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The American Graduate School of International Management
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 A Global Manager’s Guide to Currency Risk Management
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| 25 pp.
| Case
Michael Moffett, Anant Sundaram
Since the advent of the floating exchange rates, any time that a transactionuwhether that transaction is in goods, services, people, capital, or technologyuhas crossed borders, it has been subject to the influence of changes in exchanges rates. The basic problem posed by exchange rates on the cross-border firm is that money across borders has no fixed value. Consequently, neither does the transaction undertaken across borders. In the note, our purpose is to understand, categorize, and define the specific types of exchange rate risks that firms face across borders, and to address how managers can plan for, manage, and hedge these risks. Specifically, this note provides an overview of the risks posed by exchange rates to the cross-border firm, and the major strategies and solutions managers can employ to deal with them.
Thunderbird Number: B03-03-0006 Type: Case
Publication Date:
Subjects: International finance; financial management; currency exposure
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| Ad-lider Embalagens, SA: Marketing Research for Drawstring Trash Bags in Brazil
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| 21 pp.
| Case
Author(s): Rosane Gertner, Dennis Guthery, Richard Ettenson
Abstract: This case presents market research data concerning the launch of a new drawstring trash bag in Brazil. Ad-lider, one of the leaders in the Brazilian plastic bag industry, has purchased the production machinery for producing the trash bag, and now must decide how the new product should be launched. Data for focus groups and field interviews are included for analysis. The case touches on many areas of marketing, including new product development, marketing research, and creating customer value.
Teaching: This is appropriate for both undergraduate and graduate marketing classes. It’s ideally suited for the marketing research component of a marketing management class. Alternatively, it‘s also appropriate for the market research session of the new product development course or for a qualitative data session of a marketing research course. The teaching note is useful for all three purposes.
Thunderbird #: A12-04-0031
Setting: Latin America Industry: Consumer goods
Subjects: Marketing
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| An Entrepreneur Seeks the Holy Grail of Retailing
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| 5 pp.
| Case
Author(s): Lauranne Buchanan
Publication Date: 2007
Product Type: Case
Product ID: A11-06-0018
Geographic Setting: USA Industry Setting: Consumer goods
Subjects: Manufacturing and operations
Product Description: This case examines the experience of two young entrepreneurs as they work to gain entry into the world’s most powerful retailer, Wal-Mart. The path is full of obstacles — from thousands of competitors to one skeptical buyer. Even as the entrepreneurs are granted a trial period in the store, challenges continue: the giant retailer may have the most efficient back-end operations in the world, but that doesn‘t mean that product always gets to the shelf. Teaching — This case can be used to demonstrate the challenges of gaining distribution for a start-up operation. Getting a new product to market requires thinking outside the box and patiently building the market. In addition, the case demonstrates the value-add of the supplier in store operations. Most students assume that once product is delivered to Wal-Mart's distribution center, the supplier's job is over. Nothing could be further from the truth. Diligent investigation of store operations by supplier is critical for product sales. The case can also be used successfully in conjunction with a reading from the Wall Street Journal about the experience of another team of entrepreneurs, Mark Fleming and Bill Hall of the Charleston Tea Company, with Wal-Mart: Kortney Stringer (2000), “U.S. Tea Grower is in Hot Water,” Wall Street Journal, September 13, B1. Together, these two readings can produce an interesting contrast of what it takes for a small company to work successfully with the world's largest retailer.
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| Anheuser-Busch and Harbin Brewery Group of China
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| 17 pp.
| Case
Author(s): Michael Moffett, Kannan Ramaswamy
Abstract: The case discusses the acquisition of Harbin Brewery, a Chinese-owned company with extensive operations in the northeast of China, by Anheuser-Busch, the U.S. multinational brewer. The Chinese beer industry had witnessed multiple waves of foreign investment in the late 1980s and early 1990s. Many of the foreign entrants had their grandiose plans scuttled by a mix of archaic industrial licensing policy, infrastructural challenges, and economic realities. Most sold to local companies and moved out of China. By 2003 the market was heating up again, and the majors such as SAB Miller and Anheuser-Busch (AB) were aiming for China once again. Harbin Brewery was partly owned by SABMiller through a joint venture when AB launched a takeover bid. The case discusses the nature of the Chinese business system, economic potential, consumer behavior, and the nexus between politics and business. It offers a rich context within which the strategic actions of AB and SABMiller can be interpreted. The case closes with the successful acquisition by AB.
Teaching: This case is intended for use in a course/program dealing with corporate strategy and/or global strategy issues or in an advanced stage of a preliminary class in competitive strategy. Given the rich China focus, it fits in with courses on international business environments as well. It has been successfully used in several executive programs to emphasize global strategy or China-specific themes. The purpose of the case is to illustrate:
(a) the contextual challenges facing firms that aspire to profit from a China presence
(b) the relationship between country v. global strategy
(c) valuation of firms in emerging markets
Thunderbird #: A07-05-0003
Setting: China Industry: Beer
Subjects: General management
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| Arab African International Bank: The Introduction of Smart Cards to the Egyptian Market
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| 16 pp.
| Case
Author(s): Eskandar A. Tooma, Robert Grosse
Abstract: Arab African International Bank (AAIB) is a private-sector bank competing in Egypt against four large state-owned banks and about 20 other foreign and domestic private-sector banks. The case focuses on AAIB’s retail banking strategy, and particularly on the launch of a “smart card” for use as a credit/debit card, and potentially for additional functions. The product is supported by VISA International, and AAIB is the first bank to issue the card in Egypt. The case describes the product launch, the positioning of AAIB in the Egyptian market, and the strategy that AAIB was following at the time of the launch.
Teaching: This case can be used for finance or financial-institutions course, a marketing course, or a strategy course. Information is presented in the case to analyze the product launch, the decision of whether to purchase or lease card-reader machines, and to consider AAIB‘s competitive position in the Egyptian market.
Thunderbird #: A06-05-0007
Setting: Cairo, Egypt, 2003 Industry: Commercial banking
Subjects: Finance; marketing; industry and competitive strategy
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| Argentina: Anatomy of a Finance Crisis
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| 23 pp.
| Case
Author(s): C. Roe Goddard
Abstract: This case is intended for a broad range of student/executive audiences, and has the ability to be used successfully in a number of courses. It can be used in courses in international economics, international finance, international political economy, financial risk management, and regional courses focusing on the politics or economies of emerging markets/Latin America. Ideally, students/executives would have had macro- and microeconomics; however, I have found that students/executives with neither of these courses have still performed well in the case analysis. It is a challenging case study and is particularly useful in an MBA or executive MBA course, but can be taught successfully in advanced undergraduate courses.
