Faculty
Professor Richard A. D'Aveni
Objectives
Course Overview and Purpose
Multinational corporations account for about half the productive wealth in the industrialized world. Their importance in the U.S. economy is no less significant: close to three-quarters of the sales revenues of all U.S. corporations are accounted for by U.S. multinationals, and further, about a third of the sales revenues of these U.S. multinationals comes out of their production abroad. They account for 75% of all U.S. exports and 50% of all U.S. imports. Clearly, we are dealing with institutions that are remarkably significant in the world/U.S. economy.
Operation in an international environment gives the manager access to new markets, additional natural resources, and low-cost-factor endowments. More importantly, it opens up new sources of ideas and knowledge to stimulate future innovation. Above all, global markets provide a vast new source of the scarcest of all corporate resources: management talent. On the other hand, these new opportunities present the challenges of managing in more complex, diverse, and uncertain circumstances.
Purely domestic companies operate in a single national environment where consumer preferences, government policies and regulations, and labor union demands are relatively consistent and predictable and where competition is bounded within a single, familiar market. Overall performance is measured in one comparable unit: the local currency.
Unlike the purely domestic company, multinational corporations (MNCs) face diverse and often conflicting demands and pressures--including political risks from various host countries. Unlike domestic companies, MNCs must deal with barriers of distance and time, and differences in language and culture. They must compete on a complex, global playing field. Furthermore, MNCs are required to measure results with a flexible yardstick as the values of currencies fluctuate against each other.
In some instances, firms choose to confront these challenges when they make the decision to expand internationally. In many instances, however, firms have these challenges thrust upon them as their industries become increasingly global in scope. This is especially true for countries that are rapidly opening up their borders. For these firms, global competition is not an option but a necessary survival response to a changing world.
This course focuses on the challenges of developing and implementing strategies in global industries. The aim of the course is to provide participants with a conceptual and practical understanding of the strategic and organizational challenges of multinational corporate management. The types of questions that we address are: Why do firms go aboard? What differentiates a “global” from a “Multi-domestic” industry? How does a multinational company play the global chess game? Why and when do/should companies engage in cross-border strategic alliances? Cross-border mergers and acquisitions? What are the associated risks and how to guard against them? What potential roles can foreign subsidiaries play in the MNC’s global strategy? How do companies choose an optimal global structure? How do companies ensure coordination between the headquarters and its subsidiaries, and among subsidiaries? How do companies manage strategic change from one type of global strategy to another?
In sum, the course addresses the four critical strategic choices that MNCs must make:
1. Where to compete with the world,
2. Which products to offer around the globe,
3. Where to locate the various activities of the firm, and
4. How to organize to effectively coordinate worldwide activities.
The course takes the firm, which operates across borders as its unit of analysis, and the typical featured decision-maker is a senior manager within a multinational.
Who Should Take the Course and What You Will Get From It
As an outcome of this course, participants are expected to acquire knowledge, skills, and sensitivities that will help them manage effectively in an international business environment. Since virtually all corporations have to deal with global competition in one form or another, this course is intended for students interested in pursuing general management positions in any corporation. The course is well suited for students electing careers in management consulting, strategic planning, general management, and brand management in a global environment. Global Strategy and Implementation is designed for every student who will be involved in managing and advising companies that either compete internationally or which face international competitors.
Course Structure and Content
This course is designed to address the creation of competitive advantage in large, complex organizations that span national boundaries. The course is developed as a follow-up to the required strategy course in the core curriculum and assumes the knowledge imparted in that course.
The course is organized in two modules:
I. Understanding and dealing with the global context and why it is different from domestic competition
II. Generic Global Strategies - Exploiting and balancing global economies of scale/scope vs. local tailoring, using different activity architectures.
Module I introduces what makes global strategy different from domestic competitive strategy, focusing on the importance and impact of host governments and country-based advantages.
Module II surveys different generic global strategies, including global export, global value chain, multi-domestic, and transnational strategies. Each demonstrates a different emphasis on tailoring to local tastes, competitive conditions, and economic political risks versus seeking the benefits of economies of scale and global reach.
Cases and materials used in the course cover companies of all sizes, from entrepreneurial ventures to long-established large multinationals, and firms based in all regions of the globe. The cases include companies that are domiciled in the U.S., Europe and Asia. The geographic setting of all the cases varies too, including U.S. companies competing in Europe and Asia to Asian companies competing in Europe and the U.S. As a result, by the end of the course, students should have been exposed to a wide range of business environments, from politically unstable economies (such as in the Middle East) to the G8 countries. A wide variety of manufacturing industries are also included in the course cases.
