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Teaching Materials

newsletter

New Brief Cases in Accounting

Harvard Business PuBlisHing

in this issue 01 03

03 04 new BRIeF CASeS In ACCountIng new BRIeF CASeS In FInAnCe mAthemAtICS FoR mAnAgement new onlIne SImulAtIonS new CASeS, noteS, ARtICleS & BookS

is pleased to announce that it has extended its highly successful Brief Cases collection to the accounting discipline. Currently, five Brief Cases in financial accounting are available for courses, with more to debut in Fall 2009. Characteristics of

Brief Cases :

They are short. The average length of our accounting cases is 9 pages. They are rigorous. Students are given challenging assignments that require quantitative analysis as well as the absorption of important accounting principles. They are targeted at the first-year MBA-level course in accounting. The authors have focused on learning objectives for the first-year course; however, many faculty will find these cases fit nicely into a number of specialized accounting courses. They are accompanied by a comprehensive Teaching Note. Instructors will not be left to determine on their own how to make the best use of these cases. The Teaching Note provides clear guidance on basic themes and principles explored in each case, making it easy for instructors to determine which cases to adopt for course use. Teaching Notes also furnish valuable information and suggestions for facilitating effective class discussion about a case. Four of the five Brief Cases in accounting were written by Harvard Business School Professor Emeritus William J. Bruns. Professor Bruns, who supervised the introductory accounting course at HBS for many years, has published numerous best-selling cases in financial accounting. His article "Why I Use the Case Method to Teach Accounting" (#193177) is regarded by many instructors as a persuasive argument for the value of participant-centered learning in accounting courses.

05 05 05 06 08 10 13 15 16 17 18 20 21

Accounting & Control Business & government Competitive Strategy entrepreneurship Finance general management human Resource management management of Information Systems marketing operations management organizational Behavior & leadership Social enterprise & ethics

23 ContACt InFoRmAtIon 23 new weB SIte

BC Role plAyS

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New Brief Cases in Finance

Midland Energy Resources, Inc.: Cost of Capital

Timothy A. Luehrman, Joel L. Heilprin

MAiN TopiCs: WACC and CAPM seCoNdAry TopiC: effect of capital

Brief Cases in aCCounting For more information about Brief Cases in Accounting, Marketing, and organizational Behavior, visit our web site at hbsp.harvard.edu.

The Talbots, Inc., and Subsidiaries: Accounting for Goodwill

William J. Bruns, Jr.

structure on the WACC

Product #4129 · Teaching Note #4130

Expansion and Risk at Hansson Private Label, Inc.: Evaluating Investment in the Goliath Facility

Thomas R. Piper, Jeffrey DeVolder

MAiN TopiCs: NPV, capital budgeting seCoNdAry TopiC: capital planning

In 2006, Talbots, Inc., a specialty women's retailer, purchased a competitor, J. Jill. The transaction created a large goodwill account. Talbots determined that the goodwill was not impaired in its fiscal year 2007 and it was carried forward at its purchase cost. But one year later, Talbots finds that the goodwill is impaired, and this and other impairments are deducted from revenues in fiscal year 2008. Learning Objective: To gain an understanding of what goodwill is, how it originates, how it is measured at acquisition, and how it is amortized or impaired.

Product #3254 · Teaching Note #3257

consequences of repurchasing company bonds outstanding using cash that might be obtained by issuing new bonds at a lower interest rate. Learning Objective: To understand the nature of a bond contract and to isolate the cash flows when the bond is issued, during each investment period, and the point when the bond is finally retired. To understand the multiple impacts of changing interest rates on bonds.

Product #3215 · Teaching Note #3216

as an organizational process

Product #4021 · Teaching Note #4024

Depreciation at Delta Air Lines: The "Fresh Start"

William J. Bruns, Jr.

Ceres Gardening Company: Funding Growth in Organic Products

John H. McArthur, Sunru Yong

MAiN TopiCs: interpretation of financial

statements and the importance of cash flow; making financial projections seCoNdAry TopiC: credit policy

Product #4017 · Teaching Note #4018

Merrimack Tractors and Mowers: LIFO or FIFO?

William J. Bruns, Sharon Bruns, Susan S. Harmeling

COMing sOOn Mercury Footwear: Valuing a Business

Timothy A. Luehrman, Joel L. Heilprin

MAiN TopiCs: formulating operating projections; computing debt-free cash flows; calculating enterprise and equity value seCoNdAry TopiCs: estimating terminal

values and WACC; performing sensitivity analysis; adjusting for non-operating assets/liabilities

Product #4050 · Teaching Note #4051

Product manufacturing costs are increasing faster than competitors' costs, and earnings are likely to fall below those reported in 2007. The controller perceives that if the company changed from LIFO to FIFO it might be possible to maintain earnings growth in 2008. He explains to the president how inventory flow assumptions work and provides pro-forma income statements that show that, for one product, adopting FIFO would allow Merrimack to report higher income in 2008 than it did in 2007, but higher income taxes would have to be paid. Learning Objective: To expose students to differences in permitted methods of inventory valuation; this leads to a discussion of how asset valuation, income, and taxes are interrelated. To introduce the idea that companies have choices about accounting policies used in preparing financial reports.

Product #3217 · Teaching Note #3219

In estimating depreciation, Delta has changed its assumptions about aircraft lifespan and residual values four times in three decades; most recently, Delta adopted fair value accounting as part of its "fresh start" emergence from bankruptcy. Each of these policy changes has affected future asset values as well as present and future income. Learning Objective: To become acquainted with the components of depreciation policy. To link accounting policies to financial reporting choices, business strategies, and the challenges of financial analysis.

Product #4013 · Teaching Note #4016

Biovail Corporation: Revenue Recognition and FOB Sales Accounting

Craig J. Chapman

Blaine Kitchenware: Capital Structure

Timothy A. Luehrman, Joel L. Heilprin

MAiN TopiCs: effects of leverage on firm value, M-M conditions; optimal capital structure; static trade-off theory; interest tax shields; costs of financial distress seCoNdAry TopiCs: effects of leverage

Lyons Document Storage Corporation: Bond Math

William J. Bruns, Jr.

on financial ratios; measuring leverage and liquidity

Product #4040 · Teaching Note #4041

Biovail Corporation, a major pharmaceutical company, announces that it will miss its quarterly earnings target, blaming $10 to $15 million of the shortfall on a truck accident involving a shipment that left its facility on the last day of the quarter. The company was ultimately prosecuted by the SEC; the case centers on the question of revenue recognition and how the company should have accounted for the sales (FOB company or FOB destination). The case also provides a rich setting for exploration of peripheral topics such as the ethics of earnings management. Learning Objective: To explore concepts of revenue recognition.

Product #4011 · Teaching Note #4012

In 2009, a recent MBA must analyze the possible refunding of bonds issued in 2000 when interest rates were much higher. She must consider the possible

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Teaching Materials Newsletter · Fall 2009

Mathematics for Management

A New online Course

introduces students to the Microsoft Excel functions and formulas that facilitate the application of these math concepts. Mathematics for Management engages students by using the storyline of several families operating businesses in the hypothetical town of Smalltown, USA, to explain mathematical concepts in an intuitive way with accessible, engaging examples. Visual animations and graphics also support the learning objectives and bring concepts to life. The "seat time" for students is approximately 10­15 hours and includes pre- and post-tests for each topic section. The course is also appropriate for executive education and undergraduate classes. The course was authored by Professor Wayne Winston (with Sarah Fairchild Sherry) who also co-authored Spreadsheet Modeling (#3252), part of the growing collection of introductory online courses available from Harvard Business Publishing. These courses include:

· Finance (#208719) · Financial Accounting (#105708) · Quantitative Methods (#504702) · spreadsheet Modeling (#3252)

MATHEMATICS FOR MANAGEMENT by Professor Wayne Winston and Sarah Fairchild Sherry · Product #3350 · Teaching Note #4049

and in the business world, mathematics is used to solve a wide range of practical business problems. For example, in finance, managers calculate the net present value of a stream of future cash flows; in economics, they calculate a profit-maximizing price for a product; and in marketing, they use statistics to draw conclusions from market research results. This fall, Harvard Business Publishing will premiere its latest online course, Mathematics for Management. The course outline was developed with input from professors of quantitative disciplines and is designed to level the playing field among incoming MBA students, regardless of prior professional or academic background, and aid them in

during an MBa PrOgraM

applying appropriate math strategies to practical business problems. It can be used as a prematriculation offering or as reference support during the academic year. Mathematics for Management reviews the key mathematics concepts and skills that students should be familiar with in order to handle quantitative problems in the MBA curriculum. The concepts are organized into four separate modules: Algebra/Math Review, Calculus, Statistics/Probability, and Mathematics of Finance. A sampling of concepts covered includes Mathematical Notation, Exponents, Linear Functions, Polynomial Equations, Inequalities, Statistics, Derivatives, Time Value of Money, and Bond Pricing. The course also

For more information about Mathematics for Management and other online courses, visit hbsp. harvard.edu/list/online-courses.

> learn MOre On Our weB site: hbsp.harvard.edu

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New online simulations

in project Management and Marketing

Available for Fall 2009, two new online simulations: Project Management: Scope, Resources, Schedule and Marketing: Managing Segments and Customers. Both simulations are designed for administrative ease and student engagement. Each is accompanied by a detailed Facilitator's Guide, including screen-by-screen instructions. Project Management: scope, resources, schedule

Robert D. Austin

In this single-player simulation, students make both quantitative and qualitative decisions as they manage a critical new product development project for a printer manufacturer. The students' objective is to bring the product to market on time and on budget, ahead of the competition. Explores the three major project management levers--scope, resources, and schedule--and their pivotal role in a project's success or failure. Faculty can choose from a variety of scenarios to meet specific learning goals. Ideal for courses in Operations Management and Project Management.

Product #3356 · Teaching Note #4047

Marketing: Managing segments and Customers

Das Narayandas

Acting as CEO of a company that manufactures motors used in medical devices, students make a variety of marketing management decisions over a period of 8 quarters. This single-player simulation focuses on the link between strategy formulation and execution, requiring students to face real-world challenges: budgeting for market research, evaluating investment in product features, and exploring the relationship between customer satisfaction and firm profitability. Students also explore segmentation, targeting, and positioning, and must learn to respond to customer needs while maintaining a level of consistency in marketing strategy formulation. Ideal for courses in Marketing (especially business-to-business issues), Strategy, and Consumer Marketing.

Product #3341 · Teaching Note #4048

Teaching faculty can receive preview access to online simulations. Contact customer service at 1-800-545-7685. (Outside the U.S. and Canada, 1-617-783-7600.)

