Ivey Publishing

International Market Entry Strategies

Forum for International Trade Training,5/e (Canada, Forum for International Trade Training, 2008)
Prepared By Alex Beamish,
Chapter and Title Chapter Matches: Case Information
Chapter 1:
Strategic Planning for Market Entry

CURRIE ROAD CONSTRUCTION LIMITED (A)
Paul W. Beamish

Product Number: 9B11M001
Publication Date: 1/7/2011
Revision Date: 11/20/2014
Length: 13 pages

A successful Canadian road construction and maintenance company is contemplating U.S. market entry via a subsidiary in Texas. The case deals with market entry considerations: speed of entry, the need to invest in learning about a market, and the importance of staying focused on what is a reasonable, original strategy.

Teaching Note: 8B11M001 (8 pages)
Industry: Construction
Issues: International Business; Corporate Strategy; Market Analysis; Location Strategy; United States and Canada
Difficulty: 4 - Undergraduate/MBA



TAVAZO CO.
Paul W. Beamish, Majid Eghbali-Zarch

Product Number: 9B10M093
Publication Date: 11/12/2010
Revision Date: 9/21/2011
Length: 13 pages

In June 2010, Naser Tavazo, one of the three owner/manager brothers of both Tavazo Iran Co. and Tavazo Canada Co., was considering the company's future expansion opportunities, including further international market entry. Candidate cities of interest were Los Angeles, Dubai and other cities with a high Iranian diaspora. Another question facing the owners was where to focus on the value chain. Should the family business use its limited resources to expand its retailer business into more international markets, or to expand their current retailer/wholesale activities within Canada and Iran?

The objectives of this case are: (A) to discuss the typical problems that small companies confront when growing internationally and the implication of being a family business in this transition; (B) to provide a vehicle for developing criteria for market selection; (C) to highlight the importance of focus in the value chain regarding horizontal vs. vertical integration.

This case can be used in international business, strategic management or family business (entrepreneurship) courses. In international business, it may be used as an internationalization case and positioned early in the course. In a strategic management course, it might be positioned in sections dealing with managerial preferences, or diversification.


Teaching Note: 8B10M93 (9 pages)
Industry: Agriculture, Forestry, Fishing and Hunting, Manufacturing
Issues: Market Selection; Family Business; Internationalization; Imports; Exports
Difficulty: 4 - Undergraduate/MBA



CHABROS INTERNATIONAL GROUP: A WORLD OF WOOD
Paul W. Beamish, Bassam Farah

Product Number: 9B10M100
Publication Date: 11/30/2010
Revision Date: 4/17/2014
Length: 16 pages

AWARD WINNING CASE - MENA Business Cases Award, 2012 European Foundation for Management Development (EFMD) Case Writing Competition. The Chabros International Group case examines how a Lebanese multinational wood company confronts a drastic drop in its largest subsidiary's sales after 2008's global economic crisis. Antoine Chami, Chabros's owner and president, was reviewing his company's 2009 end-of-year financial statements and, in particular, a 30 per cent drop in sales in Dubai. In 2007, a year before the global economic crisis, Chami had invested more than $11 million to acquire and expand a sawmill in Serbia to meet Chabros's growing lumber sales demand. With a much higher capacity to produce lumber and a much lower probability to sell it, Chami had to decide what to do to overcome this challenge. Should he close parts of his Serbian sawmill? Should he try to boost his company's sales to use all of his sawmill's available capacity? If so, should Chabros try to increase sales within the countries where it already operated (UAE, Saudi Arabia, Qatar, Oman, Egypt) or should it expand into a new country (Algeria, Bahrain, Iran, Iraq, Jordan, Kuwait, Libya, Syria, Tunisia)? Would Morocco, among other countries, be the best country to expand into? Was it the right time to embark on such an expansion?

Teaching Note: 8B10M100 (15 pages)
Industry: Manufacturing
Issues: International Expansion; Market Entry; Growth Strategy; Exports
Difficulty: 4 - Undergraduate/MBA


Chapter 2:
Barriers to Entry

WOMEN'S TENNIS ASSOCIATION IN ASIA - BUT WHERE? (A)
W. Glenn Rowe, Sharda Prashad

Product Number: 9B10M026
Publication Date: 10/25/2010
Length: 11 pages

In 2007, the Women's Tennis Association (WTA) was facing a saturated market for women's tennis and identified the emerging middle-class in Asia as a growth area. The chief operating officer (COO) of the WTA was faced with a dilemma: He had to decide the new location of the Asian regional office of the WTA and present his recommendation at both the next board meeting and the WTA Global Advisory Council. The COO's presentation had to include the rationale for the chosen location and a strategy to increase the sport's popularity in the Asian market. With several cities to choose from, the COO had to weigh the pros and cons of each to present the most logical choice.

