the Top of the details of credit history. The case facilitates S T R A T E G Y – III S T R A T E G Y – IIIPyramid. The super luxury car segment discussion on whether ICICI Bank will able • To understand Corporatepresented excellent opportunities for to sustain its partnership model as the Entrepreneurshipmarketers. Porsche AG with global sales of Indian microfinance sector becomes • New Venture Development :¤7,367.9 million for the year 2006-2007, lucrative. Opportunities and Challenges for anplanned to expand its subsidiary, Porsche EntrepreneurCars India Private Limiteds (Porsche) Pedagogical Objectivespresence in the luxury car segment. But in • To analyse Strategies for New Venturethe wake of the expansion plans would it • To assess the opportunities and Development.lose exclusivity, and how would Porsche challenges in Indian microfinance sector Industry Airline Industrymaintain its exclusivity in the emerging • To understand evolution of SHGs-Bank Reference No. MES0091AIndian economy remained to be seen. The Linkage programme in Indian Year of Pub. 2008case thus helps to understand how Indians microfinance sector Teaching Note Availablelook at luxury and facilitates the discussion Struc.Assign. Availableabout how Iconic brands can maintain • To evaluate growth and feasibility ICICIexclusivity in an emerging economy like Banks "Partnership Model" KeywordsIndia. • To assess competitive scenario shaping David Neeleman; JetBlue; up for ICICI Bank and it impacts. Entrepreneurship; Azul; TAM; GOL;Pedagogical Objectives Brazilian Airline Industry; Low-cost Carrier Industry Financial Services• To understand the dynamics of the (LCC); Entrepreneurial Leadership; Brand Reference No. MES0092A Indian automobile industry Building; New Venture Development; Year of Pub. 2008 Duopoly; Five Forces Analysis; Market• To understand how Indians look at luxury Teaching Note Available Entry Strategies Case Study; SWOT Struc.Assign. Available• To analyse how brands become Icons analysis Keywords• To analyse whether a trade off is possible between exclusivity and profitability in Microfinance; Microfinance in India; Market Entry Strategies Case Study; ICICI Google’s Orkut in Brazil: What’s the luxury segment. Bank; SHGs-Bank Linkage Program; So Social About It?Industry Automobile Industry IRDP; NABARD; Regional Rural Banks;Reference No. MES0093A Social network advertising is forecasted to Entry Level Strategy; Bank of MaduraYear of Pub. 2008 reach $3.6 billion by 2011. There are a (BoM); Partnership Model; MicrofinanceTeaching Note Available number of companies cashing in on this Institution in India; SHARE Microfin Ltd;Struc.Assign. Available trend. Google, the biggest search engine Grameen Foundation; Centre for company, launched its social networkingKeywords Microfinance Research; Institute for site Orkut in 2004. The site was not Financial Management Research successful in the US. However, becameAutomobile industry India; Auto immensely popular in Latin America,consumerism; Experiential marketing; particularly Brazil, where almost 70% ofEmotional branding; Indias affluent space; JetBlue Founder David Internet users were Orkut users. Soon,Luxury market India; Super luxury carsIndia; Brand Icons; Exclusivity; Porsche Neelemans LCC in Brazil: The Google was plagued by allegations thatAG; Indian auto consumer; Market Entry Conundrum of New Venture Orkut communities of neo-Nazis, anti- Development socials and racists were being formed. ItStrategies Case Study; Luxury marquees was being used to spread child pornography,India Entrepreneur David Neeleman paedophilia and for Internet trafficking. (Neeleman), founder of the US based Google was asked to hand over user data to successful low-cost carrier (LCC), JetBlue Brazilian authorities for identifying theMicrofinance in India: The Case Airways Corp. (JetBlue), after stepping perpetrators. Google refused to do so. As a of ICICI Bank down as JetBlues chief executive officer result, criminal charges were filed against in February 2008, announced the creation Google’s head of Brazilian operations andSince its entry into Indian microfinance of a low-cost carrier in Brazil to tap the a fine was levied on Google for each day ofsector in 2001, ICICI Bank, one of the nations expanding appetite for flying. non-compliance. Google eventuallylargest private sector banks in India Neeleman planned the carrier to start flying cooperated with the authorities. Its woesachieved remarkable progress in its by early 2009. Neeleman saw plenty of however did not end here. When Googleportfolio. Instead of the conventional opportunities in the booming Brazilian introduced advertising on Orkut, there werebranch-banking model, it opted to economy where air travel had been reports that ads were appearing alongsidedifferentiate it operational model, to foray expanding annually at a double-digit pace. illegal content. With no way to monetiseinto rural markets to tap lucrative However, the Brazilian market, having Orkut and the never-ending controversies,opportunities in the Indian microfinance infrastructural issues and being dominated will Google be tempted to cut its losses andsector. Apart from basic microfinance by two airlines; Transportes Aereas shut down Orkut in Brazil? This case studyservices, it planned to offer various Meridional (TAM) and GOL Linhas Areas talks about the growth of social networkingfinancial products like weather insurance, Inteligentes S.A. (GOL), that together sites, particularly on Orkut’s operations inhealth insurance, remittance services and commanded more than 90% of domestic Brazil. The issue of whether usercommodity derivatives to rural masses. But, airline market, presented a tough situation information should be shared with the legalit faced stiff competition from commercial for the entrepreneur. The case, highlighting authorities forms the core of the discussion.and other foreign banks, which were the Brazilian airline industry scenario, in Should Internet companies hand over userdetermined to boost their presence in the view of Neelemans new LCC, provides a data when demanded? Does theirIndian microfinance sector. Apart from scope to analyse the strategies, compliance mean breach of user trust? Ifthat, the bank faced major challenges like opportunities, and challenges of a new they refuse, termination of services isinformation irregularity, inability of poor venture development for an entrepreneur. likely, then how do companies achieve the 59 www.ibscdc.org
  • 60. goal of wealth maximisation? How can there is a serious challenge or is it only a • To understand and compare McDonald’s Internet companies best combine the passing phase in the search giant’s growth. business model, both globally and in Market Entry Strategies interests of their users, advertisers and Russia authorities, while ensuring that revenues Pedagogical Objectives • To examine the food consumption trends keep flowing in? The case is structured to let the students and consumer behaviour in the Russian analyse and understand: fast food segment Pedagogical Objectives • A search engine’s business model in • To analyse the reasons behind The case is structured to let the students McDonald’s cautious growth in Russia analyse and understand: general and that of Google in particular and suggest ways to gain sizeable market • The characteristics of social networking • Should a business model be adapted, when share there. sites and the reasons behind their entering a foreign market? Industry Fast Food Retailing popularity • How should Google respond to Reference No. MES0088 • Importance of scrutinising a country competition from the governments in Year of Pub. 2008 before offering a product there France, Germany and Japan? Teaching Note Available Struc.Assign. Available Industry Internet Search & Navigation • Social networking sites’ dilemma - whether to share user information with Services Keywords Reference No. MES0089 the legal authorities or refuse and risk Fast food; Russian economy; Collapse of Year of Pub. 2008 getting shut down? the Soviet Union; Economic reforms; Teaching Note Available Industry Internet Search & Navigation Struc.Assign. Available Liberalisation; privatisation & Services globalisation; Ruble inconvertibility; Reference No. MES0090 Keywords George Cohon; Khamzat Khasbulatov; Year of Pub. 2008 Google; Baidu.com; China’s Search Engine Russian financial crisis and its impact; Teaching Note Available Market; Business Model; Globalisation and Russian bureaucracy and communism; Struc.Assign. Available Localisation; CAGE Frame Work; Alliance Market Entry Strategies Case Study; Strategies; Acquisitions and Partnerships; McDonald’s flawed expansion strategy; Keywords McComplex; Competition from local and Chinese Google; Government Business Google; Baidu.com; China’s Search Engine Environment; Internet Censorship; Online global rivals; Growth plans for McDonald’s Market; Business Model; Globalisation and Advertising; Market Entry Strategies Case in Russia; McDonaldl’s at Pushkin Square Localisation; CAGE Frame Work; Alliance Study; International Business; Legal Strategies; Acquisitions and Partnerships; Environment and Regulations Chinese Google; Government Business Wal-Mart in India: Can it be the Environment; Internet Censorship; Online Messiah of Indian Farmers? Advertising; Market Entry Strategies Case McDonald’s in Russia ndia was among the top producers of Study; International Business; Legal Environment and Regulations McDonald’s - a name easily digested by vegetables and fruits, but 30%-40% of the commons and celebrities alike, in the produce was wasted due to poor storage developed nations - has been trying hard and handling facilities. The potential of agri-business in India attracted many Google vs Baidu.com (B): to serve developing nations. It would be a domestic and multinational players. Wal- mistake if one assumes it is out to better Google’s Country Experiences Mart, the American retailer with net sales the living standards in the second world. At the heart of Google’s worldwide success Rather, McDonald’s stalled growth in of $344,992 million in 2007 planned to is its PageRank technology and its online developed nations led its foray into start its operations in India and formed a advertising model. After success in its home emerging markets. The case study joint venture with Bharti Enterprises country, the US, Google has expanded to chronicles McDonald’s entry into Russia (Bharti). Bharti was one of the leading international markets including countries and how it set up its outlets, leaping over business groups in India with interests in in Europe and the Asia-Pacific. Has Google Russian brand of communism. After its first telecom, agribusiness, insurance, and retail been