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Teaching Materials Newsletter · Fall 2009

ACCOU N TIN G & CON TR OL -- B U SIN ESS & GOV ERN MEN T

Cases

Newly releAsed

aCCOunting & COntrOl

The AFSCME vs. Mozilo...and "Say on Pay" for All! (A)

Fabrizio Ferri

Harvard Business School Case (Field) Product #109009 (32 pages) Supplement #109057

nOtes artiCles BOOks

A union seeking to protect its pension funds through shareholder activism focuses on corporate governance and executive compensation. The case uses Countrywide Financial as an example. Richard Ferlauto, director of pensions and benefits policy at AFSCME, the largest public sector workers union in the U.S., was responsible for protecting the pensions of its members. Because pensions were invested for decades, Ferlauto wanted the companies in which the union invested to be managed for the long-term interests of shareholders. The case explores the history of AFSCME's shareholder activism on this front and particularly its use of shareholder proposals voted on at annual meetings. The case then looks at the issue of executive compensation and the idea that excessive compensation is a sign of poor governance. It also discusses the union's Say on Pay proposals that sought to allow shareholders an advisory vote on executive compensation.

Learning Objective: To allow students to evaluate the role of executive pay in corporate governance and assess potential reforms aimed at increasing shareholder power over board decisions.

producer in Japan and second-largest in the world, faces challenges in pursuing its strategy to become a true international player. Nippon Steel had long been the top Japanese company; however, the emergence of a global player, Arcelor-Mittal, prompted globalization of the steel industry. Nippon Steel feels the urgent need to also globalize by not just increasing overseas production but also making necessary changes to the company structure.

these directly impacted its fee. After beta testing the TSCC for one year, VM's Daniel Borunda and O&M's Michael Stefanic believed that TSCC was a better and more cost-effective pricing model, but could they convince their companies to continue to invest in TSCC?

Learning Objective: Study how a lean healthcare organization partners with a supplier, using an innovative pricing model to drive efficiencies in the supply chain.

Supply Chain Partners: Virginia Mason and Owens & Minor (A)

V.G. Narayanan

Harvard Business School Case (Field) Product #109076 (27 pages) Supplement #109077

Business & gOvernMent

The First Global Financial Crisis of the 21st Century

laura Alfaro, renee Kim

Harvard Business School Case (Secondary Source) Product #709057 (15 pages)

Virginia Mason Medical Center (VM) hired Owens & Minor (O&M) as its alpha vendor for medical/surgical supplies in 2004. By 2005, O&M was performing JIT and LUM services for VM, but they believed the pricing model in the industry was outdated. VM and O&M partnered to create the Total Supply Chain Cost (TSCC) pricing program, an activity-based model that assigned all the cost drivers of distribution and inventory handling to VM but also assured O&M of a profit. The TSCC incented VM to streamline its distribution activities, since

The global economy was expected to suffer from negative growth for the full year in 2009, a phenomenon not seen since World War II. While the U.S. subprime mortgage disaster was blamed as the original instigator, it was noted that the "global imbalances" of the U.S. current account deficit funded for many years by other nations

aPPlY fOr eduCatOr aCCess On Our weB site

Faculty authorized on our web site receive: Educator copies of cases, articles, book chapters, and role plays Preview access to online courses and simulations Teaching Notes Course planning tools Special pricing for students These benefits are available to teaching faculty at academic institutions. APPLY NOW at educatoraccess.hbsp.harvard.edu

Nippon Steel Corporation

srikant M. datar

Harvard Business School Case (Field) Product #109038 (18 pages)

Nippon Steel Corporation, the largest steel

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BU S IN E SS & G OV E R N ME NT -- CO M P ETI TI VE STRATE GY

such as China, was also a chief culprit of the crisis. Policymakers around the world recognized that the scope and scale of the financial crisis required a coordinated global response. Yet there were conflicting views on what kind of action was needed to address the first global financial crisis of the 21st century.

Learning Objective: Identify the deep interrelationship among world economies that led the U.S. subprime mortgage crisis to spread to a global level and understand the possible policy options and their potential effects.

between protecting private property and ensuring national development, and the limits to government intervention in private markets.

The World Food Programme during the Global Food Crisis (A)

Anette Mikes, peter Tufano, eric werker

Harvard Business School Case (Field) Product #709024 (24 pages) Supplement #709052 Teaching Note #709053

to turn things around, Finance Minister Dr. Amnuay Viravan resigned over policy disagreements and the Thai stock market plunged as investors feared a currency devaluation. As Amnuay's successor, Thanong, tried to pick up the pieces, he uncovered an awful secret: Thailand's central bank had virtually no liquid foreign exchange reserves left to defend its exchange rate. What action should he take? And, more important, what action could he take?

Special Economic Zones in India: Public Purpose and Private Property (A)

lakshmi iyer, laura Alfaro

Harvard Business School Case (Field) Product #709027 (25 pages) Supplement #709029 Teaching Note #709028

Rising food prices threatened an unprecedented number of people around the world with malnutrition or starvation in 2008. The new executive director of the United Nations World Food Programme (WFP)--the world's largest food relief agency--must not only address this challenge but also must also rethink the WFP's strategy in the rapidly changing world of humanitarian assistance.

Learning Objective: Causes of food crisis, global response to hunger, managing a multilateral organization, commodity prices, enterprise risk management, and crisis management.

China's Trade Disputes

david w. Conklin, danielle Cadieux

Ivey School of Business Case Product #909M18 (15 pages) Teaching Note #809M16

In 2005, the government of India enacted the Special Economic Zones (SEZ) Act in order to attract investment, generate export revenues, and create manufacturing jobs. However, several planned projects faced difficulties in acquiring land for setting up an SEZ. In December 2007, the government introduced a new piece of legislation that proposed to extend the power of eminent domain to allow the government to acquire land for SEZs. Was this the right response to the land acquisition problems of private firms? Was the SEZ strategy the right one for India's economic growth?

Learning Objective: Discuss the right balance

Thailand: An Imbalance of Payments

Michael J. enright, James Newton, Mary Ho, elyssa Tran, ricky lai

University of Hong Kong Case Product #HKU804 (19 pages)

In June 1997, Thailand's currency became the object of intense speculation as the country's balance of payments was in tatters. Amid the government's efforts

C o M P e t i t i V e s t r at e g Y

By 2009, China's exports had increased dramatically, from $250 billion in 2000 to a projected $1,500 billion in 2009. This enormous growth of exports severely damaged competing businesses in the advanced nations, particularly in the United States and Europe. China's entry into the World Trade Organization (WTO) in 2001 guaranteed China's right to export to these nations, but at the same time the WTO required China to adhere to certain rules that sought to support fair trade and create a level playing field. Several broad subjects gave rise to a series of trade disputes: the protection of intellectual property, health and safety concerns about China's products, labor and environmental standards, China's manipulation of its currency, and costs and prices determined by the government rather than free markets. This case examines each set of trade disputes and China's attempts to resolve them. It also examines the WTO dispute resolution procedures and enforcement mechanisms that have been directed at China's trade disputes.

strategy: Create and implement the Best strategy for Your Business

Harvard Business Essentials Series

Covers strategy from the ground up, explaining what strategy is, how to put together a strategic plan, what tools and resources are necessary to execute it, and how to measure results. provides background information, comprehensive advice, and guidance on the most relevant topics in strategy.

availaBle in CHaPters Product #6328 · isBn 978-1-59139-632-1 · Paperback · 192 pages · $19.95

COMPetitive strategY

CBS and Online Video

dennis yao

Harvard Business School Case (Secondary Source) Product #709447 (12 pages)

In late March 2007, CBS faces an important decision about its online video strategy. A just-announced joint online distribution

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Teaching Materials Newsletter · Fall 2009

COMPETITIVE ST R AT E GY

venture between NBC Universal and News Corporation (Fox) is the impetus for this decision. Should CBS join forces with this new venture, come to terms with YouTube (the leading video-sharing site on the Internet), or maintain a nonexclusive strategy?

Learning Objective: To provide a discussion vehicle through which students learn how to think about multiple-player strategic interactions, coalition building, and strategic leadership.

best customers. Furthermore, travel agents tended to favor whichever GDS offered the highest commissions--impeding price competition among GDSs. Against this backdrop, American considered how best to cut its GDS costs.

Learning Objective: Pricing and strategy in a complex networked business with lock-in, convoluted payments, and changing regulatory requirements.

ler, and simple but fun games made the console a hit by appealing to people who were traditionally not avid video game users. Microsoft's and Sony's more powerful machines remained targeted at the traditional "core gamer" audience: 18to 65-year-old males. Sony was determined to restore that supremacy, in the current generation or the next.

Learning Objective: The importance of complementors as a factor shaping strategy. Two-sided platform strategy. Network externalities.

Microsoft's Search The Cleveland Clinic: Growth Strategy 2008

Michael e. porter

Harvard Business School Case (Field) Product #709473 (22 pages)

Jan w. rivkin, eric Van den steen

Harvard Business School Case (Field) Product #709461 (18 pages)

In 2008, The Cleveland Clinic is restructuring the organization into teams defined around patient needs rather than traditional medical specialties. "Patients First!" takes shape as the teams measure and report outcomes, coordinate care, and develop systems to support improving value for patients. In addition to restructuring care delivery in the hospitals and throughout northeastern Ohio, the clinic has investments, facilities, and staff in several other states in the U.S. as well as in Canada and Abu Dhabi. It is also considering initiatives in Austria, China, and India. Students can explore strategy transformation, geographic expansion, the process of introducing new measurement approaches, alignment of activities with strategic goals, and issues in leading change both within a company and across an economic sector.

Learning Objective: Healthcare growth strategy.

In 2008, executives at Microsoft must decide how to compete against Google in the market for Internet search and advertising. The case describes how Microsoft has responded to a set of competitive threats in the past, how Google has gained a dominant position in Internet search and advertising, and what Microsoft has done so far in its as-yet-unsuccessful effort to catch up with Google. The case then challenges students to construct a strategy that will allow Microsoft to achieve its objectives in the evolving market for search and advertising.

Learning Objective: Introduce students to the topic of competitive dynamics, with a special emphasis on competitive dynamics in markets with network effects. Allow discussion of direct and indirect network effects, responses to substitution and imitation threats, and the nature of "winnertake-all" markets. Examine how to attack a competitive position that is protected by network effects.

Nintendo's Disruptive Strategy: Implications for the Video Game Industry

Ali Farhoomand, Havovi Joshi

University of Hong Kong Case Product #HKU814 (24 pages) Teaching Note #HKU815

Distribution at American Airlines (A)

Benjamin edelman

Harvard Business School Case (Field) Product #909035 (10 pages) Supplement #909036 Teaching Note #909059

Responding to the Wii?

Andrei Hagiu, Hanna Halaburda

Harvard Business School Case (Secondary Source) Product #709448 (18 pages) Teaching Note #709481

In April 2008, Nintendo was ranked seventh in the annual BusinessWeek-Boston Consulting Group listing of the world's most innovative companies. The award recognized the company as an innovative design powerhouse that had challenged the prevailing business model of the video game industry with its new video game console, the Wii. Nintendo believed that the video game industry had been focusing far too much on existing gamers and completely neglecting nongamers who could well be the source for future growth. Armed with this insight, Nintendo had developed a radically different strategy by producing the Wii, whose processing power was dwarfed by that of the PlayStation 3 and Xbox 360. Nevertheless, it soon became evident that Nintendo's Wii was a runaway success. How has Nintendo achieved this success? Has the company really disrupted the video game industry? What course of action is available to Nintendo's competitors?