What the Course Does Not Cover
The course necessarily involves discussion of the vast differences among countries and the effects of government policy on international trade and competition. However, these elements are taken as a given, much as managers take as given the context of the economies in which they operate. As such, the course is not intended for government policymakers seeking to design macro, microeconomic or industrial policy.
While we will take a look at the infrastructure and unique characteristics of individual countries, this is not an international business course that will teach you everything you need to know about doing business in Europe or developing countries. It is not a course on "how-to" do business abroad, covering the details of setting up overseas subsidiaries, or the laws on licensing. The course assumes that tactical details of implementation are addressed elsewhere, and focuses on the strategic issues that arise when firms compete across borders.
Finally, this is not a course on international finance or international marketing. We will discuss financial transactions, such as hedging, when relevant, and we recognize that financial issues, particularly exchange rate and economic conditions, do affect strategic choices. Similarly, details of market positioning and marketing campaigns across countries will be addressed when relevant to the larger global strategy of the firm. However, the focus is on the general manager who is sufficiently well informed about financial and marketing issues that he or she can incorporate them into strategic decisions without having to master their technical details.
Requirements
In the Classroom
My expectation is that you will come to the class having already thought through and analyzed the cases. This way, we can devote the bulk of the class time to thinking about and responding to each other's analyses of the cases and only the necessary minimum to getting the facts out.
I encourage active student participation in class. I should point out that most students typically tend to underestimate-rather than overestimate-the worth of what they have to say. Thus, if you are ever in doubt, I encourage you to speak up instead of staying quiet. It is especially important to get the contributions of international students and visiting students from overseas universities to help understand the local context of the cases.
If you are inadequately prepared to lead off the discussion of the particular case, you may:
ask before class not to be called on,
pass when you are called, or
"wing it."
These actions are listed in increasing order of negative evaluation.
My role in the class is to help facilitate discussion. In part, I serve as a clarifier and sometimes an intensive questioner in order to help you present and develop your ideas. One of my primary roles is to manage the class process and to assure that the class achieves an understanding of the case situation. Another of my primary roles is to provide you with a summary of the cases' major issues and the relevant research/literature (if any) on those issues. However, the goal is for you to discover the main issues on your own or through responding to my in-class questions. So, the primary responsibility for learning must rightfully fall upon the student. This makes your preparation, as well as your cooperation and open mindedness during class, critical.
Clearly, there is no single correct solution to any of these cases. There are, however, several wrong solutions and many lessons to be learned. There are also solutions which are inadequately supported with analysis, and there are solutions and analyses which are ineffective because they are not presented in an orderly and persuasive fashion. We should work together to see to it that each class session is a lively, stimulating, and intellectually rewarding venture in group learning. We are individually and collectively responsible for achieving that end.
Each case has its own integrity and, thus, it stands on its own. You may draw on personal experiences if you believe they are substantive, insightful, and generalizable. Generally, I am not concerned with what was the actual outcome of the case. Such an approach would imply that there is a "right answer". The actual outcome of a situation may or may not reflect a good solution. In those instances where there was a particularly interesting outcome, it will be shared with the class.
To get a full assessment of your prepartation, there may also be up to two, twenty minute unannounced quizzes administered during class sessions. These quizzes will count towards your class participation grade and they help me to assess the learning of those students who are quieter in class due to cultural differences.
In the Classroom--Speaker Presentations
My expectation is that you will attend all presentations by invited speakers (unless they are specifically identified as optional). While it is tempting to skip speaker sessions because of your other duties and because you will not be cold called, it is very important that you attend because it reflects poorly on the Tuck school if a CEO comes to an empty room and it decreases our ability to get other CEOs to come in the future. Your actions affect more than your self in this situation. They are dedicating their valuable and limited time as well as considerable corporate expense to talk to a very small audience. You will probably not get the opportunity to see such a high-powered group of CEOs such as this again, and they deserve our consideration and respect considering what they are doing for you.