successful in all the countries it Russian outlet opened in 1990, McDonald’s with market capitalisation of INR 1519 entered? What has been Google’s leveraged the Russian’s love for American billion. Wal-Mart planned to invest in back experience in these countries? What are food and gradually strengthened its end technology and replicate its global the key insights? This case, the second in presence. But its growth was restrained - supply chain model in India. But analysts the series, Google vs Baidu.com, looks at due to Russian bureaucracy as well as a were skeptical about Wal-Mart’s entry into Google’s meteoric rise worldwide and the behavioural shift from bigger-in-size to India, as the company was known for its reasons for its global success. The focus is better-in-customer-reach. How should aggressive attitude towards its suppliers. on Google’s operations in France, Germany McDonald’s deal with its dilemmas in Anti MNC activists were concerned about and Japan. Google’s foray into these Russia? What are its growth options there? the social disruptions that the company countries though successful is also marked Should it be wary of store expansions or would cause in the retail sector. The case by the threat of impending competition spread across Russia? details the controversies and challenges from a new adversary - the government that Wal-Mart might face and facilitates discussion on whether Wal-Mart can sponsored national search engines. The Pedagogical Objectives case details the reasons for and the establish itself in India. initiatives of the respective governments • To examine the characteristic features to challenge Google’s stronghold and of emerging markets, particularly Russia Pedagogical Objectives market dominance. What are the • To analyse the political, economic and • To understand the dynamics of ramifications of the government social conditions in Russia and identify agriculture produce and food retailing in initiatives succeeding for Google and what areas in which the nation differs from emerging countries like India does it need to do to ensure its continued other developed countries dominance? The case questions whether60 www.ibscdc.org
  • 61. • To discuss the possible factors of agrarian Year of Pub. 2008 Barclays’ Entry into India: Strategies and Prospects S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III crisis in India S T R A T E G Y – III S T R A T E G Y – III Teaching Note Available Struc.Assign. Available• To analyse the food supply chain in India Barclays Bank PLC (Barclays) had been Keywords providing financial services to the global• To analyse the logistics and supply chain management strengths of Wal-Mart Nokia; Branding; Cellular Phone Market; community for 300 years. It was operating Marketing Strategy; Market Leadership; in India since the late 1970s as an• To analyse opportunities and challenges Localisation Strategy; Advertising Strategy; investment banker. In 2006-2007, Barclays for a multi national retailer in an Brand Image; Market Entry Strategies Case chose to enter the retail banking sector in emerging economy like India. Study; Competition India.The Indian banking sector was on a high due to the increased purchasing powerIndustry Retailing of Indians coupled with higher interestReference No. MES0087A rates. Many foreign bankers were willingYear of Pub. 2008 Harley-Davidson: Market Entry to expand in India as the economy wasTeaching Note Available Strategies in India growing at a rate of over 8% per annum.Struc.Assign. Available India offered ample opportunities in Global automobile companies have linedKeywords corporate banking, small-and-medium size up Indian roads taking advantage of the enterprises, retail banking, consumerAgrarian Crisis; Supply Chain; Food economic prosperity of the country. finance and micro finance. A large numberRetailing India; Agribusiness Harley-Davidson, the most iconic US of foreign banks focused only on corporateOpportunities; Agriculture produce; motorcycle manufacturer is a prospective banking whereas analysts opined that theAgriculture Marketing; Consumer entrant into the Indian market. Earlier, real opportunity lay in retail banking andBehaviour; Agriculture Credit; Wal-Mart; Harley-Davidson bikes were restrained consumer finance. In this context it wouldWal-Mart in China; RFID; Rural Supply from entering India due to stringent be relevant to analyse Barclays’ entryChain in India; Indo-US Initiative; Market emission norms and high import duties. strategies into India as also the growthEntry Strategies Case Study; Food The emission norms were relaxed as part prospects of foreign banks in developingProcessing in India; Consumer Spending in of a trade agreement between the US and countries.India India on April 13th 2007. However, the large bikes are haunted by high import tariffs in India that double the original price Pedagogical Objectives of the bikes. Further Harley-Davidson bikesNokia: The Brand and its Future in also face competition from its Japanese • Banking operations by a global bank India counterparts who already have businesses • Regulatory framework for foreign banks in India. Although the Indian government in IndiaThe cellular phone market in India hasbeen recording significant growth since the offers different market entry options for • Operational strategies used by Barclayslate 1990s and is the fastest growing in the foreign firms, Harley-Davidson has bank to expand in Indiaworld. Nokia, the world leader in cellular announced that it will enter India onlyphone communications entered India in through the import route. How and when • To study the challenges and prospects1995. Since then the Nokia brand has been Harley-Davidson will enter India is to be of foreign banks in India.steadily growing and has gained wide seen. Industry Bankingacceptance in the Indian market. India is Reference No. MES0084Cthe third largest market for Nokia, in terms Pedagogical Objectives Year of Pub. 2008of its net sales as of 2006. Nokia is one of • To understand the motorcycle market Teaching Note Availablethe most trusted brands in India and leads in India Struc.Assign. Availableother cellular phone brands in terms ofmarket share, advertising and customer • To discuss Harley-Davidson’s brand Keywordsservice. The innovative technologies, user- identity and its scope in the Indian Global Bank; Barclays Bank; Foreign banksfriendly features and affordable prices market in India; Entry strategies; Market Entrycontributed to Nokia’s success in India. The • To understand different market entry Strategies Case Study; M&A in Bankingcase facilitates discussion on Nokia’s brand strategies allowed in India sector; Future challengesbuilding strategies in India. It also allowsfor discussion on the future of the Nokia • To discuss the market entry strategiesbrand and the cellular market in India. to be adopted by Harley-Davidson in India. Walt Disney Co. (B): Disney inPedagogical Objectives India Industry Motorcycle• To analyse the role of brand image in Reference No. MES0085C Although Disney entered India much sustaining market leadership Year of Pub. 2008 before any other player in 1993, it failed Teaching Note Available to capitalise on its First Mover Advantage.• To analyse the competitive scenario in Struc.Assign. Available This was mainly because of its failed the cellular market in India partnership with K. K. Modi Group. After Keywords its partnership ended, it reentered India in• To discuss the strategies of Nokia in India Harley-Davidson; Motorcycle Industry in 2004 with television business. Within 3• To analyse the localisation strategy of India; Cult Brand; Market Entry Strategies years, the company was successful in Nokia as a major tool for gaining market Case Study; Consumer Behaviour; Business establishing its presence in the country. It leadership Strategy; Developing Economy; Business later on introduced its other divisions, Environment; Localisation Strategies excluding theme parks. However, with the• To analyse the future of the Nokia brand presence of strong competition, it has not in India. been able to derive what it expected.Industry Mobile Phone However, Disney plans to become theReference No. MES0086C leading entertainment brand in India 61 www.ibscdc.org
  • 62. through localising its products. To what • Disney’s market entry strategies L’Oreal in India: Marketing extent would it be successful? - is the Middle Class Consumers with Market Entry Strategies • Lessons from Disney’s success and question that can be answered only in the failures. Premium Prices? coming years. Industry Media and Entertainment India, in recent years, has emerged as one Pedagogical Objectives Reference No. MES0082 of the hot destinations for global cosmetics Year of Pub. 2007 players. Overseas players like Unilever, • To analyse the factors forcing Teaching Note Available Procter & Gamble and LOreal dominate globalisation and the need to globalise, Struc.Assign. Available the industry through targeting the growing especially for entertainment companies middle class. Players like Hindustan Keywords Unilever Limited (Unilevers Indian • To know the importance of emerging markets and the need for MNCs to Walt Disney; Mickey and Mini Mouse; subsidiary), Procter & Gamble target their rethink their marketing models for these Market Entry Strategies Case Study; customers with mid prices; while LOreal markets Donald Duck and Goofy; Animation; Indiais targeting them with premium prices. Theme Parks and Resorts; Growth This strategy helped LOreal to breakeven • To discuss the initial problems Disney Strategies; Michael D. Eisner; Robert A. the sales and then record a huge increase in faced after re-entering India and the Iger; Emerging Markets; Globalisation and its profits. But considering the increasing strategies it adopted to tackle this Localisation; Disneyland competition and price sensitiveness among the Indians, it has to be seen how long can • To discuss the challenges for Disney in LOreal continue this success? the coming years. Industry Media and Entertainment Vespa’s Entry Strategies for the US Pedagogical Objectives Reference No. MES0083 Market Year of Pub. 2007 • To analyse the opportunities and The Piaggio Group, one of the worlds top challenges for cosmetics players in Teaching Note Available two-wheeler manufacturers introduced its emerging markets Struc.Assign. Available brand, Vespa, in the US market during 1950. Keywords But Vespa had to be pulled out of the market • To understand and analyse the Indian because of stringent emission standards. In cosmetics industry and the changing Walt Disney; Mickey and Mini Mouse; 2000, Piaggio re-launched Vespa in the US consumer behaviour Donald Duck and Goofy; Animation; market which was better and fuel-efficient. Theme Parks and Resorts; Growth • To discuss the business model adopted As scooters were gaining popularity around by the players, particularly the Strategies; Michael D. Eisner; Robert A. this time in the US and sales rising, Piaggio Iger; Emerging Markets; Globalisation and multinationals felt that it was not an opportunity to be Localisation; Disneyland; Toon Disney vs missed. It went ahead implementing several • To analyse the reasons for L’Oreal’s POGO; Market Entry Strategies Case strategies to strengthen its presence in the initial strategy failure in India Study; Animax market but faced a big challenge in • To discuss L’Oreal’s revised strategy of combating rising safety concerns regarding scooters. targeting middle-class with premium price and its success. Walt Disney Co. (A): The Emerging Markets Strategy Pedagogical Objectives Industry Cosmetics Reference No. MES0080 With little opportunities left in its domestic • To study the market for scooters in the Year of Pub. 2007 media and entertainment market, Walt US Teaching Note Available Disney began looking outside for new • To examine the reasons of Vespa behind Struc.Assign. Available growth avenues. After Robert Iger (Iger) reentering the US market became CEO in 2005, Disney’s global focus Keywords increased. The plan is now to derive half • To study the market entry strategies of Emerging markets; Indian cosmetics of its profits from overseas markets. For Vespa industry; Cosmetics players; Customer this, Iger has been emphasising mostly on segmentation; Indian middle-class emerging markets particularly China and • To elucidate the safety concerns regarding scooters and understand consumers; Consumer behaviour; Market India. There are equal opportunities and Entry Strategies Case Study; MNCs business challenges in emerging markets for the Vespas measures to respond to them model; LOreal India and strategies; Moving global players. Understanding and • To study the branding challenges that a away from brand image; Mass vs premium overcoming the challenges would help multinational company faces on entering product strategy in emerging markets players to extract most from the diverse cultures. opportunities. Even Disney, which initially stumbled, is now making the most from Industry Automobile-Two Wheeler the opportunities that exist in the emerging Reference No. MES0081B Standard Chartered Bank in markets like China, Russia and India by Year of Pub. 2007 South Korea adopting various strategies. Teaching Note Available Struc.Assign. Available The case discusses the mega-merger of one of the leading banks in the world - London Pedagogical Objectives Keywords based Standard Chartered Bank, with South The case study helps to analyse and Vespa; Piaggio; US market; Two Wheeler; Koreas seventh largest bank - Korea First understand: Vespanomics; Aprilia; Moto Guzzi; Bank. The merger resulted in the creation Lifestyle Brand; Scooter; Market Entry of one of the largest banks in South Korea- • Importance of emerging markets SC Jeil Eun Haeng (SC First Bank). After Strategies Case Study; ET2; ET4; Safety; • Opportunities and challenges for the Utility Vehicle; Economy providing a brief note on the structure and players in emerging markets recent trends in the South Korean banking industry, this case also provides a detailed62 www.ibscdc.org
  • 63. commentary on the two banks. The case Pedagogical Objectives Keywords S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – IIIdiscusses the rationale behind the merger S T R A T E G Y – III S T R A T E G Y – IIIand the benefits which the two companies • To discuss about the history and growth IKEA; Japanese home furnishing industry;were expecting from it. The case then goes of Dell Market Entry Strategies Case Study;on to explain the merger deal in detail. It Product; Price; Place; Promotion; • To discuss about Dells unique business Distribution; Positioning; Targeting;finally discusses the possible challenges modelwhich the merger could face in the near Segmentation; Otsuka Kagu; Localisationfuture. • To discuss the major players in the strategy; The IKEA concept; Home gaming PC market furnishing retailingPedagogical Objectives • To assess how Dell targeted the niche segment of the gaming PC industry• To discuss the Korean banking industry United Parcel Service:• To understand the core competence of • To argue whether Dell would succeed in Expanding in China both the banks this new initiative. United Parcel Service (UPS), an American Industry Personal Computers based express delivery service provider, was• To analyse the possible synergies of the Reference No. MES0078K one of the worlds largest. It planned to merger. Year of Pub. 2006 expand aggressively into China particularlyIndustry Banking Teaching Note Not Available after the latters entry into the World TradeReference No. MES0079K Struc.Assign. Not Available Organization (WTO) in the year 2001.Year of Pub. 2005 UPS increased its flights to and fromTeaching Note Not Available Keywords Chinese cities, built more infrastructure andStruc.Assign. Not Available Dell; Personal computer (PC); Consumer established stronger brand presence in theKeywords PC segment; Gaming PC; US PC market; country. It also opened UPS Express Repositioning; Market Entry Strategies centers in several Chinese cities toStandard Chartered; Korea First Bank; SC Case Study; Direct sales model; strengthen its package drop-off and pickupJeil Eun Haeng (SC First Bank); Acquisition Customisation; Product strategy; Pricing services. UPS had started its operations inwas largest foreign direct investment; Asian strategy; Promotional strategy; Branding; China in 1988. However, FedEx hadFinancial Crisis (1997); Market Entry Value proposition; Cannibalisation; Target entered China in 1984 and DHL hadStrategies Case Study; The Korean Banking market commenced business in China even earlierIndustry; Standard Chartered Bank in South in 1980. Both these companies had aKorea; Forex Management; Merger significant lead over UPS. Among globalsynergies; Commercial banking; Priority integrators, UPS had a market share of IKEA: Re-entering The Land ofbanking; Retail banking; Mervyn Davis only 11% in China as against DHLs 51% Rising Sun and FedExs 28%. Nonetheless, UPS IKEA, the Swedish home furnishing decided to invest heavily in China, in view Dells Entry into Gaming PC: The company entered into Japanese home of the potential that it offered. The Chinese economy was growing at a rapid pace and Decision Dilemma furnishing industry during the decade of 80s. there was also phenomenal increase in the However, during that time, the companyDell, the worlds leader in PC industry, failed to mark its presence in Japanese home countrys international trade, therebyreaped the benefits of its unique business furnishing industry. Analysts commented providing huge business opportunity for amodel of customization and direct sales. that, since the company failed to adapt the logistics company. In spite of stiffThe company registered double digit localization strategy it failed. In 2006, the competition from FedEx and DHL, UPSgrowth in its two-and-half decades of company again plans to make an entry in aimed to strengthen its hold on the logisticsexistence. During 2004-05, the company Japan. Though, this time the company plans market there. At the same time, UPS wasfailed to maintain its expected growth and to stress upon the localization strategy. The losing market share in its home base in thethe sales declined. The company faced company modified its furniture and other US. Can the business growth in China makechallenges due to the saturation of the US home furnishing items to suite the taste and up for the decline faced in the homeconsumer PC market, increasing preference of the Japanese audience. This market?competition and declining price of PCs. case discusses in details about the marketingThe company identified a niche market of strategy adopted by IKEA to make a Pedagogical Objectivesgaming PC with prospective growth successful entry in Japan. It also covers thepotential. There were very few and small 4Ps of marketing and segmentation- • To discuss about the courier industry inplayers in the market of gaming PC. The targeting-positioning strategy adopted by Chinacompany was in a decision dilemma the company. • To understand the competition in thewhether to enter into the gaming PC Chinese courier and parcel industrymarket or not. If it enters, then what would Pedagogical Objectivesbe its branding and marketing strategy? • To discuss about the entry and expansionThe case discusses in details the about Dells • To understand the importance of of UPS in China.inception, its growth and challenges. It also localisation strategy in the context of Industry Courier/Parcel Industrygives a detailed outlook about the US PC IKEAs failure venture in Japan Reference No. MES0076Bmarket. Then the case provides description • To discuss the market dynamics of Year of Pub. 2006of the gaming PC market with respect to furniture Industry in Japan during 2006 Teaching Note Not Availableplayers in the market and their positioning, Struc.Assign. Not Availableconsumer behaviour, recent trends and • To analyse IKEAs STP strategy.future prospect. The students can discuss Keywords Industry Home Furnishingwhether Dell will enter into the gamingPC market or not and if the company Reference No. MES0077K Courier industry; Competition; Unitedenters, what will be its value proposition, Year of Pub. 2006 Parcel Service; Courier Service; Expressbranding strategy and marketing strategies? Teaching Note Not Available Parcel Service; Geographic Expansion; Struc.Assign. Not Available Expansion into China; Market Entry 63 www.ibscdc.org