Teaching:The purpose of the case study is to both illustrate the complex set of internal and external causes of emerging market financial crises, and assist the student to comprehend the high degree and multiple strands of interdependence linking emerging market economies and the large international economy. The case is highly illustrative in the application of financial/banking concepts such as interest rate spreads, debt swaps, reserve requirements, the role of international sovereign credit rating agencies to the deteriorating position of Argentina’s finances. Argentina‘s experience in December 2001/January 2002 and the failed policies that led up to this economic, political, and social tragedy provide a vivid example of the risk associated with doing business in emerging markets in general, and Latin America countries in particular, with their penchant for excessive fiscal spending. More specifically, this case helps the student to comprehend international economic and financial concepts and linkages, and assess financial and exchange rate risk.
Thunderbird #: A03-04-0006
Setting: Argentina Industry: Emerging markets
Subjects: Business, government, an
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| Bayer AG: Children’s ASPIRIN
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| 19 pp.
| Case
Lauranne Buchanan, Christopher K. Merker
In the mid-1980s, Bayer AG faced a crisis when aspirin was associated with Reyes Syndrome, a rare but serious illness in children. Bayer decided not to remove Children?s ASPIRIN from the market, but they pulled all promotion for the brand and complied with government regulations regarding product warnings on packaging. Shortly thereafter, new discoveries revealed the effectiveness of aspirin in the prevention of heart attacks and strokes in adults. Children?s ASPIRINudue to its lower cost and lower dosageuwas an ideal product for the prevention market. Over the years, sales of Children?s ASPIRIN had increased, but Bayer AG had never analyzed the percent of sales due to the children?s v. prevention markets. Now the company must make a decision about what to do with the product. Should they retract Children?s ASPIRIN altogether in order to increase sales of Bayer?s higher-margin prevention brands, or reintroduce it as a prevention product under another brand name? Implication for company growth and profitability are examined.
Thunderbird Number: A12-02-0026 Type: Case
Publication Date:
Geographic Setting: Germany, Europe, U.S., Latin America Industry Setting: Pharmaceutical
Subjects: Marketing
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| Best Western International: One Global Brand
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| 41 pp.
| Case
Author(s): Richard Etttenson, Dennis Guthery
Abstract: Best Western International (BW) is striving for global brand leadership in the broad, worldwide, mid-scale lodging market. Management must decide how best to strategically position the Best Western (BW) brand in an increasingly competitive lodging environment. There is also the need to provide direction and connection to BWI’s affiliates and members worldwide to ensure that marketing and business success in different markets is not isolated and random. How to achieve this goal presents management with many marketing, branding, and organizational challenges.
Teaching: This case is appropriate for both graduate marketing courses and executive education programs. The case is well suited for a graduate brand management course or executive program. The issues addressed in the case make it useful either as an introductory brand management case or as a comprehensive summary case. The case addresses such issues as value delivery, customer analysis/marketing research, brand equity, positioning, global branding, and brand extensions, among others. The case is also well suited for a graduate marketing management course when used in the session covering brand management.
Thunderbird #: A12-03-0024
Setting: Worldwide Industry: Lodging
Subjects: Brand management; global branding; international marketing; marketing research
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| Broadband Communications, Inc.
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| 5 pp.
| Case
Author(s): Graeme Rankine
Abstract: Anna Amphlett and Katy Ianuzzo are in the planning stages of acquiring a bankrupt cable company operating in the San Juan Islands of Washington State. The entrepreneurs plan to resuscitate the business with new capital, develop new products and services such as high-speed Internet, and operate the new business as Broadband Communications, Inc. The entrepreneurs have approached San Juan Community Bank for a $3 million loan, but the bank has asked the entrepreneurs to provide the company’s business plan, including projected financial statements for the first year of operations, before they will consider funding the new business.
Teaching: Students are asked to prepare financial statements using the company‘s balance sheet at its inception (Exhibit 2 in the case) and a set of eleven summary transactions described in the case. The instructor can provide students with an Excel worksheet to organize the beginning balance sheet, i.e., each balance sheet account in a separate column and the accounting events. The amounts on the balance sheet at the business's inception can be put in the first row under the appropriate balance sheet account label. The transactions described in the case can be inserted in successive rows on the worksheet. The completed worksheet (see Exhibit TN-1) enables students to prepare the company's financial statement. These include (1) the balance sheet at the end of the first year from the totals in the last row (see Exhibit TN-2), (2) the income statement and statement of retained earnings for the first year from the amounts recorded (excluding the dividends) in the retained earning account (see Exhibit TN-3), (3) the statement of cash flows for the first year using the direct method from the amounts recorded in the cash column (see Exhibit TN-4), and (4) the statement of cash flows for the first year using the indirect method by starting with net income and adding the accrual adjustment
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| Broadway Metal Equipment Corporation
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| 7 pp.
| Case
F. John Mathis, Darian Narayana, Paul Keat
The case involves the sale of production equipment by a U.S. manufacturer, Broadway Metal Equipment (BME), to a large Mexican steel producer, Acero del Norte (ADN), that wants to upgrade and expand its capacity. It is a major and complex order for BME, and Acero has required that whoever wins the bid also must provide financing. The project is valued at $35 million, involves more than 60 subcontractors in the U.S., and takes two years to complete before final payment is received. The case is designed to examine the methods of structuring the financing of capital goods exports over a two-year period. The case is useful for identifying all the various risks associated with the transaction and possible methods for mitigating these risks. The case also involves an analysis of country risk conditions in Mexico during the period 1992 to 1999.
Thunderbird Number: A10-01-0004 Type: Case
Publication Date:
Geographic Setting: U.S., Mexico Industry Setting: Steel manufacturing
Subjects: Finance; international trade
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| Catastrophe Insurance Exposure and Hedging: Structure and Issues
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| 11 pp.
| Case
Mark D. Griffiths
Catastrophe insurance, like most types of insurance, is essentially a protective put option, purchased by someone to ensure or olocko the value of some underlying asset, be it a house, car, or their health. The buyer pays the insurance company a premium to purchase the policy. If some predetermined event occurs, reducing the value of the protected asset, the insurance company effectively buys or replaces the asset for the policyholder according to the details of the policy. A catastrophe, by legal standards, must be an event causing a least $25 million in damage and affecting multiple parties.
Thunderbird Number: B06-00-0023 Type: Case
Publication Date:
Geographic Setting: North America Industry Setting: Weather
Subjects: Finance; derivatives
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| Coca-Cola’s Marketing Challenges in Brazil: The Tuba?nas War
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| 18 pp.
| Case
Author(s): Denise Guthery, David Gertner, Rosane Gertner
Abstract: This case presents the challenges the Coca-Cola Company faced in Brazil. Not only was Coke up against its nemesis, Pepsi, it also had to compete with hundreds of local brands, many of which did not pay taxes. These local brands were generically called tubaí nas. The case provides background information on the history of Cake in Brazil, trends in the Brazilian soft drink market, and on competition by Pepsi and the many local soft drink firms. In addition, Coke’s strategies for competing are outlined. The student is asked to analyze the information presented in the case and to make recommendations to Coke on how to better compete in Brazil.