You are required to prepare for the speakers by doing any reading assigned by the speakers as well as to gather your thoughts on any assignment questions that they might ask you to think about. You must prepare questions for the speakers based on those readings and assignments that evidence specific knowledge about the speaker’s company, not just generic questions. You should also look at the company’s website (or check other library resources if the website is unavailable or in a language you do not speak) to familiarize yourself with the company’s products and global strategy. If the speaker has not addressed global strategy, as they have been requested to do, then you should ask about global strategy and organization to make the speech relevant to the course. Since many of the speakers are CEOs of big companies, they often talk about whatever is on their minds and stray from the core theme of the course. So it is your responsibility to bring them back to global issues through your questions.
The final exam will include questions that ask you to do a summary and critical analysis of some of the speakers' presentation.
Written Assignments—Two Speaker Write ups
Two write ups based on speakers’ presentations are required. You must signup on the door of my office for one of the following speakers (in order of their appearance during the course):
Bill Johnson, CEO, Heinz
Fred Hassan, CEO, Schering Plough
Peter Volanakis, COO, Corning
Rod O'Neal, CEO & President, Delphi Corporation
Mike Roth, CEO, Interpublic Group
Dave Spears, CEO, Illinois Tool Works
Jack Stropki, Jr., Chairman, President & CEO, Lincoln Electric
Signups are first come first serve. My academic coordinator will email you when the signup sheets are posted on my office door.
The speaker write up should be 3 pages in length, 12 pt font, double spaced. The write up should include your summary of the presentation, and your analysis of the company’s global strategy. A strong paper would do a summary of the global strategy, a SWOT analysis of its global strategy, a critique, and suggestions going forward for the company. If the speaker does not talk about what you need to do this write up, you should be prepared to ask the speaker questions that allow you to gather the facts necessary to do the write up. You may also do additional research in the library or on the internet to supplement what you heard in class.
The write up is due one week after the speaker’s session and should be turned into my academic coordinator.
Research in the library or on the internet is permitted (for the write up only, not for the final exam). You may have to do a lot of interpretation of facts (such as where plants are located, or the names of overseas subsidiaries) to make your best judgment about what and why the firm is doing what it is doing. Just state your assumptions.
Papers will be graded on the basis of their: thoroughness, accuracy, clarity, conciseness, organization and application of the principles and tools learned in this course. A big plus is given for identifying something new and unique that adds to the learning experience of your classmates during your presentation.
One final note, a truly great write up evaluates the global strategy of the firm or assesses the profit potential of the global industry structure, discusses implications for the future, and makes actionable recommendations for future strategy of the firm.
Written Assignments--One Case Write up
Each student is required to signup for one case write-up. This is a four-page, double spaced (minimum font size = 12) paper answering the case questions assigned in the syllabus. The write-up is due at the beginning of the class session, and students doing the case write-up are expected to take the lead in the class discussion that day. A signup sheet will be posted on my office door. The possible case choices are:
Emerson Electric
Unilever
Zara
Antmobel
Xerox and Fuji Xerox
Signups will be limited for each case to insure all cases get equal coverage, so the signups are first come, first serve. My academic coordinator will email you when the signup sheets are posted on my office door.
No outside research is permitted. Please just use the readings and the case.
Additional Guidelines
Attendance is obviously important; other activities, including job interviews, ought to be scheduled so as not to conflict with class meetings whenever possible. Two or more absences may have a serious impact on your class participation grade. You are on the honor code to report all absences to the professor. Excused absences may be granted for health or family emergencies, as well as religious reasons.
Classes will begin on time. I will appreciate it if you are in the classroom before the class starts.
I frequently call on students who do not have their hands raised. If you are not prepared for class, please notify me in advance.
I have a strong preference that laptops not be used during class. Doing email or surfing the net often restricts comprehension and limits participation, thereby reducing your learning or those of others. Laptops should not be used during class for emailing, researching the cases, surfing the net, or any unrelated purpose. If you must, laptops may be used for note taking, spreadsheet analysis requested by the professor, or in-class power point presentations. Please see the Tuck Laptop Policy for more details.
Many of the CEOs will not provide us with reading materials and assignment questions until last minute, so please check Tuck Streams for constant changes in the syllabus. Otherwise, you will not be prepared for the speakers and you will not get very much out of this potentially very valuable experience
Final Examination
There will be a three hour take home exam, which will be passed out on the last day of class. This is open book to your notes and the cases and assigned readings only. You must not talk to anyone about the exam or background facts necessary for answering the exam questions. The exam must be written by you alone.
