Ivey Publishing

Gaining and Sustaining Competitive Advantage

Barney, J.,4/e (United States, Pearson, 2011)
Prepared By Maximilian Stallkamp ,
Chapter and Title Chapter Matches: Case Information
Chapter 1:
What is strategy?

Paul W. Beamish

Product Number: 9B16M032
Publication Date: 3/9/2016
Revision Date: 8/29/2019
Length: 11 pages

By September 2015, Deep Roots Distillery (DRD) had been operating for 22 months. While starting up had taken a little longer than originally estimated, material progress was now evident. By November 2015, the company expected to have six of its products (either spirits or liqueurs) available in the Prince Edward Island liquor store outlets. However, numerous questions remained for DRD’s owner and his small, family-run business. Given capital and resource constraints, how could DRD grow into a competitive business? How should time be allocated between research and development, production, marketing, and administration? Would the start-up’s current product/market strategy allow it to achieve its goals? If not, which expansion route should DRD take?

Teaching Note: 8B16M032 (10 pages)
Industry: Accommodation & Food Services
Issues: dfifferentiation strategy, industry analysis, SWOT, market segmentation, family business, organic, 80-20 rule, breakeven analysis; SME
Difficulty: 4 - Undergraduate/MBA

Jean-Philippe Vergne, Alexander (A.J.) Miller

Product Number: 9B13M072
Publication Date: 6/21/2013
Revision Date: 6/20/2013
Length: 4 pages

A young entrepreneur is considering options for starting an art dealership. Everyone has some commonsense knowledge of what an art gallery is, yet very few have realized how competitive the art market is and what it takes to succeed in that industry. The price of a painting can be anywhere between $50 and $500,000, and that price typically does not depend on the objective properties of the artwork itself. This is where the art dealer plays an important role. The budding entrepreneur has to make strategic decisions regarding which segment of the art market to serve (high or low brow?), where to start his business (mid-size hometown or large city?), how to deliver the art to market (by opening a traditional art gallery, by partnering with retail locations such as restaurants to put the artworks on display or by organizing temporary exhibitions in rented spaces) and whether he should ally with a local arts collective.

Teaching Note: 8B13M072 (10 pages)
Industry: Arts, Entertainment, Sports and Recreation
Issues: Strategy; Alliance; Art; Canada
Difficulty: 2 - Intro/Undergraduate

Luis Alfonso Dau, David T.A. Wesley

Product Number: 9B12M040
Publication Date: 4/5/2012
Revision Date: 4/5/2012
Length: 10 pages

This case examines two of the leading video rental services in the United States, Blockbuster and Netflix, and how each adapted to changing technology and market forces. At the end of the case, Blockbuster has declared bankruptcy and Netflix has seen its first decline in subscribers since its founding in 1997. Netflix also faces a number of new threats, including illegal file sharing, rental kiosks, and new low-cost video-on-demand (VOD) services. Netflix responds to these threats by announcing that it will split the company in two — Netflix will focus exclusively on streaming content, while a new subsidiary called Qwikster will be restricted to providing DVDs by mail. Customers overwhelmingly react negatively to the announcement, and Netflix’s stock price plunges by more than 50 per cent.

Teaching Note: 8B12M040 (7 pages)
Industry: Arts, Entertainment, Sports and Recreation
Issues: Competitive Advantage; Innovation; Technological Change; Technological Disruption; Movie Rental Industry; United States
Difficulty: 2 - Intro/Undergraduate

Chapter 2:
Firm performance and competitive advantage

Sayan Chatterjee, Christopher Masotti

Product Number: 9B11M081
Publication Date: 10/18/2011
Length: 9 pages

This case describes how Cold Stone Creamery created a business model for a premium customized ice cream experience. It describes the company’s value proposition, growth strategy, and competitors, and poses the question of whether the company could continue to attract new franchisees.

Teaching Note: 8B11M081 (13 pages)
Industry: Accommodation & Food Services
Issues: Business Policy; Franchising; Competitive Advantage; Business Development; Dairy; United States
Difficulty: 4 - Undergraduate/MBA

Stewart Thornhill, Ken Mark

Product Number: 9B08M093
Publication Date: 1/20/2009
Revision Date: 5/3/2017
Length: 18 pages

The Dell story is well-known in the business world: a young Michael Dell, while attending the University of Texas in Austin, founds a computer sales company that eventually revolutionizes the industry. The case puts students in the position of a senior executive at Dell who is preparing for an investor relations meeting. As the senior executive reviews information on his company, he wonders how best to convey to skeptical investors that Dell's strategy will return the company to growth. In examining the Dell story, students learn about how Dell built up a set of competitive advantages that seemed unassailable until the early 2000s. The second part of the case illustrates the impermanence of competitive advantages - it describes how Dell is attempting to remake itself after falling behind its competitors.