Teaching Note: 8B10M26 (4 pages)
Industry: Arts, Entertainment, Sports and Recreation
Issues: Emerging Markets; Market Strategy; Location Strategy; Government and Business
Difficulty: 4 - Undergraduate/MBA



PAN BORICUA: DEVELOPING A MARKET STRATEGY FOR THE HISPANIC MARKET IN THE UNITED STATES
Victor Quiñones, Julia Sagebien, Marisol Perez-Savelli, Eva Perez, Jennifer Catinchi

Product Number: 9B09A020
Publication Date: 8/27/2009
Length: 10 pages

Two inexperienced, but strongly committed, entrepreneurs face the hassles of a new venture: exporting dough from Puerto Rico to cities in the United States with large numbers of Puerto Rican immigrants who are longing nostalgically for their beloved pan sobao (bread made with vegetable shortening). With thousands of Puerto Ricans living in and/or moving to the United States and after several incidents of fraud by partners of the entrepreneurs, they are thinking about how to take advantage of what seems to be an opportunity for doing business outside their Caribbean home. These entrepreneurs are confronting several challenges: 1) Preparing to detect opportunities and to get personally involved in a demanding export business 2) Differentiating and positioning the brand in a crowded market. Is a nostalgic feeling enough of a motivator to engage customers with the brand? 3) Deciding whether institution is a substitute for market data and feasibility determination.

Teaching Note: 8B09A20 (7 pages)
Industry: Wholesale Trade
Issues: Hispanic; Minority; Market Adaptation; New Markets
Difficulty: 4 - Undergraduate/MBA



AMERICAN FAST FOOD IN KOREA
Paul W. Beamish, Jae C. Jung, Hun-Hee Kim

Product Number: 9B03M016
Publication Date: 4/2/2003
Revision Date: 10/22/2009
Length: 12 pages

A major U.S.-based fast food company with extensive operations around the world was contemplating whether or not they should enter the Korean market. The Korean fast food market was hit badly by the Asian economic crisis in the late 1990s, but the economy was turning around. Thus, fast food demand in Korea was expected to increase. For the industry analysis, this case provides information on various competitors, substitute foods, new entrants, consumers and suppliers. In addition, social issues are included as potential forces.

Teaching Note: 8B03M16 (15 pages)
Industry: Accommodation & Food Services
Issues: Industry Analysis; Market Entry; Fast Food; International Business
Difficulty: 4 - Undergraduate/MBA


Chapter 3:
Market Entry Strategy Selection

WHERE HAVE YOU BEEN?: AN EXERCISE TO ASSESS YOUR EXPOSURE TO THE REST OF THE WORLD’S PEOPLES
Paul W. Beamish

Product Number: 9B11M013
Publication Date: 2/11/2011
Revision Date: 3/23/2011
Length: 11 pages

This exercise assesses one's exposure to the rest of the world's peoples. A series of worksheets require the respondents to check off the number and names of countries they have visited and the corresponding percentage of world population which each country represents. By summing a group's collective exposure to the world's people, the result will inevitably be the recognition that together they have seen much, even if individually some have seen little. The teaching note provides assignments and discussion questions which look at: why there is such a high variability in individual profiles; the implications of each profile for one's business career; and, what it would take for the respondent to change his/her profile.

For marketers, it underscores the need to gather greater base knowledge about opportunities abroad.


Teaching Note: 8B11M013 (6 pages)
Issues: Career Development; Intercultural Relations; Team Building; Internationalization
Difficulty: 4 - Undergraduate/MBA



RBC FINANCIAL GROUP - ENTERING INDIA
Jean-Louis Schaan, Ramasastry Chandrasekhar

Product Number: 9B10M007
Publication Date: 4/19/2010
Length: 17 pages

In January 2007, the managing director of Global Financial Institutions (GFI), a business unit within the Capital Markets group of RBC Financial Group (RBC), was facing dilemmas at two levels: personal and organizational. He had been mandated by RBC to lead an expansion project with the goal to open a representative's office in Mumbai, India. GFI had already established a revenue pipeline from India through relationships it developed with Indian financial institutions, yet the managing director had concerns. He determined that the financial upside of expansion was limited in the short-run. His own boss, the head of RBC Capital Markets, was unwilling to have a presence in India and the managing director was worried that his career was being placed at risk for GFI's limited financial gain should the market entry occur. He wondered how to steer the bank's managers towards making an informed decision on entering the Indian market without the support of interim sponsorship from the business groups. He had to focus on the big picture while safeguarding the financial interests of GFI as the sole sponsor and of his own as a career professional.