The exam will include questions about the speakers’ presentations (for which you may not do any research on the internet or in the library during the exam, nor may you view any tapes of the speakers that are on reserve in the library during the exam period.)
And the exam may include a case with questions, or it may ask you to compare what you learned from the course cases and lectures to what the speakers said. Again you should not use any reference source, person, website or any other source to look up what they company actually did regarding this case.
Your answers should apply the concepts and frameworks from the course, and must stick within the page limitations set out in the instructions. You will be on the Tuck honor code for this exam.
Materials
Course Materials
The course packet contains all the readings and cases (except the Komatsu case, which will be handed out in class). You should not research cases on the internet, in the library, or through personal contacts to find out "what happened" or "what the answer is." The learning in this course focuses more on the thought process in analyzing global business situations, not just on the "solutions" per se.
Anticipation of Speaker Cancellations
Because of the responsibility of the speakers we must anticipate and forgive them if they cancel last minute. Some will be hit by pressing business crises, such as take over attempts, public relations issues, and legal issues. If they do cancel, and we can anticipate that some will, class will still be scheduled. You will be notified by email of what is required when a cancellation occurs. So please be vigilant as to monitoring notices concerning cancellations.
If a cancellation occurs, the speaker will be replaced by a lecture giving an overview of global strategy issues and a Q&A session with the professor. We will also discuss the implications of what the speakers had to say. The goal will be to outline the course and to review what we have learned from the speakers to date.
Tuck Honor Code
The Tuck honor and social codes strictly apply to this course. Severe violations may jeopardize your grade in the course.
The following statements should further define role of these codes in this course:
You are encouraged to form study groups to prepare the assigned case for each day. However, you should not use any handouts or power points distributed in previous years or other sections of the course.
Disruption of the learning experience for others should be avoided, which means that each student should respect the opinions of others and the professor, even if cultural or national difference lead to conflicting views and ethics or political incorrectness from the American perspective.
Please report any suspected Honor Code violations to the Judicial Board. You should also feel free to ask the professor for clarification of “gray areas” without prejudice before infractions occur or to admit fault to the professor so that a satisfactory resolution can be achieved.
Grading
Class Participation* 50%
* Includes unannounced in-class quizzes, if any as well as attendance and in-class involvement.
Speaker Write ups (2) 10%
Case Write up (1) 10%
Final Examination 30%
Schedule
Session 1: Monday, September 15, 2008 Rosenwald Classroom
Topic 1: Course Introduction and The Changing Global ContextTopic 2: The Changing Global Context-Falling Barriers to Entry and the Destruction of Traditional Strategic Perspectives
Case: Caterpillar Tractor Company
HBS Case (9-385-276)
Reading: “How Global Companies Win Out”. Hout, Thomas M., Porter, Michael E. and Rudden, Eileen; Harvard Business Review (Reprint 82504)
Questions:
What are the key elements in Caterpillar’s historical strategy? What is the source of its outstanding success in the worldwide earth-moving equipment industry?
What changes do you see in the industry and the competitive environment? What implications do they have for companies in the industry?
How well is Cat positioned for the future? What recommendations would you make to Lee Morgan?
BE PREPARED FOR AN OPENING COLD CALL TO DISCUSS HOW THE GLOBAL ENVIRONMENT IS CHANGING AND WHAT MUST BE CHANGED AT CAT TO DEAL WITH THESE CHANGES.
Session 2: Tuesday, September 16, 2008 Rosenwald
Topic: The Struggle for Global Dominance-The Unconventional Tactics of Global Challengers
Case: Komatsu Limited (to be handed out at end of previous class) HBS Case (9-385-277)
Reading: "Strategic Intent", Gary Hamel & C.K. Prahalad, Harvard Business Review, May-June 1989, pp. 63-77 (Reprint R0507N)
Questions:
How does Komatsu disrupt Cat’s Strengths? Why does Komatsu use the sequence of initiatives it does? Were they planned?
How does Komatsu see its source of competitive advantage differently from Cat?
Session 3: Monday, September 22, 2008 Rosenwald
Topic: Utilizing the Competitive Advantage of Nations
Case: Hyundai Heavy Industries and the Shipbuilding Industry HBS Case (9-385-212)
Reading:“The Competitive Advantage of Nations”, Porter, M.E., Harvard Business Review, March-April, 1990. (Reprint 90211)
Questions:
Use the numbers and text of the case to identify the sources of the cost and other advantages of the Korean, Japanese and European competitors in the case.
What should the Korean, Japanese, European, Chinese and American competitors do?
Students with last names beginning with letters (A-E) should be ready to take the position of the leading Korean Firm.
Students with last names beginning with letters (F-J) should be ready to take the position of the leading Japanese Firm.
Students with last names beginning with letters (K-P) should be ready to take the position of the leading European firms.
Students with last names beginning with letters (Q-Z) should be ready to take the position of leading firms in the third world nations (potential entrants) and the US.
Preparation: You have been asked to take the perspective of the leading firm in various countries.
Hints: You should first identify the profit potential for the global industry using the five forces (i.e., is buyer power high or low, etc.). What does the model tell you about the industry’s profitability? Then, move on to considering why firms in some nations might do better than those in other nations. For your country, identify as of 1984, the strengths, weaknesses, opportunities and threats of the leading firm in that country. Some will have country-based advantages with respect to costs, government policy, etc. Then consider the impact of your SWOT on the Mission, Distinctive Competence and Scope (Product / Market, Geographic & Customer) of the leading firm in that country. Consider how you will out-maneuver the leading firms from other countries with different country-based advantages.
Session 4: Tuesday September 23, 2008 Rosenwald
Topic: Managing Host Country – MNC Relations
Case: Exxon Corporation, In “The Strategy Process” by J.B. Quinn, H. Mintzberg, and R.M. James. Prentice Hall, Englewood Cliffs, NJ. First Edition, 1988. pp. 457-479.
Reading:“The New World Disorder” by Nicolas Checa, John Maguire, and Jonathan Barney, Harvard Business Review, August, 2003, pp. 71-79. (Reprint R0308E).
For an update on the world politics concerning oil, also skim:
Questions: Found in the back of the case. Answer them as of the end of the case.
Part II: Global Generic Strategies
Session 5: Monday, September 29, 2008 Rosenwald
Speaker: Bill Johnson, CEO. H.J. Heinz Company
Readings:
"The Innovation Playbook" Chief Executive Magazine, March 2008, pp. 336-41.
"Managing the Right Tension", by Dominic Dodd & Ken Favaro; Harvard Business Review, December 2006, pp. 62-74.
H.J. Heinz Company 2008 Annual Report (available on Heinz.com).
Optional Readings: May 29, 2008: Analyst Day Webcast (available on Heinz.com). The entire webcast is 4 hours. If you want to narrow the scope, focus on Bill's sections, the strategy piece by Beth Eckenrode, and the Emerging Markets piece.
Browse "Heinz.com", which has a wealth of information.
Session 6: Tuesday, September 30, 2008 Rosenwald
Speaker: Fred Hassan, CEO, Schering Plough
Tentative Topic: "Getting in Tune, Executing with Excellence: A Formula for Driving Long-Term High Performance."
Readings:
"We Can't Just Demand Trust...Interview with Fred Hassan"; The Focus: The Egon Zhender International Leadership Magazine, Vol. XII (I), 2008.
"Fred Hassan-The Leader Behind the Transformation of Schering Plough", American Management Association MWorld, Winter 2007/08.
The Schering Plough Core Document: Background, November 2007
Optional Reading:
"My Years with General Motors", by Alfred P. Sloan, Prentice-Hall: Englewood Cliffs, NJ; 1960 (On Reserve in Feldberg Library)
Questions: TBA
Session 7: Monday, October 6, 2008 Rosenwald
Topic: Discussion of how to learn from the speakers
Session 8: Tuesday, October 7, 2008 Rosenwald
Speaker: Peter Volanakis, COO, Corning
Required Readings:
"Cornings Biggest Bet Yet? Diesel-Filter Technologies" by Sara Silver, Wall Street Journal, March 7, 2008.
"Glass Menagerie" by Jonathan Fahey, Forbes, April 24, 2006.
"Trial by Fire" by William Holstein, Business 2.0, February 2003.
Optional Readings:
"How Corning's Board Stays on Top of Technology" by John R. Engen, Corporate Board Member March/April 2007.
"Alumni Pages" Tuck Today, Tuck School of Business, September 15, 2008.
Questions:
How do you think Corning’s experience in the Telecom crash has impacted its financial structure, risk orientation, and approaches to innovation?
How might the role of Corning’s board be influenced by Corning’s approach to innovation, business model, and Asian business concentration?
What are some challenges of an American company competing in Asia against Asian competitors?