Teaching Note: 8B08M93 (5 pages)
Industry: Manufacturing
Issues: Strategy Development; Strategic Change; Globalization; Strategic Balance
Difficulty: 4 - Undergraduate/MBA

Chapter 3:
Evaluating environmental threats

Franck Brulhart, Philippe Chereau, Pierre-Xavier Meschi

Product Number: 9B16M030
Publication Date: 3/3/2016
Revision Date: 3/3/2016
Length: 17 pages

AWARD WINNING CASE – This case won the Euro-Mediterranean Managerial Practices and Issues category at the 2015 EFMD Case Writing Competition. The chief executive officer of Les Moulins de la Brague (LMB), a seven-generation French olive oil miller, was worried about the future of the business. LMB was trying to find a profitable niche in a market that was filled with multinational companies, whose products came in a variety of quality and price ranges, and filled the shelves of French grocery stores. Although LMB had achieved critical acclaim for its blended olive oils made with spices and flavours, the business was unstable for a number of reasons. First, weather conditions had caused a decrease in the number of olives harvested. Second, on the consumer front, shoppers’ interest in the health benefits of olive oil, promoted by the popularity of the “Mediterranean diet” seemed to have peaked. Finally, the market was flooded with various levels of quality: low-quality brands with low prices; medium-quality brands that dominated consumer markets; and many high-end premium brands that were produced by olive mills just like LMB. With a market environment pressured in so many ways, how could LMB keep its 200-year-old millstones turning?

Teaching Note: 8B16M030 (14 pages)
Industry: Agriculture, Forestry, Fishing and Hunting
Issues: SME, industry analysis, performance and strategy, olive oil industry
Difficulty: 4 - Undergraduate/MBA

Heike C. Wörner

Product Number: 9B15M027
Publication Date: 6/18/2015
Revision Date: 6/29/2015
Length: 17 pages

Tremendous changes in the global competitive landscape threaten Deutsche Lufthansa AG, the largest airline group in the world. Three large Gulf carriers, Emirates, Etihad Airways and Qatar Airways, as well as Turkish Airlines, now stand to compete with Lufthansa on the traditionally profitable long-haul segment. Chairman of the executive board and chief executive officer has to act quickly if Lufthansa is to keep its top spot. Having ignored the threat from low-cost airlines in the past, Lufthansa must now be better prepared to respond. It is crucial that Lufthansa finds adequate strategic options for sustaining and further expanding its market-leading position.

Teaching Note: 8B15M027 (11 pages)
Industry: Transportation and Warehousing
Issues: Airlines; competitive threats; decision-making; profitability; aviation industry; strategic management; strategic analysis; competitive advantage; competitive strategy
Difficulty: 4 - Undergraduate/MBA

Darren Meister, Paul Bigus

Product Number: 9B11M086
Publication Date: 9/13/2011
Revision Date: 2/1/2013
Length: 12 pages

The world famous toymaker, The LEGO Group, assembled an internal management team to create a strategic report on LEGO’s different product lines and business operations. In recent years, numerous threats to LEGO had emerged in the toy industry. The acquisition of Marvel Entertainment by The Walt Disney Company created major implications for valuable toy license agreements. LEGO had also recently lost a long legal battle with major competitor MEGA Brands, makers of MEGA Bloks, with a European Union court decision that removed the LEGO brick trademark. Furthermore, the second-largest toymaker in the world, Hasbro, was preparing to launch a new rival product line called Kre-O. It was critical for the management team to identify where to expand LEGO’s product lines and business operations, in order to develop a competitive strategy to continue the organization’s recent years of financial success and dominance in the building toy market.

Teaching Note: 8B11M086 (6 pages)
Industry: Other Services
Issues: Opportunity Recognition; Licensing; Competitive Strategy; Business Growth; Toy Industry; Denmark
Difficulty: 4 - Undergraduate/MBA

Chapter 4:
Evaluating environmental opportunities

Louis Hébert, Ali Taleb

Product Number: 9B11M072
Publication Date: 9/19/2011
Revision Date: 3/29/2016
Length: 21 pages

In July 2004, Bombardier Aerospace announced its intention to develop a new family of aircraft called CSeries. In May 2007, three years after the initial announcement, the final decision on whether to proceed with the initiative was still pending. Moreover, during this period, the company released several confusing announcements that raised concerns among investors and industry analysts regarding the sustainability of the company’s long-term strategy. In the meantime, Brazilian Embraer had invested heavily in research and development and had taken the leadership position in the regional aircraft segment from Bombardier. Consequently, Bombardier was faced with a serious dilemma of whether or not to launch the CSeries project. The decision was expected to have a major impact on the future market positioning of Bombardier.

Students may be asked to act as advisors to Pierre Beaudoin, president and chief executive officer of Bombardier Aerospace, and recommend whether the company should proceed with the CSeries initiative. More specifically, students should do a full analysis of the company’s external environment, identify the alternatives available to Beaudoin, assess these options based on internal and external environments, and recommend a course of action. For Beaudoin, the recommendation was due before the annual meeting of shareholders, scheduled on May 29, 2007.

