Case studies

Shows how a regional family company threatened by national competition must make changes to its structure and way of doing business or face extinction or sale.

After a massive storm hit the northern Illinois service area of electric utility Commonwealth Edison on July 11, 2011, more than 900,000 customers were left without power during a hot, humid summer. ComEd crews and reinforcements from more than a dozen other states worked for days afterward to restore service. Meanwhile, the company's months-old social media strategy faced its first major test. The eChannels social media team, part of ComEd's customer operations division, worked around the clock to respond to posts from customers on social networking sites Facebook and Twitter. At a time when the company faced public debate and criticism over its plan to raise electricity rates, in part to invest in smart-grid upgrades, engaging directly through social media was a way to strengthen relationships with customers and the general public, consistent with an important corporate goal: “Keep the lights on and information flowing.”

After discussing the case, students will:

• Develop an appreciation for the role social media can play in shaping a company's reputation

• Understand how companies can use social media to engage customers directly in order to protect their reputations

• Understand the role these interactions with customers can play during a crisis situation

• Recognize the added reputational risk when a company's core business is directly impacted by a natural disaster

Develop an appreciation for the role social media can play in shaping a company's reputation

Understand how companies can use social media to engage customers directly in order to protect their reputations

Understand the role these interactions with customers can play during a crisis situation

Recognize the added reputational risk when a company's core business is directly impacted by a natural disaster

In March 2007 C. James Prieur, CEO of insurance provider Conseco, was faced with a crisis. The front page of the New York Times featured a story on the grieving family of an elderly woman who had faithfully paid for her Conseco long-term care (LTC) policy, only to find that it would not pay her claims. Her family had to pay for her care (until her recent death), which unfortunately resulted in the loss of the family business. The family was now very publicly pursuing litigation. For a company that depended on thousands of employees, investors, and independent agents who sold the insurance plans, this reputational risk was a serious threat. On top of this immediate crisis, all signs in the industry were pointing to the fact that the LTC business itself was not viable, yet over the years Conseco had acquired a number of LTC insurance providers. Students are asked to analyze not only what Prieur’s priorities should be in addressing the immediate crisis but also the risks inherent in the LTC industry and how this might affect Conseco’s success as a business moving forward

After reading and analyzing the case, students will be able to:

• Analyze the risks in the long-term care insurance industry

• Distinguish the various types of risk that caused a company’s crisis and recognize the potential for contagion

• Brainstorm how the risks faced by Conseco could have been avoided or better contained

• Recommend the first steps C. James Prieur and the Conseco leadership team should take to rectify the New York Times article crisis

Analyze the risks in the long-term care insurance industry

Distinguish the various types of risk that caused a company’s crisis and recognize the potential for contagion

Brainstorm how the risks faced by Conseco could have been avoided or better contained

Recommend the first steps C. James Prieur and the Conseco leadership team should take to rectify the New York Times article crisis

On October 22, 2004, junior trader Mary Lucas was browsing through the recent trading activities of a few convertible bonds the firm held. First Convergence Inc. was a hedge fund specializing in convertible arbitrage founded by three Wall Street traders in 2002. Prior to starting at the firm, she had known little about convertible bonds. Now she stayed late almost every day in order to learn as much about the business as possible. Suddenly, she noticed something unusual about the trading of a convertible bond issued by Countrywide Financial Corporation (NYSE:CFC). Although the average daily trading volume on this bond had been only three thousand during the previous month, it had shot up to fifty thousand in the last three days. Lucas remembered this particular bond. In fact, First Convergence was actually holding a slightly different convertible bond (known as the liquid yield option note or LYON) issued by the same company. On August 20, Countrywide had offered to exchange the new convertible bond for the original LYON. First Convergence had accepted the exchange offer, thus ending up with the new convertible bond. At that time, Lucas was asked to help evaluate the offer, so she was familiar with the features of both bonds. “What's happening?” she asked herself. She quickly checked the recent price movement on Countrywide's stock. The stock had plunged 11.5 percent on Wednesday, October 20, after the company announced earnings below analysts' expectations. On the same day, trading on the convertible shot up. These two events must be related. But how? Is there a potential investment opportunity?

Understanding various features of a convertible bond; identifying and exploiting an arbitrage opportunity

Change is hard for all but perhaps more difficult for school leaders and other nonprofit organizations. The role that culture plays in a mission-driven organization can often be an impediment to change. This case uses a unique education institution, St. Martin dePorres School of the Cristo Rey Network, to illustrate the importance of culture in implementing change. It demonstrates how leaders can articulate a vision and create a strategy to change an organization and move toward success. The case focuses on the leadership team of Principal Mike Odiotti and Assistant Principal Judy Seiberlich and how they used cultural change as the key driver to school success. That success was defined by improved academic performance, greater accountability for students, teachers and staff and stronger empowerment of constituents. It includes an overview of how the school's leadership team used data to drive decision making. This case is ideal for MBA students, executives in nonprofit management or school leadership and can be used to illustrate change management, nonprofit leadership, culture change, mission-driven strategy or school leadership. It addresses critical issues that organizations face and provides tools and tactics that can be applied to mission-driven enterprises.