Teaching Note: 8B10M007 (9 pages)
Industry: Finance and Insurance
Issues: Internationalization; Strategy Formulation; Organizational Structure
Difficulty: 4 - Undergraduate/MBA



RUTH'S CHRIS: THE HIGH STAKES OF INTERNATIONAL EXPANSION
Ilan Alon, Allen H. Kupetz

Product Number: 9B06A034
Publication Date: 1/9/2007
Revision Date: 5/18/2017
Length: 8 pages

In 2006, Ruth's Chris Steak House was fresh off of a sizzling initial public offering and was now interested in growing their business internationally. With restaurants in just four countries outside the United States, a model to identify and rank new international markets was needed. This case provides a practical example for students to take quantitative and non-quantitative variables to create a short list of potential new markets.

Teaching Note: 8B06A34 (6 pages)
Industry: Accommodation & Food Services
Issues: Market Strategy; International Business; International Strategy; Market Entry
Difficulty: 4 - Undergraduate/MBA


Chapter 4:
Agents, Distributors and Trading Houses

DANIMAL IN SOUTH AFRICA: MANAGEMENT INNOVATION AT THE BOTTOM OF THE PYRAMID
Verity Hawarden, Helena Barnard

Product Number: 9B10M099
Publication Date: 1/21/2011
Revision Date: 8/23/2012
Length: 15 pages

This case focuses on management innovation in the South African dairy industry, describing how an innovative new yoghurt product, Danimal, was created specifically for the market at the base of the pyramid. It explains how management of the product line embodied the various innovation opportunities and challenges presented. The concept was initially introduced in order to assess the feasibility of profitably servicing this market. However, the project was not simply about introducing a cheap brand to the poor but was more about creating brand awareness in the market at the base of the pyramid. The new product took into consideration the nutritional shortcomings in the diet of children in this market and also allowed for the lack of available infrastructure — electricity and refrigeration.

The case illustrates the importance of a product being affordable, relevant, and available to its market. Innovation went further than product design and also took into account the necessity of a lean distribution channel. This took the form of micro-distributors, referred to as Danimamas, who comprised township residents that were unemployed or part-time employed. The case offers insights into the complexity of doing business in developing countries. It concludes with the challenge of how to ensure that the project continued on its upward trajectory.


Teaching Note: 8B10M099 (17 pages)
Industry: Manufacturing
Issues: Positioning; Developing Countries; Innovation; Social Marketing; Brand Development; Dairy; South Africa; GIBS
Difficulty: 5 - MBA/Postgraduate



MARKET STRETCH
Gavin Price, Margaret Sutherland

Product Number: 9B09M046
Publication Date: 6/25/2009
Length: 11 pages

Bio-Oil is a multi-purpose skin care product that has gone from being sold only in South Africa to being the No. 1 scar treatment product in 16 of the 17 countries in which it is distributed. Retail sales have jumped from R3 million per annum to R1 billion from 2000 to 2008. Justin and David Letschert made key decisions to eliminate all of the other 119 products that were being manufactured by the company that they took over in 2000, and focused on the mainstay product of Bio-Oil. Union-Swiss accomplished its successful sales through the use of a hybrid distribution model that compelled its distributors in each country to communicate and share knowledge with each other. Union-Swiss also ensured that it remained focused on building the brand through limiting its activities in the value chain to that of marketing. It did this to such an extent that it created a separate entity to run the distribution of Bio-Oil in South Africa.

Teaching Note: 8B09M46 (8 pages)
Industry: Wholesale Trade
Issues: Market Entry; International Business; Supply Chain Management; Strategic Positioning; GIBS
Difficulty: 5 - MBA/Postgraduate



GINO SA: DISTRIBUTION CHANNEL MANAGEMENT
Terry H. Deutscher, Alan (Wenchu) Yang

Product Number: 9B02A013
Publication Date: 4/25/2002
Revision Date: 10/28/2009
Length: 15 pages

Gino SA was a major European-based manufacturer of burner units that are sold in China through exclusive contracts with three distributors. As a result, the three Chinese distributors have significant bargaining power with Gino. A leading boiler manufacturer, who is currently purchasing through a distributor, has approached Gino to receive OEM treatment (a further discount by purchasing the burners direct from the manufacturer, in return for a commitment to purchase a percentage of their burners from Gino). In deciding whether or not to pursue the company's first direct OEM relationship, the marketing manager must consider the impact of his decision on the distributors, the competition and the company's corporate management.