Teaching Note: 8B11M072 (16 pages)
Industry: Transportation and Warehousing
Issues: Industry Analysis; Corporate Strategy; Competitive Advantage; Strategic Positioning; Aerospace; Canada
Difficulty: 4 - Undergraduate/MBA

Allen Morrison, Cyril Bouquet

Product Number: 9A99M023
Publication Date: 5/9/2000
Revision Date: 5/23/2017
Length: 22 pages

The efforts of Swatch to reposition itself in the increasingly competitive global watch industry are reviewed in this case. Extensive information on the history and structure of the global watch industry is provided and the shrinking time horizons decision makers face in formulating strategy and in responding to changes in the industry are highlighted. In particular, the case discusses how technology and globalization have changed industry dynamics and have caused companies to reassess their sources of competitive advantage. Like other companies, Swatch faces the difficult task of deciding whether to emphasize product breadth, or focus on a few key global brands. It also must decide whether to shift manufacturing away from Switzerland to lower cost countries like India.

Teaching Note: 8A99M23 (10 pages)
Industry: Manufacturing
Issues: International Business; Industry Analysis; Competing with Multinationals; Globalization
Difficulty: 5 - MBA/Postgraduate

Chapter 5:
Evaluating firm strengths and weaknesses: The resource-based view

Yi Rong Loh, Ye Jun Lee, Marleen Dieleman

Product Number: 9B14M108
Publication Date: 10/24/2014
Revision Date: 10/24/2014
Length: 12 pages

Sheng Siong was the third-largest supermarket chain in Singapore. Its chief executive officer co-founded it with his two brothers in 1985. Sheng Siong’s business model was well suited to cater to the price-sensitive and more traditional customer segment in Singapore, with a dominant presence in suburban areas called “heartlands.” It also had a unique corporate philosophy, which was influenced by the personal values of its founding family. However, the market became increasingly saturated, competitors were aggressive and costs were rising. The key question was whether Sheng Siong’s original competitive advantage was sustainable and how it could grow.

Teaching Note: 8B14M108 (7 pages)
Industry: Retail Trade
Issues: Competitive advantage; value-based management; internal analysis; Singapore
Difficulty: 4 - Undergraduate/MBA

Ben Forrey, Andreas Schotter, Jonathan Doh, Thomas Lawton

Product Number: 9B12M013
Publication Date: 2/17/2012
Revision Date: 2/17/2012
Length: 22 pages

By 2007, AirAsia had become one of the most successful budget airlines in the world. Having dominated Southeast Asia and entered China and India, AirAsia was poised to solidify its place as a top budget airline and one of the most consistently profitable globally. But company founder Tony Fernandes had bigger plans. From the outset in 2001, Fernandes had intended to offer long-haul service, competing against the largest and most established airlines in the world. However, his advisors had urged him to focus on regional, short- to medium-distance service. With many previous successes, Fernandes was once again ready to attempt long-haul service. Despite warnings from industry insiders, Fernandes pushed forward with the expansion.

Hiring 36-year-old Azran Osman-Rani as the CEO for the new long-haul venture, nicknamed X, was a critical step in this process. By early 2010, X had received its eleventh aircraft and was flying to 15 destinations on three continents. However, over time the substantial differences between long-haul and short-haul operating requirements became more apparent. Consequently, the management decided to formally separate X from AirAsia. This separation, and the inherent challenges for X and its recently appointed head of commercial operations, included: (1) how best to leverage the extensive network of the regional sister company AirAsia in selecting new and profitable destinations for X, (2) how to increase revenues without raising ticket prices, (3) how best to globally position the airline’s brand in non-Asian markets, (4) how to shift his marketing team’s mentality away from a start-up mindset, and (5) how to prepare for a global initial public offering within the next year. See supplement 9B15M018.

Teaching Note: 8B12M013 (15 pages)
Industry: Other Services
Issues: Strategic Marketing Management; Competitive Strategy; Expansion; Emerging Markets; Airline Industry; Malaysia
Difficulty: 4 - Undergraduate/MBA

Chapter 6:
Cost leadership

Wiboon Kittilaksanawong, Elise Perrin

Product Number: 9B16M007
Publication Date: 1/29/2016
Revision Date: 1/15/2016
Length: 13 pages

In 2012, All Nippon Airways diversified into Japan’s emerging low-cost carrier market by launching two new low-cost carriers: Peach Aviation and AirAsia Japan. After one year, Peach Aviation experienced financial losses and operations failures; after two years, the company announced cancellation of many flights. The second carrier, AirAsia Japan, ended its operations in 2013, and was later restructured as Vanilla Air, a wholly owned subsidiary of All Nippon Airways. Why was a highly successful flag and legacy carrier unable to successfully run a low-cost carrier in Japan?

