Ben Chang, the CEO of a small credit union, Neighbourhood Credit Union (Neighbourhood), located in Atlantic Canada was evaluating a possible merger with another larger credit…
Abstract
Synopsis
Ben Chang, the CEO of a small credit union, Neighbourhood Credit Union (Neighbourhood), located in Atlantic Canada was evaluating a possible merger with another larger credit union, Pleasantview Credit Union (Pleasantview). Chang and Neighbourhood’s Board of Directors (Board) were interested in a merger that would enhance member benefits via improved technology, innovative delivery channels and a more robust financial planning and wealth management capability. Chang, along with a team of experts, was methodical in seeking out interested credit unions. Pleasantview emerged as a strong candidate from the expression of interest stage. The initial due diligence review was complete, the memorandum of understanding signed and a working group comprised of members from both credit unions formed. Chang, however, was becoming increasingly concerned about the lack of strategic fit between Neighbourhood and Pleasantview. In conversation with the consultant hired to assist with the merger process, Chang was considering recommending to the Board that the merger process with Pleasantview be halted. It was January 2015 and Chang was set to retire in May. Before he retired he wanted a plan in place that ensured increased member benefits, as well one that balanced growth and sustainability for Neighbourhood. Chang was scheduled to meet with the Board in four days. He needed a recommendation that would address the current merger situation, as well as provide other options for Neighbourhood.
Research methodology
This case is based upon primary and secondary data collection. Formal and follow-up informal interviews were conducted in 2015 with the CEO and “merger” consultant at Neighbourhood Credit Union. Organisational documents and publicly available documents were also consulted. To ensure the confidentiality terms of the merger discussions, the case is disguised with respect to the name and location of the credit unions, the names of the CEO and consultant, as well as the financials. The timeline, process followed, key decision and opinions of the CEO and merger consultant as presented in the case are real.
Relevant courses and levels
This case is formulated for university undergraduate students in their third or fourth years of study and graduate students. It is appropriate for strategic management and co-operative/not-for-profit management classes intended for a 60–75 min class session.
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Daphne Rixon and Karen Lightstone
Edward Rowan, 89 year-old patriarch and the Rowan family were trying to decide if they should start a vineyard in the Nova Scotia Annapolis Valley. Edward had a life-long dream of…
Abstract
Synopsis
Edward Rowan, 89 year-old patriarch and the Rowan family were trying to decide if they should start a vineyard in the Nova Scotia Annapolis Valley. Edward had a life-long dream of starting a vineyard on this five-acre farm. Edward, his son David and granddaughter Mary along with their respective spouses had agreed to be partners and provide financing to start the vineyard. The time had arrived to make a decision because they had to order the vines by the end of the month. While they have an extended family to provide free labor for planting, pruning and harvesting along with free access to the necessary machinery, they wanted to be sure that they did not lose money on the venture. They recognized the first four to five years would not generate profits, but they wanted to ensure that in the long term the venture would be viable.
Research methodology
This case was developed from an interview with Donna Rowan, a documentary review of the family’s estimates as well as an interview with the owner of a well-established vineyard in the Annapolis Valley. Secondary sources were used to provide information on the industry and average costs to operate a vineyard. The case uses a partial disguise with respect to the names of family members. The case was tested at the Atlantic Schools of Business student case competition where ten teams from different Atlantic universities participated. The authors were not judges and all suggested changes have been incorporated in the case.
Relevant courses and levels
The relevant courses are: managerial accounting undergraduate programs; intermediate accounting and entrepreneurship courses in undergraduate programs; second-level accounting and entrepreneurship courses in MBA programs; and professional accounting programs’ CPA.
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This policy brief calls for co-operative industry associations to implement policies that encourage co-operatives to embrace the SDGs in a way that reflects the co-operative…
Abstract
This policy brief calls for co-operative industry associations to implement policies that encourage co-operatives to embrace the SDGs in a way that reflects the co-operative difference. In particular, this brief explores why it is important for co-operatives to measure and report on the SDGs and to link the SDGs to the seven principles of co-operatives. We argue that reporting on the SDGs in the context of the seven principles enables co-operatives to illustrate their co-operative difference from investor-owned businesses (IOB) who are increasingly reporting on SDG performance. We identify key recommendations that are critical in facilitating co-operatives’ adoption of the SDGs and in reporting their performance relative to the SDGs and the seven principles.
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Lawrence T. Corrigan and Daphne Rixon
Electric cooperatives may be seen as an alternative form of organizing in the shadow of investor-owned utilities. They are presumed able to meet financial challenges while…
Abstract
Purpose
Electric cooperatives may be seen as an alternative form of organizing in the shadow of investor-owned utilities. They are presumed able to meet financial challenges while simultaneously honoring cooperative principles of member-owners. This paper aims to investigate such a balancing act and conceptualize “key performance indicators” (KPIs) as a dramatic accounting discourse.
Design/methodology/approach
This paper uses a dramaturgical approach to cooperative performance accounting, and claims that KPIs are a simplification of a complex and shifting reality which they also socially construct. Data were gathered from annual financial reports and websites of rural electric cooperatives along with semi-structured interviews conducted with senior cooperative officials.
Findings
The cooperatives in this case study reported a huge number of KPIs. However, this paper reveals that the performance indicators serve impression management goals and operational demands rather than reporting on fulfillment of the “Seven Cooperative Principles” that are fundamental to the cooperative movement.
Research limitations/implications
Extant inquiry regarding electric cooperatives tends toward a positivist research approach and a realist worldview. This overlooks dramatic and critical possibilities of KPIs as a management construction project. Expanding beyond mainstream research, this paper calls attention to artistic production of knowledge and applies a qualitative framework to problematize accounting disclosures.
Originality/value
Prior KPI research has often been instrumental, looking for predictive evidence that KPIs have strategic value as a “tool” for organizations to attain competitive advantage. This paper introduces the notion that performance measures are theatrical, and applies this to rural electric cooperatives, an industry mostly ignored in the academic literature.
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Louis Beaubien and Daphne Rixon
To examine metrics used for performance measurement, analysis, and decision-making by insurance cooperatives.
Abstract
Purpose
To examine metrics used for performance measurement, analysis, and decision-making by insurance cooperatives.
Design and approach
A documentary review and semi-structured interviews of three large insurance cooperatives form the basis of the study.
Findings
The analysis suggests insurance co-operatives metrics are consistent with investor-owned companies. These measures do not recognize the cooperative principles and values which consistent the formative basis of these insurance co-operatives.
Practical implications
The insurance co-operatives under examination do not engage in a comparison to other insurance co-operatives; rather comparisons are made against investor-owned companies. As this analysis is used in decision-making and strategy formulation, guiding the direction of the co-operatives the questions must be raised: does the co-operative difference exist in the insurance sector and how (and what) performance analysis tools are used to assess their performance?
Originality
There is a paucity of research in the area of metrics and analytics of co-operatives. As such this article expands the academic scope of examination of co-operatives in the context of financial and accounting operations. Additionally, it adds to the ongoing discussion in the academy focused on the nature of co-operatives and the nature of the co-operative difference.