Teaching: This case is appropriate for both undergrad and MBA international marketing classes. It is ideally suited for discussing international branding and strategies MNCs can use to compete with local brands. The teaching note includes the citation of three excellent articles focusing on global brands versus local brands. These three articles plus the case cover most issues relating to this topic and can be used in conjunction for a discussion covering at least two hours.
Thunderbird #: A12-04-0025
Setting: Latin America, Brazil Industry: Soft drink, beverage
Subjects: Marketing; industry and competitive strategy
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| Competitive Advantage through Channel Management
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| 7 pp.
| Case
Author(s): Lauranne Buchanan, Carolyn J. Simmons
Abstract: This case provides a synopsis of three companies — Dell, Inc., IKEA, and Seven-Eleven (Japan) -- that has developed a competitive advantage through channel management. Each case highlights the company’s focus on customer relationships and how the channel is designed to maximize customer service. Examples illustrate how these companies think “outside the box” in their selection of channel partners and in the sequencing and assignment of the activities involved in product design, production, and transfer. They also illustrate how closely these companies work with their suppliers in order to coordinate activities and reduce channel cost. The net effect is a more efficient channel designed to serve the customer more effectively.
Teaching: The case is intended to stimulate discussion about what it takes to develop a competitive advantage through channel management. It illustrates that a competitive advantage can be created by:
• Controlling channel costs so that the right product can be sold profitably at a fair price to consumers,
• Ensuring that the product is available at the right time (mundane but crucial),
• Ensuring that customers‘ shopping experience in the retail environment (store, catalogs, or online) meets their specific needs.
Thunderbird #: A12-04-0019
Setting: U.S., Japan, Sweden, 1990-2004 Industry: Hi-tech, retail
Subjects: Marketing
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| Currency Markets and Parity Conditions
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| 12 pp.
| Case
Anant Sundaram
This note develops the foundations of the ideas underlying much of the theory and practice of international finance, notably the basic oparity conditionso linking exchange rates, interest rates, and inflation rates. Specifically, the note develops the ideas of purchasing power parity, speculative efficiency, uncovered interest parity, and the international Fisher effect, and the links among these from a managerial perspective. It includes a brief discussion of the factors driving exchange rate changes in the medium term, and of the three types of exchange rate exposure that cross-border firms face; namely, translation exposure, transaction exposure, and economic exposure.
Thunderbird Number: B06-03-0010 Type: Case
Publication Date:
Geographic Setting: World
Subjects: Finance; international trade
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| D’Aquino Quimica do Brazil S.A.
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| 18 pp.
| Case
Author(s): Priscilla Wisner, John Zerio
Abstract: D’Aquino Quimica S.A. is the Brazilian subsidiary of Berre Chimique. The operation serves the four Mercosur markets — Brazil, Paraguay, Uruguay, and Argentine. The economic volatility in the region requires extraordinary focus on resource utilization and profit measurement. The case highlights issues dealing with marketing unit performance, product line profitability, profit impact of marketing programs, and sales strategy. In addition, by linking events to the Mercosur context, the case offers an opportunity to explore the economic and political circumstances that surround the customs union.
Teaching: The case can be successfully used in a capstone marketing course on strategy, managerial accounting, and profit planning and control.
Thunderbird #: A12-04-0024
Setting: South America Industry: Chemical
Subjects: Account and control; finance; marketing; finance and international trade
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| Dealing with Governments in Emerging Markets: The Crude Oil Pipeline (OCP) in Ecuador
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| 13 pp.
| Case
Author(s): Robert Grosse, Juan Yañ es
Abstract: Ecuador’s main industry is petroleum, which generates half of export earning, finances much of the government budget, and employs directly more than 12,000 people in a country of 14 million people. The oil was discovered by foreign oil companies, produced and distributed largely by them until a national company was created in 1974, and is exported to them by the government-owned company and by the remaining companies operating in Ecuador. Relations between the companies and the government have been quite turbulent, with the government taking partial ownership of the main company in 1974, buying out Gulf Oil a year later, and finally taking Texaco‘s share in 1992. Only medium-sized and small foreign oil companies remain, since the opportunities in Ecuador are limited, and the government has proven unreliable in its regulation of the firms. This case describes the process through which a second oil pipeline was built in 2001 to transport oil from the jungle to the coast, and the dealing between the companies and the government during that process. Even in 2004 there were several major unresolved issues that left government-company relations on very conflictive terms.
Teaching: This case can be taught in a government-business relations course, a course on doing business in emerging markets, and of course in any context that deals with company-government relations in the oil industry. Either a company or a government point of view may be taken — and the case could be used to create a negotiation between the two sides, either at the time of the OCP approval effort in 1998-2001 or, more currently, to deal with the tax conflict and the various other problems that have arisen between the Ecuadorian government of President Lucio Gutierrez and the foreign companies during 2002-04.
Thunderbird #: A03-04-0028
Setting: Ecuador 1998-2001 Industry: Oil
Subjects: B
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| Dell’s Dilemma in Brazil: Negotiating at the State Level
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| 14 pp.
| Case
Roy C. Nelson
Dell has recently concluded a site selection process in Brazil to determine where it will locate its manufacturing plant in that country, which will be its first manufacturing plant in Latin America. After a lengthy site selection process in the first half of 1998 involving five states in BraziluS?o Paulo, Rio de Janeiro, Paran?, Minas Gerais, and Rio Grande do SuluDell has decided to locate the plant in the state of Rio Grande do Sul, Brazil. Although a number of factors influence Dell?s decision, one of them is the generous incentives that Governor Antonio Britto of the relatively centrist Partido do Movimento Democratico Brasileiro (PMDB) has offered Dell. However, after Dell makes this decision, a new governor, Olivio Dutra of the Partido dos Trabalhadores (PT, or Workers? Party), is elected in October 1998 and takes office in January 1999. The PT is a socialist party. Having made an issue of what he considered to be overly generous incentives offered to transnational corporations during his campaign, Governor Dutra seems likely to rescind the incentives that the Britto government had offered. Given this situation, Keith Maxwell, Dell?s Senior Vice President for Worldwide Operations, must make a recommendation to Michael Dell. The case presents three possible options for Dell: (1) leave Brazil entirely; (2) move the plant to another state within Brazil; (3) try to renegotiate with Governor Dutra.