Teaching Note: 8B16M007 (12 pages)
Industry: Transportation and Warehousing
Issues: Low-cost carrier, market entry, diversification, Asia
Difficulty: 4 - Undergraduate/MBA

Jeff Moretz, Chirag Surti

Product Number: 9B15M002
Publication Date: 6/24/2015
Revision Date: 6/24/2015
Length: 10 pages

By the end of 2013, PC Financial remained one of the few successful no-frills banking providers in Canada. Since its founding in 1998, the company had grown into a significant competitor in consumer financial services with nearly three million customers and $644 million in revenue. The financial crisis of 2008 and the competitive situation in Canadian retail financial services had led to the acquisition and in some cases closure of several of its competitors. While the changes in the market arguably seemed to be beneficial by reducing competition, they also raised questions about the company’s ability to continue as a separate operating entity.

Teaching Note: 8B15M002 (10 pages)
Industry: Finance and Insurance
Issues: Five forces, resource-based view, low cost competition, operations
Difficulty: 4 - Undergraduate/MBA

Thomas Lawton, Jonathan Doh

Product Number: 9B08M054
Publication Date: 10/31/2008
Revision Date: 7/21/2010
Length: 16 pages

In September 2001, Tony Fernandes left his job as vice president and head of Warner Music's Southeast Asian operations. He reportedly cashed in his stock options, took out a mortgage on his house, and lined up investors to take control of AirAsia, a struggling Malaysian airline. Three days later, terrorists destroyed the World Trade Center. Despite the negative aftermath of the 9-11 attacks, by 2003, AirAsia had demonstrated that the low-fare model epitomized by Southwest and JetBlue in the United States, and by Ryanair and easyJet in Europe, had great potential in the Asian marketplace. Now, Fernandes had to make plans to ensure that AirAsia maintained its momentum while considering the influx of new entrants into the low-fare segment of the airline industry in Asia.

Teaching Note: 8B08M54 (8 pages)
Industry: Transportation and Warehousing
Issues: International Business; Competitive Strategy; Strategic Positioning; Entrepreneurial Business Growth
Difficulty: 4 - Undergraduate/MBA

Chapter 7:
Product differentiation

Ram Subramanian

Product Number: 9B13M068
Publication Date: 6/11/2013
Revision Date: 5/4/2016
Length: 14 pages

AWARD WINNING CASE - This case won the 2013 Oikos Sustainability Case Writing Competition. Chipotle Mexican Grill, Inc. competes in the fast casual segment of the restaurant industry. Its founder and current co-CEO has always emphasized not only good tasting food but also a commitment to sustainability through the mission statement: “Food with Integrity.” The company has positioned itself as a differentiator, using both food quality and a commitment to sustainability as factors that isolate it from its competitors. However, in 2012, the company faces a number of challenges from increased competition and rising food costs. As a result, a hedge fund investor has recently called for shorting the company’s stock. The co-CEOs must decide on the best course to confront these challenges as the company’s stock price is in a free fall.

Teaching Note: 8B13M068 (9 pages)
Industry: Accommodation & Food Services
Issues: Sustainability; Differentiation; Positioning; United States
Difficulty: 4 - Undergraduate/MBA

Anil Nair

Product Number: 9B09M019
Publication Date: 5/22/2009
Revision Date: 5/4/2017
Length: 18 pages

IMAX was involved in several aspects of the large-format film business: production, distribution, theatre operations, system development and leasing. The case illustrates IMAX's use of its unique capabilities to pursue a focused differentiation strategy. IMAX was initially focused on large format films that were educational yet entertaining, and the theatres were located in institutions such as museums, aquariums and national parks. However, IMAX found that its growth and profitability were constrained by its niche strategy. In response, IMAX sought to grow by expanding into multiplexes. Additionally, IMAX expanded its film portfolio by converting Hollywood movies, such as Harry Potter and Superman, into the large film format. This shift in strategy was supported by the development of two technological capabilities - DMR for conversion of standard 35 mm film into large format, and DMX to convert standard multiplexes to IMAX systems. The shift in strategy was partially successful, but carried the risk of IMAX losing its unique reputation.

Teaching Note: 8B09M19 (11 pages)
Industry: Arts, Entertainment, Sports and Recreation
Issues: Business Policy; Strategic Positioning; Industry Analysis; Corporate Strategy
Difficulty: 4 - Undergraduate/MBA

Chapter 8:
Flexibility: Real options under risk and uncertainty

Martin J. Bliemel, Elicia M.A. Maine

Product Number: 9B16M004
Publication Date: 2/22/2016
Revision Date: 2/22/2016
Length: 10 pages

Solectric was a small solar power venture located in Sydney, Australia. The founder was an academic entrepreneur who was planning to return to his academic career. A new business development manager had been hired to explore and enter markets with varying degrees of uncertainty and potential profitability. The capital was running out and an unfocused strategy was exacerbating negligible sales revenues. Together, they were faced with the decision of which market(s) to focus on, how to allocate available capital, and how to consider the implications regarding distribution of equity and control.

