Case studies

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. After some ups and downs, the Joyoung manufacturer founded the Shandong Joyoung Electric Appliances Co., Ltd. in 2002. It was further reorganized to the current Joyoung Company Limited in September 2007. 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—the soymilk makers—alone have 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 introducted in 1994, people had no idea what this new creature was supposed to do. The first 2,000 units of Joyoung products remaintroducedined stacked in storage for months. Joyoung then decided to conduct some marketing research. Joyoung's repositioning strategies and new product developments based on their marketing research have been evidently successful, and they have defined a new product category in China and in the world.

A married couple who have a successful industrial B2B business evaluate whether or not to sell the business to two of their offspring, who are both entrepreneurial MBA graduates. Complicating factors include the fact that the sale price and structure need to finance the couple's retirement and give fair inheritance treatment to the remaining siblings. In addition, the father has had some health issues and the business is doing well, so there is a lot of forward momentum to sell to the next generation

Evaluate whether or not, and how, to keep a business founded and run by entrepreneurs as a family business into the sibling generation. Explore “escalation of commitment” and how it influences decisions to keep the business in the family or not.

Global Connect, a major telecommunications service provider, partners with national cable providers to bundle media and telecom services offered through voice over Internet protocol (VoIP). Global Connect provides the VoIP physical infrastructure that enables cable providers to offer VoIP phone service to their end customers. VoIP cable services are growing at a faster rate than anticipated, leaving Global Connect incapable of meeting contractual agreements with the cable partners and preventing them from capturing substantial VoIP market opportunities. Students are asked to improve the configuration of work at this service organization by identifying the types of waste in the current process. Process improvements use lean tools and their impact is quantified using time and capacity analysis.

To view a service business as a process and to understand where to find the constraints regarding customer responsiveness (flow time) and sales (throughput). This requires a rather subtle capacity analysis.

Describes the events leading up to the imposition of the London congestion charge. Views about the congestion charge, both pro and con, are presented. Also discusses, in general terms, the economics of traffic congestion, pointing out that an unregulated market for driving will not reach the social optimum. Contains sufficient data to estimate the deadweight loss in an unregulated market and the reduction of the deadweight loss due to the imposition of the congestion charge in 2003.

To provide a good illustration of how an unregulated market with negative externalities can lead to an overprovision of a good (in this case driving). Also, to show how an externality tax (in this case, London's congestion charge) can lead to an improvement in social welfare.

In the fall of 2007 a senior director of product marketing at Qwest in Denver, Colorado, gets an offer to work for an entrepreneurial high-growth venture. The vision is for greater wealth, accelerated business opportunity, more thrill on the job, and faster path to leadership by pursuing a position with a start-up firm. Kiva Allgood has management responsibility in her current position (e.g., manages a high-budget portfolio), with compensation of $145,000 in salary and incentive bonuses up to 100% of base salary. She realizes that she is not prepared for the negotiation because she has only negotiated job offers within large firms. She needs to know what many of these entrepreneurial finance terms mean and to understand whether she is being offered terms and amounts commensurate with the value she feels she will bring to the entrepreneur. She also needs to understand her opportunity cost and the expected value of her options: staying with the current job, starting her own venture, or taking this offer at the entrepreneurial venture. She had no idea there were also so many additional, non-financial factors to take into consideration. With her future on the line, she needs to work through the numbers fast. The entrepreneur gave her five days to come back with a counter offer, which he considered a generous amount of time. In evaluating these questions, students will take Allgood's point of view. The case is based on a real job offer to a real person named Kiva Allgood. The entrepreneur and his firm are fictitious in order to heighten the issues in this situation.

Exposes customary negotiations between a prospective employee and an entrepreneur, taking into account the valuation of the entrepreneurial firm, salary, stock options, ownership percentage, etc.; Examines the difference between considering a position with an entrepreneurial venture and one at a stable corporate organization; Looks at typical compensation criteria for entrepreneurial venture capital-backed firms; Introduces method for assessing an entrepreneur as a prospective future employer.