Thunderbird Number: A03-03-0021 Type: Case
Publication Date:
Geographic Setting: Brazil Industry Setting: Computer
Subjects: Business; government; and international policy
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| Enron’s Demise — Were There Warning Signs?
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| 15 pp.
| Case
Author(s): Graeme Rankine
Abstract: The collapse of Enron will undoubtedly go down in history as one of the most notorious corporate scandals in the twentieth century. Enron’s employees lost billions of dollars in retirement savings tied up in Enron as stock became worthless. The rise and fall of Enron was marked by inflated earnings and substantial amounts of hidden debt, enabled by the use of special purpose entities, the application of unethical accounting techniques, and an unquestioning board of directors. The transformation of Enron from a mundane natural gas transportation company into a financial trading empire, with operations in natural gas, water, broadband, electricity, power plants, and exotic derivatives, was masterminded by Jeffrey Skilling, one-time chief executive officer, and Andrew Fastow, the company‘s chief financial officer. In the aftermath of the company's collapse, the U.S. Congress enacted sweeping changes to corporate governance. But why did Enron's collapse take the financial community by complete surprise? Were there any warning signs that Enron was not as financially solid as it appeared? The case examines these issues using data from Enron's 2000 10-K and Compustat data for 1984-2000.
Teaching: The purpose of this case is to determine whether there were any early signs of Enron's collapse. Students are asked to undertake an analysis of selected financial statement data from Enron's 2000 10-K, including the company's use of off-balance sheet entities accounted for using the equity method of accounting. Students are asked to assess the company's earnings quality using historical data from cCompustat for 1984-2000. In addition, students are asked to consider whether Enron was worth over $60 per share at the end of April 2001.
Thunderbird #: A01-04-0017
Setting: U.S. Industry: Energy
Subjects: Accounting and control; finance
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| Fairfield Communities, Inc.
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| 28 pp.
| Case
Graeme Rankine
In 2000, Fairfield Communities, Inc. was one of the largest time-share operators in the U.S. The company?s portfolio of resorts consisted of 35 resorts located in 12 states and the Bahamas. Of the company?s resorts, 25 were located in destination areas with popular vacation attractions such as Daytona Beach, Florida, and Las Vegas, Nevada, and ten were located in scenic regional locations. Fairfield sold and financed vacation ownership intervals (VOI), providing a deeded interest in the use of a fully furnished vacation property of a specific size, at a specific location, at a specific time of the year, and a specified length of stay. Customers typically provided a down payment of 16%-18% of the purchase price and financed the balance. Approximately 80% of Fairfield?s customers elected to finance their VOI purchases through the company on terms of up to seven years and at interest rates of approximately 15% per year. To finance its rapid growth, Fairfield securitized the receivables by osellingo them to special purpose entities (SPE). The SPE issued debt collateralized by the receivables. As permitted under U.S. GAAP, Fairfield accounted for the SPE using the equity method of accounting rather than consolidating the SPE?s financial statements. Thus, the SPE?s debt did not directly appear on Fairfield?s balance sheet.
Thunderbird Number: A01-02-0015 Type: Case
Publication Date:
Geographic Setting: U.S. Industry Setting: Leisure
Subjects: Accounting; control
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| Global E-Commerce at United Parcel Service (UPS) 2001
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| 17 pp.
| Case
Christine Uber Grosse
After being privately held for over 90 years, United Parcel Service (UPS) carried out the largest initial public offering ever by a U.S.-based company in 1999. The IPO raised $5.47 billion, leaving the company cash-rich and able to pursue strategic acquisitions and mergers. Since then, the company has embarked on aggressive expansion around the world, consistent with its new charter to become an enabler of global e-commerce, as well as a leader in parcel delivery service. UPS?s broad vision of e-commerce includes integrating the flow of information, capital, and goods around the world. How can UPS keep its competitive edge and continue to grow in times of rapid change? How can the giant company integrate e-commerce throughout its global operations?
Thunderbird Number: A07-02-0010 Type: Case
Publication Date:
Geographic Setting: Georgia, World Industry Setting: Mail, package, freight
Subjects: Strategy
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| Home Store, Inc.
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| 6 pp.
| Case
Author(s): Graeme Rankine
Abstract: Home Store, Inc. is a retail chain of home improvement stores catering primarily to middle income female homemakers interested in undertaking do-it-yourself (DIY) and do-it-for-me (DIFM) projects. The company grew rapidly from a single store with sales revenue of $8.8 million in 2001 to 20 stores with total sales of $11.334 million in 2003. Yet, the company’s rapid growth in revenues has been accompanied by declining profits and a substantial increase in receivables, inventories, and capital investments in new stores. The resulting cash outflows have been financed by increased borrowing from Bank of America as well as stretching the company‘s payables, i.e., taking longer to pay suppliers. Bank of America reluctantly increased the maximum amount available to the company under its term loan to $5 million from $2.6 million. In early January 2004, Hermione Granger, President and Chief Executive Officer of Home Store, Inc., and Ron Weasley, the company's chief financial officer, completed a review of the company's financial situation. The company's executives are unsure whether the new credit limit will permit the company to implement its growth strategy since there is only $1.464 million remaining under the term loan at the beginning of 2004.
Teaching: The purpose of the case is to evaluate the company's recent financial performance, determine whether the company's planned growth strategy can be financed within the new credit limits, and to assess alternative courses of action that might be available to improve the company's future performance. First, students are asked to consider the company's business strategy and whether it's likely to yield a sustainable competitive advantage. Second, students are asked to develop a cash flow statement for 2001-2003 to assess the company's cash generation. The cash flow statement indicates that the decline in the company's cash flow from operations is a result of ballo
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| Johnson & Johnson Consumer Products Brazil: Corporate Transformation
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| 12 pp.
| Case A
Author(s): Inkpen, Andrew
Publication Date: 2007
Thunderbird Number: A07-07-001
Geographic Setting: Brazil Industry Setting: Consumer Products
Subjects: General management; Industry and competitive strategy
Abstract: In January 2000, Jose Antonio Justino, accepted an offer to become the Managing Director of the Consumer Division of Johnson & Johnson Brazil (in Portuguese: Johnson & Johnson Comercio e Distribuicao Ltda.). Johnson & Johnson Brazil (J&J Brazil) had been the early leader in Brazil in a variety of products, including disposable diapers, sanitary napkins, bandages, cotton swabs, sunscreen, and baby care products. Unfortunately, performance had deteriorated in recent years, with both sales and profitability dropping significantly. Market share in many categories was falling because of increased competition from local firms and multinationals. The company group chairman of J&J’s global consumer business told Justino in February that he would have to present a business plan at a J&J meeting in Mexico in May 2000. The business plan would have to identify the specific steps that would allow J&J Brazil to restore profitability by the end of 2000 and position the company for future growth. Teaching: The J&J Brazil case series examines organizational turnaround. In 2000, J&J Brazil was in dire straits. Although still one of the strongest consumer brands in Brazil, the company was struggling with new competition, an outdated approach to sales and marketing, a changing Brazilian macro-environment, declining sales in key product categories, and an organizational culture resistant to change and innovation. After a successful stint as president of J&J Colombia, Justino was brought in to fix things. The (A) case requires students to develop a turnaround plan that establishes priorities and leads to improved financial performance. The (B) case describes the changes that took place and allows studen
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| Lost Peak Winery, Inc. (B)
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| 3 pp.
