Additional Guidance for last (Glo-Bus) Written Case
1. You have competed for 9 years (Years 6-14) in two industries – action-capture cameras (ACC) and unmanned aerial view (UAV) commercial drones. Your company set goals (and investors had their own expectations (IE)) as you headed into Year 6 and your team created a strategy to help attain them. Your company has either met those goals (partially or completely) or not. It also had investor expectations for each year and it either met those (partially or completely) or your company did not. At this stage, you are assessing your company as the situation changes (after Year 14 but before Year 15). In essence, you are doing a case analysis on your own company that you have been in charge of for the past 9 years.
2. However, even though you have a common past history, each person in your company has a different scenario moving forward. Each scenario is part marketing forecast (different growth rate projections for drones/cameras for each team member) and part “new investor expectations “ for years 15-18 (also different for each team member and for each team). This case analysis is a culmination of what you have learned in Mgt 485 (and in your major). The more that you are familiar with Glo-Bus, the easier it should be, and also the more detailed and creative you can be. If you have not participated as much in the nuts and bolts of Glo-Bus, this will come through in your lack of detail in this case and your grade will reflect that as well.
3. So, you are assessing your company’s situation at the end of Year 14 as you head into Year 15 (with projections and investor expectations – up to Year 18). You need to come up with at least two well-developed issues that your company is facing. What is on your “worry list” after you do an external and internal analysis? Then, you need to let me know which of these issues is the most pressing and tell me why that issue is more important. Next, come up with at least two alternatives (three would be even better) that would address that one, main issue. Determine which alternative would best address your one, main issue. Finally, create an action plan with a timeline – one that is allowed under the rules of Glo-Bus that you have been using and should be familiar with (i.e. –no 3 month or 9-monts assessments for any timeline as Glo-Bus only allows yearly changes. Thus, YOU can propose only things that are currently allowed under Glo-Bus and in the format that Glo-Bus allows. For instance, you can only buy back stock to 15 million shares of stock. Some scenarios do allow for unusual and creative solutions but pay attention to those. For instance, some scenarios may allow a company to reduce the number of shares to 10 million, or allow to attempt to purchase a competitor or diversify into another, related industry.
4. As part of your issue determination, you need to assess your team’s financial performance over the past 5 years (Years 10-14). For this attachment, partial group/team work is allowed. You can create the Generic “Super DuPont” and CAGRs for Years 10-14 (for your company, the industry (avg), and one competitor) as a group. This will be Attachment A for the case for all team members. But, while the attachment will be the same, each person will write and analyze it on their own, independently. The idea here is that you demonstrate to me that you understand what is going on from a financial standpoint. For instance, if one of your issues is that ROAE is low (compared to investor expectations, the industry average, your own objectives, or a competitor), then you would have the START of understanding WHY it was low. If you do not understand why, then you would never be able to actually fix/correct it.
Industry
GPM OPM NPM/ROS AT ROA Lev (A/Avg Equity)
ROA ROAE
Year 10
Year 11
Year 12
Year 13
Year 14
Repeat the above table for your company, and a competitor. So – three tables total with the above information!! Then, add the following, fourth table to complete Attachment A:
CAGRs required
CAGRs Years 10-14 Industry Your Company Competitor
Profit (net)
Revenues
Assets (total)
Equity
[Do not have the words “your company” and “competitor” but please put in the actual name of your company and your competitor. – I have seen it all!]
These four tables will be Attachment A for the case. The above should be similar/same for EACH team member and thus, can be worked on together. How you interpret the data should be done individually and preferably tailored to your individual issue going forward. THIS IS IMPORTANT – you can construct these four tables together but be forewarned – if they are done incorrectly, you ALL suffer. So, make sure someone double-checks the numbers.
Then, INDIVIDUALLY, you may create and add other financial information (from the production cost report, competitive intelligence report, the benchmarking data, labor and compensation data, or any other financially related document). For instance, if you have marketing costs that are relatively high compared to the industry, this would be a drill down on the financials above from the CDJ, but it could be its own attachment. Anything created individually would be a different Attachment (for instance, Attachment B) and MUST be your own, individual work. (Another financial attachment is NOT required as an attachment but may be helpful).
5. In addition to Attachment A, you still will need (at a minimum) two other attachments (also created individually). Having three attachments will earn you 24/30 points (at most) on this portion of the grading sheet. Depending on the number and quality of additional attachments, you could earn all 30 points here. These other attachments could be anything from a SWOT, to a competitive strength assessment, a summary of the pros/cons of your alternatives, a detailed action plan, a pro forma of how the numbers will change, an assessment of the driving forces, or any other document of your choosing. I would NOT recommend Porter’s 5-Forces because 4 of the 5 forces are held constant (see class notes).
6. As far as approaching this project – you should go back to the end of chapter 4 (text) and recall the “worry list” idea. Regardless of the scenario that I gave each of you, what worries you – are you struggling in any particular area (or overall)? Does your financial analysis reveal any weaknesses compared to competitors or the industry? Are you trying to improve some area of your objectives and getting nowhere? Are you blowing things out of the water (doing really well) and are both above investor expectations AND your own objectives but realize that it will be difficult remaining there? This should give you at least one issue. Another issue might come from the financial tables created above (Attachment A). Another issue could come from high warranty costs (if they are relatively high). Another issue could come from high labor costs or low productivity of your workforce (or both). Another issue could come from low OPMs in a region. Another issue could come from low market share in a region. And this hypothetical list of issues does not even address YOUR SCENARIO going forward. You need to identify and explain at least two issues. You then need to tell me which of your issues is the main issue and why it is the main issue. ALL OF THIS needs to be completed individually.
7. Then, based upon the forecasted individual scenario (A through E), you need to come up with alternatives to your one main issue. Based upon these forecasts, what can you do about this issue? (Two alternatives are the minimum, three would be better).
8. Select one of these alternatives as your recommendation. Tell me why you chose this alternative over the other alternative(s). Make sure to give the pros and cons of your alternatives.
9. Create a detailed action plan for the next couple of years. You are (or should be) familiar with Glo-Bus. What are you changing? Why? You can get very specific here but it must be doable within Glo-Bus or allowed under the terms of your scenario.
10. Based upon this action plan, what will be the results and will these results actually address the main issue you have identified in #3 above.
11. REMEMBER – staple your scenario (A, B, C, D, E) to the back of your case. You do not need to submit the scenario when you submit it to assignments (doing so would blow up Turnitin.com). Attach/staple WC#2 grading sheet to the front of your case and still put your random number (with ‘B’ in front of it) along with the date, and WC#2 as a header on each page.
12. Do NOT mention anything “Game” related. For instance, do not call any other company “Team A” because it is not a Team – it is a company in this industry that has a name that begins with the letter A. Do not mention that your company (or any other company) is winning or leading other teams (or companies) as that sounds like you are referencing the game.
13. Assume you are a real company, this is a real industry, and the time period is Year 6 to Year 14. You are now headed into Years 15-18. It is NOT 2014; it was Year 14.