  • 64. Strategies Case Study; Fedex in China; DHL versatile vans and heavy duty trucks to UK. Led by its maverick Chief Executive in China; Courier Business in China; comfortable coaches. DaimlerChrysler AG Sir Bill Gammell, the company sold its Market Entry Strategies Multinational courier companies in China; was formed in 1998 by the merger of holdings in the North Sea and focused on UPS in China; UPS Express Stores Daimler-Benz AG (Germany) and Chrysler buying and developing oil acreages in South Corporation (USA). Thus, Asia. Cairn shot into the limelight when DaimlerChrysler had a tradition of more after a decade of drilling and exploring it than one hundred years, featuring the hit big in Rajasthan, India in 2006. What Success of IBM in India pioneering achievements in automotive would Cairns strategy in India be? In 1991, the Indian government started engineering by both of its predecessor relaxing the foreign investment norms and companies. Pedagogical Objectives this encouraged foreign IT companies like On 28th June, 2006, DaimlerChrysler • To understand oil exploration industry Electronic Data System (EDS), Hewlett- announced that its unique and urban- in UK Packard (HP) and International Business friendly, fuel-efficient, subcompact Smart Machines Corporation (IBM) to enter • To understand oil exploration industry brand (Smart) would enter the U.S. market. India. Among these, IBM, a multinational in South Asia The company redesigned its original model computer technology corporation had Smart Fortwo and informed that the new • Cairn Energys oil exploration strategies shown keen interest in establishing itself generation Fortwo would be available in in India. in the Indian market. Till 2001, IBM the U.S. in three models from 2007. witnessed slow growth and started Americans, in general, did not like small Industry Oil and gas experiencing gain since 2002. In 2005, to cars as they were doubtful about the safety Reference No. MES0073B compete with the Indian software giants features of such cars. However, since 2003- Year of Pub. 2006 like Wipro, Infosys and Tata Consultancy 2004, due to a continuous hike in US Teaching Note Not Available Services, IBM adopted the Global Delivery gasoline prices, there was a declining sale Struc.Assign. Not Available Model and with other foreign companies of the large SUVs and pickups. Hence, the like Accenture, Intel and AMD planning company felt that it was the right time to Keywords to invest heavily in India, IBM decided to bring its Smart cars to the United States. Cairn Energy; Petroleum sector; Energy invest $6 million to start several initiatives But, the US market was already flooded sector; Energy in Bangladesh; Oil in that would serve to fulfill its vision of with fuel-efficient subcompact cars like Rajasthan; Sir Bill Gammell; NELP; UK becoming a globally integrated company. Toyota Scion and BMW Mini Cooper. based Independent Oil Company; Sangu With the Indian software giants dominating Some of them also had their US dealer reserves; Rajasthan oil reserves; Market the IT sector and with the entry of other network in place. Further, three Japanese Entry Strategies Case Study; Edinburgh; foreign software companies, analysts were subcompact cars were expected to enter Scotland based-i&P Company skeptical about IBMs success. Would IBM the US market by 2006-2007. They were succeed in its endeavors? low-priced compared to the Smart brand cars. Therefore industry observers were Pedagogical Objectives skeptical about Smarts success in the US. BenQ Corporation: Entering the Branded Cell Phone Market in • To understand the impact of relaxing of FDI norms by the Indian Government Pedagogical Objectives China • IBMs experience in the Indian markets • To understand the global automotive The case focuses on BenQ Corporation, a industry US$3.2 billion Taiwan-based company. By • Adoption of Global Delivery model by 2001 BenQ had become the largest contract IBM • To understand the US automotive manufacturer of mobile handsets. However, industry in 2002 the company decided to move away • IBMs strategies to succeed in the Indian from contract manufacturing and launched markets. • To understand the challenges in the US branded products. As part of this strategy, automotive industry Industry IT Industry in 2004 the company launched branded Reference No. MES0075B • To analyse whether Smart will be a mobile handsets in China, which was the Year of Pub. 2006 success in US. fastest growing and the most competitive Teaching Note Not Available handset market globally. The case gives Industry Automotive Industry in-depth information on the Struc.Assign. Not Available Reference No. MES0074B characteristics and nature of the Chinese Keywords Year of Pub. 2006 handset market, the various competitors Teaching Note Not Available and their strategies. The case IBM; Global Delivery Services; Global Struc.Assign. Not Available Delivery Model; e-governance; simultaneously highlights the market entry competition; Market Entry Strategies Case Keywords strategies used by BenQ. Study; On Demand Model; growth strategy; Daimler Chrysler; Smart Fortwo; Mercedes Pedagogical Objectives Intel; TSIL; entry of MNCs Car Group; Market Entry Strategies Case Study; Automotive Industry; Swatch; • The steps taken by BenQ to move from Subcompact car; NAIAS; US car market; being a contract manufacturer to a brand Smart Fortwos Entry into the US.: Daimler-Benz AG; Chrysler Corporation; manufacturer Smart Move? Fuel-efficeint car; Small car; Eco-friendly • A comparison of BenQ’s strategy with car; Two-seater car; Gasoline price in USA In 2005, DaimlerChrysler was the worlds Samsung’s fifth largest automotive group. • The nature and characteristics of the DaimlerChrysler was a unique and prominent company in the global Cairn Energy – What Would Chinese handset market automotive industry. It had a product Cairns Strategy in India be? • The segmentation, targeting and portfolio that ranged from small cars to positioning strategy used by the various Cairn Energy was an independent oil sports cars and luxury sedans, and from mobile handset vendors exploration and Production Company in64 www.ibscdc.org
  • 65. • The strategy employed by BenQ to enter Japan; Dual Branding Strategy; Branding Regulatory Authority of India (TRAI); S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III the mobile handsets market in China. dilemma Bharti Televentures Ltd. (BTVL); Cheung S T R A T E G Y – III S T R A T E G Y – III Kong (Holdings) Limited; 2G and 3GIndustry Mobile Handset ServicesReference No. MES0072BYear of Pub. 2005 Vodafones Strategic Move inTeaching Note Not Available Indian Telecom MarketStruc.Assign. Not Available Starbucks Coffee Company: The Vodafone was one of the worlds leading Indian DilemmaKeywords mobile telecommunication companies with interest in voice and data communications. In 2006, the US based Starbucks CoffeeBenQ Corporation; Branded cell phone Seeing an opportunity in India, where Company, with over 11,000 stores in 36market in China; KY Lee; Contract telecom sector was rated as the fastest- countries was the No. 1 specialty coffeemanufacturer; Branded players; Chinese growing wireless market in the world, company in the world. Every week overhandset market; Market entry strategies; Vodafone acquired a 10% stake in Bharti 40 million customers visited StarbucksMarket Entry Strategies Case Study; Acer Televentures Ltd (BTVL) in 2005. When coffeehouses. After phenomenal success inPeripherals; Motorola; Nokia; Ningbo Hutchison Whampoa Ltd (HWL), a Hong the US, and revolutionizing specialty coffeeBird; Samsung; Global system for mobile Kong based Telecommunication company culture, Starbucks undertook internationalcommunication (GSM) segment; Code declared its intentions to sell its stake in expansion and popularized its specialtydivision multiple access (CDMA) segment; Hutchison Essar, a leading telecom player coffee worldwide. In the 1990s, StarbucksOriginal equipment manufacturer; original only Vodafone had publicly shown its concentrated its expansion efforts mainlydesign manufacturer interest in acquiring the stake. In February in Asia. The initial pages of the case 2007, it acquired 67% stake in Hutchison delineate the origin and growth of Starbucks Essar Ltd. According to analysts, the as a company and a super brand and theVodafones Branding Dilemma in acquisition of HWLs stake would give strategies adopted by it. India Vodafone a considerable access to rapidly In 2002, Starbucks announced that it was growing Indian telecom market. But,In mid February 2007, Vodafone Group Plc. Vodafone faced many challenges in planning to enter India. Later it postponed(Vodafone), one of the leading global acquiring stake in HWL. The major its entry as it had entered China recentlytelecommunication companies acquired concern was the valuation aspect of and was facing problems in Japan. In 2003,67% stake in Hutchison Essar, one of the Hutchison Essar Ltd. In the recent past, there was news again that Starbucks wasleading telecom operator in India, which Vodafone had spent nearly $300 billion in reviving its plans to enter India. In 2004,provided its services under the brand name, acquisitions which had led to decline in the Starbucks officials visited India butHutch. Speculation mounted whether shareholders confidence. It also faced stiff according to sources they returnedVodafone would retain the existing brand competition to acquire stake in Hutchison unconvinced as they could not crystallizeor re-brand it. Many analysts opined that Essar Ltd. from other bidders like Reliance on an appropriate partner for its entry. Inif Vodafone replaces the Hutch brand with Communications, Hinduja Group and Essar mid 2006, Starbucks announced that theyits own, the move could backfire, because Group. Vodafone approached Essar to were all set to offer the StarbucksHutch was well established and most remain its local partner on which Essars experience to Indians in the next 18admired brand in the Indian telecom sector. decision was pending. months. The case explores India as the next destination for Starbucks and providesThe case details about corporate The case details about the shifting strategy an industry analysis of the Indian coffeerebranding dilemma faced by Vodafone in of Vodafone to target emerging markets industry. It attempts at initiating a debateIndian telecom market. like India. It also details about the that whether Starbucks should enter India opportunities and challenges in the Indian or not. If it should, then its entry strategy,Pedagogical Objectives telecom market. differentiation strategy and long term strategy for India may be identified. The• To understand corporate rebranding strategies Pedagogical Objectives challenges that India may present for Starbucks and how should it cope up with,• To study the brand transition strategies • To understand the Indian telecom market can also be discussed. The case is targeted adopted by Vodafone globally • To understand the market entry strategy at management students and can be taken adopted by Vodafone up in their Strategic and General• To understand brand positioning of Management curriculum. Hutch in India • To study the merger and acquisition as• To study the challenges involved in growth strategy Pedagogical Objectives rebranding in merger or an acquisition. • To understand the competitive scenario • To analyse Starbucks as a companyIndustry Telecommunication in Indian telecom market. • To analyse the Indian coffee industryReference No. MES0071A Industry Telecommunication and India as a potential destination forYear of Pub. 2007 Reference No. MES0070A StarbucksTeaching Note Available Year of Pub. 2007Struc.Assign. Available Teaching Note Available • To discuss the entry strategies for Struc.Assign. Available Starbucks in IndiaKeywordsVodafone; India; Hutch; Market Entry Keywords • To discuss the opportunities and challenges that Starbucks could face inStrategies Case Study; Brand Transition; Vodafone; Vodafone in India; Inorganic India.Brand Promotional Strategies; Brand Growth strategy; Competitive Scenario;Dilution; Indian Telecom Sector; Brand New Product Segment; Market Entry Industry Specialty Retailing/BeveragesDifferentiation; Vodafones Global Strategies Case Study; Government Policy; Reference No. MES0069ABranding Strategy; Brand Attributes; Hutchison Whampoa Ltd.; Hutchison Year of Pub. 2006Vodafone in Czech Republic; Vodafone in Essar Ltd.; Valuation Aspects; Indian Teaching Note Not AvailableTurkey; Vodafone in Italy; Vodafone in Telecom Sector; GSM Players; Telecom Struc.Assign. Not Available 65 www.ibscdc.org