What are some risks to Corning’s “high stakes” innovation business model, particularly as it applies to Asia?
What unique skills are necessary for Corning’s keystone component innovation model to succeed?
What advantages or disadvantages do you see to Corning’s R&D headquarters being in rural upstate NY?
What would you expect the leadership culture and operating environment inside Corning to be like?
How do you manage for the long term when investors are focused on next quarter’s performance?
Session 9: Monday, October 13, 2008 Rosenwald
Speaker: Rod O'Neal, CEO Delphi
Topic:“(Vision + Strategy) x Execution = Success”
Readings:
Delphi’s Original Chapter 11 motion filed with the U.S. Bankruptcy Court, October 2005 (www.delphidocket.com)
The latest court decisions from October 2008 (on pension, GSA and MRA) (www.delphidocket.com)
Optional Readings:
Journey Though Heartsongs, Mattie Stepanek
Snapshots From Hell, Peter Robinson
Questions:
If you were the CEO of Delphi, would you have filed for Chapter 11? If so Why? If not, why not?
How would you manage a Board of Directors in the selection of filing Chapter 11 as an option to restructure the company?
Who is the most important constituency for a CEO to manage?
Session 10: Tuesday, October 14, 2008 Stoneman
Speaker Cancelled
Speaker: Mike Roth, CEO, Interpublic Group
Questions:
Session 11: Monday, October 20, 2008 Stoneman
Topic: Global Activity Architecture
Case: Emerson Electric Company ACP Division: The Fan Subpack Sourcing Decision, Darden Case (UVA-OM-0631)
Reading: "Building Competitive Advantage Through Global Networks of Capabilities", Andrew Bartness & Keith Cerny, California Management Review, Winter 1993, 35(2); pp. 78-103.
Optional Reading: "The Global Costs of Opacity", Joel Kurtzman, Genn Yago & Triphon Phumiwasana, MIT Sloan Management Review, Fall 2004, pp. 38-44.
Questions:
What are the sources of risk to ACP in each of the sourcing alternatives? How do you evaluate the risks?
What are the costs associated with each sourcing alternative? What are the landed total costs of each alternative? Does landed total cost present a true picture of the real costs of each alternative? What are the additional costs?
How does each of the alternatives influence the geographic positioning and configuration of ACP’s overall value chain? What are the advantages and disadvantages of the alternative overall configurations and what issues are not considered when looking at the sourcing decision in isolation of the overall configuration?
Session 12: Tuesday, October 21, 2008 Stoneman
Topic: Adapting the Multi-Domestic Strategy to a Globalizing World
Case: Unilever's Butter-Beater: Innovation for Global Diversity HBS Case (9-698-017)
Reading: "Unleash Innovation in Foreign Subsidiaries", Julian Birkinshaw & Neil Hood, Harvard Business Review, March 2001, pp. 131-137 (Reprint R0103J)
Questions:
Unilever traditionally has been successful using a multi-domestic strategy -- tailoring its products, marketing and strategies to each country. Is there any reason to change now?
Should products, marketing and strategy be tailored to each market or regionally standardized in the novel spreads market? Why? What factors should you consider?
What is your explanation for the data in Exhibits 4, 5 and 6? Are there any contradictions? Do they give you any insights into what approach might work in novel spreads?
If the German team had done a better job of coordinating with its counterparts in other countries during the Krona development effort, would it have changed the outcome? What are the fundamental, underlying reasons why the country organizations did not embrace the Krona concept with enthusiasm? What evidence do you see in the case that supports your diagnosis of the root cause?
Why else has Unilever been unable to implement a regional product strategy? What should Unilever have done differently?
The German team at the bottom of page 10 seems to have concluded that a free market system (in which new products are designed with a single country in mind, rapidly brought to market, and then successful ones are made available to be picked up by other countries if they are successful) is the right way to address this problem for the future. Under what circumstances might this be the optimal course?
What should Bill Bordewijk do?
FALL BREAK
NO CLASSES OCTOBER 27 & 28, 2008
Session 13: Monday, November 3, 2008 Stoneman
Speaker: Dave Speer, Chairman & CEO, Illinois Tool Works
"ITW Puts Tools To Good Use", Chicago Tribune, July 21, 2006:
"Turning Managers into Takeover Artists, Wall Street Journal, April 6, 2007
"Global Economic Picture Darkens",Wall Street Journal Asia, August 15, 2008 (In the Course Folder)
Illinois Tool Works Annual Report, under Investor Relations or directly from:
Questions:
What do you think are some of the big challenges in a largely decentralized organizaion like ITW?