Teaching Note: 8B02A13 (15 pages)
Industry: Manufacturing
Issues: China; Distribution; Emerging Markets; Marketing Channels; Market Strategy
Difficulty: 4 - Undergraduate/MBA


Chapter 5:
E-Commerce

REVENUEWIRE.COM: GROWING IN A COMPETITIVE AFFILIATE INDUSTRY
Rebecca A. Grant

Product Number: 9B11M029
Publication Date: 4/29/2011
Length: 16 pages

After three years of rapid growth in a relatively young industry, the affiliate and payment-processing company RevenueWire.com found itself operating in a very different environment. Sales growth in the company’s affiliate network service had leveled off, and orders for Q1 2010 looked just like those for Q1 2009. New competitors, low entry barriers, and a plateau in the affiliate market meant few opportunities for growth across the industry. Despite these conditions, the company’s owners had set aggressive revenue targets for 2010 to 2012. The general manager needed to evaluate options for growth, including new markets and new products, to determine how to meet her targets. Because RevenueWire.com’s competitors were privately held, there was little public data on the state of their finances or the size of various markets. The general manager had learned how to use surrogate data to gauge the market and make strategic decisions, and the students must do the same to develop an effective three-year plan that will hit or exceed the owners’ expectations.

The case exposes students to decision making in a global industry dominated by privately held companies. It also exposes students to the affiliate marketing industry from the viewpoint of an entrepreneurial company that serves as an intermediary between merchants and affiliates. It describes many of the challenges facing an intermediary in an industry that includes not only legitimate merchants but a vast array of scam artists and phony products.


Teaching Note: 8B11M029 (6 pages)
Industry: Information, Media & Telecommunications
Issues: E-Commerce; E-Business; Entrepreneurial Business Growth; Affiliate Marketing; Marketing Networks
Difficulty: 4 - Undergraduate/MBA



SHOPSTER.COM
Malcolm Munro, Sid L. Huff

Product Number: 9B07E005
Publication Date: 8/21/2007
Revision Date: 9/27/2007
Length: 18 pages

Shopster.com is a Calgary-based e-business company whose business is to assist other individuals or companies in setting up their own retail transactional websites. Shopster differs significantly from ordinary website developers in that retailers are able to select from a huge inventory of saleable products, through Shopster's network of goods providers. Shopster also provides software tools, and expertise, to allow anyone wishing to create an online retail store to do so quickly and easily. Shopster's business has done well to date, but there are plenty of operational challenges ahead. As well, the principals would like to raise the bar substantially, to something they refer to as Shopster 2.0, the specifics of which are still at a formative stage. The Shopster case provides an interesting example of a small but rapidly growing Canadian company with an innovative business model and big dreams for the future.

Teaching Note: 8B07E05 (9 pages)
Industry: Administrative, Support, Waste Management and Remediation Services
Issues: Supply Chain Management; E-Business Models; E-Commerce; Virtual Business
Difficulty: 4 - Undergraduate/MBA


Chapter 6:
Strategic Alliances, Licensing and Franchising

TRYING TO CREATE A STIR: OPENING A COFFEE SHOP IN KOREA
Gyewan Moon, Allen H. Kupetz

Product Number: 9B10M113
Publication Date: 3/18/2011
Length: 8 pages

A critical question for entrepreneurs starting a business, particularly in a foreign country, is choosing whether or not franchising is the appropriate mode of entry. Franchising offers the entrepreneur instant brand recognition, established business processes and supply chains, regulatory and tax guidance, and a ready supply of assistance in the early months. However, it deprives the entrepreneur of what many of them crave - the ability to create and grow a business from one’s imagination. The two entrepreneurs in this case had regular salaries, but wanted to try opening a coffee shop - or a chain of coffee shops - in South Korea, which already had many brands with multiple outlets.

Teaching Note: 8B10M113 (6 pages)
Industry: Accommodation & Food Services
Issues: Market Selection; Entry Mode; Market Strategy; Franchising; Coffee Shops; South Korea
Difficulty: 4 - Undergraduate/MBA



SAN FRANCISCO COFFEE HOUSE: AN AMERICAN STYLE FRANCHISE IN CROATIA
Ilan Alon, Mirela Alpeza, Aleksandar Erceg

Product Number: 9B08A013
Publication Date: 8/14/2008
Revision Date: 4/20/2010
Length: 10 pages

On their return to Croatia following a six-year visit to the United States, a couple has decided to open their own coffee house, one that is new to Croatia — a California-style coffee house that offers the quality, service, product assortment, ambiance, and efficiency found in sophisticated coffee shops in developed markets, and all for a locally affordable price. The major challenge faced by the couple is how to grow. Specifically, should they consider franchising over organic growth? If so, how should they go about franchising in a country where the market is developing and where franchising is under-regulated, underdeveloped, and misunderstood?