Learning Objective: To introduce the concept of disruptive technology. To analyze how a creative innovation can impact existing industry dynamics. To discuss the key principles by which successful firms can introduce and manage disruptive innovations. To discuss the options available to competition in the wake of a disruptive innovation.

American Airlines sought to reduce the fees it pays to global distribution services (GDSs) such as SABRE to reach travel agents. But GDSs held significant tactical advantages. For example, GDSs had signed long-term exclusive contracts with the corporate customers who were American's

After years of gaming console industry leadership, how should Sony respond to the overwhelming success of competitor Nintendo's user-friendly Wii over Sony's high-tech PlayStation 3? Though the Wii was technologically much less advanced than PS3 and Xbox 360, the Wii's ease of use, innovative motion-sensitive control-

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COM PE T I T I V E ST R AT EGY -- E NTRP RENE URS H I P

Pro Clean, Tennessee

Jim Kayalar

Ivey School of Business Case Product #908M91 (15 pages) Teaching Note #808M91

The owner of a carpet cleaning operation in Tennessee is urgently looking for solutions after his business expansion project fails. The owner has emulated the business model of a well-established competitor, hoping that what has worked for his competitor would also work for him. The business is churning cash fast as a result of the additional cost of personnel and equipment and could face bankruptcy in the near future.

Learning Objective: The case can be best used to assess business strategy, process reengineering, entrepreneurship, and marketing issues. It is positioned to introduce strategy, marketing, and human resource concepts and frameworks.

benefit a firm. Understand IT infrastructure outsourcing and management issues such as personnel reductions and organizational change. Learn which outsourcing pricing model is the best fit for a project. Create a rigorous cost-benefit financial analysis and ROI model for IT infrastructure outsourcing. Analyze the model and learn how to financially engineer the deal to be a win-win for the outsourcer and client.

Valuing Infrastructure Investment: An Option Games Approach

lenos Trigeorgis, Han T.J. smit

California Management Review Article Product #CMR419 (23 pages)

Reinventing Your Business Model

Mark w. Johnson, Clayton M. Christensen

Henning Kagermann Harvard Business Review Article Product #R0812C (12 pages)

Outsourcing at Office Supply Inc.

Mark Jeffery, James Anfield, subhankar Bhowmick

Kellogg School of Management Case Product #KEL308 (19 pages) Supplement #KEL310 Supplement #KEL311 Teaching Note #KEL309

Office Supply Incorporated (OSI) is a company in crisis, with challenges in its cost structure, and poor IT performance. Outsourcing to Technology Infrastructure Solutions (TIS) is an opportunity to both reduce costs and complexity for the firm, but students first must consider whether outsourcing is a good strategic fit for OSI. Detailed spreadsheet templates based on a real outsourcing client engagement for a major infrastructure outsourcing company are provided. The spreadsheets allow students to quickly address the management challenge: how should TIS price and structure the outsourcing deal? Answering this question provides deep insights into the business case for IT outsourcing and how outsourcers financially engineer a deal structure to ensure a win-win outcome for both the client and the outsource service provider.

Learning Objective: Understand the strategic context of IT outsourcing and when it will

Why is it so difficult for established companies to pull off the new growth that business model innovation can bring? They don't understand their current business model well enough to know if it would suit a new opportunity or hinder it, and they don't know how to build a new model when they need it. Game-changing opportunities deliver radically new customer value propositions: they fulfill a job to be done in a dramatically better way (as P&G did with its Swiffer mops), solve a problem that's never been solved before (as Apple did with its iPod and iTunes electronic entertainment delivery system), or serve an entirely unaddressed customer base (as Tata Motors is doing with its Nano, the $2,500 car aimed at Indian families who can't afford any other type of car and usually use motorcycles to get around). Doing so doesn't always require a new business model, but a new model is called for under certain conditions. It is often needed to leverage a new technology (as in Apple's case), is generally required when the opportunity addresses an entirely new group of customers (as with the Nano), and is surely in order when an established company needs to fend off a successful disruptor (as the Nano's competitors will now need to do).

Learning Objective: To become familiar with the types of opportunities and challenges that suggest a company should change its business model.

To understand the recent trend toward privatization of infrastructure assets (e.g., airports), this article proposes a valuation methodology based on real options and game theory analysis that enables assessing when investors might overpay for infrastructure assets over standard discounted cash flow methods and when a premium is justified for their operating flexibility or strategic growth option value. While some infrastructure asset acquisitions may involve financial transactions whose value derives primarily from their expected cash flows, many of these infrastructure investments provide a platform and create the strategic context within which a firm can grow.

entrePreneursHiP

Avid Radiopharmaceuticals: The Venture Debt Question

Matthew rhodes-Kropf, Ann leamon

Harvard Business School Case (Field) Product #809086 (21 pages)

The CEO of a promising biotech company must decide how to respond to the economic slump of late 2008. He had planned to pursue an aggressive schedule, moving the firm's Alzheimer's and Parkinson's disease imaging compounds through clinical trials and into the market. This involved expanding the firm's facilities and head count, and he planned to fund this by taking on venture debt. Although clinical trial data is extremely encouraging, questions about raising his next venture round and the overall environment have made him question the wisdom of this plan. This case gives students an opportunity to explore the true cost of venture debt and when it is best used to achieve the goals of all parties--venture capitalists, entrepreneurs, and venture lenders.

Learning Objective: To introduce students to the subtleties of biotech investing and venture debt.

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teaching Materials newsletter · fall 2009

ENTRP R E N E U R S H I P

Big Spaceship: Ready to Go Big?

Boris Groysberg

Harvard Business School Case (Field) Product #409047 (37 pages) Teaching Note #409087

Big Spaceship, a digital marketing agency, faced a big challenge: how to scale the distinctive culture that was essential to its competitive strategy. Renowned for the cutting-edge web sites that it developed to market major Hollywood movies and leading consumer brands, the firm had won numerous awards and garnered considerable attention within the advertising industry. In mid-2008, Big Spaceship remained small but was poised for significant growth. For founder and CEO Michael Lebowitz, the central challenge was to figure out whether and how the agency could retain its boutique culture while transcending its boutique size. The case begins by briefly outlining Lebowitz's background, along with the history of Big Spaceship since its founding in 2000. Then the case shifts to a discussion of external dynamics: the firm's value proposition, which focused on providing start-to-finish, strategy-driven digital marketing solutions; its interaction with clients; and its relationship with established players in the advertising industry. Next, the case examines the firm's internal dynamics. Finally, the case provides an overview of key issues that Lebowitz and his team must consider as they plan for the firm's growth--how to raise capital, how to gauge the optimal size for the company, how to manage an expanding staff.

Learning Objective: To explore the alignment of organizational design, human resources, culture, and competitive strategy in a growth-oriented and human-capitalintensive company.

his Blogger experiences had included a major blowup with his co-founder that resulted in legal proceedings, a brush with near bankruptcy, and the laying off of his entire team, Williams has become even more disillusioned with his current venture, Odeo. Odeo, a podcasting pioneer, had debuted almost two years before and had gotten off to a very strong start, with a high-profile debut at a prominent industry conference, coverage on the front page of the New York Times Business section, and the raising of a large round of financing from a top-tier venture capital firm. His attempts to find an acquirer have failed, layoffs have begun, and he is now facing a meeting with an increasingly hostile board of directors. At that meeting, he is very tempted to resign so he can move on to his next project and regain the thrill of being an entrepreneur.

Learning Objective: To examine alternate approaches to founding and building new ventures by examining the decisions and actions of a serial entrepreneur who has taken a very different approach with each of his first two ventures.

profitability and strong growth. However, sustaining growth would prove challenging. Growth had strained Linden Lab's technical infrastructure. Also, although Second Life had attracted a large, loyal base of early adopters, it was unclear whether their preferences were similar to those of mainstream consumers. In this context, management faced choices about platform strategy and target markets. Should Linden Lab continue to offer an open platform or build its own solutions for customers? Should it target adult consumers, teens, enterprise customers, or the education market?

Learning Objective: Explore issues facing an entrepreneurial firm managing the transition from proof of concept to accelerated growth.

Farming Pharmaceuticals: Ventria Bioscience and the Controversy over Plant-Made Medicines

Anne T. lawrence

Ivey School of Business Case Product #909M11 (11 pages)

Linden Lab: Crossing the Chasm

Thomas eisenmann, Alison Berkley wagonfeld

Harvard Business School Case (Field) Product #809147 (26 pages)

In early 2008, managers at Linden Lab, creator of the virtual world Second Life, faced decisions about the company's growth strategy. Despite profound initial skepticism about demand for a usergenerated virtual world that was not a traditional game, Second Life had achieved

This case focuses on the challenges facing Ventria Bioscience, a small biotechnology firm based in California. The company had developed an innovative technology for "growing" genetically modified rice proteins useful in the treatment of childhood diarrhea. The company's efforts to obtain regulatory approval in California to commercialize its invention met with a firestorm of opposition from a wide range of stakeholders, including environmentalists, food safety activists, consumer advocates, and rice farmers. The case presents the hurdles faced by Ventria as it has attempted to commercialize its invention in

Evan Williams: From Blogger to Odeo (A)

Noam wasserman

Harvard Business School Case (Field) Product #809088 (14 pages) Supplement #809093 Teaching Note #809137

entrePreneurshiP

entrepreneur's toolkit: tools and techniques to launch and grow Your Business

Harvard Business Essentials

This comprehensive guide covers all the key elements that help entrepreneurs succeed, from the basics of writing a business plan to the challenges of developing a marketing and sales program.

availaBle in CHaPters Product #4368 · isBn 978-1-59139-436-5 · Paperback · 256 pages · $24.95

For several months, founder-CEO Evan Williams has felt trapped, unable to control Odeo and its strategic direction. He longs for the "simple" days of Blogger, the previous venture he had co-founded. Although

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E N TR PR E N E UR S H I P -- FI NANC E

the context of the broader debate over the ethics of plant-based medicines.

Learning Objective: Identify a biotechnologybased start-up company's relevant stakeholders, their interests, and sources of power. Generate options for moving forward in the face of significant stakeholder opposition. Develop a strategy for commercializing a controversial technology.

have evidently been successful, and it has defined a new product category in China and in the world.

Focus Media (A): Building a Chinese Media Giant

George Foster, Ning Jia, david w. Hoyt

Stanford Graduate School of Business Case Product #E330A (19 pages) Supplement #E330B

company and how those can be changed as the result of growth. The company chose acquisition as its primary growth strategy after its IPO, which incorporated both risks and benefits. The core competencies that led it to its initial success must be reevaluated in light of the changes that the company encountered through growth and acquisitions.