What do you think could be real advantages to this decentralized structure?
What are the benefits of using operating management to drive the acquisition process?
What are the challenges of this acquisition structure?
Session 14: Tuesday, November 4, 2008 Stoneman
Topic: Activity Architecture-Global Value-Added Chains/Constraints for International Expansion
Case: ZARA: Fast Fashion, HBS Case (9-703-497)
Reading: "Retailers to the World," Denise Incandela, Kathleen McLaughlin & Christina Smith Shi, The McKinsey Quarterly, 3 (1999), pp. 84-97.
Optional Reading: "Transfer of Managerial Practices by French Food Retailers to Operatons in Poland", Marcus & Stephanie Hurt, Academy of Management Executive, 2005, 19(2),pp. 36-49.
Questions:
Was Galicia/Spain fertile ground for the emergence of an apparel manufacturing/retailing powerhouse?
What are the sources of Zara’s competitive advantage? What is unique compared to H&M, The Gap and Benetton?
Are Zara’s advantages sustainable? Will they travel globally?
How far will they travel? Looking at cost, pricing, etc. can they extend into the USA? The Middle East? Run the numbers.
What do you think of Zara’s past international growth strategy? Evaluate, in particular, its strategy for market selection, its mode of entry, and its marketing approach.
What is the best way to grow Zara now? How, specifically, do you see prospects in the Italian market? And more broadly, what do you think about the strategy on focusing on Europe versus making a major commitment to another region?
Assignment:
Graph Zara’s arctivity architecture (value stages by geographies) to show the flow of work in Zara’s business system. Evaluate the pros and cons of this architecture compared to the approaches taken by H&M, The Gap and Benetton, and in light of the changing global environment.
Evaluate Zara’s choice of breath and depth across countries in store locations and operations.
Evaluate Zara’s global strategy in light of the McKinsey recommendations in the assigned reading? How does it compare?
BE PREPARED TO PRESENT YOUR GRAPH OF ZARA'S ACTIVITY ARCHITECTURE IN CLASS. I WILL PICK ONE OR TWO STUDENTS TO PRESENT THEIR GRAPH AND ANALYSIS.
Session 15: Monday, November 10, 2008 Stoneman
Topic: Taking the First Steps-Internationalization & Entry Mode
Case: Antomobel (A) & (B), HBS Cases (9-795-100) & (9-795-101)
Reading: "Distance Still Matters: The Hard Reality of Global Expansion", Pankaj Ghemawat, Harvard Business School September 2001 (Reprint R0108K).
Questions:
Should Antmobel be internationalizing at all? What Challenges does it face?
How do you compare the Uzbek and French opportunities? Should they accept the Uzbek order or invest in France?
What criteria should companies use when choosing which countries to enter?
What are the inherent advantages of an export vs. internationalization strategy and vice versa?
Session 16: Tuesday, November 11, 2008 Stoneman
Speaker: John Stropki, Jr., CEO, Lincoln Electric Tool
Reading:
Lincoln Electric Annual Report 2007
Lincoln Electric 3rd Quarter Results
Lincoln Electric Strategy, Smart Business Magazine, October 2008. (Copyright 2008 Smart Business Network, Inc. Reprinted with permission.)
Lincoln Electric, HBS Case, 9-707-445 (rev. 8/25/2008) by Prof. Jordan Siegel.
Sesssion 17: Monday, November 17, 2008 Stoneman
Topic: Managing Cross-Border Alliances-Dealing with Conflicts, Changing Power & Constant Adjustment of Terms-to Achieve a Larger Global Strategy
Case: Xerox and Fuji Xerox, HBS Case (9-391-156)
Questions:
What role has Fuji Xerox played in Xerox’s global strategy? How do you expect this role to change in the future?
Is Fuji Xerox a successful joint venture in 1990? How do you measure its performance? Please be as concrete and specific as possible.
What were the key success factors in this alliance in the past? Do you expect these factors to change in the future?
Consider the different options for reorganization listed in Exhibit 11. Select one option in each functional area and be prepared to explain why you prefer it over the others?
Session 18: Tuesday, November 18, 2008 Stoneman
Topic: Wrap-Up Lecture and Q&A