Teaching Note: 8B08A13 (10 pages)
Industry: Accommodation & Food Services
Issues: Business Development; Retail Marketing; Corporate Governance; Human Resources Management; Franchising; Brands
Difficulty: 2 - Intro/Undergraduate



NOTE ON INTERNATIONAL LICENSING
Paul W. Beamish

Product Number: 9B06M005
Publication Date: 11/28/2005
Revision Date: 9/17/2009
Length: 18 pages

Licensing is a strategy for technology transfer; and an approach to internationalization that requires less time or depth of involvement in foreign markets, compared to exports, joint ventures, and foreign direct investment. This note examines when licensing is employed, risks associated with it, intellectual property rights, costs of licensing, unattractive markets for licensing, and the major elements of the license agreement.

Issues: Technology Transfer; Licensing; Corporate Strategy; Internationalization
Difficulty: 4 - Undergraduate/MBA



CARTRIDGE WORLD: THE MASTER FRANCHISE OPPORTUNITY
Stewart Thornhill, Ken Mark, Jordan Mitchell

Product Number: 9B05M071
Publication Date: 4/28/2006
Revision Date: 10/1/2009
Length: 12 pages

An entrepreneur has received additional information on the Cartridge World franchising concept - a store focused on the refilling of printer cartridges. The idea for Cartridge World began in Australia in 1988 and has grown to almost 200 locations in Australia, New Zealand and the United Kingdom. The entrepreneur must look at the market opportunity in Canada and decide whether he should apply for the country's master franchise, a single franchise, or abandon the concept altogether. Students will evaluate a franchise concept based on market opportunity and the franchise contract.

Teaching Note: 8B05M71 (13 pages)
Industry: Retail Trade
Issues: Models; Franchising; Investment Analysis; Market Analysis
Difficulty: 4 - Undergraduate/MBA


Chapter 7:
Foreign Direct Investment

CARLSBERG IN EMERGING MARKETS
Michael W. Hansen, Torben Pedersen, Marcus Moller Larsen

Product Number: 9B11M009
Publication Date: 3/23/2011
Length: 12 pages

Risking becoming the target of a hostile takeover or being cornered as a small regional player in the global beer industry, the Danish brewery Carlsberg decided in the early 2000s to expand into rapidly growing emerging markets to pursue new arenas of growth. By 2008, this strategy had paid off, and Carlsberg was positioned among the five largest breweries in the world. In the Russian market — one of the fastest-growing markets in the world — Carlsberg had become the market leader. In China — the world’s largest beer market in terms of size and population — the company had achieved a 55 per cent market share in Western China, and operated 20 brewery plants with approximately 5,000 employees. The ambitious acquisition strategy applied in emerging markets had become essential to Carlsberg’s business in relation to future growth and profits. Accordingly, the case focuses on Carlsberg’s entry into China, which started as a commercial failure in the eastern part of the country, but subsequently developed successfully in the west.

Teaching Note: 8B11M009 (15 pages)
Industry: Manufacturing
Issues: Acquisition Strategy; Global Strategy; Emerging Markets; Marketing Management; Beer Industry; Denmark; China
Difficulty: 4 - Undergraduate/MBA



BOMBARDIER TRANSPORTATION AND THE ADTRANZ ACQUISITION
Allen Morrison, David Barrett

Product Number: 9B04M023
Publication Date: 5/14/2004
Revision Date: 9/21/2011
Length: 18 pages

Bombardier Transportation, one of the world's largest manufacturers of passenger rail cars, has successfully negotiated the purchase of Adtranz, a large European manufacturer of rail equipment. The newly appointed chief executive officer has been brought in to manage the acquisition. The new CEO faces many challenges including decisions about the pace of integration, location of headquarters, organization structure, personnel retention and personal management style. Students may use this case to discuss post-acquisition strategy and how fast companies should move to integrate acquisitions.

Teaching Note: 8B04M23 (13 pages)
Industry: Transportation and Warehousing
Issues: Management Decisions; Management in a Global Environment; Mergers & Acquisitions; Change Management
Difficulty: 4 - Undergraduate/MBA



VINCOR AND THE NEW WORLD OF WINE
Paul W. Beamish, Nikhil Celly

Product Number: 9B04M001
Publication Date: 1/14/2004
Revision Date: 11/18/2014
Length: 17 pages

Vincor International Inc. was Canada's largest wine company and North America's fourth largest in 2002. The company had decided to internationalize and as the first step had entered the United States through two acquisitions.The company's chief executive officer felt that to be among the top 10 wineries in the world, Vincor needed to look beyond the region. To the end, he was considering the acquisition of an Australian company, Goundrey Wines. He must analyze thestrategic rationale for the acquisition of Goundrey as well as to probe questions of strategic fit and value.