Joyoung Soymilk Maker: Segmentation, Targeting, and Positioning

yi Qian

Kellogg School of Management Case (4 pages) Product #KEL386

The Joyoung brand was launched in 1994, when a group of recent college graduates invented the world's first automatic hot soymilk-maker home appliance. Joyoung's sales grew rapidly from RMB 6 million in 1994 to 120 million in 1999, and this trend has continued into the new century. By the first quarter in 2006, the signature product of Joyoung had already surpassed the sales by Philips Home Appliances in the Chinese market. Contrary to its current success, however, Joyoung Soymilk Maker's launch did not go smoothly. When the first model of the automatic soymilk maker was introduced in 1994, people had no idea what this new product was supposed to do. The first 2,000 units of Joyoung products remained stacked in storage for months. Joyoung then decided to conduct some marketing research. Joyoung's repositioning strategies and new product developments based on its marketing research

In 2003, Focus Media pioneered digital outdoor advertising in China, placing LCD displays in locations in leading commercial buildings that had areas of high traffic and waiting times, such as lobbies and elevator waiting areas. This provided advertisers with a targeted way to access middle- and high-income consumers and was far more effective than conventional television advertising. Focus Media invested heavily to quickly gain control of this market. It was soon profitable and acquired other companies in related businesses. By 2007, it had revenues of more than $500 million, more than $250 million in cash and a market capitalization of $6.5 billion, and was included in the Nasdaq 100 nonfinancial firms. In light of this rapid, successful growth, the company looked to the future with optimism. There were suggestions that it might acquire SINA, the leading Chinese Internet portal. Expansion to other countries was also a possibility. In light of this success, the case asks students to consider how the company should best proceed.

Learning Objective: This case can be used to evaluate the sources of success for a

finanCe

Groupe Eurotunnel S.A. (A)

stuart C. Gilson, Vincent dessain

Harvard Business School Case (Field) Product #209062 (23 pages) Supplement #209113

In the summer of 2006 the chairman and CEO of Eurotunnel Group is faced with the decision of whether to file for bankruptcy protection, after having failed to gain creditor approval of an ambitious out-of-court restructuring plan. Eurotunnel is jointly listed in the U.K. and France, and its shareholders, who are largely based in France, face the prospect of significant dilution under any restructuring plan. Eurotunnel's capital structure is staggeringly complex, and a large fraction of its debt has come to be held by U.S.-based hedge funds that specialize in investing in distressed companies. Eurotunnel's business is extremely challenging to value and is faced with significant competition. If the current CEO decides to file for bankruptcy, he faces the additional choice of whether to file for bankruptcy in the U.K. or in France, which take quite different approaches to restructuring troubled companies.

Learning Objective: To analyze restructuring of a complex capital structure, compare bankruptcy laws in different countries, value a complex long-lived asset, and assess the role and impact of hedge funds in restructuring distressed companies.

finanCe

Manager's toolkit: the 13 skills Managers need to succeed

Harvard Business Essentials Series

Zeroing in on the specific skills that make great managers stand out from the pack, this comprehensive guide is both an essential primer for new managers and a valuable resource for seasoned executives. included: understanding key financial statements, preparing budgets, hiring and retaining good people, motivating and developing team members, and setting goals for others.

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The Tip of the Iceberg: JP Morgan and Bear Stearns (A)

daniel B. Bergstresser, Clayton rose, david lane

Harvard Business School Case (Field) Product #309001 (37 pages) Supplement #309070 Supplement #309091

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teaching Materials newsletter · fall 2009

F IN A N CE

Teaching Note #309072

Bear Stearns & Co. burned through nearly all its $18 billion in cash reserves during the week of March 10, 2008, and an unprecedented provision of liquidity support from the Federal Reserve on Friday, March 13, was insufficient to reverse the decline in Bear's condition. Federal Reserve Chairman Benjamin Bernanke, Treasury Secretary Henry Paulson, and New York Fed President Timothy Geithner were intent on limiting the impact of Bear's problems on the wider financial system. James "Jamie" Dimon, Morgan's chairman and CEO, was in frequent contact with these regulators over the weekend of March 14-16, negotiating possible scenarios for the rescue of Bear, without which Bear would be forced to seek bankruptcy protection when markets opened on Monday. Late on Sunday afternoon, March 16, Bear's board accepted Morgan's offer to purchase Bear for $2 per share, an offer that would not have been made without significant government assistance. There was hope that the Bear rescue would help avert the far-reaching spread of damage into the larger financial world that many policymakers viewed as likely to follow the failure of a major investment bank. This case examines a seminal event in the financial and economic crisis that began in the summer of 2007 and provides background for better understanding the full scope of the crisis as it was revealed during the summer and fall of 2008.

Learning Objective: Corporate finance issues of capital, liquidity, and firm valuation. General management issues of internal and external governance and of navigating a firm through a crisis when faced with compelling pressures and competing stakeholder interests.

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confronts students with a question: To what extent is this spin-off opportunity attractive from a value-investing standpoint? Historically, spin-offs have been attractive investments because of supplydemand dynamics associated with their investor bases. The case is an opportunity to ask whether the same dynamics will operate for TA.

Learning Objective: To provide a conceptual justification for why spin-offs can be attractive value investing opportunities. To ask whether the themes associated with successful spin-off investments can be applied in the case of TA.

WL Ross and Plascar

C. Fritz Foley

Harvard Business School Case (Field) Product #209091 (16 pages) Supplement #209723 Teaching Note #209092

UBS and Auction Rate Securities (A)

daniel B. Bergstresser, shawn Cole

Harvard Business School Case (Secondary Source) Product #209119 (22 pages) Teaching Note #209122

Wilbur L. Ross, chairman and CEO of the private equity firm WL Ross & Co., LLC, has the opportunity to bid for debt and equity claims on Plascar Industria e Comercio Ltda., the Brazilian subsidiary of the bankrupt global auto components company Collins & Aikman Corp. In evaluating this opportunity, students must analyze Ross's strategy to reshape a global industry with significant overcapacity, consider the opportunities created by the legal procedures that govern cross-border insolvencies, study a debt overhang problem, and consider how restructuring alternatives can address this problem.

Learning Objective: To illustrate how international restructurings take place, and the opportunities they create for distressed investors.

TravelCenters of America

robin Greenwood

Harvard Business School Case (Secondary Source) Product #209030 (14 pages) Supplement #209712 Teaching Note #209049

UBS, a global financial services company, must decide whether to continue to support the market for Auction Rate Securities in the face of a growing financial crisis. These instruments, underwritten by UBS, were marketed to clients as highly liquid and safe alternatives to cash. UBS' decision becomes urgent when Citigroup, another leading underwriter of ARS, decides to let its auctions fail, leaving clients with illiquid assets of uncertain value. The case explores theoretical and practical aspects of liquidity risk and challenges students to evaluate the benefits of honoring implicit commitments to customers against the costs of acquiring billions of dollars in illiquid assets.

Learning Objective: To illustrate the challenges and opportunities inherent in security design. To identify and understand the concept of liquidity risk. To consider and discuss the role of regulation in the provision of financial services to retail customers and institutional investors.

Citibank's Cooperative Strategy in China: The Renminbi Debit Card

stephen Ko, Havovi Joshi

University of Hong Kong Case Product #HKU806 (11 pages) Teaching Note #HKU807

A New York-based hedge fund must decide whether to invest in TravelCenters of America (TA), a recent spin-off from a U.S.based real estate investment trust. The case

The strategy of Citibank (China) Co. Ltd. (Citi) in China has evolved as the business environment has changed. Since the start of its operations in China in 1902, the global banking giant has preferred opening offices as branches (when allowed by the government) rather than subsidiaries. In 2001, China announced that it would join the World Trade Organization and would undertake a series of measures to open up its banking sector. By that time, Citi had realized that the pace of its growth in China had been very slow. Consequently, the bank reviewed its strategy and decided to enter

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F IN A N C E

the market as an embedded, or genuinely local, bank. Citi's July 2008 agreement with China Unionpay (CUP), China's only national bankcard association, allows Citi's debit cardholders to enjoy the convenience of access to CUP's vast network in China. The agreement is the latest milestone in the bank's strategy to establish its presence in the emerging and rapidly growing China market through a series of strategic alliances.

Learning Objective: To define and discuss the principles of cooperative strategic management. To analyze the different forms of cooperative strategies (strategic alliances and collusive strategies) and the advantages of both forms. To understand and identify when strategic alliances are diversifying strategic alliances at the corporate level, or horizontal complementary strategic alliances at a business level.

OPK Capital Corporation-- An Introduction to Search Funds

stewart Thornhill, Tevya rosenberg

Ivey School of Business Case Product #909M06 (6 pages) Teaching Note #809M06

This case provides an introduction to the concept of a "search fund." A search fund is an investment vehicle through which a group of investors provides financial support to an entrepreneur or a small team of entrepreneurs for the purpose of finding and acquiring a privately held company in which the entrepreneurs would ultimately perform senior management roles. This case deals with the process of setting up the fund, defining its terms, and examining the economics. Search funds are new to the Canadian market.

Learning Objective: Explain the nature of a search fund. Position search funds in the context of entrepreneurial finance. Identify the issues to be addressed in searching for an acquirable company. Describe the process, from forming the fund to finding and funding the company to purchasing the company.

diligence sessions, but one after another, potential investors had backed away, scared off in part by Bear's sizable mortgage holdings at a time when every bank on Wall Street was reducing its positions and taking massive write-downs in the asset class. In the past week, those rumors had reached a fever pitch, with financial analysts openly questioning Bear's ability to continue operations and its clients running for the exits.

Learning Objective: An analysis of the fall of Bear Stearns facilitates an understanding of the difficulties affecting the entire investment banking industry: high leverage, overreliance on short-term financing, excessive risk taking on proprietary trading and asset management desks, and myopic senior management all contributed to the massive losses and loss of confidence.

Akbank: Credit Card Division

Mary M. Crossan, Marina Apaydin

Ivey School of Business Case Product #909M02 (29 pages) Teaching Note #809M02

Challenging Confucius: Western Banks in the Chinese Credit Card Market

Justin w. evans

Business Horizons Article Product #BH302 (9 pages)

The Turkish financial sector has been developing rapidly and often unpredictably, offering an ideal backdrop to carry out an industry analysis in the dynamic environment of an emerging market. Akbank, one of the leading private Turkish banks, has been successful in taking advantage of the new opportunities that appeared in the credit card sector as a result of post-crisis restructuring of the financial services industry in the early 2000s. Launched in late 2001, Akbank's Axess credit card quickly gained a significant market share of 15 percent and was popular with both customers and merchants. At the same time, the attractive margins in this sector have sparked many local and foreign competitor entries. Setting a sustainable strategy for the next few years is complicated by the changes in the political, macroeconomic, and competitive environments.

Learning Objective: To acquaint students with the rapidly changing macroeconomic environment of emerging markets.