| Case
Graeme Rankine
Roberto and Pablo Conca have just completed the first year of operations of the Lost Peak Winery, Inc. as described in the Lost Peak Winery, Inc. (A) case. The first year of operations has been successful, but the company faced considerable competition from high-quality, low-priced wines from Australia, South Africa, and Spain. Stiff competition had forced the company to cut its wine prices, and some customers had not complied with the company?s credit terms, resulting in lower cash collections. The company also experienced higher costs than anticipated. In response to these developments, the company took longer to pay its trade creditors and had obtained an emergency short-term loan. Why did the company need an emergency short-term loan? In Lost Peak Winery (B), Pablo and Roberto Conca plan to prepare a statement of cash flows and analyze how changes in the business affected the company?s cash flows. The brothers also decided that they should also plan their business over a longer horizon to avoid being unable to meet the long-term debt repayment schedule and to be able to arrange for future financings should they need additional cash to continue growing. In Lost Peak Winery (C), Pablo and Roberto plan to prepare pro forma financial statements for the next five years to examine the effects of alternative business scenarios on the company?s cash flows.
Thunderbird Number: A01-02-0024 Type: Case
Publication Date:
Geographic Setting: Northwest U.S. Industry Setting: Wine
Subjects: Accounting; control
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| Lost Peak Winery, Inc. (C)
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| 4 pp.
| Case
Graeme Rankine
Roberto and Pablo Conca have just completed the first year of operations of the Lost Peak Winery, Inc. as described in the Lost Peak Winery, Inc. (A) case. The first year of operations has been successful, but the company faced considerable competition from high-quality, low-priced wines from Australia, South Africa, and Spain. Stiff competition had forced the company to cut its wine prices, and some customers had not complied with the company?s credit terms, resulting in lower cash collections. The company also experienced higher costs than anticipated. In response to these developments, the company took longer to pay its trade creditors and had obtained an emergency short-term loan. Why did the company need an emergency short-term loan? In Lost Peak Winery (B), Pablo and Roberto Conca plan to prepare a statement of cash flows and analyze how changes in the business affected the company?s cash flows. The brothers also decided that they should also plan their business over a longer horizon to avoid being unable to meet the long-term debt repayment schedule and to be able to arrange for future financings should they need additional cash to continue growing. In Lost Peak Winery (C), Pablo and Roberto plan to prepare pro forma financial statements for the next five years to examine the effects of alternative business scenarios on the company?s cash flows.
Thunderbird Number: A01-02-0025 Type: Case
Publication Date:
Geographic Setting: Northwest U.S. Industry Setting: Wine
Subjects: Accounting; control
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| Migros (Switzerland)
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| 6 pp.
| Case
Author(s): Jutta Ulrich
Abstract: Migros is a grocery retailer in Switzerland, organized as a co-op with over one million Swiss households as members. Migros also operates a travel agency, gas stations, a book and record club, and other business. In the last decade, Migros has tried to expand into neighboring countries, but the venture in Austria failed and the presence in France and Germany remained small. The case asks why Migros has not been more successful abroad, especially in Austria, given the seemingly quite similar cultural environment and language (German). A key issue is the Migros brand strategy, both in the domestic market and abroad. Cultural questions are important since behavior and food preferences vary significantly. The case also raises the question what a successful enterprise can do when it seemingly cannot grow.
Teaching: This case works well for a discussion of culture and language issues, an introduction to differences in shopping behavior and the importance of brands, and sensitizing students to the fact that countries may appear similar in culture and language but, in fact, pose challenges to marketers. The case is appropriate for an international marketing course and other international business courses that wish to focus on marketing communication and culture. For advanced business language courses, the case is also available in German translation. Most students will require some background on countries involved (Switzerland, Austria, perhaps Germany and France), including geography, demographics, and national culture. Students can research these topics as part of the case preparation. Class discussion usually revolves around the Migros brand, the importance of name recognition, as well as the extensive use of the Migros house brand. Most students take it for granted that Migros can continue to grow and that the enterprise can and should expand outside of Switzerland, when Migros may, in fact, find growth of its
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| Moving Up the Value Chain: A Good Approach for Ireland?
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| 12 pp.
| Case
Author(s): Roy C. Nelson
Abstract: Ireland has experienced rapid economic growth in the last 15 years, in part because of its successful effort to attract foreign direct investment (FDI). The government agency responsible for this effort, originally called the Industrial Development Authority (IDA), has been restructured and is now divided into three organizations: Forfás (charged with coordinating Ireland’s economic development strategy); IDA Ireland (responsible for investment promotion), and Enterprise Ireland (charged with promoting the development of indigenous industry). Now that Ireland has reached full employment and salaries and other operating costs have risen, the country is no longer competitive as a low-cost investment location in Europe for manufacturing and service industries. As a result, Forf?s must decide how to deal with this situation.
Teaching: This case can be used in a number of contexts. It would be appropriate to use in any course dealing with different perspectives on foreign direct investment (FDI). In this context, it can be used to demonstrate to international managers how the regulatory environment for FDI might be affected by government development efforts. The case would also be useful in a course on international development. In this context, it could demonstrate how development agencies can use FDI in order to promote economic development.
Thunderbird #: A03-04-0018
Setting: Ireland Industry: N/A
Subjects: Business, government, and international policy
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| Organizational Alignment: Managing Global and Local Integration
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| 4 pp.
| Case
Author(s): Caren Siehl
Abstract: This case is set in the finance operation of a $1.4 billion aerospace company with global operations. The protagonist is the leader of this 90-person group, the Director of Finance. He is faced with immediate issues of missed financial targets, $20,000,000 in accounting write-offs, and finance employees violating company policy. He is grappling with how to drive an integrated financial approach in a complex global environment with significant cultural differences. The leader faces several options, including address the symptoms, dig in and understand the underlying issues, or do nothing and hope for isolated corrective actions.
Teaching: The case is intended for use in an MBA-level course on global management or an Executive Education program for middle managers. The case highlights both the challenges and the opportunities for leading from the middle of a large, global business.
Thunderbird #: A15-04-0008
Setting: U.S., Germany Industry: Aerospace
Subjects: Organizational behavior; general management
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| Planet Starbucks (B): Caffeinating the World
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| 15 pp.
| Case
Michael Moffett
The case discusses the international expansion efforts of the global coffee retailer, Starbucks. Starbucks had proliferated in several regions of the world, many of which had historical ties to a coffee heritage such as Western Europe. It had also challenged traditionally tea-drinking countries such as Japan and China. In implementing its globalization strategy, the company relies on a set of sound principles that call for astute partner selection, real estate management, and managing the brands. While the company had witnessed critical success in most of its major markets overseas, it appeared to be facing significant challenges in every region. For example, in Japan, revenues had declined and so, too, profitability. New copycat competitors had emerged, and many had started questioning the validity of Starbucks? market saturation strategies. In emerging countries such as Mexico, China, and India, the company saw very good potential, but this rosy picture was somewhat dampened by the ability of the consumer to pay close to $3 for a cup of coffee when local versions retailed at $.50. The case considers several questions related to the future of Starbucks in the global arena, whether it should alter its new-store growth strategy, whether it should rethink its uniform pricing policy in emerging markets where affordability was of paramount importance, and where the next major thrust ought to be.
Thunderbird Number: A07-03-0013 Type: Case
Publication Date:
Geographic Setting: Global Industry Setting: Retailing, Food
Subjects: Industry and competitive strategy; international management
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| POLLY PECK INTERNATIONAL PLC
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| 7 pp.
| Case
Author(s): Kenneth Ferris, Mofilal Gyamlani
Abstract: In September 1990, Polly Peck International was forced into bankruptcy by its lenders. From 1983 to 1989, the company embarked on a major acquisition program, with financing largely provided by banks on a revolving line-of-credit basis. In many instances, the debt was secured by the company’s publicly traded shares. Students are asked to evaluate the company‘s financial health using cash flow analysis, ratio analysis, and bankruptcy prediction techniques.
Teaching: The purpose of the case is twofold. First, provide a forum to illustrate the importance of ratio analysis and cash flow analysis when analyzing the financial health of a company. Second, illustrate the use of bankruptcy/distress prediction techniques.
Thunderbird #: A01-04-0005
Setting: U.K., 1990 Industry: Textile
Subjects: Accounting and control
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| PORSCHE EXPOSED
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| 13 pp.
| Case
Author(s): Michael Moffett, Barbara S. Petitt
Abstract: It was January and Porsche — the legendary manufacturer of performance sports cars -- wished to reevaluate rate strategy. Porsche’s management had always been unconcerned about opinions of the equity market, buts its currency hedging strategy was becoming something of a lighting rod for criticism. Although the currency hedging results had been positive, many experts believed that Porsche had simply been “more lucky than good.” There was a growing nervousness among analysts that the company was actually speculating on currency movements, and that was not in the best interests of shareholders. Analysts were estimating that more than 40% of earnings were to come from currency hedging. Porsche‘s President and CEO, Dr. Wendelin Wiedeking, now wished to revisit the company's exposure management strategy.
Teaching: The case is intended to provide a contemporary debate over the use of financial derivatives (in this case, foreign currency options) as a method for the management of the economic exposure (also called operating exposure) experienced by Porsche as a result of its global sales. Porsche serves as an excellent focal point for this debate, given that it produces in only one currency environment, the euro zone, and then exports products globally. In addition, the decision-making of senior management is also questioned because the firm has continued to be highly controversial in its attitudes and practices related to financial reporting, and the associated practices of management towards shareholders relations and corporate governance as a whole. The case could be used in a class in international finance, international financial management, or corporate finance.
Thunderbird #: A06-04-0004
Setting: Europe, U.S., 2004 Industry: Automotive
Subjects: International finance; foreign exchange exposure; international corporate governance
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| Procter and Gamble versus Bankers Trust: Caveat Emptor
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| 18 pp.
| Case
Author(s): Michael Moffett, Barbara Petitt
Abstract: It was May 1, 1996, and the Procter & Gamble Company (P&G) was nearly out of time. If it was to settle its $200 million lawsuit against Bankers Trust Company (Bankers Trust) out of court, it had to do so soon. The two companies had already suffered two very hard years of a very public disagreement. P&G needed to decide now if it wanted to go to trial, or settle for some amount short of what it actually owed to Bankers Trust (it had never actually paid Bankers Trust any of the funds in question). On a large scale, the controversy surrounding the P&G swap losses had threatened to undermine the widespread use of financial derivatives by corporate treasuries in general. These swaps had been entered into under the guise of hedging, but were now being characterized as purely speculative. Corporate finance groups — and their bankers -- were all asking the same question: How could this happen?
Teaching: The case was written to detail the multitude of issues involved in what is frequently cited as the most prominent derivatives debacle in U.S. financial history. Although finance students are routinely schooled in the construction and valuation of various financial derivatives, including foreign exchange and interest rate swaps, they rarely see how these specific instruments fit within the corporate frameworks of financial policy and procedure. The failure of Bankers Trust to divulge all of the valuation details behind the transaction sold to Procter & Gamble in 1993-94, and the failure of P&G’s treasury staff to pursue their own valuation and mark-to-market due diligence on the transactions entered into, combine to create a situation in which disaster was an eventuality. Topics include the understanding and valuation of leveraged interest rate swap transactions, a bank‘s possible fiduciary duties in regards to corporate customers, and corporate philosophy on differentiating hedging from spec
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| Rite Aid Corporation
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| 37 pp.
| Case
Graeme Rankine
The case focuses on the rapid growth of Rite Aid from a small company established by Alex Glass in Pennsylvania in 1962 to the second largest U.S. retail drug chain based on store count by early 1999. Until the mid-1990s, Rite Aid grew by acquiring smaller chains on the eastern and southern regions in the U.S. Martin Glass, Alex?s son, assumed the position of CEO in 1995 and began an ambitious expansion path. After failing to acquire Revco D.S. in 1995 with over 2,100 stores, Rite Aid acquired Thrifty Payless, a West Coast drug chain with over 1,000 stores in 1996. Thrifty Payless was no stranger to reorganizations, having been the product of Thrifty?s acquisition of Payless Drugs and a subsequent initial public offering in 1995. Rite Aid?s long-term debt increased dramatically after the Thrifty Payless acquisition in 1996 and the acquisition of PCS Health Systems, Inc., the largest pharmaceutical benefit management company (PBM), from Eli Lilly in November 1998. Rite Aid?s top management announced plans to continue its rapid growth, but the company faced many challenges in implementing the aggressive plans, not least of which was the fact that Rite Aid?s stock fell dramatically on March 12, 1999, after the company announced that it would restate its financial statements. The disclosure cast doubt over the likelihood that the company would be able to issue new equity to refinance the debt issued to acquire PCS. Rite Aid faced fierce competition from CVS Corp. and Walgreen Co., companies that were also driven to become low-cost providers of health products and services.