Teaching Note: 8B04M01 (14 pages)
Industry: Manufacturing
Issues: Internationalization; Market Entry; Acquisitions; Growth Strategy
Difficulty: 4 - Undergraduate/MBA


Chapter 8:
Finding the Right Partner

GDR VERSUS KODAK - BART FILM SCANNER
Donald A. Pillittere

Product Number: 9B09M059
Publication Date: 10/14/2009
Length: 7 pages

Georginelli Dental Research (GDR) has transitioned from an agile entrepreneurial company to one that has become overly cautious as its high-margin film sales have eroded. Even though the phases-and-gates process in place at GDR provides guidance to projects, the spirit that led the company to past success has been removed from the organization. The two main characters of the case want to bring back that can-do spirit as they attempt to rapidly commercialize the Bart scanner and extend the life of film. The issues in the case concern: a) entrepreneurial companies and their business strategies and processes for managing new product development b) the implications these strategies and processes have on addressing the needs of customers, shareholders and employees c) the role people can play in pushing through corporate processes and culture to improve time-to-market. The case focuses on the ways individuals might overcome internal company resistance or roadblocks by partnering with an OEM partner that possesses complementary capabilities. When seeking a strategic partner, most think in terms of technical skills; however, the culture or DNA of a partner is just as important. The case is intended for use in courses in managing new product commercialization, managing technology and innovation, strategic thinking, international business and leadership.

Teaching Note: 8B09M59 (6 pages)
Issues: International Business; Corporate Culture; Corporate Strategy; Product Design/Development; Organizational Change; Operations Management; International Joint Venture; Product Development Alliances; Technological Change
Difficulty: 4 - Undergraduate/MBA



CAMERON AUTO PARTS (A) - REVISED
Harold Crookell, Paul W. Beamish

Product Number: 9B06M015
Publication Date: 1/11/2006
Revision Date: 9/17/2009
Length: 10 pages

This case is about a small American auto parts producer trying to diversify his way out of dependence on the major automakers. A promising new product is developed and the company gets a chance to license it to a Scottish manufacturer. The issue of whether to license or go it alone in international markets is central to the case. (A sequel to this case is available titled Cameron Auto Parts (B) - Revised, case 9B06M016.)

Teaching Note: 8B06M15 (8 pages)
Industry: Manufacturing
Issues: Corporate Strategy; Exports; Licensing; International Business
Difficulty: 4 - Undergraduate/MBA



CAMERON AUTO PARTS (B) - REVISED
Harold Crookell, Paul W. Beamish

Product Number: 9B06M016
Publication Date: 1/11/2006
Revision Date: 9/17/2009
Length: 10 pages

Two years after signing a license agreement in the U.K., the company now faces an opportunity to establish with another firm a joint venture in France for the European market. However, the prospect upsets the U.K. licensee who is clearly doing very well, and who even wants Cameron to consider joint venturing with him in Australia. The case ends with Cameron, run off its feet in North America, trying to decide whether to enter Europe via licensing, joint venture or direct investment. (This case is a sequel to Cameron Auto Parts (A) - Revised, case 9B06M015.)

Teaching Note: 8B06M16 (7 pages)
Industry: Manufacturing
Issues: Licensing; Joint Ventures; International Business; Corporate Strategy
Difficulty: 4 - Undergraduate/MBA


Chapter 9:
Negotiating a Partnership Agreement

NORA-SAKARI: A PROPOSED JV IN MALAYSIA (REVISED)
Paul W. Beamish, R. Azimah Ainuddin

Product Number: 9B06M006
Publication Date: 11/30/2005
Revision Date: 5/23/2012
Length: 16 pages

This case presents the perspective of a Malaysian company, Nora Bhd, which was in the process of trying to establish a telecommunications joint venture with a Finnish firm, Sakari Oy. Negotiations have broken down between the firms, and students are asked to try to restructure a win-win deal. The case examines some of the most common issues involved in partner selection and design in international joint ventures.

Teaching Note: 8B06M06 (12 pages)
Industry: Information, Media & Telecommunications
Issues: Intercultural Relations; Third World; Negotiation; Joint Ventures; Finland; Malaysia
Difficulty: 4 - Undergraduate/MBA



MAJESTICA HOTEL IN SHANGHAI?
Paul W. Beamish, Jane W. Lu

Product Number: 9B05M035
Publication Date: 4/11/2005
Revision Date: 9/21/2011
Length: 14 pages

Majestica Hotels Inc., a leading European operator of luxury hotels, was trying to reach an agreement with Commercial Properties of Shanghai regarding the management contract for a new hotel in Shanghai. A series of issues require resolution for the deal to proceed, including length of contract term, name, staffing and many other control issues. Majestica was reluctant to make further concessions for fear that doing so might jeopardize its service culture, arguably the key success factor in this industry. At issue was whether Majestica should adopt a contingency approach and relax its operating philosophy, or stick to its principles, even if it meant not entering a lucrative market.