Teaching Note: 8B16M004 (15 pages)
Issues: Decision analysis, real options, equity, ownership, innovation, technology management
Difficulty: 4 - Undergraduate/MBA

Chapter 9:
Tacit collusion

Mark B. Vandenbosch, Amit Jethani

Product Number: 9B14M031A
Publication Date: 4/15/2014
Revision Date: 4/21/2014
Length: 13 pages

Uralkali, the giant Russian potash producer, decided to stop export sales through the Belarusian Potash Company – an export cartel it had formed with Belaruskali. Uralkali planned to increase potash production and export it independently through its own trading company. This move threatened to reduce global potash prices by up to 25 per cent. Immediately, the stock prices of major potash producers around the world plummeted. This set of three cases looks at the potential competitive strategies of three key players in the industry: PotashCorp, the firm with the world's largest potash reserves; Agrium, a firm in the midst of a large potash mine expansion; and BHP Billiton, the world's largest mining company planning huge potash mine development. See B case 9B14M031B and C case 9B14M031C.

Teaching Note: 8B14M031 (14 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: Competition; game theory; rivalry; cooperation; Canada; Russia
Difficulty: 4 - Undergraduate/MBA

Mark B. Vandenbosch, Amit Jethani

Product Number: 9B14M031B
Publication Date: 4/15/2014
Revision Date: 4/21/2014
Length: 13 pages

Uralkali, the giant Russian potash producer, decided to stop export sales through the Belarusian Potash Company – an export cartel it had formed with Belaruskali. Uralkali planned to increase potash production and export it independently through its own trading company. This move threatened to reduce global potash prices by up to 25 per cent. Immediately, the stock prices of major potash producers around the world plummeted. This set of three cases looks at the potential competitive strategies of three key players in the industry: PotashCorp, the firm with the world's largest potash reserves; Agrium, a firm in the midst of a large potash mine expansion; and BHP Billiton, the world's largest mining company planning huge potash mine development. See A case 9B14M031A and C case 9B14M031C.

Teaching Note: 8B14M031 (14 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: Competition; game theory; rivalry; cooperation; Canada; Russia
Difficulty: 4 - Undergraduate/MBA

Mark B. Vandenbosch, Amit Jethani

Product Number: 9B14M031C
Publication Date: 4/15/2014
Revision Date: 4/21/2014
Length: 13 pages

Uralkali, the giant Russian potash producer, decided to stop export sales through the Belarusian Potash Company – an export cartel it had formed with Belaruskali. Uralkali planned to increase potash production and export it independently through its own trading company. This move threatened to reduce global potash prices by up to 25 per cent. Immediately, the stock prices of major potash producers around the world plummeted. This set of three cases looks at the potential competitive strategies of three key players in the industry: PotashCorp, the firm with the world's largest potash reserves; Agrium, a firm in the midst of a large potash mine expansion; and BHP Billiton, the world's largest mining company planning huge potash mine development. See A case 9B14M031A and B case 9B14M031B.

Teaching Note: 8B14M031 (14 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: Competition; game theory; rivalry; cooperation; Canada; Russia
Difficulty: 4 - Undergraduate/MBA

Frank C. Schultz, Michael McCune

Product Number: 9B05M027
Publication Date: 1/31/2005
Revision Date: 10/1/2009
Length: 12 pages

This is a supplement to Gillett's Energy Drain (A): The Acquisition of Duracell, product 9B05M026. Highlighted is Energizer's acquisition of Schick. Gillette was just dabbling in batteries but its source of profits always been in razors and blades. Now, that business is under direct threat by Energizer, with its acquisition of Schick. This supplement provides an excellent example of multipoint competition, and raises the question, should Gillette have anticipated that the acquisition of a battery company would ultimately put razor profits at risk?

Teaching Note: 8B05M26 (13 pages)
Industry: Manufacturing
Issues: Strategy Implementation; Competition; Corporate Strategy; Mergers & Acquisitions
Difficulty: 4 - Undergraduate/MBA

Chapter 10:
Vertical integration strategies

Noel Machado, G. Krishnakumar, Sanjeev Pillai, P.V.S.L. Narasimham

Product Number: 9B13M128
Publication Date: 1/14/2014
Revision Date: 2/3/2014
Length: 17 pages

Bharat Petroleum Corporation Limited (BPCL) is an Indian public-sector oil company that features among the Fortune Global 500. The company has historically been in the business of refining and marketing petroleum products. For about 25 years, BPCL operated in a protected environment where it was assured 12 per cent post-tax returns by the Indian government. In 2002, the government stopped guaranteeing returns to its oil companies, and BPCL found that its sales were increasing but its profitability was declining. In response, BPCL ventured upstream into the exploration and production of hydrocarbons. The case is set in 2010, seven years after BPCL adopted a corporate strategy of vertical integration. BPCL’s chairman and managing director assesses reasons for the company’s spectacular success and considers what BPCL should do next.