  • 66. Keywords India. These areas were touted to be Pedagogical Objectives prospective areas for McDonalds Market Entry Strategies Starbucks; Howard Schultz; Seattle; Japan; expansion in the decade ahead. McDonalds • The case study will familiarize the China; India; specialty coffee instant had tried to localise its strategies in these students with coffee; coffee culture; third place concept; areas with reasonable success. However, to differentiation; spoke and hub strategy; • US retail industry and the concept of achieve increased returns from these areas, convenience stores Market Entry Strategies Case Study; word- it had to overcome challenges like of-mouth promotions; emerging economy; competition, menu innovations etc. In this • Tescoâ•™s customer retention and retail environment; Foreign Direct background, it was to be seen if McDonalds market entry strategies Investment; industry analysis; beverage could increase its share in the Asian market market; tea; market entry strategy; • Factors which lead to the success of a and what it should do to achieve this. retailer. differentiation strategy; second mover advantage; entry dilemma; joint venture; The case brings out the strategies adopted Industry Consumer Electronics Industry competitive scenario; market structure; by McDonalds in its markets in China, Reference No. MES0066C market development; Starbucks Japan and India and the challenges in each Year of Pub. 2007 experience; lifestyle marketing of these markets. The case allows the Teaching Note Available student to appreciate the localisation Struc.Assign. Not Available strategies adopted by McDonalds and also to discuss the future of McDonalds in Asia. Keywords Bharti Wal-Mart Tie-up: The case would be suitable to teach modules Opportunities and Challenges in International marketing with specific Tesco; Wal-Mart; 7-Eleven; Food Retail; reference to localisation strategies. Market Entry Strategies Case Study; The Indian retail scene was abuzz with Convenience Store; Territorial radio; Terry activity. With A T Kearney listing India as Leahy; Famima; Fresh & Easy; ASDA; the topmost in market attractiveness, Pedagogical Objectives Tesco Metro; Warren Buffet; Tesco many foreign retailers were looking to enter Steering Wheel; Tesco Express; tesco.com • To understand the globalisation of an India. Wal-Mart, the world renowned international fast food brand retailer had tied-up with Bharti Enterprises Ltd. a leading telecom company in India. • Localisation issues in Asian markets. While many synergies were expected out Retail market in Vietnam- of the deal, the Indian retail scene had its Industry Fast Food Industry Challenges and Opportunities share of challenges. Reference No. MES0067C Year of Pub. 2007 Vietnam was considered to be a potential The case outlines the areas of opportunities Teaching Note Available retail market and one of the leading markets and challenges that the Indian retail scene Struc.Assign. Not Available in Asia. According to A.T. Kearneys Global offered. It provides scope for the student Retail Development Index (GRDI) 2006, to understand the dynamics of the Indian Keywords the Vietnamese retail market was found to retail scene and facilitates debate on the McDonald’s; Strategy; Fast food outlets; be attractive for the foreign players to future of Indian retail. It also allows for Market Entry Strategies Case Study; invest in the country. The Vietnamese retail discussion on whether the Bharti Wal-Mart Branding; Redesigning; Menu change; market already had some foreign retailers combine would win the race in the Indian Drive thrust in their market. Despite the attractiveness, Retail market. the market posed a number of challenges to the foreign retailers entering the Pedagogical Objectives Vietnamese market. The regulations on Tescos Entry Strategies in US foreign direct investment (FDI) in Vietnam • To discuss the challenges faced by foreign acted as barriers for the foreign retailers to retailers in emerging markets like India The London based retailer giant, Tesco enter the Vietnamese market. The made its entry into US, by opening "Fresh • To discuss the issues and opportunities domestic retailers were also threatened by & Easy" format convenience stores at in the Indian Retail Scene. the entry of the global players. The Arizona. Anticipating this move, Warren Vietnamese government had taken a Buffet, the second richest person in the Industry Retailing number of initiatives to help the domestic world, bought shares of the company in Reference No. MES0068C players. 2006 and its market value went up. Year of Pub. 2007 Berkshire Hathaway invested $1419.59 In this background it was to be seen how Teaching Note Not Available million in Tescos expansion projects. It the Vietnamese retailer market would Struc.Assign. Not Available had the ability to roll out multiple formats evolve. The case study gives scope for Keywords and adapt to the local tastes of consumers. discussion on the challenges facing the It was able to maintain its leadership in foreign retailers and their chances for Bharti; Wal-Mart; Indian Retail; Retail UK, by pushing Wal-Mart ASDA to third succeeding in the market. The case study Industry; Competition in Indian Retail position, in terms of market share. Tesco also gives emphasis on the challenges facing Sector; Market Entry Strategies Case had undertaken meticulous research about the domestic retailers and the strategies Study; Tie-up; Store formats; FDI in Retail; US retail market and preemptively adopted by them to compete with the global Real Estate; Supply Chain and Sourcing; acquired real estate for its retail operations retailers. Consumer Behavior; Synergies; Market at important locations. For independent attractiveness; mom-and-pop shops; and niche retailers, the growth of Tesco Buying behavior Pedagogical Objectives would be a great challenge and they would eventually need innovation and customer • Retail market environment in Vietnam segmentation strategies to survive. But for • Challenges facing the foreign retailers McDonald’s in Asia: Tesco, US was new turf where there were in entering the new market Incubator- Opportunities and Challenges more than 50 convenience store chains. incubatee relationship 7-eleven and Famima,, which have already McDonald’s was concentrating on its established convenience store chains in • Competitive measures taken by the business in Asia mainly- Japan, China and US. domestic retailers along with the66 www.ibscdc.org
  • 67. Vietnamese government to succeed in Yahoo! China sold its China operations to • To discuss the impact of WTO on the S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III the market. Alibaba, the leading B2B Chinese portal. Chinese motorcycle industry. S T R A T E G Y – III S T R A T E G Y – III Although Alibaba had achieved significantIndustry Retail Industry Motorcyle Manufacturing success in the Chinese e-commerce market,Reference No. MES0065C Reference No. MES0063K the deal did not yield significant increaseYear of Pub. 2007 Year of Pub. 2006 in traffic. The main issue the case tries toTeaching Note Available Teaching Note Not Available highlight is how Yahoo! China will faceStruc.Assign. Not Available Struc.Assign. Not Available increasing competition in the searchKeywords engine market in China. KeywordsRetail Market; Supermarkets; Vietnam; Pedagogical Objectives Harley Davidson; Chinese motorcycleConsumer Behaviour; FDI in Vietnamese market; Honda; Yamaha.Retail; Market attractiveness; Competition • To introduce the students to the Internetin Vietnamese retail industry; Retailers in industry in ChinaVietnam; Retailers Strategies; Market Entry • To highlight the various stages of Yahoo Dr. Reddy’s Laboratories, theStrategies Case Study; Strategies in retailmarket; Foreign retailers in Vietnam; and challenges faced in China Leading Indian PharmaceuticalChallenges in Vietnamese retail industry; Company, in Europe: The • To throw light on the various players inEntry strategies of Foreign retailers; Chinese Internet market. Inorganic Growth StrategyGrowth prospects in Vietnam Industry Internet and Online Business In February 2006, the Indian Reference No. MES0064C pharmaceutical company, Dr. Reddys Year of Pub. 2007 Laboratories Limited (DRL), announced Yahoo! China: Challenges Teaching Note Available that it would acquire the Germanys fourth Struc.Assign. Not Available largest generic pharmaceutical, betapharm.Yahoo! China released a statement that The deal was settled at US$570 million.their President Xie Wen, (Xie) had resigned, Keywords After the US, Europe was the second largestonly 42 days after he joined the company. pharma market with Germany as its largestThis development was just the latest in a Yahoo!; Yahoo! China; Internet in China; constituent. Moreover, worldwide it wasseries of problems that Yahoo! had faced Market Entry Strategies Case Study; the third-largest generic market. Thein China. In the past, Yahoo! China had Alibaba Baidu.com; Competition; market trends showed that generics had aencountered many hurdles- from regulatory Marketing; Strategy; Emerging markets; better market potential over their brandedtroubles to problems in localization. Jack Ma; Jerry Yang; Google; search market counterparts. In addition, the EuropeanYahoo! China was struggling in the Chinese in China generic market proved to be more lucrativesearch market. Xie wanted to try a Web than the US market because it had less of2.0 strategy of addressing the huge demand governmental rules directed towards drugfor user-generated content but Jerry Yang, Harley-Davidson’s Foray in approvals and marketing.cofounder Yahoo!, wanted to stick to the Chinacompany’s portal model and was The case analyses the synergies and possibleunimpressed by Xie’s strategy. This led to In the first half of 2006, Harley-Davidson challenges of such an acquisition anda divide in top management and ended in (H-D), an icon of the motorcycle industry, discusses the inorganic growth strategy ofXies resignation. decided to set up its first outlet in China, DRL that was aimed at penetration into one of the largest manufacturers in the the German and subsequently the EuropeanYahoo! China had tried management generic market. It also provides a brief world. With this decision, H-D aimed tochanges, outsourcing, and local tie-ups to overview of the two companies. establish its presence in the country, amidstestablish itself in China, but none of them various tariff and non-tariff barriers. Theyielded any results.Yahoo! was one of thefirst U.S. Internet companies to move into advent of the dealership was also set to Pedagogical Objectives discourage illicit smuggling of bikes andChina. In 1999, it entered China by • To discuss DRL’s inorganic strategies by protect the brand identity of the productslaunching a Chinese website, cn.yahoo.com which it aimed to penetrate into the from piracy.and tied up with a local company through worlds fourth largest generic market,a strategic partnership with Beijing The case, while providing an overview of Germany and subsequently the EuropeanFounder Electronics Co Ltd, a leading the Chinese motorcycle industry and its generic marketinformation products maker in China, to various roadblocks, discusses the entrytap the emerging on-line advertisement strategies of H-D. • To discuss the possible synergies andmarket. Yahoo! China faced immense challenges of the acquisition.competition from local portals like Pedagogical Objectives Industry PharmaceuticalSina.com, Sohu.com and Netease.com, who Reference No. MES0062Khad already won the loyalty of Chinese • To understand the competitive forces Year of Pub. 2006Net users. By 2003, these three players in the Chinese motorcycle industry Teaching Note Not Availablewere thriving while Yahoo! China was Struc.Assig. Not Available • To discuss the various tariff, non-tariffstruggling to come up. Yahoo! China could and other government restrictions thatnot make an impact on the Chinese Keywords reduced foreign competition in Chinainternet market as it did not localize itsstrategies. So the company changed Dr Reddy’s Lab; Drug market in Europe; • To discuss the entry strategy of Harley-directions and purchased a popular local Generics; Patent policy; R&D. Davidson in the Chinese marketsearch company, 3721.com, for $120million. This move did not yield much result • To critically analyse the effects ofand so Yahoo! China tried the new strategy piracy and counterfeit goods on Harley- Virgin: Entering the Indian Skiesof outsourcing that promised to solve its Davidson’s brand image and its strategyproblem. It decided to team up with a local to counter it The low-cost airline was a phenomenonplayer who could understand China better. world wide and was increasing steadily. In 67 www.ibscdc.org
  • 68. the mature aviation market of the US and miss match. Thus, while setting up the New South Wales; Chardonnay; Merlot; Europe, the low cost airlines business model Hong Kong Disneyland, the company gave Cabernet Sauvignon; W.J.Deutsch&Sons; Market Entry Strategies was successful. But in the country like India, proper emphasis on localisation strategy. Distribution. where aviation market was still at the The case gives a proper description about nascent stage, the success of the low-cost the entry strategy adopted by Disney and business model was a debatable issue. After offers a scope for discussing its success and Viacom in China the liberalisation in 1991, the Indian sky failure. The case will also help the students experienced the entry of a few private as to discuss about the success and failure of Viacom Inc., currently split as Viacom Inc., well as foreign players in the low-cost the growth strategy adopted by the and CBS Corp. forayed into China in 1995. aviation business. Virgin Blue, which was a company and how it has planned to By 2005, the company brought to the part of Richard Branson’s Virgin group, was leverage its localisation strategy. Chinese audience, its world-class successful in the low-cost aviation business entertainment programmes meant for kids in the skies of Australia, New Zealand and Pedagogical Objectives and youth. However, the company, like South Africa and entered the Indian sky. other foreign companies, had to face the The case discussed in detail the low-cost • To discuss the market entry strategy in government regulations that kept changing business model of the aviation industry its entertainment industry from time to time. The case chronicles target markets and challenges. Finally, the • To discuss the concept of localisation the company background, the diverse case highlighted the challenges faced by strategy channels it used to make progress and the Virgin Blue in the fiercely competitive challenges it had to face in China in the Indian aviation industry. Besides, it • To discuss the key success factors into wake of fresh regulations and cultural examined whether the company could the success and failure in entering into a hurdles. replicate its successful business model in new market India. The case included a detailed note on Pedagogical Objectives the Indian civil aviation industry, covering • To discuss the success and failure of the profile of the major players, low-cost growth strategy To understand: business model followed by other low-cost • To discuss how companies plan to • The media business in China airlines in the Indian aviation industry. It leverage its localisation strategy and can also elaborated on India’s civil aviation integrate it with entry strategy and • Challenges faced by Viacom in China due policy and the statutory requirements to growth strategy. to regulations and cultural hurdles. be fulfilled by a company, to enter and operate in the industry. Industry Entertainment Industry Media Reference No. MES0060K Available at www.ibscdc.orgwww.ecch.com Year of Pub. 2006 Reference No. MES0058C 306-212-1 Pedagogical Objectives Teaching Note Not Available Year of Pub. 2006 • To give a glimpse about the Indian Struc.Assig. Not Available Teaching Note Not Available aviation industry Struc.Assign. Not Available Keywords • To discuss in details how Low Cost Keywords Airlines (LCA) act as a key China, Disney; Entertainment park. Viacom; MTV; Nickelodeon; Paramount; differentiator in Indian aviation industry Sumner Redstone; China; SARFT; SMG; • To discuss the segmentation-targeting- Regulations. Yellow Tail: The Aussie positioning aspect in aviation industry. Champion in the US Wine Market • The 4Ps of marketing and its application in Indian aviation industry Yellow Tail, an Australian wine brand Hollywood’s Foray into China became a top seller in a short span of five • The market entry strategy adopted by a years in the competitive US wine market. China was seen as a potential movie new player to enter into a competitive With an innovative label and competitive market. Yet the Government’s restrictions market, problems associated with entry pricing, Yellow Tail created a niche of its on the release of foreign films hampered into new market and how to overcome own in the market. The case provides a their prospects in the Chinese movie the problems. background note on the US and the market. However, the growing popularity Australian wine markets and the strategy of Chinese films in the international Industry Airlines market, China’s liberalised foreign that Yellow Tail adopted to reach its present Reference No. MES0061K investment policies post its WTO entry status in the wine market. Year of Pub. 2006 and low production costs attracted the Teaching Note Not Available attention of Hollywood studios. The case Struc.Assig. Not Available Pedagogical Objectives details the background of the Chinese film To understand: industry and the impact made by the Keywords Government’s foreign investment policies Virgin; Indian aviation Industry; Indian • Strategy of success of a new brand in an on the Chinese film exhibition industry Airlines; Jet Airlines; Sahara Airlines. established market and the movie market. It also covers the • Niche marketing. strategies adopted by the Hollywood studios to capitalise on the Chinese movie market. Industry Food and Beverages China: Disney’s New Destination Reference No. MES0059C Pedagogical Objectives In 2000, the Walt Disney Corporation Year of Pub. 2005 opened its Disneyland in Hong Kong, Teaching Note Available To understand which, within a few years, became the most Struc.Assign. Not Available • Movie Market business in China popular tourist destination. Earlier, the Keywords company had opened a Disneyland in Paris • Foreign investment policies of Chinese (France), but it was not successful. The Yellow Tail; US; Australia; Wine; John Govt regarding film industry in China analysts attributed this failure to the cultural Casella; John Soutter; Carramar Estate;68 www.ibscdc.org
  • 69. • Strategies adopted by Hollywood studios Behaviour; Trademark; Intellectual Economy cars; International Auto shows; S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III to capitalise the Chinese market. Property Rights; Chinese Coffee Sedans; US venture; Global Strategies; S T R A T E G Y – III S T R A T E G Y – III Consumption; Tea industry in China; Global entry; business expansion; KoreanIndustry Entertainment Expansion strategy. automakers; US Testing standards.Reference No. MES0057CYear of Pub. 2005Teaching Note Not AvailableStruc.Assign. Not Available Geely: The Chinese Car’s Reliance Infocomm’s Teething American Venture Troubles – AKeywords Geely Automobile Holding Co. Ltd. This is the first of a two-case series.China, Foreign films; Cultural Revolution; (Geely), the Chinese automaker decided to Considering the boom in the mobileUnited States; Hollywood; WTO; Warner enter the US auto market by 2008. In telephony market in India, RelianceBros; Wanda Group; Sony and China Film pursuit of this ambition and to make a mark Industries, India’s biggest business houseGroup. internationally, Geely participated in two makes a foray into the Telecom and of the five major international auto shows, Information Technology sector. Reliance namely, the Frankfurt International Motor launches its services as Reliance Infocomm Achieving Success in China: Show in September 2005, followed by the and offers a bouquet of services like mobile Starbucks’ Strategies and North American International Auto Show and fixed line telephony, broadband, Challenges in January 2006 at Detroit. national and international long distance services, data services and a wide range ofStarbucks, the world’s leading retailer, Automobile industry analysts felt that the value-added services. Reliance Infocomm’sroaster and brand of specialty coffee opened major challenge for Geely would be to launch is widely awaited by the public as itits first store in China in 1999. Despite conform to the quality standards of the is expected to bring about a revolution ininitial scepticism about the entry of a coffee American market. Geely said that it was the mobile telephony market. The servicebrand in a traditional tea drinking nation, aware of the high-quality, safety and looks promising with its innovativeStarbucks was well-received in China and emission standards of the US market and technology, features and low prices. Ashad established its presence there. It was reported that it was taking the necessary Reliance Infocomm is launched across therapidly expanding and announced that it steps in this regard. Geely would also have country, top officials are confident of itslooked to China as the largest market to compete with the established players in success. The market reality though isoutside the US. Although Starbucks was the US Auto industry. The US Auto industry something different. The company facesconfident of its growth there, it faced some was itself under threat from the foreign teething troubles and market response ischallenges. Following its entry, a number automakers, as the Japanese and Korean disappointing. Infocomm managementof imitators which tried to replicate all the brands had eaten into the market share of wonders if they can turn thefeatures of the Starbucks stores had opened. Ford and GM. Under these circumstances, disappointment in to a success.A number of international players also it was to be seen if Geely with relatively low-priced cars would succeed in its USoperated and planned to expand their venture. Pedagogical Objectivespresence in China. Revenues from itsChinese operations were not significant The case allows for discussion on the • To discuss the launch of Reliance groupsince Starbucks operated mainly through challenges faced by the Chinese car to enter in the telecom sector and the initialpartnerships and licensees. Marketing the US market and the strategies adopted problems that it facedanalysts wondered if the initial success of by them to compete with the established • To briefly discuss the Indian cellularStarbucks in China could be sustained. players there. It also offers scope for telephony market scenario and existingThe case facilitates discussion on (1) Entry discussion on issues faced by the Chinese players.strategies adopted by an established brand car relating to the low-quality perception that the American consumers had towards Industry Telecomwhile entering an emerging market (2) Chinese cars. Reference No. MES0054PLocalisation strategies of Starbucks (3) Year of Pub. 2006Sustaining and increasing profits from its Teaching Note Not AvailableChinese operations. Pedagogical Objectives Struc.Assig. Not Available To discuss:Pedagogical Objectives keywords • Entry strategies of a new foreign player• Entry strategies adopted by an in a mature market Reliance Infocomm; Telecom sector; established brand while entering an Infocomm Rollout; Teething Troubles; emerging market • Strategies for successful market launch Dhirubhai Ambani Entrepreneurs; CDMA; Cellular Telephony.• Localisation strategies of Starbucks • Strategies to counter negative consumer perceptions• Sustaining and increasing profits from its Chinese operations. • Counter measures to be adopted by Chinese Flavoured KFC existing established players in theIndustry Coffee Chain market. Kentucky Fried Chicken Corp. (KFC) is aReference No. MES0056C division of the Kentucky (Louisville) basedYear of Pub. 2006 Industry Auto Industry global fast food franchiser YUM! BrandsTeaching Note Available Reference No. MES0055C Inc. In 2005, KFC was America’s No.1 fastStruc.Assign. Not Available Year of Pub. 2006 food chicken chain and world’s most Teaching Note Available popular chicken restaurant chain. KFC hadKeywords Struc.Assign. Not Available expanded globally but in China the companyStarbucks; China; Speciality Coffee Retailer; Keywords had been a pioneer in the foreign fast foodEntry Strategy; Localisation Strategy; sector. KFC adapted itself to China andPartnerships; Store Location; Store Geely; China; Automobile Industry; Li became China’s largest quick-serviceOperations; Store Design; Consumer Shufu; Chinese cars; US Auto Market; restaurant brand. Rivals like McDonald’s 69 www.ibscdc.org
  • 70. were following KFC’s strategies. The case the internet population started rising Pedagogical Objectives discusses KFC’s strategies in China. across various countries of Asia. Online Market Entry Strategies auction giant eBay, after its successful • The state of the Chinese wholesale and retail setup before and after liberalisation Pedagogical Objectives business execution in US and European countries eyed opportunities in Asian • Impact of WTO on the local and global • To discuss the fast food market scenario markets. This case talks about how eBay retailers operating in China in China initiated its business in Asian countries. First, it started its operations in Japanese • Metro’s entry strategy in foreign • To discuss KFC’s localisation strategy markets of tailoring its menu, décor and market where it failed and quickly shifted appearance in China and its success. focus on other upcoming Asian markets, • Metro Cash and Carry’s operations in mainly on China. Before entering into China Industry Food Industry China, it tested various Asian online auction Reference No. MES0053P markets and zeroed in on specific strategy • Metro’s expansion strategies in China Year of Pub. 2006 to tap China’s online auction market. The • Challenges faced by Metro Cash and Teaching Note Not Available company also expected to expand its reach Struc.Assig. Not Available in many other Asian countries. Carry with the entry of other global players in China. keywords Pedagogical Objectives Industry Wholesale KFC; Yum! Brands Inc.; KFC in China; Reference No. MES0050B Localisation Strategy; Fast Food in China; • eBay’s growth and expansion strategies Year of Pub. 2004 KFC’s Strategies. • Emerging trend of online auction market Teaching Note Not Available in Asia Struc.Assig. Not Available • The online auction market scenarios in keywords Geely: The Tyro in the US market various Asian countries Metro Cash and Carry; German Distributor In 2005, the US automobile market was • Facts and Fallacies of Asian online in India; Foreign Investment Promotion dominated by the ‘Big Seven’. These auction market Board; Foreign Direct Investment; Indian major players in were ramping up Distribution Set-up; Indian Wholesale production, and were developing • Future of eBay in Asia. Industry; Indian Retail Industry; Organised innovative models to claim their market Retailing; Global Players in India; Industry Online auction Industry positions. Toyota, one among the Big Membership Cards; Government of India; Reference No. MES0051B Seven, experienced a steady increase in its Wal-Mart. Year of Pub. 2005 market share. Witnessing the success of Teaching Note Not Available Toyota, a few Chinese automakers had Struc.Assig. Not Available plans of entering the US automobile Amazon’s foray into e-grocery market. Geely, a private Chinese keywords automaker had exported its cars to almost market: Successful Venture? 30 countries in Asia, the Middle East and eBay’s Asian Adventures; Online Auction market; Internet Population of Amazon.com is a leading online book Eastern Europe. To expand further, Geely selling retailer. It has diversified into expected to market its cars in the US by Asia;Internet usage in Asia; eBay Business model; Pierre Omidyar; Margaret Meg different products lines. It witnessed its first 2008. As Geely was a greenhorn in the US profit in 2002 and continued to do so till automobile market, analysts were sceptical Whitman; Stephanie Tilenius Bo Shao; Each Net; Internet Auction Co. Ltd (IAC); 2004. In 2005, Amazon.com profit whether Geely would sustain and achieve slumped. In 2006, to overcome its loss success in the US automobile market. Neocom Technology; Yahoo!; Google; Taobao.com; lpai.com. and to expand further, it has entered into the online grocery business. But analysts Pedagogical Objectives have mixed opinions about its success. Will Amazon.com witness the same success as • To understand about the US automobile METRO Cash and Carry – in book selling business? market Exploring the Chinese Markets • To discuss about the problems which a In 2004, China, with a population of 1.3 Pedagogical Objectives new entrant into the US automobile billion was one of the world’s largest retail • To understand how Amazon witnessed market will face. markets. With the liberalisation of the growth as an online retailer Industry Automotive Chinese economy in 1992 and its Reference No. MES0052B subsequent entry into WTO in 2001, the • To discuss the fate of Amazon in the e- Year of Pub. 2006 Chinese retail market saw the entry of grocery market. Teaching Note Available many global retailers. Metro Cash and Carry Industry Retail Struc.Assig. Not Available was the third-largest retailer in Europe and Reference No. MES0049B the fourth largest in the world, with annual keywords sales of •56.4 billion (US$68.9 billion) in Year of Pub. 2006 Teaching Note Not Available Geely; US automobile market; Big Three; 2004 with around 2,300 outlets in 28 Struc.Assig. Not Available Big Seven; Chery; virtual gorilla strategy; countries. It entered the Chinese market CK-7151; John Harmer; US Safety in 1996 and faced competition from other keywords Standards; confined test market. global retailers like Wal-Mart and Carrefour. This case discusses in detail the Amazon.com; Online selling; e-grocery; Chinese retail and wholesale market after Books; Competitors; Business model; liberalisation. Further the case discusses the Internet Book Shop; Customers; Products; eBay’s Asian Adventures operations, distribution and merchandizing Barnes & Noble; Book store; Walmart; strategies of Metro Cash and Carry in China Dot-com bubble; Webvan; internet The online internet market in Asia started retailers. taking shape by the turn of 21st century as along with its growth strategies.70 www.ibscdc.org