Teaching Note: 8B05M35 (8 pages)
Industry: Accommodation & Food Services
Issues: China; Market Entry; Negotiation; Control Systems; Corporate Culture
Difficulty: 4 - Undergraduate/MBA



CIBC-BARCLAYS: SHOULD THEIR CARIBBEAN OPERATIONS BE MERGED?
Don Wood, Paul W. Beamish

Product Number: 9B04M067
Publication Date: 1/10/2005
Revision Date: 9/21/2011
Length: 17 pages

At the end of 2001, the Canadian Imperial Bank of Commerce (CIBC) and Barclays Bank PLC were in advanced negotiations regarding the potential merger of their respective retail, corporate and offshore banking operations in the Caribbean. Some members of each board wondered whether this was the best direction to take. Would the combined company be able to deliver superior returns? Would it be possible to integrate, within budget, companies that had competed with each other in the region for decades? Would either firm be better off divesting regional operations instead? Should the two firms just continue to go-it-alone with emphasis on continual improvement? A decision needed to be made within the coming week. This case may be taught on a stand alone basis or in combination with any of the six additional Cross-Enterprise cases that deal with the various functional issues associated with the actual merger: Accounting and Finance - CIBC-Barclays: Accounting for Their Merger, product 9B04B022, Information Systems - Information Systems at FirstCaribbean: Choosing a Standard Operating Environment, product 9B04E032, Marketing and Branding - FirstCaribbean International Bank: The Marketing and Branding Challenges of a Start-up, product 9B05A012, Human Resources - Harmonization of Compensation and Benefits for FirstCaribbean International Bank, product 9B04C053, Finance - FirstCaribbean Merger: The Proposed Merger, product 9B06N004, and technical note - Note on Banking in the Caribbean, product 9B05M015.

Teaching Note: 8B04M67 (8 pages)
Industry: Finance and Insurance
Issues: Corporate Strategy; Emerging Markets; Mergers & Acquisitions; Integration; University of West Indies
Difficulty: 4 - Undergraduate/MBA


Chapter 10:
Managing International Business Operations

CIBC MELLON: MANAGING A CROSS-BORDER JOINT VENTURE
Paul W. Beamish, Michael Sartor

Product Number: 9B10M091
Publication Date: 11/5/2010
Revision Date: 5/24/2012
Length: 15 pages

During his 10-year tenure, the president and CEO of CIBC Mellon had presided over the dramatic growth of the jointly owned, Toronto-based asset servicing business of CIBC and The Bank of New York Mellon Corporation (BNY Mellon). In mid-September 2008, the CEO was witnessing the onset of the worst financial crisis since the Great Depression. The impending collapse of several major firms threatened to impact all players in the financial services industry worldwide. Although joint ventures (JVs) were uncommon in the financial sector, the CEO believed that the CIBC Mellon JV was uniquely positioned to withstand the fallout associated with the financial crisis. Two pressing issues faced the JV’s executive management team. First, it needed to discuss how to best manage any risks confronting the JV as a consequence of the financial crisis. How could the policies and practices developed during the past decade be leveraged to sustain the JV through the broader financial crisis? Second, it needed to continue discussions regarding options for refining CIBC Mellon’s strategic focus, so that the JV could emerge from the financial meltdown on even stronger footing.

Teaching Note: 8B10M91 (13 pages)
Industry: Finance and Insurance
Issues: Financial Crisis; Joint Ventures; Leadership; Alliance Management; Managing Multiple Stakeholders; Canada; United States
Difficulty: 4 - Undergraduate/MBA



LUNDBECK KOREA: MANAGING AN INTERNATIONAL GROWTH ENGINE
Paul W. Beamish, Michael Roberts

Product Number: 9B10M012
Publication Date: 2/11/2010
Revision Date: 2/12/2010
Length: 16 pages

In 2005, the vice-president of Lundbeck, a Danish based pharmaceutical firm, needed to decide what to do with one of his most promising subsidiaries, Lundbeck Korea. Over its short lifetime, under the leadership of the country manager and the Asia regional manager, the subsidiary had grown well beyond the original goals set for it. The vice-president wanted to create a reporting structure and management mix that would balance the local demands that Lundbeck Korea required for growth with Lundbeck's overall strategy of specialization, speed, integration and results. The case also traces Lundbeck's internationalization efforts in Asia over the past 20 years. The company had grown from pure licensing arrangements to establishing its own country level subsidiaries. This case introduces the dynamic tensions between taking advantage of local management expertise and executing a corporate strategy developed for an entire global group. In addition, it illustrates the importance, but difficulties, of being sensitive to local management goals, while promoting a global corporate culture.