Investment Banking in 2008 (A): Rise and Fall of the Bear

david p. stowell, evan Meagher

Kellogg School of Management Case Product #KEL378 (25 pages) Supplement #KEL380 Supplement #KEL381 Teaching Note #KEL379

Gary Parr, deputy chairman of Lazard Frères & Co. and Kellogg class of 1980, could not believe his ears. "You can't mean that," he said, reacting to the lowered bid given by Doug Braunstein, JP Morgan head of investment banking, for Parr's client, legendary investment bank Bear Stearns. Less than 18 months after trading at an all-time high of $172.61 a share, Bear now had little choice but to accept Morgan's humiliating $2-per-share, Federal Reserve-sanctioned bailout offer. Rumors had swirled around Bear ever since two of its hedge funds imploded as a result of the subprime housing crisis, but time and again, the scrappy Bear appeared to have weathered the storm. Parr's efforts to find a capital infusion for the bank had resulted in lengthy discussions and marathon due

China has commanded a great deal of interest from virtually all U.S. business sectors. The Chinese credit card market is now particularly intriguing for Western banks. This article examines the strategic minefield that Western banks must navigate as they attempt to compete in the Chinese credit card industry. As an example, Bank of America (BOA)--fresh from purchasing a 9 percent interest in China Construction Bank (CCB) a few years ago--is now contemplating a joint venture with CCB. The new company will be tasked with leading the Chinese credit card market. Specifically, two questions are addressed: (1) whether the Chinese banking market is a sound option at this time and (2) whether China affords an optimal environment for credit. The analysis yields several strategic lessons and encourages caution on the part of Western bank executives as they enter the Chinese market. In particular, BOA officials must appreciate the timing of their joint venture's evolution. Additionally, BOA officials should strongly consider financial ventures other than credit, as Chinese culture should prove particularly resistant to serving as a profitable customer base in the short and middle time frames.

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GEN ER A L MA N AG EMEN T

general ManageMent

American Cancer Society: Access to Care

robert l. simons

Harvard Business School Case (Field) Product #109015 (22 pages) Teaching Note #109016

Yahoo! in China (A)

sandra J. sucher

Harvard Business School Case (Secondary Source) Product #609051 (26 pages) Supplement #609073

University of Hong Kong Case Product #HKU812 (20 pages) Teaching Note #HKU813

CEO John Seffrin decides to radically change the strategy of the American Cancer Society. The new Access to Care strategy relies on advocacy to change public policy and increase the number of Americans eligible for cancer prevention and treatment. The new strategy brings with it considerable political risk. Leveraging an organization with 3 million volunteers, he skillfully transforms the organization (structure, control systems, staff, shared values, etc.) to implement the new strategy.

Learning Objective: Strategy implementation in a nonprofit organization. Leadership.

South Pole Carbon Asset Management--Going for Gold?

Forest reinhardt

Harvard Business School Case (Field) Product #709030 (29 pages)

In 2007, Jerry Yang, CEO of Yahoo!, was lambasted by U.S. Representative Tom Lantos, chairman of the U.S. House Committee on Foreign Affairs, for Yahoo!'s role in the arrest and imprisonment of Chinese journalist and democracy advocate Shi Tao. The case describes the actions that Yahoo! had taken to grow its business in China, its handling of a government request for the identity of a Yahoo! user, and subsequent actions by the firm to respond to negative publicity and congressional inquiry. The case raises broad questions about the challenge of complying with domestic law when operating in states that do not consistently respect human rights and of satisfying stakeholders across national boundaries. It allows students to consider the practical steps that a firm can take to protect itself and its stakeholders in states where the law is not always a reliable safeguard.

Learning Objective: To examine the challenge of complying with domestic law when operating in states that do not consistently respect human rights.

Prior to the 2008 Summer Olympics in Beijing, the Chinese people were outraged by repeated interruptions of the Olympic torch relay in Paris on April 7, 2008. Soon after the incident, LVMH Group, a shareholder of the retailer Carrefour, was accused by some Chinese Internet users of donating money to the exiled spiritual leader of Tibet. The rumor spread on the Internet quickly, leading to calls for a large-scale boycott of Carrefour on May 1, 2008. Despite the souring public sentiment, Carrefour did not provide a consistent response to the public, even after one whole week of the crisis. The situation deteriorated quickly, with demonstrations taking place in various cities across China. Meanwhile, further rumors about Carrefour's antiboycott promotions were circulating on the Internet. How should the local management react to the public relations crisis and how can Carrefour manage its corporate image going forward?

Learning Objective: To identify potential courses of action for responding to the public relations crisis. To understand the roles of multinational firms in the evolving Chinese market through the example of Carrefour's crisis situation. To develop a long-term strategy for rebuilding Carrefour's corporate image to secure successful business expansion in the future.

In late 2008, Christoph Sutter, CEO of South Pole Carbon Asset Management, reflects on his firm's early success at originating carbon credits in developing nations and selling them to governments and firms that seek to offset their greenhouse gas emissions voluntarily or to fulfill regulatory obligations. South Pole's early strategy has focused on being a first mover in the niche market for premium-quality carbon credits. But as the market evolves in the face of significant policy uncertainty, Sutter wonders what South Pole's strategy should be for the future. This case study can facilitate discussions about environmental markets, about opportunities for entrepreneurship raised by new environmental regulations, and about challenges in markets for tradable pollution permits.

Learning Objective: To explore firm strategy in an uncertain regulatory environment.

Carrefour China and the Olympic Torch Relay: Managing Corporate Crisis amid Evolving Expectations of Multinational Firms

Kineta Hung, Candise pong-wa wai

general ManageMent

the future of Management

Gary Hamel

Through history, management innovation has enabled companies to cross new performance thresholds and build enduring advantages. The Future of Management explains how to turn a company into a serial management innovator, revealing the make-or-break challenges that will determine competitive success in an age of relentless, head-snapping change.

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BP in Russia: Settling the Joint Venture Dispute

Gevork papiryan

Ivey School of Business Case Product #908M99 (22 pages) Teaching Note #808M99

as case competitions or exams. It can also be used to introduce the Five Forces or give an overview/review of the entire strategic analysis process.

Learning Objective: To allow students to employ a set of qualitative and quantitative tools to assess a strategic opportunity. In their analysis, students will employ the Diamond-E model to look at the firm and its environment. This case demonstrates that strategy is dynamic, decisions have ripple effects that make static analysis faulty at best, and growth opportunities must be closely examined for their profitability impacts.

In September 2003, British Petroleum (BP) formed a 50/50 international joint venture (JV) company, TNK-BP, with a group of Russian investors: Alfa Group, Access Industries, and Renova (AAR). This JV was established as a result of the merger of Russian oil companies TNK and Sidanko, owned by AAR, with the majority of BP's Russian oil assets. On May 26, 2008, TNKBP's chief executive officer, Robert Dudley, told Vedomosti, Russia's leading business daily, about a conflict between British and Russian shareholders. During this dispute, AAR declared that BP treated TNK-BP as its subsidiary and not as a JV. Also, the Russian shareholders criticized the JV's leadership of the company's expansion strategy and climate. As the conflict escalated, BP's leadership needed to decide whether to walk away or continue its participation in the JV.

Learning Objective: To understand how the institutional environment impacts a firm's international strategy, specifically how the strategy relates to its alliances and JVs. To understand the intricacies of managing a JV at the beginning stage of its evolution and the skill sets that are needed. To develop a framework for assessing the pros and cons of continuing or discontinuing a JV/alliance.

Kimberly-Clark Andean Region: Creating a Winning Culture

Jeffrey pfeffer, Megan elizabeth Anderson

Stanford Graduate School of Business Case Product #OB72 (14 pages)

Countries around the world are putting innovation at the top of their agendas. As a result, companies now have access to a global market for talent, capital, tax credits, and regulatory relief. Before setting up a research laboratory or a marketing office in one of the world's innovation hot spots, organizations must consider which of the emerging innovation models best suits their requirements. In the focused factory model, countries concentrate their resources. Countries adopting the brute force model hope to generate innovations by marshaling massive amounts of labor and capital. The goal of the "Hollyworld" model is to create the right environment for innovation by assembling a critical mass of skilled individuals. Several countries have developed large-scale ecosystem models that combine funding bodies, research institutions, and business and academic collaboration.

West Lake Home Furnishings Ltd.

Charlene Zietsma, Ken Mark

Ivey School of Business Case Product #907M71 (7 pages) Teaching Note #807M71

Kimberly-Clark in the Andean region had hit a performance plateau. Five years prior, Sergio Nacach had taken over as general manager for the region and had embarked on a cultural transformation to build a winning culture centered on the people who worked for the organization. This case explores what he did and the context within which he did it. Similar to other cases on high-commitment work arrangements but set in a non-U.S. context, the case discusses organizational cultural change, the extent to which high-performance work practices generalize across settings, and what made the Andean region a particularly receptive place for this management approach. The case also raises the issues of how to keep the enthusiasm going and the extent to which this transformation depended on a particular individual and his personal style.

Learning Objective: To have students learn about how to change organizational cultures and to consider the extent to which high-performance work arrangements generalize across cultures.

The Legal Implications of Electronic Document Retention: Changing the Rules

robert M. Barker, Andrew T. Cobb, Julia Karcher

Business Horizons Article Product #BH321 (10 pages)

The CEO of West Lake Furnishings Ltd. has been given a proposal from one of his top three wholesale customers: lower the price of a line of signature lamps from $69.99 to $29.99 in exchange for five times the unit sales. The decision point of the case focuses on whether the CEO should take the offer, and answering the question requires a close examination of West Lake's business strategy and its industry. The West Lake case is a short, comprehensive case that is useful for time-pressured situations such

Tapping the World's Innovation Hot Spots

John Kao

Harvard Business Review Article Product #R0903J (9 pages)

Document retention policies are an often overlooked aspect of information management in most organizations. As 99 percent of business documents are currently being produced electronically, processes governing the location and storage duration of these documents are very important. Given that most organizations in the United States will find themselves named in a lawsuit and the documents mentioned above may have to be produced in original form for litigants during discovery, document retention policies can spell the difference between successful defense and painful, expensive loss in litigation. While some organizations have such policies, do those policies cover new communication and data storage technologies? Do the policies address cell phones, personal data assistants, high-density flash drives, instant messaging technologies, and a workforce that is no longer concentrated in one physical space? This article explores the new rules for electronic discovery and how those rules should drive changes regarding organizational management and storage of documents.

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teaching Materials newsletter · fall 2009

GEN ER A L MA N AGEMEN T -- HU MA N R ESOU R CES M A N AG EMEN T

Towards a Comprehensive Understanding of Public Private Partnerships for Infrastructure Development

young Hoon Kwak yingyi Chih, C. william ibbs

California Management Review Article Product #CMR418 (29 pages)

offered to employees in 2008, as well as the firm's contracting policies with commercial insurers and self-insured plan administrators, are examined in detail. Pitney Bowes health and wellness programs are also described, enabling an analysis of the firm's overall employee health strategy in 2008 and a discussion of where Pitney Bowes should focus its attention moving forward.

Learning Objective: Employer health strategy.

Learning Objective: The key objective of this case is to understand performance management systems from the perspectives of different stakeholders and develop a framework that meets all objectives of performance management. The case enables users to understand all steps in performance management and examine shortcomings at each stage.

Public Private Partnerships (PPP) have emerged as one of the major approaches for delivering infrastructure projects effectively. This article develops a PPP framework for infrastructure development. It discusses examples of worldwide applications as well as benefits and obstacles of PPP through a literature review on PPP-related research over the last 20 years. The syntheses of the knowledge present foundations from which the laws, regulations, and guidelines for effective and successful PPP implementation can be established. This analysis reveals that PPP can create new and long-term business opportunities with a chance to deliver infrastructure services of higher quality and efficiency. However, these benefits will be materialized only when a PPP project is properly planned and managed and both the public and private sectors work together successfully.

Gen Y in the Workforce

Tamara J. erickson

Harvard Business Review Article Product #R0902B (8 pages)

Performance Management at the National Institute of Management (Central India Campus)

ranjee Nambudiri, K.r. Jayasimha

Ivey School of Business Case Product #908C20 (25 pages) Teaching Note #808C20

HuMan resOurCes ManageMent

Pitney Bowes: Employer Health Strategy

Michael e. porter

Harvard Business School Case (Field) Product #709458 (30 pages)

The case describes existing performance management systems at a leading business school in India, the National Institute of Management--Central India campus (NIM CI campus). The institution, which is ranked among the top 20 business schools in India, is facing critical issues in attracting and retaining faculty members. The director of the NIM CI campus has implemented a unit-based performance measurement and incentive system, which has worked favorably and enabled the institute to recruit top academicians. However, the management committee believes that the system has outlived its utility and desires to replace it with more robust systems that are less vulnerable to misuse. The faculty members, however, support retention of the existing system.

Josh Lewis, a young staffer at Rising Entertainment, is frustrated because his boss, marketing chief Sarah Bennett, won't listen to his ideas about using new media to promote films. She's trapped in the 1990s, he thinks, when people actually watched network TV! Rushing through his assignment for a team presentation, he works up a plan and pitches it to the CEO in the hallway. The CEO loves it, but Sarah is upset with Josh for going over her head--and for submitting subpar work on the presentation. How can these members of two different generations work together effectively?

Learning Objective: In this fictional case study, a Generation X manager at a multimedia production and distribution company must decide how to work effectively with her recently hired Generation Y employee, who is ignoring decision-making protocols and expecting immediate promotion. Students will consider questions such

Pitney Bowes, a Fortune 500 mail and document management firm, offered its first health plans in the years following World War II. Over the ensuing decades, Pitney Bowes adapted its approach to employee health amid rising healthcare costs, shifting employer attitudes toward health benefits, and a rapidly changing policy environment. By 2008, the firm was widely regarded as an innovator in employee health, having dedicated substantial time and resources to its health benefits. The case provides an overview of the history of employee health benefits in the U.S. and at Pitney Bowes. The range of health plans that Pitney Bowes

HuMan resOurCes ManageMent

Performance Management: Measure and improve the effectiveness of Your employees

Harvard Business Essentials

A competitive workplace demands that managers evaluate employee performance and provide coaching. This book provides comprehensive advice, background information, and guidance on the most relevant topics in human resource management, as it helps managers prepare for a formal performance meeting with a direct report and create a development plan to increase employee productivity.

availaBle in CHaPters Product #8428 · isBn 978-1-59139-842-4 · Paperback · 208 pages ·$19.95

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as how members of the two generations can clarify their expectations and accommodate one another's differing communication styles, and how Gen X managers can coach their Gen Y employees to deliver the on-the-job performance the company needs.

ManageMent Of infOrMatiOn sYsteMs

F-Secure Corporation: Software as a Service (SaaS) in the Security Solutions Market

lynda M. Applegate, robert d. Austin

Harvard Business School Case (Field) Product #809099 (22 pages)

The Market Within: A Marketing Approach to Creating and Developing High-Value Employment Relationships

linda schweitzer, sean lyons

Business Horizons Article Product #BH306 (11 pages)

In the battle for high-value talent, managers need to think like marketers, creating job offerings and employment relationships that provide mutual value for firms and their employees. This article provides a three-stage framework for the application of marketing techniques to the recruitment and retention of high-value employees. In the first stage, the 4Ps of the marketing mix are used to create compelling job offerings that attract high-value employees. In the second stage, firms use relationship marketing concepts to build long-lasting employment relationships that create mutual value for the firm and its employees. The third stage involves the outcomes of high-value employment relationships, which include greater employee commitment and satisfaction, which then lead to greater employee advocacy of the firm and lower levels of employee turnover. The ultimate proposed outcomes of this approach are increased performance and stability of the firm.

This case describes the development of a business model based on "software as a service" (SaaS) for security solutions distributed through Internet service providers (ISPs). F-Secure disruptively entered a mature business with dominant players by executing an innovative new service model. The case describes the challenges involved in developing and executing the new service model and offers students opportunities to discuss the evolving challenges the company faces looking forward.

Learning Objective: To demonstrate the challenges and rewards of developing a new service model in a mature industry.

sight. In the (A) case, the board of directors must decide what action to take with regard to management's actions and regarding the project contractor, PricewaterhouseCoopers. The (B) case outlines what happened afterward. The cases span a 10-year period-- from inception to litigation. The case is useful as a tool to explore governance issues at the board and senior management levels as they pertain to enterprise risk management and IT risk. This case deals with a classic and large information technology (IT) disaster. However, unlike most disaster stories, this one was played out in public and a wealth of information exists as to why events unfolded as they did.

Learning Objective: The purpose of this case is to explore and define the role of the board in IT decisions.

Unity Bank: Realizing Value From an M&A Integration

Nicole r.d. Haggerty, John Fong

Ivey School of Business Case (15 pages) Product #908E09 Teaching Note #808E09

Sydney Water Customer Information and Billing System (A)

Michael parent

Ivey School of Business Case Product #908E12 (4 pages) Supplement #908E13 Teaching Note #808E12

Sydney Water's new customer information and billing system (CIBS), its largest information technology project ever, was over budget and very late, with no end in

ManageMent Of infOrMatiOn sYsteMs

adventures of an it leader

Robert D. Austin, Richard L. Nolan, Shannon O'Donnell

Becoming an effective iT manager presents a host of challenges--from anticipating emerging technology to managing relationships with vendors, employees, and other managers. This book invites students to accompany new Cio Jim Barton to better understand the role of iT in an organization. They'll observe Jim's struggles through a challenging first year, handling (and fumbling) situations that, although fictional, are based on true events. The book can be read from beginning to end, or used as a series of cases.

availaBle in CHaPters Product #11990 · isBn 978-1-4221-4660-6 · Hardcover · 320 pages · $29.95

A member of the integration leadership team must help plan and execute the integration of Delta's information technology (IT) operations into those of Unity. He has been given a time limit of three years and has been charged with removing $60 million of expenses during the process. Half of the savings will come from reducing the number of staff whose roles have been duplicated as a result of the merger. The remaining savings will be achieved through the reduction of associated assets such as hardware, software, and property. There are many hurdles to overcome, including motivating soon-to-be-made-redundant staff, finding and keeping Delta's star performers, designing the new organizational structure for the technology group, choosing the target IT platform, and performing the infrastructure consolidation.

Learning Objective: This case takes a student through the important decisions in integration projects in order to ensure success in a merger or acquisition, bringing awareness of the execution aspects of these transactions.

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teaching Materials newsletter · fall 2009

MA RKET IN G

Marketing

JWT China: Advertising for the New Chinese Consumer

elisabeth Koll

Harvard Business School Case (Field) Product #809079 (27 pages)

This case analyzes the business strategy and expansion of JWT China from the late 1990s to 2008. As part of the world's fourth-largest marketing communications network, JWT China grew into one of the largest integrated communications companies in China, operating from offices in various parts of the country. The case provides students with insights into China's advertising industry and the challenges for foreign and domestic firms operating within a highly regulated media environment controlled by the Chinese government. At the same time, the case offers insights into the structure of the highly fragmented Chinese consumers market, exploring the socioeconomic disparities in income and media access as well as culturally determined consumer behavior across different regions and urban and rural areas. The case lets students explore how these trends might impact JWT's advertising and marketing strategies in the future and how to evaluate JWT's business expansion in China dealing with local and foreign competition.

Learning Objective: How a multinational marketing communications network can effectively reach the new Chinese middle class as consumers across China. How to expand the business in China, dealing with local and foreign competition.

personal goal of becoming basketball's first billionaire. By late 2008, James has entered various lucrative endorsement deals and is considering three exclusive videogame endorsement opportunities from Electronic Arts, 2K Games, and Xbox Live to add to his portfolio. Allows for a rich discussion about how superstar athletes and other celebrities can create and capture value from their brands as well as what role talent agencies and other intermediaries play in that process. Provides in-depth information on three endorsement opportunities that each represent a common way in which talent can choose to get compensated: through a fixed-fee payment, a bonus payment structure, or a revenue-sharing agreement.

Learning Objective: To examine marketing issues and, more specifically, celebrity endorsement opportunities in the context of a world-class athlete. To explore ways in which superstars in the creative industries create and capture value from their brands.

increasing affluence. As the growing middle class demanded higher standards from these companies, McDonald's local business practices in terms of food handling, employee welfare, and other socioenvironmental issues were put under close scrutiny in China. While the nation's booming economy provided environmental conditions suitable for fast-food culture, the environment also posed challenges to the survival of fast-food operators in the country. Would McDonald's be able to sustain its momentum as China transformed into a developed nation?

Learning Objective: To examine the general environmental components that influence McDonald's operation in China. To identify opportunities and threats based on an external environmental analysis. To analyze the underlying structure of the fast-food industry in China in terms of Porter's Five Competitive Forces. To understand the strategic group in which McDonald's competes most in China.

McDonald's: Is China Lovin' It?

stephen Ko, Claudia woo

University of Hong Kong Case Product #HKU802 (14 pages) Teaching Note #HKU803

Louis Vuitton in India

shih-Fen Chen, ramasastry Chandrasekhar

Ivey School of Business Case Product #908A20 (16 pages) Teaching Note #808A20

McDonald's, the world-famous American fast-food franchisor, entered mainland China in 1990, when Chinese franchise law did not even exist. In this once-closed country whose market only opened up to foreign investors in 1978, McDonald's had to adapt to an unfamiliar and rapidly changing environment. Competition was also intensifying as local and foreign restaurants sought to capitalize on China's

The case portrays a subtle situation in international marketing--the marketing of a high-end brand into a low-income nation, or the expansion of Louis Vuitton into India. This luxury goods marketer faced practical problems in India, such as the challenge of identifying potential customers, the lack of media to build its brand, and

LeBron James

Anita elberse

Harvard Business School Case (Field) Product #509050 (4 pages)

Marketing

In 2005, to the astonishment of many sports industry insiders, superstar basketball player LeBron James fired his agent and established his own firm, LRMR, to handle all aspects of his business ventures and marketing activities and named his childhood friend Maverick Carter as the CEO. LRMR is tasked with turning James into a global icon as well as helping him reach his

Marketer's toolkit: the 10 strategies You need to succeed

Harvard Business Essentials

effective marketing can mean the difference between runaway successes and costly flops. Covering everything from customer programs to ad campaigns to sales promotions, this is every marketer's hands-on guide to turning opportunities into profits.

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the absence of prestige shopping areas to support retail stores. In Europe and the U.S., luxury goods are often sold through company-owned stores that cluster in a particular area of the city (i.e., luxury retail cluster). After opening stores inside two luxury hotels in New Delhi and Mumbai, Louis Vuitton teamed up with other Western brands to develop a shopping mall. The case is designed to explore the possibility of using a luxury mall as a replacement for luxury retail clusters.

application model, students determine an optimal publisher strategy and complete copy improvement analysis.

B2B Branding: A Financial Burden for Shareholders?

lars ohnemus

Business Horizons Article Product #BH319 (8 pages)

Air France Internet Marketing: Optimizing Google, Yahoo!, MSN, and Kayak Sponsored Search

Mark Jeffery, lisa egli, Andy Gieraltowski, Jessica lambert, Jason Miller, liz Neely

Kellogg School of Management Case Product #KEL319 (18 pages) Supplement #KEL321 Teaching Note #KEL320

Rob Griffin, senior vice president and U.S. director of search for Media Contacts, a communications consulting firm, is faced with the task of optimizing search engine marketing (SEM) for Air France. At the time of the case, SEM had become an advertising phenomenon, with North American advertisers spending $9.4 billion in the SEM channel, up 62 percent from 2005. Moving forward, Griffin wants to ensure that the team keeps its leading edge and delivers the results Air France requires for optimal Internet sales growth. The case centers on Air France's and Media Contacts' efforts to find the ideal SEM campaign to provide an optimal amount of ticket sales in response to advertising dollars spent.

Learning Objective: Students learn how to leverage the Internet in generating customer sales in a cost-effective manner. Students analyze and manipulate a variety of data using pivot tables to determine optimal strategies for obtaining maximum total online bookings through the various online channels available. Using a portfolio

Is branding an effective tool for generating shareholder wealth for companies that are active in a business-to-business environment? Or do other factors such as innovation and manufacturing efficiency--or the lack thereof--create or destroy shareholder wealth? Based on an examination of almost 1,700 companies listed on either the United States or European stock exchanges, this study reveals that this crucial relationship could be described as a W-shaped curve with five distinctive phases, depending on the strategic branding position of the company. Business-to-business (B2B) companies with a balanced corporate brand strategy, used strategically, generally yield a return to their shareholders that is 5-7 percent higher than the return of companies without such a strategy. This study also reveals that shareholders should insist on systematic performance feedback from the corporation regarding all key items in the balance sheet--including branding. Yet very few of the companies analyzed possessed an optimal balance between branding and financial performance.

Instead, companies have relied on the brilliance of tastemakers to predict and shape what people would buy. Creative judgment and expertise will always play a vital role in the creation, shaping and marketing of cultural products. But the balance between art and science is shifting. Today companies have unprecedented access to data and sophisticated technology that allow even the best-known experts to weigh factors and consider evidence that was unobtainable just a few years ago. In this article, the authors describe the results of a study of prediction and recommendation efforts for a variety of cultural products. They discuss different approaches used to make predictions, the contexts in which these predictions are applied, and the barriers to more extensive use, including the problem of decision-making pre-creation.

OPeratiOns ManageMent

Innovation at Mahindra & Mahindra (A)

stefan Thomke

Harvard Business School Case (Field) Product #609065 (19 pages) Supplement #609067 Supplement #609068

What People Want (and How to Predict It)

Thomas H. davenport, Jeanne G. Harris

Sloan Management Review Article Product #SMR298 (11 pages)

The Mahindra & Mahindra Group is among the top industrial houses in India, and its managing director, Anand Mahindra, has put innovation at the core of its growth strategy. Emphasis is placed on managing the balance between structured processes and the creation of an environment in which radical innovations can succeed. The Farm Equipment Sector, one of the group's largest and most successful sectors, is developing a revolutionary tractor outside its conventional development process with the help of a "maverick" innovator. Not surprisingly, the project encounters numerous obstacles and setbacks.

Learning Objective: The role of creative innovators in breakthrough innovations. The need for process, structure, and early feedback from markets. The sources of radical product concepts. The marketing of innovations.

Historically, neither the creators nor the distributors of cultural products such as books or movies have used analytics--data, statistics, predictive modeling--to determine the likely success of their offerings.

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teaching Materials newsletter · fall 2009

OPERATIONS M A N AG E M E N T

When Supply Is of Public Interest: Roche and Tamiflu

Noel watson

Harvard Business School Case (Field) Product #609061 (21 pages) Teaching Note #609074

The case focuses on the challenges Roche faced in maintaining a supply network for a global influenza pandemic response initiative based on its antiviral drug Tamiflu. The Roche group is a 40 billion CHF company consisting of a pharmaceutical division and a diagnostic division. The company's antiviral drug Tamiflu dominates the market for prevention and treatment of seasonal influenza. Tamiflu, however, could also play an important role in responding to the first wave of a pandemic caused by a particularly harmful strain of the influenza virus A. Tamiflu was designed to be effective against any strain of Type A or B influenza. Thus, there was the potential to establish a preparedness plan based on creating a stockpile of the drug in conjunction with an appropriate plan for distribution to the affected population. The use of Tamiflu in such a crisis would allow the world to respond immediately rather than having to wait for development of a vaccine that would have limitations in its effectiveness, and the drug has been endorsed by the WHO as a first line of defense. Managing supply is particularly challenging for three reasons. First, demand for stockpile quantities is spiky and uncertain, and governments placing orders expect lead times to be short. Second, lead times for increasing capacity are long, as are lead times for drug production and encapsulation. Last, media coverage and press releases made by governments and other stakeholders increase the stakes, as negative media coverage may damage Roche's reputation with consumers, leading to lower sales levels for its products.

Learning Objective: Global supply chain coordination in healthcare.

In the summer of 2007, Mattel, the largest toymaker in the U.S., made several recalls of products that had been made in China. The recalls led not only to a sharp reduction in Mattel's sales but also to public hearings in the U.S. Congress that significantly affected Mattel's reputation. Like other toymakers, Mattel has been relocating its production abroad, outsourcing the manufacture of parts and components. Indeed, 65 percent of Mattel's products are made in China. In contrast to its competitors, however, Mattel has understood the importance of quality control in this relocation/outsourcing process. In the 1980s, it reversed its earlier strategy of outsourcing to factories in Asia by owning and operating some plants in Asia for producing its most popular products. The product recalls show that quality control continues to be an issue.

Learning Objective: This case illustrates the different factors underlying strategies for organizing international production: integration (i.e., in-house production) versus outsourcing. It can also be used for teaching strategies for choosing production locations (developing countries versus developed countries), whether for integration or outsourcing.

(including recruiting, culture, call center, inventory, web site, and supply chain) to provide the best possible service--it wanted to "wow" everyone who interacted with the company, from customers to employees to corporate partners. Zappos grew rapidly and by 2008 was profitable, with net sales (after returns) of about $650 million. The company faced a number of issues as it looked forward. While it had penetrated only about 3 percent of the U.S. market for shoes, Zappos had expanded its product lines to items such as camping gear and video games. It needed to determine which elements of its strategy had contributed to its success in shoes and whether it would be able to duplicate that success in other product lines. It also needed to determine how it could scale its business to a company with revenues of tens of billions. Finally, the economic landscape changed dramatically in late 2008, with the financial market collapse and recession. The serviceintensive Zappos.com business was based on sales at little to no discount, unlike many web sites that relied on selling at the lowest possible price. Would the company need to make changes to respond to the changed economic environment, and if so, what were those changes?

Learning Objective: The case highlights an Internet retailer that has grown rapidly but faces significant issues, including scope of product offerings, supply chain costs, customer service costs, and scalability. The teaching objective of the case is to examine these issues and the considerations that the company must make in choosing a way forward.

Zappos.com: Developing a Supply Chain to Deliver WOW!

Michael Marks, Hau lee, david w. Hoyt

Stanford Graduate School of Business Case Product #GS65 (27 pages) Teaching Note #GS65TN

Zappos was founded in 1999, during the Internet boom, to sell shoes online. Zappos organized all aspects of its business

negOtiatiOn

guide to negotiation

Negotiation--whether brokering a deal, mediating a dispute, or writing up a contract--is both a necessary and challenging aspect of business life. This guide helps managers to sharpen their skills and become more effective deal makers in any situation.

availaBle in CHaPters Product #1113 · isBn 978-1-59139-111-1 · Paperback · 208 pages · $19.95

Mattel's Strategy after Its Recall of Products Made in China

Jiangyong lu, Tao Zhigang, yu linHui, Grace loo

University of Hong Kong Case Product #HKU810 (9 pages) Teaching Note #HKU811

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| 19

OR G A N I Z AT I O N A L B EH AVI O R & LEAD ERS H I P

OrganizatiOnal BeHaviOr & leadersHiP

Barbara Norris: Leading Change in the General Surgery Unit

Boris Groysberg, Nitin Nohria

Harvard Business School Case (Secondary Source) Product #409090 (5 pages)

hostile work environments, performance review and management, middle managers, employee morale, and employee turnover and retention.

Exeter Group, Inc.

robert G. eccles, das Narayandas

Harvard Business School Case (Field) Product #409001 (22 pages)

Bob Beall at the Cystic Fibrosis Foundation

robert steven Kaplan

Harvard Business School Case (Field) Product #409107 (22 pages)

Barbara Norris struggles to address the many problems facing her as a recently promoted nurse manager in the General Surgery Unit (GSU) at Eastern Massachusetts University Hospital (EMU). She has inherited a unit with the lowest employee satisfaction scores and highest employee turnover rate among all the departments at EMU. Furthermore, her new unit is infamous for its culture of confrontation, blaming and favoritism. The staff that has remained is dissatisfied, unmotivated, and not functioning as a team to deliver patient care. In fact, GSU's patient satisfaction scores, although average, have been declining steadily over the past few years. Barbara has been asked by EMU's director of nursing to turn the unit around in the midst of an economic crisis and deep cost-cutting measures throughout the hospital. Where and how should she begin?

Learning Objective: This case explores many issues: employee satisfaction and job motivation, change management, managing a crisis, taking charge, human resources management, leading teams,

Bob Beall is the chief executive officer of the Cystic Fibrosis Foundation (CFF). CFF is an extremely successful organization, but Beall has to determine how to manage the organization through the financial crisis of 2008/2009. In this situation, donations are likely to dwindle, investment surplus has declined, and biotech partners are challenged to finance joint projects as well as their own operations. Beall is striving to find a cure for cystic fibrosis while also determining what priorities he must emphasize and what trade-off decisions he must make in managing through the current period. He is preparing for a meeting with his board of trustees where he plans to discuss the current situation and the key decisions the organization needs to make.

Learning Objective: Maintaining alignment during a crisis. Elements of nonprofit leadership.

Jonathan Kutchins and Mark Cullen, managing partners of IT consulting firm Exeter Group, Inc., are considering four potential client engagements. Three of them involve prominent universities, an area of market strength for the firm, and one involves a top-tier strategy consulting firm, a new market for Exeter. Each of the projects has both attractive and unattractive attributes, with various degrees of upside and downside risk. As a relatively new and small IT consulting firm, Exeter needs to make careful choices about how it allocates resources to projects, and it is not clear if the firm has the capacity to add all four projects at once. Thus Kutchins and Cullen have to decide which, if any, of these projects to do. In some cases they must also decide whether they want to try to restructure the nature of the engagement to better fit the firm's service model. Although young and small, the firm has grown successfully and is optimistic about its future prospects. Kutchins and Cullen thus want to make decisions in the context of their overall strategy and the contributions of these engagements to helping the firm achieve its long-term goals.