Teaching Note: 8B13M128 (12 pages)
Industry: Manufacturing
Issues: Corporate strategy; petroleum; oil; energy; vertical integration; public sector; India
Difficulty: 5 - MBA/Postgraduate

Bo Bernhard Nielsen, Torben Pedersen, Jacob Pyndt

Product Number: 9B08M014
Publication Date: 5/29/2008
Revision Date: 5/10/2017
Length: 21 pages

ECCO A/S (ECCO) had been very successful in the footwear industry by focusing on production technology and assuring quality by maintaining full control of the entire value chain from cow to shoe. As ECCO grew and faced increased international competition, various value chain activities, primarily production and tanning, were offshored to low-cost countries. The fully integrated value chain tied up significant capital and management attention in tanneries and production facilities, which could have been used to strengthen the branding and marketing of ECCO's shoes. Moreover, an increasingly complex and dispersed global value chain configuration posed organizational and managerial challenges regarding coordination, communication and logistics. This case examines the financial, organizational and managerial challenges of maintaining a highly integrated global value chain and asks students to determine the appropriateness of this set-up in the context of an increasingly market-oriented industry. It is suitable for use in both undergraduate and graduate courses in international corporate strategy, international management, international marketing, supply-chain management, cross-border strategic management and international business studies in general.

Teaching Note: 8B08M14 (15 pages)
Industry: Manufacturing
Issues: Marketing Management; Operations Management; Global Strategy; Vertical Integration; Value Chain; Competitor Analysis
Difficulty: 4 - Undergraduate/MBA

Chapter 11:
Diversification strategies

George Peng, Paul W. Beamish

Product Number: 9B13M124
Publication Date: 12/5/2013
Revision Date: 10/10/2014
Length: 16 pages

AWARD WINNING CASE: European Foundation for Management Development (EFMD) Case Writing Competition 2014 — Emerging Chinese Global Competitors category.

In 2011, a major coal producer in China — Yancoal — must make several decisions in terms of product and geographic diversification. One option is to retain its focus on the coal business. Here, it can acquire other coal assets in Australia to further increase its coal reserves. Another option is to acquire 19 potash-exploration permits in Saskatchewan, Canada. This represents an opportunity for both product diversification and further geographic diversification. Yancoal has to decide whether it should focus on the coal industry or pursue the potash opportunity as well.

Teaching Note: 8B13M124 (23 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: Diversification; value creation; cartel; growth; alternatives; strategic choice; state-owned enterprise; China; Canada; Australia
Difficulty: 4 - Undergraduate/MBA

Paul W. Beamish, George Peng

Product Number: 9B06M088
Publication Date: 1/23/2007
Revision Date: 9/21/2011
Length: 17 pages

In 2003, 3M initiated contact with Yunnan Baiyao Group Co., Ltd. to discuss potential cooperation opportunities in the area of transdermal pharmaceutical products. Yunnan Baiyao (YB), was a household brand in China for its unique traditional herbal medicines. In recent years, the company had been engaged in a series of corporate reforms and product/market diversification strategies to respond to the change in the Chinese pharmaceutical industry and competition at a global level. By 2003, YB was already a vertically integrated, product-diversified group company with an ambition to become an international player. The proposed cooperation with 3M was attractive to YB, not only as an opportunity for domestic product diversification, but also for international diversification. YB had been attempting to internationalize its products and an overseas department had been established in 2002 specifically for this purpose. On the other hand, YB had also been considering another option namely, whether to extend its brand to toothpaste and other healthcare products. YB had to make decisions about which of the two options to pursue and whether it was feasible to pursue both.

Teaching Note: 8B06M88 (12 pages)
Industry: Health Care Services
Issues: China; Product Diversification; Internationalization; Brand Extension; Alliances
Difficulty: 4 - Undergraduate/MBA

Chapter 12:
Implementing corporate diversification

Jean-Louis Schaan, Ramasastry Chandrasekhar

Product Number: 9B13M112
Publication Date: 10/30/2013
Revision Date: 10/30/2013
Length: 17 pages

In early 2013, the head of business development and commercial operations of Arla Foods, a dairy enterprise focused on Northern European markets, is examining, in the light of a new five-year strategy, alternatives to the existing organization structure. His dilemma is to determine the best structure that can deliver the strategy, which is focused on renewed international expansion. The new structure must support the company's strategy in relation to both the existing core markets in Northern Europe and also the growth markets of the future in countries of Asia and Africa. It must ensure that Arla Foods has the right competitive stance in individual markets, which vary widely in terms of customer buying habits and retail formats. It must also ensure regular innovation of dairy categories developed from local resources and marketable globally.

Teaching Note: 8B13M112 (9 pages)
Industry: Retail Trade
Issues: Strategy implementation; organization structure; innovation; globalization; key success factors; customer focus; United States.
Difficulty: 5 - MBA/Postgraduate

Lawrence G. Tapp, Trevor Hunter

Product Number: 9B02M045
Publication Date: 1/10/2003
Revision Date: 12/3/2009
Length: 11 pages

CCL Industries Inc. is one of the top packagers of consumer products in the world. Over its 50-year history the company had grown from a small room to a multinational firm employing 7,500 people with over $1.6 billon in sales. CCL faces an uncertain environment that had already led to a major strategic reorientation when its plan to sell its largest division was cancelled. A global economic slowdown and lower consumer confidence coupled with extensive international operations, significantly increased the risk to CCL's sales and already slim profits. In the past, the company prospered through product diversification gained through acquisition. The economic slowdown and increased uncertainty meant that this strategy may not be appropriate in the future. The chief executive officer recognizes the time, attention, advice, composition and operations of the board of directors would likely have to be altered to reflect this new reality.