Teaching Note: 8B10M12 (19 pages)
Industry: Manufacturing
Issues: MNE Reporting Structures; International Strategy; Emerging Markets
Difficulty: 4 - Undergraduate/MBA



RESEARCH IN MOTION: MANAGING EXPLOSIVE GROWTH
Rod E. White, Paul W. Beamish, Daina Mazutis

Product Number: 9B08M046
Publication Date: 5/15/2008
Revision Date: 5/24/2017
Length: 19 pages

Research in Motion (RIM) is a high technology firm that is experiencing explosive sales growth. David Yach, chief technology officer for software at RIM, has received notice of an impending meeting with the co-chief executive officer regarding his research and development (R&D) expenditures. Although RIM, makers of the very popular BlackBerry, spent almost $360 million in R&D in 2007, this number was low compared to its largest competitors, both in absolute numbers and as a percentage of sales (e.g. Nokia spent $8.2 billion on R&D). This is problematic as it foreshadows the question of whether or not RIM is well positioned to continue to meet expectations, deliver award-winning products and services and maintain its lead in the smartphone market. Furthermore, in the very dynamic mobile telecommunications industry, investment analysts often look to a firm's commitment to R&D as a signal that product sales growth will be sustainable. Just to maintain the status quo, Yach will have to hire 1,400 software engineers in 2008 and is considering a number of alternative paths to managing the expansion. The options include: (1) doing what they are doing now, only more of it, (2) building on their existing and satellite R&D locations, (3) growing through acquisition or (4) going global.

Teaching Note: 8B08M46 (19 pages)
Industry: Manufacturing
Issues: Telecommunication Technology; Change Management; Globalization; Staffing; Growth Strategy
Difficulty: 4 - Undergraduate/MBA


Chapter 11:
Exit Strategies

SILVER SALES COMPANY
Gary Whitney, Stephen Standifird

Product Number: 9B09M095
Publication Date: 3/2/2010
Length: 8 pages

Silver Sales Company's president is building a growing company that sells extremely accurate flow meters used to measure water flow in pipes and channels. In addition, Silver Sales Company provides inspection and assessment services to water agencies. The president owns 31 per cent of the company. Ring Manufacturing, the sole owner of the intellectual property and manufacturing facility for the flow meters, controls 62 per cent of the ownership of Silver Sales Company. The president is considering his long-term stake in the organization. Recently, the president has been approached by a U.K. company that is a sales agent for Silver Sales Company's products. The company has expressed an interest in a possible merger or acquisition between the two companies and has further indicated that it has an investor to support its desires. The president is now trying to determine whether a closer relationship with, or sale to, the U.K. company might be a way for him to capture some of the value he has created over the last several years.

Teaching Note: 8B09M95 (9 pages)
Industry: Manufacturing
Issues: Valuation; Mergers & Acquisitions; Exit Strategy; Decision Making
Difficulty: 4 - Undergraduate/MBA



WORKBRAIN CORP. - A CASE IN EXIT STRATEGY
Tevya Rosenberg

Product Number: 9B07N007
Publication Date: 4/2/2007
Length: 14 pages

The chief financial officer (CFO) of Workbrain Corporation (Workbrain) must prepare a memo for the upcoming board of directors meeting. Workbrain, a venture-backed company, has grown substantially since its founding in November 1999. Now the CFO must communicate to the board whether it is time to consider an initial public offering (IPO) and, if so, in which exchange market the stock should be offered. The company must also consider what financing alternatives are available (including maintaining the current venture financing arrangement) and whether the company needs to raise money at all. The CFO is thinking about the memo, knowing that his words will have considerable impact on the company.

Teaching Note: 8B07N07 (7 pages)
Industry: Administrative, Support, Waste Management and Remediation Services
Issues: Initial Public Offerings; Valuation; Exit Strategy; Venture Capital
Difficulty: 4 - Undergraduate/MBA



ALI TECHNOLOGIES INC. - EXIT STRATEGY
James E. Hatch, Ryan Kovac

Product Number: 9B04N001
Publication Date: 6/24/2004
Revision Date: 10/15/2009
Length: 15 pages

ALI Technologies Inc. is a medical information technology company that develops filmless diagnostic equipment for hospitals and clinics and is world leader in this field. An offer to acquire the company has been presented and the chief executive officer and the board of directors must determine if the offer is fair to the company shareholders and in the best interests of the company.

Teaching Note: 8B04N01 (10 pages)
Industry: Administrative, Support, Waste Management and Remediation Services
Issues: Entrepreneurial Finance
Difficulty: 4 - Undergraduate/MBA