California telecommunications company Wireworld is considering an acquisition of Nusantara Communications, a subsidiary of Indonesian conglomerate Bakrie & Brothers. Nusantara had invested $50 million in developing the advanced rural telephone system, which had the potential to provide much-needed telecommunications services to the mostly rural Indonesian population. If if were exported, the worldwide market for this product in the next five years was projected to be in the billions. Should Wireworld acquire this small company halfway around the world? Was it prepared to enter the Indonesian marketplace and beyond?

Students will examine a variety of data, including financial projections, in order to decide whether acquiring Nusantara will add value to Wireworld.

Mary Kay is one of the best-known direct sellers of women's cosmetics in the world. Its channel strategy is to use independent beauty consultants, who are independent distributors, to sell directly to consumers. Its compensation plan is multilevel, providing commissions to distributors on their own sales as well as the sales of the distributors they recruit. At the time of the case, the company is grappling with a well-established change in consumer behavior—the decline of the stay-at-home mom as she returns to the workforce—combined with the opportunities offered by Internet selling. Focuses on the company's efforts to move with consumer demand and behavior, while remaining true to its core goal of “Improving Women's Lives.” Discusses ways Internet technology can be used throughout the company's channel and supply chain structure, not just as a route to market.

Winner of the 2014 EFMD competition for best case on Indian Management Issues and Opportunities.

After a highly successful third round of funding in 2012, Gaurav Jain, founder of quick service restaurant chain Mast Kalandar, was looking to expand. In addition to opening new stores in other cities, Jain was also hoping to increase the profitability of his existing stores in Bangalore, Hyderabad, Chennai, and Pune. He needed to fully understand the financials of his current operations and identify the key drivers of success at the stores, at both the city and corporate levels. With this understanding, he would be able to evaluate how best to improve the performance of existing outlets and to choose an entry strategy for new cities. Students are asked to develop a financial model for outlets and use it to compare different growth strategies.

After analyzing this case, students will be able to:

• Assess the strategic and operational tradeoffs being made by the CEO of a company in a growing foodservice sector of an emerging market as he establishes and grows his enterprise

• Build a financial model for outlet operations that identifies key drivers of performance and allows for a comparison between different growth strategies

• Strategically prioritize growth opportunities for a company in response to an influx of new capita

Assess the strategic and operational tradeoffs being made by the CEO of a company in a growing foodservice sector of an emerging market as he establishes and grows his enterprise

Build a financial model for outlet operations that identifies key drivers of performance and allows for a comparison between different growth strategies

Strategically prioritize growth opportunities for a company in response to an influx of new capita

In July 2010 Robert Drake, senior director at Micawber Capital, one of India's largest microfinance organizations, needed to recommend a corporate structure and organization for Micawber after its scheduled IPO in August 2010.

The IPO would bring to Micawber new stakeholders, primarily financial institutions. Drake was skeptical that the new investors shared Micawber's commitment to help alleviate poverty in rural India through microcredit loans; he assumed their primary interest was a good return on their investments. The two objectives–increasing ROI and meeting the financial needs of the poor–seemed at odds with each other.

Drake had to consider how the interests of clients and investors would be represented in strategic decisions so that they balanced the conflicting values of the stakeholders.

• Balance stakeholder commitments to business objectives and social mission

• Understand the expectations of both commercial investors and mission-conscious investors in social enterprises

• Discuss the challenges and opportunities of structuring an organization and key partnerships based on a long-term values strategy

• Identify organizational policies and business processes that can be changed to encourage an appropriate balance of values-based and financial-based decisions

Balance stakeholder commitments to business objectives and social mission

Understand the expectations of both commercial investors and mission-conscious investors in social enterprises

Discuss the challenges and opportunities of structuring an organization and key partnerships based on a long-term values strategy

Identify organizational policies and business processes that can be changed to encourage an appropriate balance of values-based and financial-based decisions

Michaels Craft Stores is the largest arts and crafts retailer in the United States and in the world. Its CEO, Michael Rouleau, wants to expand the chain to 1,000 stores by 2006. The key constraint is the lack of sophistication among Michaels' supplier base, which is made up of over 1,000 suppliers, many of which are small, creative companies with little computer or logistics knowledge. As a result, the cost of running Michaels' supply chain is high. Describes the company's efforts to build the sophistication of its suppliers through educational Vendor Flow Training courses that teach suppliers how to adopt state-of-the-art practices for improved efficiency in supplying their channel.