Thunderbird Number: A01-02-0001 Type: Case
Publication Date:
Geographic Setting: U.S. Industry Setting: Retail
Subjects: Accounting; control
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| Sesame Workshop and International Growth
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| 17 pp.
| Case
Andrew Inkpen
Sesame Workshop is the producer of Sesame Street, the highly acclaimed children?s educational show. Since its American debut more than 30 years ago, Sesame Street has achieved great success in many countries. In virtually every country where it was introduced, Sesame Street, or a locally produced version of the show, had become an immediate success. Within Sesame Workshop there was a consensus that many interesting international growth opportunities existed. For example, Sesame Street was not broadcast in large-market countries such as Brazil, France, or India. There were also opportunities for co-productions in many of the countries where the English language version of the show was broadcast. Evaluating the various international opportunities had to take into consideration several factors. Sesame Workshop was a not-for-profit organization with a mission of educating children and their families globally. But, even though Sesame Workshop was a not-for-profit organization, creating a financially viable and growing organization was a necessity.
Thunderbird Number: A07-02-0004 Type: Case
Publication Date:
Geographic Setting: U.S. Industry Setting: Entertainment, Education
Subjects: General management
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| Singapore International Airlines: Preparing For Turbulence Ahead
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| 13 pp.
| Case
Author(s): Kannan Ramaswamy
Abstract: By 2004, Singapore International Airlines (SIA) enjoyed a run of exemplary profitability and service performance. It had built its strategy around the principles of a differentiated positioning using its brand image, geographic location, and outstanding service as the cornerstones of its strategy. The case offers enough data to launch into a rich discussion of the industry factors that drive profitability, and complements it with an in-depth look at the model of strategy that SIA had built in order to compete in the airline business. In recent years, there have been many environmental shocks, such as SARS, that have challenged the continued viability of the model. The company entered into an equity alliance with Virgin that has destroyed significant value. It found itself challenged by the entry of many low-cost airlines in its home market. The case closes with a decision that SIA needed to make about how it would address the onset of low-cost competitors, and whether it would make sense to move away from its differentiated premium approach.
Teaching: This case is designed to be used in a module on business strategy. It is especially effective when it follows a discussion of both cost leadership and differentiation strategies, since the main decision point in the case relates to one of strategic change from one generic archetype to another. It has been very effective with both MBA students and executive audiences.
Thunderbird #: A09-04-0013
Setting: Global, Asia-Pacific Industry: Airlines
Subjects: Industry and competitive strategy; general management
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| Steve Parker and the GFS-China Technologies Venture (A)
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| 5 pp.
| Case
Author(s): Andrew Inkpen
Abstract: GFS-China is a joint venture between Standard Industries (Standard) of the United States and Good Fortune Enterprises (Good Fortune) of China. The joint venture was created to manufacture various automotive heating, ventilation, and air conditioning parts. Two weeks after GFS-China began operating; Good Fortune’s president stopped the joint venture and would not allow the joint venture general manager into the plant. Good Fortune‘s president wrote a letter to Standard and demanded that the joint venture general manager be replaced. After various meetings and communications between the partners, it was decided that a new general manager would be appointed and that the general manager would come from Standard. Steve Parker, a Standard manager who was in China working as Asia Pacific purchasing manager for Standard HVAC, was asked if he would be interim general manager in GFS-China. It was now up to Parker to decide if he should accept the position and, if so, what he should do to get the joint venture back on track.
Teaching: This four-case series is intended to put students in the position of a joint venture general manager trying to build a viable business. The collaborative issues facing the manager involve strategy, finance, and human resources — in short, joint venture general management issues. Ethical dimensions in the (B) case complicate the decision-making. The (A) case ends with Steve Parker being asked to become GFS-China general manager. If he accepts the job, he will be largely on his own, because the only Standard manager with much knowledge about GFS-China has gone back to the United States and no Standard managers were assigned to the venture. Assuming Parker does take the job, the objective with the (A) case is to explore the challenge of a new managerial assignment. What should Parker do first? How should he allocate his time? What skills should he have in order to do an effective job? Ho
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| Steve Parker and the GFS-China Technologies Venture (B)
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| 4 pp.
| Case
Author(s): Andrew Inkpen
Abstract: GFS-China is a joint venture between Standard Industries (Standard) of the United States and Good Fortune Enterprises (Good Fortune) of China. The joint venture was created to manufacture various automotive heating, ventilation, and air conditioning parts. Two weeks after GFS-China began operating; Good Fortune’s president stopped the joint venture and would not allow the joint venture general manager into the plant. Good Fortune‘s president wrote a letter to Standard and demanded that the joint venture general manager be replaced. After various meetings and communications between the partners, it was decided that a new general manager would be appointed and that the general manager would come from Standard. Steve Parker, a Standard manager who was in China working as Asia Pacific purchasing manager for Standard HVAC, was asked if he would be interim general manager in GFS-China. It was now up to Parker to decide if he should accept the position and, if so, what he should do to get the joint venture back on track.
Teaching: This four-case series is intended to put students in the position of a joint venture general manager trying to build a viable business. The collaborative issues facing the manager involve strategy, finance, and human resources — in short, joint venture general management issues. Ethical dimensions in the (B) case complicate the decision-making. The (A) case ends with Steve Parker being asked to become GFS-China general manager. If he accepts the job, he will be largely on his own, because the only Standard manager with much knowledge about GFS-China has gone back to the United States and no Standard managers were assigned to the venture. Assuming Parker does take the job, the objective with the (A) case is to explore the challenge of a new managerial assignment. What should Parker do first? How should he allocate his time? What skills should he have in order to do an effective job? Ho
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| Steve Parker and the GFS-China Technologies Venture (C)
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| 1 pp.
| Case
Author(s): Andrew Inkpen
Abstract: GFS-China is a joint venture between Standard Industries (Standard) of the United States and Good Fortune Enterprises (Good Fortune) of China. The joint venture was created to manufacture various automotive heating, ventilation, and air conditioning parts. Two weeks after GFS-China began operating; Good Fortune’s president stopped the joint venture and would not allow the joint venture general manager into the plant. Good Fortune‘s president wrote a letter to Standard and demanded that the joint venture general manager be replaced. After various meetings and communications between the partners, it was decided that a new general manager would be appointed and that the general manager would come from Standard. Steve Parker, a Standard manager who was in China working as Asia Pacific purchasing manager for Standard HVAC, was asked if he would be interim general manager in GFS-China. It was now up to Parker to decide if he should accept the position and, if so, what he should do to get the joint venture back on track.