Teaching Note: 8B02M45 (7 pages)
Industry: Manufacturing
Issues: Board of Directors; Corporate Governance
Difficulty: 4 - Undergraduate/MBA

Tom A. Poynter, Paul W. Beamish

Product Number: 9B08M037
Publication Date: 4/15/2008
Revision Date: 5/18/2017
Length: 12 pages

Victoria Heavy Equipment (Victoria) was a family owned and managed firm which had been led by an ambitious, entrepreneurial chief executive officer who now wanted to take a less active role in the business. Victoria had been through two reorganizations in recent years, which contributed to organizational and strategic issues which would need to be addressed by a new president.

Teaching Note: 8B08M37 (7 pages)
Industry: Manufacturing
Issues: Growth Strategy; Organizational Structure; Leadership; Decentralization
Difficulty: 4 - Undergraduate/MBA

Chapter 13:
Strategic alliances

Wiboon Kittilaksanawong, Caroline Palecki

Product Number: 9B15M087
Publication Date: 10/19/2015
Revision Date: 10/19/2015
Length: 12 pages

In 2015, Renault-Nissan Alliance (RNA) launched four convergence projects in four key functions (research and development, manufacturing and logistics, purchasing, and human resources). The projects required the two independent entities, Renault and Nissan, to increase collaboration and integration to strengthen economies of scale, and thus reduce costs in order to better compete globally in both developed and emerging markets. However, as the alliance increased the level of integration and opened possibilities for inviting new partners, it also increased the time and resources needed to reach joint strategic decisions between the two companies. RNA had many difficult decisions to make with respect to moving forward — not least of which involved finding an eventual replacement for the alliance’s 61-year-old chief executive officer.

Teaching Note: 8B15M087 (12 pages)
Industry: Manufacturing
Issues: Strategic alliance; supplier relationship; keiretsu
Difficulty: 4 - Undergraduate/MBA

Paul W. Beamish, R. Azimah Ainuddin

Product Number: 9B15M085
Publication Date: 9/9/2015
Revision Date: 4/10/2019
Length: 13 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: 8B15M085 (12 pages)
Industry: Information, Media & Telecommunications
Issues: Intercultural Relations; Third World; Negotiation; Joint Ventures; Finland; Malaysia
Difficulty: 4 - Undergraduate/MBA

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

Chapter 14:
Merger and Acquisition strategies

Libo Fan, Yingchao Zhou, Oded Shenkar

Product Number: 9B15M100
Publication Date: 1/8/2016
Revision Date: 1/7/2016
Length: 9 pages

After acquiring a majority stake in the Shanghai Totole Food Company, a leader in the Chinese chicken powder industry, Nestlé faced dilemmas regarding maintaining control over this foreign-invested enterprise (FIE). Despite its 80 per cent stake, and in a departure from past practice, the Swiss company let its minority Chinese partner remain firmly in control. The circumstances surrounding the integration of Totole posed questions about the strategic decisions surrounding investment in a Chinese enterprise by a multinational firm and the challenges of integrating local and global operations. In 2012, Nestlé began talks with the general manager of Totole about acquiring the remaining 20 per cent of the company. Should Totole sell the remaining 20 per cent of shares and, if so, how and when should it do it?

Teaching Note: 8B15M100 (7 pages)
Industry: Accommodation & Food Services
Issues: Mergers; acquisitions; post-acquisition; foreign-invested enterprise; China
Difficulty: 5 - MBA/Postgraduate

Meeta Dasgupta

Product Number: 9B14M107
Publication Date: 9/2/2014
Revision Date: 9/2/2014
Length: 18 pages

Established in 2004, Facebook had shown stupendous growth. However, faced with the evolving mobile communication industry and increasing competition, the company was on the lookout to increase its user base by acquiring WhatsApp. Was it the right decision for Facebook to acquire WhatsApp — and at the steep price of $19 billion? From WhatsApp’s perspective, the company’s founder wanted to continue with his vision of connecting people, irrespective of the decision involving Facebook. Should WhatsApp sell its assets to Facebook or should it insist on an equity alliance instead?

Teaching Note: 8B14M107 (11 pages)
Industry: Information, Media & Telecommunications
Issues: Acquisitions; industry dynamics; post-merger integration; financial evaluation; United States
Difficulty: 5 - MBA/Postgraduate

Meera Harish, Sanjay Singh, Kulwant Singh

Product Number: 9B08M094
Publication Date: 2/2/2009
Revision Date: 5/3/2017
Length: 15 pages

In January 2004, the chairman of the India-based Tata Group, announced that the Tata Group would focus its efforts on international expansion to become globally competitive. This largely domestic vehicle manufacturing firm subsequently acquired a leading established South Korean firm, Daewoo Commercial Vehicle Company (DCVC). This case focuses on the background of the firms and the acquisition, and the bidding and acquisition process. It provides information on the interests of the acquirer and target, and how both came to see the value in the acquisition. The Tata Group acquisition presents an uncommon situation of how an Indian firm acquired a firm in South Korea while overcoming a series of cultural and other barriers. An analysis of this case provides the basis for determining what criteria should be considered to guide a successful acquisition. A companion case is also available, Tata Motors' Integration of Daewoo Commercial Vehicle Company.