Learning Objective: This case is used to illustrate the importance of careful project and client selection in a professional service firm and more generally.

Goedehoop: When Social Issues Become Strategic

OrganizatiOnal BeHaviOr & leadersHiP Margie sutherland, Verity Hawarden

Ivey School of Business Case Product #908M67 (17 pages) Teaching Note #808M67

a sense of urgency

John P. Kotter

in his international bestseller Leading Change, John Kotter revealed why change is so hard. in his new book, Kotter explains how to go beyond "the business case" for change to overcome the fear and anger that can suppress the critical sense of urgency, explores ways to ensure that actions and behaviors--not just words--communicate the need for change, and outlines how to keep fanning the flames of urgency even after a transformation effort has scored some early successes.

availaBle in CHaPters Product #10007 · isBn 978-1-4221-7971-0 · Hardcover · 208 pages · $22.00

This case chronicles a change process to counteract the epidemic of HIV/AIDS at a coal mine in South Africa that impacts the sustainability of the organization. It illustrates the type of leadership activities needed to deal with a compelling environmental force impacting business. It shows how a wide range of stakeholders needs to be involved and systems and practices instituted for sustainable change to be implemented. It raises the question of the role of business in society. The case also

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teaching Materials newsletter · fall 2009

O RGA N IZATION A L B EHAVIOR & LEA DER SHIP -- SOCIA L EN TER PR ISE & ET HICS

provides insights into doing business in emerging economies. The challenge at the end of the case involves how to replicate the intervention into other divisions of a large multinational.

Learning Objective: Understanding: The complexities of change management. The type of leadership activities necessary to drive change. The social imperative of business. The complexities of cost-benefit analysis in triple bottom-line reporting. The complexity of doing business in Africa or an emerging market. The impact of HIV/ AIDS on business.

Maria Yee Inc.: Making "Green" Furniture in China

Glenn Carroll, Charlie shao

Stanford University Case Product #SI110 (21 pages)

new positions, leaders must realize that the teams they have inherited are also experiencing change. Instead of focusing on individual accomplishment, leaders need to work with team members on a collective quick win. The leaders who thrive in their new roles share not only a strong focus on results--necessary for early successes--but also excellent change-management skills. They communicate a clear vision, develop constructive relationships, and build team capabilities. Collective quick wins establish credibility and prepare them to lead their teams to harder-won victories. The authors provide a diagnostic tool for identifying opportunities for collective quick wins.

Learning Objective: To anticipate and avoid five obstacles to early success in a new leadership role.

Arcadia Biosciences: Seeds of Change

Arthur A. daemmrich, Forest reinhardt, Mary shelman

Harvard Business School Case (Field) Product #709019 (26 pages)

In 2008, Maria Yee Inc. occupied a unique position as a premium "green" household furniture maker, with two direct-owned factories in China and distribution through several large U.S. retailers. Yee, a Chineseborn entrepreneur in California, founded her business in 1988 with Asian-inspired designs and Chinese hand joinery techniques. Over the years, she pursued environmentally responsible principles such as using renewable bamboo and eco-certified wood. She believed in being green through thoughtful design and manufacturing, not just marketing. The company was a leader on environmental initiatives within the furniture industry. But Yee wrestled with how to expand and become more mass-market while staying true to her green values.

Learning Objective: The case addresses the unique challenges that an entrepreneurial company faces in reaching its full potential as a business while advancing its green strategy.

sOCial enterPrise & etHiCs

Alliance for a Green Revolution in Africa (AGRA)

david e. Bell

Harvard Business School Case (Field) Product #509007 (28 pages)

The Quick-Wins Paradox

Mark e. Van Buren, Todd safferstone

Harvard Business Review Article Product #R0901D (10 pages)

In 2006, the Bill and Melinda Gates Foundation and the Rockefeller Foundation joined together to form a new organization, AGRA, to tackle the historic challenge of increasing agricultural production in Africa. Launched with much fanfare and led by former U.N. Secretary-General Kofi Annan as chairman of the board, AGRA sought to help millions of African farmers and their families achieve food security and lift themselves out of poverty. By 2008, AGRA had assembled a strong leadership team and had funded numerous small projects ranging from seed development to education. However, it needed to secure additional funding from public and private donors, gain the cooperation of governments, and catalyze private markets to achieve its goals.

Learning Objective: To understand the challenges of solving food problems in Africa. To discuss the roles of the governments, the private sector, and NGOs in agricultural and economic development.

Arcadia Biosciences is an entrepreneurial California agricultural biotech company seeking to earn carbon credits by modifying commodity crops for use in China and India. Eric Rey, Arcadia's CEO, faced a strategic inflection point in early September 2008. The company had a plan to share carbon credits allocated by the United Nations Clean Development Mechanism Executive Board to China for use of Arcadia's rice varieties, since they enabled farmers to reduce nitrogen fertilizer use, in turn lowering greenhouse gas emissions. But the company's proprietary traits for nitrogen use efficiency, salt tolerance, and water use efficiency also had more conventional paths to market based on licensing deals to large seed companies. Alternatively, Arcadia could acquire a seed company and develop and market its seed directly. A different near-term growth area involved commercializing enriched safflower oil, which had undergone several proof of concept tests and for which Rey foresaw a clear market in nutritional supplements and functional foods.

Learning Objective: Describes advances in crops genetics focused to climate change and associated resource issues of fertilizer use, water use, and soil salinity. Poses strategic choices for a start-up company operating at the intersection of business, agriculture, and climate change.

IBM: The Corporate Service Corps

Christopher Marquis, rosabeth Moss Kanter

Harvard Business School Case (Field) Product #409106 (22 pages)

Many leaders taking on new roles try to prove themselves early on by going after quick wins--fresh, visible contributions to the business. But in the pursuit of early results, those leaders often fall into traps that prevent them from benefiting from their achievements. To succeed in their

Describes the conception, development, and implementation of the Corporate Services Corps (CSC), an international community service assignment for highpotential IBM employees. The year 2008 was the pilot year of the CSC program, and 100 of IBM's best global employees were deployed to work for local partners, frequently nongovernmental organizations (NGOs), in locations such as Ghana,

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Tanzania, Romania, the Philippines, and Vietnam. The case provides data for students to assess the first year of operation and recommend what changes IBM should make to the program moving forward. Also considered is how the CSC fits into IBM's broader corporate citizenship portfolio and IBM's globalization strategy.

Learning Objective: To discuss how a corporate social responsibility program can be aligned with the organization's overall vision and operational structure, and how corporate social responsibility programs can be effectively developed and deployed.

Ethics of Offshoring: Novo Nordisk and Clinical Trials in Emerging Economies

Klaus Meyer

Ivey School of Business Case Product #909M01 (13 pages) Teaching Note #809M01

The case outlines the conflicting ethical demands on a Danish pharmaceuticals company, Novo Nordisk, which operates globally and aspires to high standards of

corporate social responsibility. A recent report alleges that multinational pharmaceutical companies routinely conduct trials in developing countries under alleged unethical conditions. The company's director reflects on how to respond to a request from a journalist for an interview. This triggers a discussion on appropriate ethical principles and how to communicate them. As a company emphasizing corporate responsibility, the interaction with the media presents both opportunities and risks to Novo Nordisk. The case focuses on clinical trials that are required to attain regulatory approval in, for example, Europe and North America, and that are conducted at multiple sites around the world, including many emerging economies. Novo Nordisk has implemented numerous procedures to protect its various stakeholders, yet will this satisfy journalists and nongovernmental organizations, and how should the company communicate with these stakeholders?

Learning Objective: Understand and evaluate economic and ethical issues relating to offshoring to emerging economies. Appreciate

ethical principles that may on occasion be in conflict with each other. Appreciate the relationship between business and the public, in particular the media, and develop skills in communicating effectively on sensitive issues with such audiences.

Does It Pay to Be Good?

remi Trudel, June Cotte

Sloan Management Review Article Product #SMR304 (10 pages)

teaCHing and tHe Case MetHOd

the Case study Handbook

How to Read, Discuss, and Write Persuasively About Cases

William Ellet

ideal for students new to the case method, The Case Study Handbook covers how to quickly establish a base of knowledge about a case, how to write persuasive casebased essays, how to talk about cases effectively in class, and more.

availaBle in CHaPters Product #1584 · isBn 978-1-4221-0158-2 · Paperback · 273 pages · 2007 · $24.95

That is a question that has long puzzled marketers who have heard from customers that they want to do business with ethically based firms--defined as companies that produce products under conditions of progressive stakeholder relations, advanced environmental practices, and respect for human rights. Marketers have no reason to doubt that sentiment, but they have always wondered if consumers would be willing to pay a higher price for ethically produced goods (since they tend to be more expensive to create). It turns out that a series of controlled experiments proves that consumers will, in fact, pay a premium for ethically produced goods. But perhaps of equal interest is the fact that they will punish (by demanding a lower price) companies that are not seen as ethical. That relationship is not symmetrical. The punishment exacted is greater than the premium customers are willing to pay. How ethical does a company have to be? The research shows that a small degree of ethicalness "pays off." It is not necessary for a company's product to be "100 percent pure" in order to receive a price premium. This research is the first to find that consumers use price to punish unethical companies more than they use price to reward ethical companies and that the ethicality of a company's behavior is, indeed, an important consideration for consumers (as demonstrated in their willingness-to-pay decisions).

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teaching Materials newsletter · fall 2009

introducing the new

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Citibank: Performance Evaluation

Robert S. Kaplan, David P. Norton

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In his latest entry to the Teaching Post, Professor Jim Heskett offers tips and advice on how to integrate case study learning in an undergraduate setting. He addresses some of the challenges faced by students and professors, as well as case selection, setting expectations, and ways to introduce excitement into classroom case discussions.

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Fatal Ascent: Leadership Lessons from the 1996 Everest Tragedy

Michael Roberto, Professor, Bryant University

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CASES

PARTICIPANTCENTERED LEARNING & THE CASE METHOD

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This online program helps instructors develop skills and confidence in leading case discussions.

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Participant-Centered Learning and the Case Method

BOOK CHAPTERS

Analyzing a Case

Outlines different types of case situations and describes a process students can use to analyze them.

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o Educator copies of cases, articles, and chapters o Teaching Notes o Preview access to online courses and simulations o Access to course planning tools to organize materials and get student pricing

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THE CASE STUDY HANDBOOK:

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How to Read, Discuss, and Write Persuasively About Cases (Paperback)

What Managers, Executives, and Students Need to Know (Hardcover)

Updated and expanded edition by Michael E. Porter (Hardcover)

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role Plays

Real-World Experience in the Dynamics of Decision-Making

Role Plays enable students to "learn by doing" as they develop their negotiation and decision-making skills under the guidance of an instructor and with their peers in class.

Role Plays cover a number of academic disciplines and are appropriate for use in undergraduate, MBA, and Executive Education courses. They can be delivered online and each is accompanied by a comprehensive Teaching Note. RolePlanner, the administrative platform for Role Plays, provides a seamless mechanism for delivering rolespecific information, timing its delivery through multiple steps, and managing the debrief when play is complete. RolePlanner is free to instructors with any Role Play purchase.

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