  • 71. Intel’s Foray into Rural India Indian market. Indian retail Industry is employ local engineers and engage in S T R A T E G Y – III S T R A T E G Y – III S T R A T E G Y – III covered in-depth. The case ends on the production of customised products for the S T R A T E G Y – III S T R A T E G Y – IIIIn March 2006, Intel, the world’s largest discussion of what strategies Wal-Mart lower end segment customers.chipmaker and leading computer should use to enter India and whether oncemanufacturer, officially launched an entered it would be successful? Pedagogical Objectivesinnovative PC platform known as“Community PC”, exclusively designed to • To study the entry strategies undertaken Pedagogical Objectivesmeet the needs of the people in rural India. by Danfoss in ChinaFor the effective implementation of this • To understand the political, legal, socialcommunity PC programme, Intel started and economical environment of India • To discuss the challenges ahead of Danfossanother programme called “Jaagruti” and its regulation for FDI in its strategy to tap low-end segments(Awakening) under which the community • To discuss the growth strategies followedPCs were deployed in internet kiosks • To understand the nature and structure of retail industry in India by Danfoss in Chinacommon in Indian villages with the supportof businesses, government, educational • To know the functional and operational • To analyse the future prospects ofinstitutions, online services and ISP. The aspects of a giant retail organisation like Danfoss in China.“community PC” and “Jaagruti” were part Wal-Mart Industry Industrial Componentsof Intel’s World Ahead Program, an Reference No. MES0046Ainitiative that aimed at enhancing lives by • To discuss the country experiences of Year of Pub. 2006accelerating access to technology for Wal-Mart particularly in Asia (Japan and Teaching Note Not Availableeveryone, anywhere in the world. The China) and the implications of entering Struc.Assig. Not Availableprogram also aimed at tapping other one more Asian country Indiaemerging markets like China, Brazil, • To derive a best fir between Wal-Mart keywordsRussia, South America and African and India Danfoss, Industrial components; Marketcountries. • To discuss the entry strategies available expansion; International venture;Though Intel was positive, analysts Refrigeration industry; Motion Controls; to Wal-Mart and followed by Wal-Martwondered whether, Intel’s strategy of rural Wuqing; Jorgen Clausen; Low-end in different countriespenetration through such endeavours would products; cultural integration;be successful. • To debate on the right entry strategy customisation of technology. for Wal-Mart for entering India.Pedagogical Objective Industry Global Retail• To help appreciate the role of creativity, Reference No. MES0047A Wal-Mart’s China Experience both and in terms of product innovation Year of Pub. 2006 Wal-Mart evolved as the retailing giant of and marketing. Teaching Note Available the world in the 21st century. The strategy Struc.Assig. Not AvailableIndustry Information of “Every Day Low Price” has been itsReference No. MES0048B keywords core competence in beating theYear of Pub. 2006 competition. It grew at a consistently Retailing; Indian Retail; Entry strategies; higher rate through out its existence, untilTeaching Note Not Available Foreign Direct Investment in India; in mid 1990s, when it faced growth crises.Struc.Assig. Not Available Regulatory environment; Political; Legal Wal-Mart decided to look for newerkeywords and Social environment; Globalisation; markets and Wal-Mart International Growth Strategy; Competition; Market division evolved. Today it operates in 10Intel; Community PC; World Ahead leader; Wal-Mart; India; localisation. countries including United States.Program; Jaagruti; India; Internet; Kiosks;Rural; Ethnography; Literacy; Village; In 1996, it entered China, which wasLanguage; Weather; Technology; Discover. becoming the powerhouse of Asia. The Will China emerge as the strategic partnership between China and Wal- second home for Danfoss? Mart created a gamut of opportunity for Wal-Mart in India Danfoss Inc. was one of the largest growth for China as well as for Wal-Mart. industrial components manufacturing The case talks about the localisationWal-Mart Stores Inc. (Wal-Mart) was the companies in Denmark. It engaged inworld’s largest retailer. It had ventured into strategy of Wal-Mart by penetrating in manufacturing of refrigeration controls, China and adapting to its local culture. Theinternational operations in mid-1990s. motion controls, compressors,Hailing from a developed country like the issues faced by Wal-Mart related to the thermostats for household appliances. It Distribution, Unions, Technology andUS it had to struggle in Asia’s developing had manufacturing facilities in fourmarkets to maintain its corporate Financial systems in China, and how it continents, branches and distributors in worked to convert these hurdles intophilosophy of ‘every day low prices’. There more than 100 countries and employedwere other cultural and local adaptations opportunities. China opened its retailing 17,000 employees across the world and industry for foreign investors fully inthat it made to capture the market. reached global sales figures of •2.2 billion December 2004. Even after nine years ofIndia being the second-largest populous in 2004. existence in the China market, amongcountry in the world was emerging as the After attaining the market leadership in foreign retail chains Wal-Mart rankedhottest destination for retail ndustry. But Denmark, Danfoss ventured into Chinese second and in domestic market it did notIndia had still not opened its retail sector market in 1995 and by 2005 it invested even rank amongst the top ten. The expertsfor Foreign Direct Investment. Wal-Mart around $100 million. Initially Danfoss have predicted that the Chinese middle classwas eyeing this market for some time now. catered to high and medium end segments who drives the retailing market is going to in China. Gradually Danfoss identified the expand to 400 to 500 million people byThe case describes Wal-Mart’s Asian immense opportunity available in the 2015. In order to capture this massiveexperiences in China and Japan and how lower end segments and in 2006 decided to market potential Wal-Mart is gearing upWal-Mart can apply its learning’s to the to understand and adapt to Chinese market. 71 www.ibscdc.org
  • 72. Pedagogical Objectives and disadvantage; Purchasing power; Gross BBH: The Russian Venture of the Domestic Product (GDP) and UK Brewer, Scottish and Market Entry Strategies • To discuss and understand the international expansion strategies consumption; Competition; Cosmetics and Newcastle personal care products; Joint venture, • To understand retail industry structure partnership and alliance; Roosevelt China Maturity, stagnation and decline in beer of China Investments Corporation; Proctor & consumption in Western Europe and North Gamble (P&G); Giorgios Armani; L’Oreal; America forced Scottish & Newcastle, an • To discuss the entry strategies to China Shiseido; Department stores UK Brewer, to foray into the emerging • To analyse the operating strategies and Russian market by forming Baltic Beverage growth strategies followed by Wal-Mart Holding (BBH), a 50:50 joint venture with Carlsberg Breweries, a prominent Danish in China IKEA in Japan: The Market Re- brewer. BBH rode on the wave of rising • To understand the ‘glocalisation’ entry Strategies disposable income of the Russians, coupled strategy and its impact in Chinese In April 2006, IKEA, the world’s largest with a shift from vodka to beer drinking, to market furniture retailer, forayed into Japan by become the leader in the Russian brewing opening its second-largest store outside industry with a market share of 36%. • To discuss the issues like cultural However, it is opined that the company adaptation, localisation and operating Sweden. The opening of the store marked the re-entry of IKEA into the Japanese would be facing a challenging future given in a fragmented retail market. market after an unsuccessful 12 years stint the forecasted decrease in beer consumption Industry Retailing between 1974 and 1986. Although the in Russia after 2008 and government Reference No. MES0045A company has planned to ‘act local’ by regulations like ban on TV advertisements Year of Pub. 2005 customising its offerings according to of beer to contain juvenile alcoholism. Teaching Note Not Available Japanese preferences, it still expects to face Struc.Assig. Not Available several challenges from the Japanese Pedagogical Objectives customers who are known to be keywords • To discuss the emergence, growth and inconsistent and unpredictable, and have forced many a foreign retailer to exit from forecasted maturity of the Russian beer Penetration Strategy; Globalisation; Out Japan. market Sourcing; Retailing; Supply Chain Management; Distribution; Localisation; • To discuss the market entry and growth Cultural Adaptation; Glocalisation. Pedagogical Objectives strategies adopted by BBH in the Russian beer market. • To discuss the need for global companies to understand consumer needs and Industry Brewers China’s Luxury Retailing Industry: preferences in each of their markets and Reference No. MES0042 Saks Inc.’s Market Entry adapt their offerings accordingly Year of Pub. 2006 Strategies Teaching Note Not Available • To understand the dynamics of the Struc.Assig. Available Since its economic reforms in 1978, Japanese retail and home improvement increasing purchasing power in China market keywords coupled with growth in private • To analyse the reasons behind IKEA’s Russian beer market; Consolidation of consumption and growing awareness of failure in Japan in its first entry (1974- Russian beer market; Scottish & Newcastle; luxury goods have fuelled the growth of 1986) and the factors that encouraged Carlsberg Breweries; Baltika Breweries; the market for luxury products in the it to re-enter the Japanese market with Market entry strategies; Growth strategies; country. It is estimated that by 2015, China the ensuing challenges Inorganic growth strategies; Statistics on would surpass the US and Japan as the largest consumption of beer in world; luxury market in the world. To cash in on • To debate whether IKEA, which is Arsenalnoye; Baltika; Baltika No.7; such growth potential, Saks, one of the known for its standard offerings across Baltika No.5. leading high-end luxury department chains the globe at the lowest price, would be from the US is planning to foray into China. able to win fastidious Japanese customers through customised offerings. Pedagogical Objectives Walt Disney Company in China Industry Home Furnishings & • To discuss and debate the impact of Housewares Retail The Chinese film industry was a highly economic reforms in China on luxury Reference No. MES0043 regulated industry until China’s entry into retailing in the country Year of Pub. 2006 the World Trade Organisation in 2001. Teaching Note Available China, with a population of 1.3 billion and • To understand the success factors in Struc.Assig. Available a rapidly growing economy, has become China’s luxury retailing industry an attractive market for all global media