Teaching: This four-case series is intended to put students in the position of a joint venture general manager trying to build a viable business. The collaborative issues facing the manager involve strategy, finance, and human resources — in short, joint venture general management issues. Ethical dimensions in the (B) case complicate the decision-making. The (A) case ends with Steve Parker being asked to become GFS-China general manager. If he accepts the job, he will be largely on his own, because the only Standard manager with much knowledge about GFS-China has gone back to the United States and no Standard managers were assigned to the venture. Assuming Parker does take the job, the objective with the (A) case is to explore the challenge of a new managerial assignment. What should Parker do first? How should he allocate his time? What skills should he have in order to do an effective job? Ho
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| Steve Parker and the GFS-China Technologies Venture (D)
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| 1 pp.
| Case
Author(s): Andrew Inkpen
Abstract: GFS-China is a joint venture between Standard Industries (Standard) of the United States and Good Fortune Enterprises (Good Fortune) of China. The joint venture was created to manufacture various automotive heating, ventilation, and air conditioning parts. Two weeks after GFS-China began operating; Good Fortune’s president stopped the joint venture and would not allow the joint venture general manager into the plant. Good Fortune‘s president wrote a letter to Standard and demanded that the joint venture general manager be replaced. After various meetings and communications between the partners, it was decided that a new general manager would be appointed and that the general manager would come from Standard. Steve Parker, a Standard manager who was in China working as Asia Pacific purchasing manager for Standard HVAC, was asked if he would be interim general manager in GFS-China. It was now up to Parker to decide if he should accept the position and, if so, what he should do to get the joint venture back on track.
Teaching: This four-case series is intended to put students in the position of a joint venture general manager trying to build a viable business. The collaborative issues facing the manager involve strategy, finance, and human resources — in short, joint venture general management issues. Ethical dimensions in the (B) case complicate the decision-making. The (A) case ends with Steve Parker being asked to become GFS-China general manager. If he accepts the job, he will be largely on his own, because the only Standard manager with much knowledge about GFS-China has gone back to the United States and no Standard managers were assigned to the venture. Assuming Parker does take the job, the objective with the (A) case is to explore the challenge of a new managerial assignment. What should Parker do first? How should he allocate his time? What skills should he have in order to do an effective job? Ho
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| Tektronix (C)
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| 12 pp.
| Case
Michael Moffett, Arthur Stonehill
In mid-1999, Tektronix, Inc. (Tek) implemented a divestment strategy designed to focus the remaining Tek activities on its Measuring Business Division (MBD). This was its original line of business, but Tek had expanded into a successful Color Printer and Imaging Division (CPID) and a Video and Networking Division. The case is set in October 1999. Tek has already sold off its Video and Networking Division to a private investment group. On September 22, 1999, Tek announced that it had agreed to sell its CPID activities to Xerox Corporation for $950 million in cash. The deal was expected to close in sixty days but would need regulatory approvals. Jerry Davies, Tek?s Treasurer, and Randahl Finnessy, Worldwide Cash manager, needed to make some urgent decisions about Tek?s foreign exchange risk management strategy.
Thunderbird Number: A06-02-0002 Type: Case
Publication Date:
Geographic Setting: U.S., Global Industry Setting: Electronic
Subjects: International finance; risk management
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| The Chad-Cameroon Oil Project: Poverty Reduction or Recipe for Disaster?
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| 12 pp.
| Case
Author(s): M. Edgar Barrett
Abstract: The largely privately funded, $3.7 billion Chad-Cameroon Petroleum Development and Pipeline Project represented the single largest foreign direct investment ever made in Sub-Saharan Africa at the time of its approval by the World Bank in June 2000. This case provides descriptive data about the project, its sponsors, the countries involved (particularly Chad), and the views of some of the project’s critics. It is designed to allow the student to gain a modest, but balanced, view of the process of dealing with large natural resource projects in emerging economies.
Teaching: The focus of the class discussion should be on some of the more important issues surrounding the process of developing a natural resource-based project in a country which faces a host of financial, political, and social issues. Due to its location and size, this particular project involves a complex series of interactions between and among three of the world‘s largest oil firms (Chevron Texaco and ExxonMobil of the U.S., and Petronas of Malasia), several multilateral agencies, and a series of nongovernment organizations (NGOs). In terms of distinct points of focus for the class discussion, or so-called “pastures,” the case easily offers five or six such venues. For many students, this will be on of their few chances to discuss the economic, political, and social reality that exists in many African countries today. Chad is an extreme example, but it does have more than a passing similarity to a number of other countries located on the same continent. There can also be a quite reasonable discussion of the potential benefits and costs to the citizens of Chad of a natural resource-based project such as the one described in this case. These first two pastures set the stage for forays into one or more of several other topical areas. Among those that can be addressed are the following:
1. A more in-depth look at some specific
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| The Global Leadership of Carlos Ghosn at Nissan
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| 12 pp.
| Case
John Milliken, Dean Fu
In 1999, after posting losses in eight of the preceding nine years, Nissan seeks a partnership with Renault. At the request of Nissan, Carlos Ghosn is appointed COO. Ghosn, a Frenchman with Brazilian-Lebanese heritage, who has spent much of his career in Michelin in Latin America and the U.S., has earned the nickname oLe Cost-Killero during his tenure at Renault. Despite his multicultural background, he speaks no Japanese and has no Asian experience. His charter, however, is to quickly turn around the ailing Japanese carmaker, with all the unique challenges of leading change as a foreigner in Japan. He commits to doing it within three years, or resigning. Enlisting middle management, he uses solid change management technique and is successful, but now must confront the process of institutionalizing his initial successes and planning for a successor.
Thunderbird Number: A07-03-0014 Type: Case
Publication Date:
Geographic Setting: Japan Industry Setting: Automotive
Subjects: Global Leadership; Succession Planning; Change Management
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| The Rise and Fall of Iridium
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| 14 pp.
| Case
Andrew Inkpen
This case describes the development and subsequent failure of Iridium. Iridium was a satellite-based communications system initially developed by Motorola and then spun off as a separate company. Using its constellation of 66 low earth-orbit satellites, the Iridium system was intended to provide reliable communications from virtually any point on the globe. On November 1, 1998, Iridium began commercial telephone service, and satellite-paging service began two weeks later. However, a variety of problems plagued the company and by May 1999 Iridium had only 10,000 subscribers. In August 1999, Iridium defaulted on its debt and filed for Chapter 11 bankruptcy protection. In March 2000, with only 50,000 subscribers, Iridium terminated its services. Motorola?s estimated financial exposure to the bankruptcy of Iridium was $2.2 billion.
Thunderbird Number: A07-00-0025 Type: Case
Publication Date:
Geographic Setting: World Industry Setting: Telecom
Subjects: General management
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