Understand the role culture plays in creating change in an organization Gain an appreciation and comprehension for the relevance of shaping culture when implementing a vision Recognize norms guide people's behavior in organizations. Learn to identify the norms that promote positive cultures and those that create toxic environments Learn how to diagnose organizational culture using the “Iceberg Model” Build a repertoire of skills needed to successfully change and shape an organization's culture

Change is hard for all but perhaps more difficult for school leaders and other nonprofit organizations. The role that culture plays in a mission-driven organization can often be an impediment to change. This case uses a unique education institution, St. Martin dePorres School of the Cristo Rey Network, to illustrate the importance of culture in implementing change. It demonstrates how leaders can articulate a vision and create a strategy to change an organization and move toward success. The case focuses on the leadership team of Principal Mike Odiotti and Assistant Principal Judy Seiberlich and how they used cultural change as the key driver to school success. That success was defined by improved academic performance, greater accountability for students, teachers and staff and stronger empowerment of constituents. It includes an overview of how the school's leadership team used data to drive decision making. This case is ideal for MBA students, executives in nonprofit management or school leadership and can be used to illustrate change management, nonprofit leadership, culture change, mission-driven strategy or school leadership. It addresses critical issues that organizations face and provides tools and tactics that can be applied to mission-driven enterprises.

Understand the role culture plays in creating change in an organization Gain an appreciation and comprehension for the relevance of shaping culture when implementing a vision Recognize norms guide people's behavior in organizations. Learn to identify the norms that promote positive cultures and those that create toxic environments Learn how to diagnose organizational culture using the “Iceberg Model” Build a repertoire of skills needed to successfully change and shape an organization's culture

AstraZeneca is preparing for the launch of Crestor, the company's first entrant in the enormous and fast-growing statin category. The team responsible for the product launch is considering how best to bring Crestor to market. Should AstraZeneca simply follow the example set by Pfizer with the exceptionally successful launch of Lipitor? Or should the company instead launch Crestor as a niche product?

To teach new product strategy for both emerging and established categories, and competitive strategy.

Describes the winning formula at Neiman Marcus that has made it the No. 1 luxury retailer in the United States in terms of sales per square foot and profitability. Highlights Neiman Marcus' efforts to define who its customers are and are not and to achieve superior focus on its customers by aligning location, price, service, and merchandise to fulfill these customers' every need. Describes ways in which Neiman Marcus prevents typical silo behavior between merchandising and selling and how it ensures that the right merchandise gets to the right customer, despite the challenge of doing this in 36 micromarkets.

To show how a company integrates two strong high-performance functions—merchandising and sales—to get the right merchandise to each customer in more than 30 diverse selling locations while consistently providing exceptional customer service.

Tel Aviv–based Diskit Khartsan Ltd. sold sprays, traps, and netting to combat Blatta lateralis, the Israeli flying cockroach. The insect, slightly over one inch (2.54 cm) long and capable of flying short distances, was noisy, unsightly, and posed a risk of food contamination. Every heat wave brought more infestations, and consumers across the Mediterranean armed themselves with Diskit's HLH™ brand products.

HLH products generated nearly two-thirds of Diskit's annual revenues. During periods of low demand, local retailers resisted devoting significant shelf space to the bulky products, which meant that during periods of high demand stockouts occurred frequently and Diskit lost sales. To address this problem, the company had implemented a trust receipts program that raised prices for retailers by 3 percent but allowed them to take Diskit products onto their balance sheets without payment until the products were sold.

After analyzing and discussing the case, students should be able to: • Understand the relationship between a firm's credit policy and its product market strategy • Explain the effect of growth on firms' strategy when product market strategy is capital-intensive • Understand how exogenous change in the market's structure affects firms' product market strategy and, consequently, its inventory and credit policie

The Disney Crisis Exercise is not revealed here because it is entirely an in-class experience; students should not have access to any details prior to the exercise. Complete information is available to instructors in the teaching note. In this real-time exercise, student teams will advise Disney how to respond to a crisis precipitated by vocal and well-organized influence groups that threaten its brand as part of their advocacy on behalf of social causes. The crisis occurs against a backdrop of dynamic industry and company changes, many of which have important consequences for Disney.

After completing this exercise, students should be able to: