A Guide to Case Analysis

In most courses in strategic management, students use cases about actual companies to
practice strategic analysis and to gain some experience in the tasks of crafting and implementing
strategy.
A
case sets forth, in a factual manner, the events and organizational
circumstances surrounding a particular managerial situation. It puts readers at
the
scene of the action and familiarizes them with all the relevant circumstances. A
case
on strategic management can concern a whole industry,
a single organization,
or
some
part of an organization;
the organization
involved can be either profit-seeking or
not-for-profit.
The
essence of the student’s
role in case analysis is to diagnose and size
up
the situation described in the case and then to recommend appropriate action steps.
WHY USE CASES TO PRACTICE STRATEGIC
MANAGEMENT?
A student of business with tact
Absorbed many answers he lacked.
But acquiring a job,
He said with a sob,
“How does one fit answer to fact?”
The above limerick was used some years ago by Professor Charles Gragg to characterize
the plight of business students who had no exposure to cases.
1
The truth is that
the mere act of listening to lectures and sound advice about managing does little for
anyone’s management skills. Accumulated managerial wisdom cannot effectively be
passed on by lectures and assigned readings alone. If anything had been learned about
the practice of management, it is that a storehouse of readymade textbook answers
does not exist. Each managerial situation has unique aspects, requiring its own diagnosis,
judgment, and tailor-made
actions. Cases provide would-be managers with a
valuable
way to practice wrestling with the actual problems of actual managers in actual
companies.
The case approach to strategic analysis is, first and foremost, an exercise in learning
by doing. Because cases provide detailed information about conditions and problems
of different
industries and companies, your task of analyzing company after
company
and situation after situation has the twin benefit of boosting your analytical
skills
and exposing you to the ways companies and managers actually do things. Most
college
students have limited managerial backgrounds and only fragmented knowledge
1
Charles I. Gragg, “Because Wisdom Can’t Be Told,” in The Case Method at the Harvard Business
School, ed. M. P. McNair (New York: McGraw-Hill, 1954), p. 11.
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about companies and real-life strategic situations. Cases help substitute for on-the-job
experience by (1) giving you broader exposure to a variety of industries, organizations,
and strategic problems; (2) forcing you to assume a managerial role (as opposed to that
of just an onlooker); (3) providing a test of how to apply the tools and techniques of
strategic management; and (4) asking you to come up with pragmatic managerial action
plans to deal with the issues at hand.
OBJECTIVES OF CASE ANALYSIS
Using cases to learn about the practice of strategic management is a powerful way for
you to accomplish five things:
2
1. Increase your understanding of what managers should and should not do in guiding
a business to success.
2. Build your skills in sizing up company resource strengths and weaknesses and in
conducting strategic analysis in a variety of industries and competitive situations.
3. Get valuable practice in identifying strategic issues that need to be addressed, evaluating
strategic alternatives, and formulating workable plans of action.
4. Enhance your sense of business judgment, as opposed to uncritically accepting the
authoritative crutch of the professor or “back-of-the-book” answers.
5. Gaining in-depth exposure to different industries and companies, thereby acquiring
something close to actual business experience.
If you understand that these are the objectives of case analysis, you are less likely to be
consumed with curiosity about “the answer to the case.” Students who have grown
comfortable with and accustomed to textbook statements of fact and definitive lecture
notes are often frustrated when discussions about a case do not produce concrete answers.
Usually,
case discussions produce good arguments
for more than one course of
action.
Differences
of opinion nearly always exist. Thus,
should a class discussion conclude
without a strong, unambiguous consensus on what do to, don’t
grumble too
much
when you are not
told
what the answer is or what the company actually did. Just
remember
that in the business world answers don’t
come in conclusive black-andwhite
terms. There
are nearly always several feasible courses of action and approaches,
each
of which may work out satisfactorily.
Moreover,
in the business world, when one
elects
a particular course of action, there is no peeking at the back of a book to see if
you
have chosen the best thing to do and no one to turn to for a provably correct answer.
The
only valid test of management action is results.
If
the results of an action turn
out
to be good, the decision to take it may be presumed right. If not, then the action
chosen
was wrong in the sense that it didn’t
work out.
Hence, the important thing for a student to understand in case analysis is that the
managerial exercise of identifying, diagnosing, and recommending builds your skills;
discovering the right answer or finding out what actually happened is no more than
frosting on the cake. Even if you learn what the company did, you can’t conclude that
it was necessarily right or best. All that can be said is “Here is what they did . . . ”
2
Ibid., pp. 12–14; and D. R. Schoen and Philip A. Sprague, “What Is the Case Method?” in The Case
Method at the Harvard Business School, ed. M. P. McNair, pp. 78–79.
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C-4 Cases in Strategic Management
The point is this: The purpose of giving you a case assignment is not to cause you
to run to the library or surf the Internet to discover what the company actually did but,
rather, to enhance your skills in sizing up situations and developing your managerial
judgment about what needs to be done and how to do it. The aim of case analysis is for
you to become actively engaged in diagnosing the business issues and managerial
problems posed in the case, to propose workable solutions, and to explain and defend
your assessments—this is how cases provide you with meaningful practice at being a
manager.
PREPARING A CASE FOR CLASS DISCUSSION
If this is your first experience with the case method, you may have to reorient your
study habits. Unlike lecture courses in which you can get by without preparing intensively
for each class and have latitude to work assigned readings and reviews of lecture
notes into your schedule, a case assignment requires conscientious preparation
before
class. You
will not get much out of hearing the class discuss a case you haven’t
read,
and you certainly won’t
be able to contribute anything yourself to the discussion.
To get ready for class discussion of a case, you must study the case, reflect carefully
on the situation presented, and develop some reasoned thoughts. Your
goal should
be
to end up with a sound, well-supported analysis of the situation and a sound, defensible
set of recommendations. The
Case-T
UTOR
software package that accompanies
this edition will assist you in preparing the cases—it contains a set of study questions
for each case and step-by-step tutorials to walk you through the process of analyzing
and developing reasonable recommendations.
To prepare a case for class discussion, we suggest the following approach:
1. Skim the case rather quickly to get an overview of the situation it presents. This
quick overview should give you the general flavor of the situation and indicate
the kinds of issues and problems you will need to wrestle with. If your instructor
has provided you with study questions for the case, now is the time to read them
carefully.
2. Read the case thoroughly to digest the facts and circumstances. On this reading,
try to gain full command of the situation presented in the case. Begin to develop
some tentative answers to the study questions from your instructor or in the CaseT
UTOR
software package, which you can download at the Web site for the text. If
your instructor has elected not to give you assignment questions or has not recommended
regular use of the Case-T
UTOR,
then start forming your own picture of
the
overall situation being described.
3. Carefully review all the information presented in the exhibits. Often, there is an
important story in the numbers contained in the exhibits. Expect the information
in the case exhibits to be crucial enough to materially affect your diagnosis of the
situation.
4. Decide what the strategic issues are. Until you have identified the strategic issues
and problems in the case, you don’t know what to analyze, which tools and analytical
techniques are called for,
or otherwise how to proceed. At
times the strategic
issues are clear—they are either stated directly in the case or easily inferred
from
it. At
other times you will have to dig out the issues from all the information
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given; if so, the study questions and the case preparation exercises provided in the
Case-T
UTOR software will guide you.
5. Start your analysis of the issues with some number crunching. A big majority of
strategy cases call for some kind of number crunching—calculating assorted financial
ratios to check out the company’s
financial condition and recent performance,
calculating growth rates of sales or profits or unit volume, checking out
profit
margins
and the makeup of the cost structure, and understanding whatever
revenue-cost-profit
relationships are present. See Table
1 on the next page for a
summary
of key financial ratios, how they are calculated, and what they show.
If
you
are using Case-T
UTOR,
some of the number crunching has been computerized
and
you’ll spend most of your time interpreting the growth rates, financial ratios,
and
other calculations provided.
6. Apply the concepts and techniques of strategic analysis you have been studying.
Strategic analysis is not just a collection of opinions; rather, it entails applying the
concepts and analytical tools described in Chapters 1 through 13 to cut beneath the
surface and produce sharp insight and understanding. Every case assigned is strategy
related and presents you with an opportunity to usefully apply what you have
learned.
Your
instructor is looking for you to demonstrate that you know how
and
when to use the material presented in the text chapters. The case preparation
guides on Case-T
UTOR will point you toward the proper analytical tools needed to
analyze the case situation.
7. Check out conflicting opinions and make some judgments about the validity of all
the data and information provided. Many times cases report views and contradictory
opinions (after all, people don’t
always agree on things, and different
people
see
the same things in different
ways). Forcing you to evaluate the data and information
presented in the case helps you develop your powers of inference and judgment.
Resolving conflicting information comes with the territory because a great
many
managerial situations entail opposing points of view,
conflicting trends, and
sketchy
information.
8. Support your diagnosis and opinions with reasons and evidence. Most important
is to prepare your answers to the question “Why?” For instance, if after studying
the case you are of the opinion that the company’s managers are doing a poor
job, then it is your answer to “Why do you think so?” that establishes just how
good your analysis of the situation is. If your instructor has provided you with
specific study questions for the case or if you are using the case preparation
guides on Case-T
UTOR, by all means prepare answers that include all the reasons
and number-crunching evidence you can muster to support your diagnosis. Work
through the case preparation exercises on Case-T
UTOR conscientiously, or, if you
are using study questions provided by the instructor, generate at least two pages
of notes!
9. Develop an appropriate action plan and set of recommendations. Diagnosis divorced
from corrective action is sterile. The
test of a manager is always to convert
sound
analysis into sound actions—actions that will produce the desired results.
Hence,
the final and most telling step in preparing a case is to develop an action
agenda
for management that lays out a set of specific recommendations. Bear in
mind
that proposing realistic, workable solutions is far preferable to casually tossing
out
top-of-the-head suggestions. Be prepared to explain why your recommendations
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C-6 Cases in Strategic Management
table 1 Key Financial Ratios, How They Are Calculated, and What They Show
Ratio How Calculated What It Shows
Profitability ratios
1. Gross profit margin An indication of the total margin available to
cover operating expenses and yield a profit.
Sales  Cost of goods sold
Sales
Profits before taxes and
before interest
2. Operating profit margin An indication of the firm’s profitability from
(or return on sales) current operations without regard to the
Sales
Profits after taxes
Sales
interest charges accruing from the capital
structure.
3. Net profit margin (or net Shows after-tax profits per dollar of sales.
return on sales) Subpar profit margins indicate that the firm’s
Profits after taxes
sales prices are relatively low or that costs
are relatively high, or both.
4. Return on total assets A measure of the return on total investment in
the enterprise. It is sometimes desirable to
add interest to the after-tax profits to form
the numerator of the ratio since total assets
are financed by creditors as well as by
stockholders; hence, it is accurate to measure
the productivity of assets by the returns
provided to both classes of investors.
Total assets
or
Profit after taxes  interest
Total assets
Profits after taxes
Total stockholders’ equity
5. Return on stockholders’ A measure of the rate of return on stockholders’
equity (or return on net investment in the enterprise.
worth)
Profits after taxes
 Preferred stock dividends
6. Return on capital A measure of the rate of return on the total
employed capital investment in the enterprise.
Total stockholders’ equity  total debt
 Par value of preferred stock
7. Earnings per share Shows the earnings available to the owners of
each share of common stock.
Profits after taxes and after
preferred stock dividends
Number of shares of common
stock outstanding
Liquidity ratios
1. Current ratio Indicates the extent to which the claims of
Current assets
Current liabilities
short-term creditors are covered by assets
that are expected to be converted to cash in
a period roughly corresponding to the
maturity of the liabilities.
2. Quick ratio (or acid-test A measure of the firm’s ability to pay off shortratio)
term obligations without relying on the sale of
Current assets  Inventory
Current liabilities
its inventories.
3. Inventory to net A measure of the extent to which the firm’s
Inventory
Current assets  Current liabilities
working capital working capital is tied up in inventory.
Leverage ratios
1. Debt-to-assets ratio Measures the extent to which borrowed funds
have been used to finance the firm’s
operations. Debt includes both long-term debt
and short-term debt.
Total debt
Total assets
2. Debt-to-equity ratio Provides another measure of the funds
provided by creditors versus the funds
provided by owners.
Total debt
Total stockholders’ equity
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table 1 (concluded )
A Guide to Case Analysis C-7
Ratio How Calculated What It Shows
Leverage ratios (cont.)
3. Long-term debt-to- A widely used measure of the balance
equity ratio between debt and equity in the firm’s long-
term capital structure.
4. Times-interest-earned Measures the extent to which earnings can
(or coverage) ratio decline without the firm becoming unable to
meet its annual interest costs.
5. Fixed-charge coverage A more inclusive indication of the firm’s ability
to meet all of its fixed-charge obligations.
Activity ratios
Long-term debt
Total stockholders’ equity
Profits before interest and taxes
Total interest charges
Profits before taxes and interest
 Lease obligations
Total interest charges
 Lease obligations
Sales
Inventory of finished goods
1. Inventory turnover When compared to industry averages, it
Sales
Fixed assets
provides an indication of whether a company
has excessive or perhaps inadequate finished
goods inventory.
2. Fixed assets turnover A measure of the sales productivity and
utilization of plant and equipment.
Sales
Total assets
3. Total assets turnover A measure of the utilization of all the firm’s
assets; a ratio below the industry average
indicates the company is not generating a
sufficient volume of business, given the size
of its asset investment.
Annual credit sales
Accounts receivable
4. Accounts receivable A measure of the average length of time it
turnover takes the firm to collect the sales made on
credit.
5. Average collection period Indicates the average length of time the firm
Accounts receivable
Total sales  365
or
Accounts receivable
Average daily sales
must wait after making a sale before it
receives payment.
Other ratios
1. Dividend yield on A measure of the return to owners received in
Annual dividends per share
Current market price per share
Current market price per share
After-tax earnings per share
common stock the form of dividends.
2. Price-earnings ratio Faster-growing or less-risky firms tend to
Annual dividends per share
After-tax earnings per share
have higher price-earnings ratios than
slower-growing or more-risky firms.
3. Dividend payout ratio Indicates the percentage of profits paid out as
dividends.
4. Cash flow per share A measure of the discretionary funds over and
above expenses that are available for use by
the firm.
After-tax profits  Depreciation
Number of common shares
outstanding
Note: Industry-average ratios against which a particular company’s ratios may be judged are available in Modern Industry and Dun’s
Reviews published by Dun & Bradstreet (14 ratios for 125 lines of business activities), Robert Morris Associates’ Annual Statement
Studies (11 ratios for 156 lines of business), and the FTC-SEC’s Quarterly Financial Report for manufacturing corporations.
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C-8 Cases in Strategic Management
are more attractive than other courses of action that are open. You’ll find Case-TU-
TOR’S case preparation guides helpful in performing this step, too.
As long as you are conscientious in preparing your analysis and recommendations,
and have ample reasons, evidence, and arguments to support your views, you shouldn’t
fret unduly about whether what you’ve prepared is “the right answer” to the case. In
case analysis there is rarely just one right approach or set of recommendations. Managing
a company and crafting and executing strategies are not such exact sciences that
there
exists a single provably correct analysis and action plan for each strategic situation.
Of course, some analyses and action plans are better than others; but, in truth,
there’s
nearly always more than one good way to analyze a situation and more than one
good
plan of action. So, if you have carefully prepared the case using either the CaseT
UTOR
case preparation guides or your instructor’s assignment questions, don’t lose
confidence in the correctness of your work and judgment.
PARTICIPATING IN CLASS DISCUSSION OF A CASE
Classroom discussions of cases are sharply different from lecture classes. In a case
class students do most of the talking. The instructor’s role is to solicit student participation,
keep the discussion on track, ask “Why?” often, offer
alternative views, play
the
devil’s
advocate (if no students jump in to offer
opposing views), and otherwise
lead
the discussion. The
students in the class carry the burden of analyzing the situation
and of being prepared to present and defend their diagnoses and recommendations.
Expect a classroom environment, therefore, that calls for your
size-up of the
situation, your analysis, what actions you would take, and why you would take them.
Do not be dismayed if, as the class discussion unfolds, some insightful things are said
by your fellow classmates that you did not think of. It is normal for views and analyses
to differ
and for the comments of others in the class to expand your own thinking
about
the case. As
the old adage goes, “Two
heads are better than one.” So it is to be
expected
that the class as a whole will do a more penetrating and searching job of case
analysis
than will any one person working alone. This
is the power of group effort,
and
its
virtues are that it will help you see more analytical applications, let you test your
analyses
and judgments against those of your peers, and force you to wrestle with differences
of opinion and approaches.
To orient you to the classroom environment on the days a case discussion is scheduled,
we compiled the following list of things to expect:
1. Expect the instructor to assume the role of extensive questioner and listener.
2. Expect students to do most of the talking. The case method enlists a maximum of
individual participation in class discussion. It is not enough to be present as a
silent observer; if every student took this approach, there would be no discussion.
(Thus, expect a portion of your grade to be based on your participation in case
discussions.)
3. Be prepared for the instructor to probe for reasons and supporting analysis.
4. Expect and tolerate challenges to the views expressed. All students have to be will-
ing to submit their conclusions for scrutiny and rebuttal. Each student needs to
learn to state his or her views without fear of disapproval and to overcome the hesitation
of speaking out. Learning respect for the views and approaches of others is
an
integral part of case analysis exercises. But there are times when it is OK to
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A Guide to Case Analysis C-9
swim against the tide of majority opinion. In the practice of management, there is
always room for originality and unorthodox approaches. So while discussion of a
case is a group process, there is no compulsion for you or anyone else to cave in
and conform to group opinions and group consensus.
5. Don’t be surprised if you change your mind about some things as the discussion
unfolds. Be alert to how these changes affect your analysis and recommendations
(in the event you get called on).
6. Expect to learn a lot in class as the discussion of a case progresses; furthermore,
you will find that the cases build on one another—what you learn in one case helps
prepare you for the next case discussion.
There are several things you can do on your own to be good and look good as a
participant in class discussions:





Although you should do your own independent work and independent thinking,
don’t hesitate before (and after) class to discuss the case with other students. In
real life, managers often discuss the company’s problems and situation with other
people to refine their own thinking.
In participating in the discussion, make a conscious effort to contribute, rather than
just talk. There is a big difference between saying something that builds the discussion
and offering
a long-winded off-the-cuff
remark that leaves the class wondering
what the point was.
Avoid the use of “I think,” “I believe,” and “I feel”; instead, say, “My analysis
shows—” and “The company should do . . . because—” Always give supporting
reasons and evidence for your views; then your instructor won’t have to ask you
“Why?” every time you make a comment.
In making your points, assume that everyone has read the case and knows what it
says; avoid reciting and rehashing information in the case—instead, use the data
and information to explain your assessment of the situation and to support your
position.
Bring the printouts of the work you’ve done on Case-TUTOR or the notes you’ve
prepared (usually two or three pages’ worth) to class and rely on them extensively
when you speak. There’s no way you can remember everything—especially the results
of your number crunching. To
reel off
the numbers or to present all five reasons
why,
instead of one, you will need good notes. When
you have prepared
thoughtful
answers to the study questions and use them as the basis for your comments,
everybody
in the room will know you are well prepared, and your contribution
to the case discussion will stand out.
PREPARING A WRITTEN CASE ANALYSIS
Preparing a written case analysis is much like preparing a case for class discussion, except
that your analysis must be more complete and put in report form. Unfortunately,
though,
there is no ironclad procedure for doing a written case analysis. All
we can offer
are some general guidelines and words of wisdom—this is because company situations
and management problems are so diverse that no one mechanical way to
approach
a written case assignment always works.
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C-10 Cases in Strategic Management
Your instructor may assign you a specific topic around which to prepare your written
report. Or,
alternatively,
you may be asked to do a comprehensive written case
analysis,
where the expectation is that you will (1) identify
all
the pertinent issues that
management
needs to address, (2) perform whatever analysis
or evaluation is appropriate,
and (3) propose an action
plan
and set of recommendations addressing the issues
you have identified. In going through the exercise of identify,
evaluate, and
recommend,
keep the following pointers in mind.
Identification
3
It is essential early on in your paper that you provide a sharply focused diagnosis of
strategic issues and key problems and that you demonstrate a good grasp of the company’s
present situation. Make sure that you can identify the firm’s
strategy (use the concepts
and tools in Chapters 1–10 as diagnostic aids) and that you can pinpoint whatever
strategy
implementation issues may exist (consult the material in Chapters 11–13
for diagnostic
help). Consult the key points we have provided at the end of each chapter for
further
diagnostic suggestions. Review the study questions for the case on Case-T
UTOR.
Consider
beginning your paper with an overview of the company’s
situation, its strategy,
and
the significant problems and issues that confront management. State problems/
issues
as clearly and precisely as you can. Unless it is necessary to do so for emphasis,
avoid
recounting facts and history about the company (assume your professor has read
the
case and is familiar with the organization).
Analysis and Evaluation
This is usually the hardest part of the report. Analysis is hard work! Check out the
firm’s financial ratios, its profit margins and rates of return, and its capital structure,
and decide how strong the firm is financially. Refer back to Table 1, which contains a
summary of various financial ratios and how they are calculated. Use it to assist in
your financial diagnosis. Similarly, look at marketing, production, managerial competence,
and other factors underlying the organization’s
strategic successes and failures.
Decide
whether the firm has valuable resource strengths and competencies and, if so,
whether
it is capitalizing on them.
Check to see if the firm’s strategy is producing satisfactory results and determine
the reasons why or why not. Probe the nature and strength of the competitive forces
confronting the company. Decide whether and why the firm’s competitive position is
getting stronger or weaker. Use the tools and concepts you have learned about to perform
whatever analysis or evaluation is appropriate. Work
through the case preparation
exercise
on Case-T
UTOR
if one is available for the case you’ve been assigned.
In writing your analysis and evaluation, bear in mind four things:
1. You are obliged to offer analysis and evidence to back up your conclusions. Do not
3
rely on unsupported opinions, overgeneralizations, and platitudes as a substitute
for tight, logical argument backed up with facts and figures.
For some additional ideas and viewpoints, you may wish to consult Thomas J. Raymond, “Written
Analysis of Cases,” in The Case Method at the Harvard Business School, ed. M. P. McNair, pp. 139–63.
Raymond’s article includes an actual case, a sample analysis of the case, and a sample of a student’s written
report on the case.
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A Guide to Case Analysis C-11
2. If your analysis involves some important quantitative calculations, use tables and
charts to present the calculations clearly and efficiently. Don’t just tack the exhibits
on at the end of your report and let the reader figure out what they mean and
why
they were included. Instead, in the body of your report cite some of the key
numbers,
highlight the conclusions to be drawn from the exhibits, and refer the
reader
to your charts and exhibits for more details.
3. Demonstrate that you have command of the strategic concepts and analytical tools
to which you have been exposed. Use them in your report.
4. Your interpretation of the evidence should be reasonable and objective. Be wary
of preparing a one-sided argument that omits all aspects not favorable to your conclusions.
Likewise, try not to exaggerate or overdramatize. Endeavor to inject balance
into your analysis and to avoid emotional rhetoric. Strike phrases such as “I
think,”
“I feel,” and “I believe” when you edit your first draft, and write in “My
analysis
shows,” instead.
Recommendations
The final section of the written case analysis should consist of a set of definite recommendations
and a plan of action. Your
set of recommendations should address all of the
problems/issues
you identified and analyzed. If the recommendations come as a surprise
or do not follow logically from the analysis, the effect
is to weaken greatly your
suggestions
of what to do. Obviously,
your recommendations for actions should offer
a
reasonable prospect of success. High-risk, bet-the-company recommendations should
be
made with caution. State how your recommendations will solve the problems you
identified.
Be sure the company is financially able to carry out what you recommend;
also
check to see if your recommendations are workable in terms of acceptance by the
persons
involved, the organization’s
competence to implement them, and prevailing
market
and environmental constraints. Try
not to hedge or weasel on the actions you
believe
should be taken.
By all means state your recommendations in sufficient detail to be meaningful—
get down to some definite nitty-gritty specifics. Avoid such unhelpful statements as
“The organization should do more planning” or “The company should be more aggressive
in marketing its product.” For instance, do not simply say,
“The firm should
improve
its market position” but state exactly how you think this should be done. Offer
a definite agenda for action, stipulating a timetable and sequence for initiating actions,
indicating priorities, and suggesting who should be responsible for doing what.
In proposing an action plan, remember there is a great deal of difference between,
on the one hand, being responsible for a decision that may be costly if it proves in error
and, on the other hand, casually suggesting courses of action that might be taken
when
you do not have to bear the responsibility for any of the consequences. A
good
rule to follow in making your recommendations is: Avoid recommending anything you
would not yourself be willing to do if you were in management’s shoes. The importance
of learning to develop good managerial judgment is indicated by the fact that, even
though the same information and operating data may be available to every manager or
executive in an organization, the quality of the judgments about what the information
means and which actions need to be taken does vary from person to person.
4
Gragg, “Because Wisdom Can’t Be Told,” p. 10.
4
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C-12 Cases in Strategic Management
It goes without saying that your report should be well organized and well written.
Great ideas amount to little unless others can be convinced of their merit—this takes
tight logic, the presentation of convincing evidence, and persuasively written arguments.
PREPARING AN ORAL PRESENTATION
During the course of your business career it is very likely that you will be called on to
prepare and give a number of oral presentations. For this reason, it is common in
courses of this nature to assign cases for oral presentation to the whole class. Such assignments
give you an opportunity to hone your presentation skills.
The preparation of an oral presentation has much in common with that of a written
case analysis. Both require identification of the strategic issues and problems confronting
the company,
analysis of industry conditions and the company’s
situation, and
the
development of a thorough, well-thought-out action plan. The
substance of your
analysis
and quality of your recommendations in an oral presentation should be no different
than in a written report. As
with a written assignment, you’ll need to demonstrate
command
of the relevant strategic concepts and tools of analysis, and your recommendations
should contain sufficient
detail to provide clear direction for management. The
main
difference
between an oral presentation and a written case is in the delivery format.
Oral
presentations rely principally on verbalizing your diagnosis, analysis, and recommendations
and visually enhancing and supporting your oral discussion with colorful,
snappy
slides (usually created with Microsoft’s
PowerPoint software).
Typically, oral presentations involve group assignments. Your instructor will provide
the details of the assignment—how work should be delegated among the group
members
and how the presentation should be conducted. Some instructors prefer that
presentations
begin with issue identification, followed by analysis of the industry and
company
situation analysis, and conclude with a recommended action plan to improve
company
performance. Other instructors prefer that the presenters assume that the
class
has a good understanding of the external industry environment and the company’s
competitive position and expect the presentation to be strongly focused on the
group’s
recommended action plan and supporting analysis and arguments.
The
latter
approach
requires cutting straight to the heart of the case and supporting each recommendation
with detailed analysis and persuasive reasoning. Still other instructors may
give
you the latitude to structure your presentation however you and your group members
see fit.
Regardless of the style preferred by your instructor, you should take great care in
preparing for the presentation. A good set of slides with good content and good visual
appeal is essential to a first-rate presentation. Take some care to choose a nice slide design,
font size and style, and color scheme. We
suggest including slides covering each
of
the following areas:




An opening slide covering the “title” of the presentation and names of the
presenters.
A slide showing an outline of the presentation (perhaps with presenters’ names by
each topic).
One or more slides showing the key problems and strategic issues that management
needs to address.
A series of slides covering your analysis of the company’s situation.
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A Guide to Case Analysis C-13
Aseries of slides containing your recommendations and the supporting arguments
and reasoning for each recommendation—one slide for each recommendation and
the associated reasoning has a lot of merit.
You and your team members should carefully plan and rehearse your slide show to
maximize impact and minimize distractions. The slide show should include all of the
pizzazz necessary to garner the attention of the audience, but not so much that it distracts
from the content of what group members are saying to the class. You
should remember
that the role of slides is to help you communicate your points to the audience.
Too
many graphics, images, colors, and transitions may divert the audience’s
attention
from
what is being said or disrupt the flow of the presentation. Keep in mind that visually
dazzling slides rarely hide a shallow or superficial or otherwise flawed case
analysis
from a perceptive audience. Most instructors will tell you that first-rate slides
will
definitely enhance a well-delivered presentation but that impressive visual aids accompanied
by weak analysis and poor oral delivery still add up to a substandard
presentation.
RESEARCHING COMPANIES AND INDUSTRIES VIA THE
INTERNET AND ONLINE DATA SERVICES
Very likely, there will be occasions when you need to get additional information about
some of the assigned cases, perhaps because your instructor has asked you to do further
research on the industry or company or because you are simply curious about what has
happened to the company since the case was written. These days it is relatively easy to
run down recent industry developments and to find out whether a company’s strategic
and financial situation has improved, deteriorated, or changed little since the conclusion
of the case. The amount of information about companies and industries available on the
Internet and through online data services is formidable and expanding rapidly.
It is a fairly simple matter to go to company Web sites, click on the investor information
offerings
and press release files, and get quickly to useful information. Most
company
Web
sites are linked to databases containing the company’s
quarterly and annual
reports and 10K and 10Q filings with the Securities and Exchange Commission.
Frequently,
you will find mission and vision statements, values statements, codes of
ethics,
and strategy information, as well as charts of the company’s
stock price. The
company’s
recent press releases typically contain reliable information about what of
interest
has been going on—new product introductions, recent alliances and partnership
agreements, recent acquisitions, and other late-breaking company developments.
Some
company Web
pages also include links to the home pages of industry trade associations
where you can find information about industry size, growth, recent industry
news,
statistical trends, and future outlook. Thus,
an early step in researching a company
on the Internet is always to go to its Web
site and see what’s
available.
Online Data Services
Lexis-Nexis, Bloomberg Financial News Services, and other online subscription services
available in many university libraries provide access to a wide array of business reference
material. For example, the Web-based
Lexis-Nexis Academic
Universe contains
business
news articles from general news sources, business publications, and industry
tho1978X_pt2.qxd 10/18/2000 11:26 AM Page C-14
C-14 Cases in Strategic Management
trade publications. Broadcast transcripts from financial news programs are also available
through Lexis-Nexis, as are full-text 10-Ks, 10-Qs, annual reports, and company profiles
for more than 11,000 U.S. and international companies. Your business librarian should
be able to direct you to the resources available through your library that will aid you in
your research.
Public and Subscription Web sites with
Good Information
In addition to company Web pages and online services provided by your university library,
almost every major business publication has a subscription site available on the
Internet.
The
Wall
Street
Journal Interactive Edition
not only contains the same information
that is available daily in its print version of the paper but also maintains a
searchable
database of all Wall
Street
Journal
articles published during the past few
years. The newspaper’s online subscription site also has a Briefings Books section that
allows you to conduct research on a specific company and track its financial and market
performance in near–real time. Fortune
and Business Week also make the content
of the most current issue available online to subscribers as well as provide archives
sections that allow you to search for articles related to a particular keyword that were
published during the past few years.
The following Web sites are particularly good locations for company and industry
information:
Securities and Exchange Commission EDGAR www.sec.gov/cgi-bin/srch-edgar
database (contains company 10-Ks, 10-Qs etc.)
NASDAQ www.nasdaq.com
CNNfn: The Financial Network www.cnnfn.com
Hoover’s Online www.hoovers.com
The Wall Street Journal Interactive Edition www.wsj.com
Business Week www.businessweek.com
Fortune www.fortune.com
MSN Money Central www.moneycentral.msn.com
Yahoo! Finance www.quote.yahoo.com
Individual News Page www.individual.com
Some of these Internet sources require subscriptions in order to access their entire
databases.
Using a Search Engine
Alternatively, or in addition, you can quickly locate and retrieve information on companies,
industries, products, individuals, or other subjects of interest using such Internet
search
engines as Lycos,
Go, Excite, Snap, and Google. Search engines find articles and
other
information sources that relate to a particular industry,
company name, topic,
phrase,
or keyword of interest. Search engine technology is becoming highly intuitive in
retrieving
Web
pages related to your query and will likely direct you to the company
Web
site and other sites that contain timely and accurate information about the company.
However,
keep in mind that the information retrieved by a search engine is unfiltered
tho1978X_pt2.qxd 10/18/2000 11:26 AM Page C-15
table 2 The 10 Commandments of Case Analysis
A Guide to Case Analysis C-15
To be observed in written reports and oral presentations, and while participating in class
discussions.
1. Go through the case twice, once for a quick overview and once to gain full command
of the facts; then take care to explore the information in every one of the case
exhibits.
2. Make a complete list of the problems and issues that the company’s management
needs to address.
3. Be thorough in your analysis of the company’s situation. Either work through the case
preparation exercises and/or study questions on Case-T
UTOR or make a minimum of
one to two pages of notes detailing your diagnosis.
4. Use every opportunity to apply the concepts and analytical tools in the text chapters—
all of the cases in the book have very definite ties to the concepts/tools in one or more
of the text chapters and you are expected to apply them in analyzing the cases.
5. Do enough number crunching to discover the story told by the data presented in the
case. (To help you comply with this commandment, consult Table 1 in this section to
guide your probing of a company’s financial condition and financial performance.)
6. Support any and all opinions with well-reasoned arguments and numerical evidence;
don’t stop until you can purge “I think” and “I feel” from your assessment and instead
are able to rely completely on “My analysis shows.”
7. Prioritize your recommendations and make sure they can be carried out in an
acceptable time frame with the available resources.
8. Support each recommendation with persuasive argument and reasons as to why it
makes sense and should result in improved company performance.
9. Review your recommended action plan to see if it addresses all of the problems and
issues you identified—any set of recommendations that does not address all of the
issues and problems you identified is incomplete and insufficient.
10. Avoid recommending any course of action that could have disastrous consequences
if it doesn’t work out as planned; therefore, be as alert to the downside risks of your
recommendations as you are to their upside potential and appeal.
and may include sources that are not reliable or that contain inaccurate or misleading information.
Be wary of information that is provided by authors who are unaffiliated
with
reputable
organizations
or publications or that doesn’t
come from the company or a
credible
trade association—be especially careful in relying on the accuracy of information
you find posted on various bulletin boards. Articles
covering a company or issue
should
be copyrighted or published by a reputable source. If you are turning in a paper
containing
information gathered from the Internet, you should cite your sources (providing
the Internet address and date visited); it is also wise to print Web
pages for your
research
file (some Web
pages are updated frequently).
The Learning Curve Is Steep
With a modest investment of time, you will learn how to use Internet sources and
search engines to run down information on companies and industries quickly and efficiently.
And
it is a skill that will serve you well into the future. Once you become familiar
with the data available on the different
Web
sites mentioned above and with one
or
more search engines, you will know where to go to look for the particular information
that you want. Search engines nearly always turn up too many information sources
that
match your request rather than too few; the trick is to learn to zero in on those
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C-16 Cases in Strategic Management
most relevant to what you are looking for. As with most things, once you get a little experience
under your belt on how to do company and industry research on the Internet,
you
will find that you can readily find the information you need.
THE 10 COMMANDMENTS OF CASE ANALYSIS
As a way of summarizing our suggestions about how to approach the task of case
analysis, we have compiled what we like to call “The 10 Commandments of Case
Analysis.” They are shown in Table 2 on the previous page. If you observe all or even
most of these commandments faithfully as you prepare a case either for class discussion
or for a written report, your chances of doing a good job on the assigned cases will
be
much improved. Hang in there, give it your best shot, and have some fun exploring
what
the real world of strategic management is all about.

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