Teaching Note: 8B08M94 (10 pages)
Industry: Manufacturing
Issues: International Strategy; International Expansion; Management Decisions; Market Entry; Mergers & Acquisitions; Corporate Strategy; Business Policy
Difficulty: 4 - Undergraduate/MBA

Gregory Vit, Johnny Boghossian, Amrita Nain, Karl Moore

Product Number: 9B09M071
Publication Date: 12/8/2009
Length: 18 pages

In December 2006, Alcan was the second largest producer of aluminum in the world, but the industry was consolidating. The case traces the development of the aluminum industry since World War II to the recent emergence of China as an economic power and the accompanying rise in commodity prices. Alcan had to decide between two offers: to be acquired or to go it alone. The first offer was from Alcoa and the other from Rio Tinto. Alcoa was the world leader in the production of aluminum and, like Alcan, was engaged in significant technological research and development. Meanwhile, Rio Tinto was one of the largest mining companies in the world, but had minor aluminum operations and, in general, few downstream processing plants or technologies. Students are asked to identify Alcan's key resources and consider which strategy would make best use of them.

Teaching Note: 8B09M71 (6 pages)
Industry: Mining, Quarrying, and Oil and Gas Extraction
Issues: Government and Business; Strategy and Resources; Globalization; Mergers & Acquisitions
Difficulty: 4 - Undergraduate/MBA

Chapter 15:
International strategies

Yves Plourde, Jean-Louis Schaan

Product Number: 9B15M013
Publication Date: 4/10/2015
Revision Date: 4/10/2015
Length: 14 pages

In May 2011, the Public Bike System Company, based in Montreal, Canada, was preparing to answer a request for proposal by New York City to create a financially self-sustaining public bike-sharing system. Three years earlier, the company, owned by the Montreal Transit Authority, had created Bixi, a service that made bikes available to members through docking stations, powered by solar energy, spread across the city. Although its financial structure was still unproven, it was a promising solution that aimed to revolutionize urban transportation. In partnership with other private bike-sharing organizations, the company had successfully expanded to Minneapolis-St. Paul and Washington D.C. but had experienced problems with its implementations in Melbourne, London and Boston. Furthermore, the system in Montreal could not provide evidence of profitability, forcing the city government to step in by guaranteeing loans and providing additional cash flow. It also did not have a clear business plan as to how, when and where its international expansion should take place. Now, news of its problems in Montreal had made headlines in New York, putting the future of its expansion ambitions in doubt.

Teaching Note: 8B15M013 (13 pages)
Industry: Other Services
Issues: Growth; strategy; expansion; Canada; United States; Australia; United Kingdom
Difficulty: 4 - Undergraduate/MBA

Abhishek Aggarwal, Rohit Kadam, Lawrence Loh

Product Number: 9B12M121
Publication Date: 5/9/2013
Revision Date: 5/6/2013
Length: 18 pages

Yamato Transport, Japan’s leading parcel delivery company, experienced internationalization and geographical diversification issues. When it launched its operations in Singapore in 2010 with a view to further branching out into Southeast Asia, the company faced challenges owing to different cultural and social landscapes, difficulties penetrating a small and saturated market, and problems hiring manpower aligned with the company’s business model. The key success factors for Yamato Transport in Japan and their applicability in Singapore are analyzed. What will it take for Yamato Transport to succeed in Singapore when pitted against the mighty SingPost?

Teaching Note: 8B12M121 (8 pages)
Industry: Other Services
Issues: Foreign market entry; delivery industry; global; cross-cultural; Japan; Singapore
Difficulty: 4 - Undergraduate/MBA

Ilan Alon, Meredith Lohwasser

Product Number: 9B12M058
Publication Date: 5/23/2012
Revision Date: 5/10/2017
Length: 16 pages

Founded in Trieste, Italy, Illy marketed a unique blend of coffee drinks in over 140 countries and in more than 50,000 of the world’s best restaurants and coffeehouses. The company wanted to expand the reach of its own franchised coffee bar, Espressamente, through international expansion. Potential markets included Brazil, China, Germany, Japan, India, the United Kingdom, and the United States. In 2012, the managing director of Espressamente knew that global expansion meant prioritizing markets, but where did the greatest potential lie? In addition to market selection, mode of entry was vital and included options such as exporting, franchising, and joint ventures. This case provides a practical example of the challenges faced in international business.

Teaching Note: 8B12M058 (7 pages)
Industry: Accommodation & Food Services
Issues: International Market Selection; Modes of Entry; Franchising; Retailing; International Business; Coffee; Italy
Difficulty: 4 - Undergraduate/MBA