Lauren Sterna, Jennifer Eccles, Scott Addison, Clint Chapman,
Craig Crowell, and Collin Gillaspie Strategic Management in Action:
The Appendixes
Slide 2
Appendix 1: How to do a Comprehensive Case Analysis What is a
Case? Simply a short story of a company and the strategic issues
its strategic decision makers are facing. What Should a Case
Analysis Include? A case analysis usually includes 6 parts:
external analysis, internal analysis, strategic issues, strategic
alternatives, recommendations, and implementation.
Slide 3
How to do a Comprehensive Case Analysis: External Analysis
Includes a description of the opportunities and threats found in
the specific and general external environmental sectors. General
sectors include economic, demographic, sociocultural,
political-legal, and technological forces. Based on the analysis of
these sectors you should describe what opportunities and threats
you see in each area, and why you see them.
Slide 4
How to do a Comprehensive Case Analysis: Internal Analysis
Includes strengths and weaknesses found in the internal functional
areas that include production-operations, marketing, HR management,
R&D, information systems, and financial-accounting. Also, an
assessment of top managers, and culture and structure of the
organization. Do not leave out a through financial analysis,
because this is how strategic managers base their decisions. This
should cover 4 parts: ratio analysis and comparison to industry
trends, graphs and charts of sales, profits, and other financial
measures, financial strengths and weaknesses, and a statement of
the overall financial condition.
Slide 5
How to do a Comprehensive Case Analysis: Strategic Issues
Issues are weaknesses that need to be corrected, opportunities that
need to be taken advantage of based on strengths and distinctive
competencies, or possible threats that need to be avoided or
buffered against. Focus on what the issue is and why it is a
problem, these need to come from the information that was included
in your previous analysis.
Slide 6
How to do a Comprehensive Case Analysis: Strategic Alternatives
You need to develop at least 2 alternatives to the current
situation when addressing strategic issues. Describe who, what,
when, and where to the question What is the alternative being
proposed?
Slide 7
How to do a Comprehensive Case Analysis: Recommendations Once
the alternatives have been developed, you are ready to make choices
about what alternatives you are choosing and why, also which are
being rejected and why. Do not forget to explain how your
alternatives will resolve the strategic issue.
Slide 8
How to do a Comprehensive Case Analysis: Implementation
Implementation of course is always the decision of the
organization, so you need to include descriptions of how things
would have to take place, and where the funding would come from to
put those changes into place.
Slide 9
How to do a Comprehensive Case Analysis: Written and Oral
Presentation The written analysis should cover all 6 parts
described and include anything that is required for the analysis.
Oral presentations need to be easy to follow and sometimes
requirements are included with the oral presentation, so follow
them exactly.
Slide 10
Appendix 3: Southwest Airlines Simple, fun, and profitable 36
consecutive years of profitability Began service in 1971 with 3
planes flying to Houston, Dallas, and San Antonio Herb Kelleher,
cofounder said, A lot of people figured us road kill at that
time.
Slide 11
Background The strategic approach that Southwest took was
unlike any other airline company at the time In the early 1970s the
airline industry was characterized by: High fares Inconvenient
flight schedules Complicated ticketing Long and inconvenient flying
experiences
Slide 12
Southwests Strategy They wanted something to be simple Get
customers to their destinations When they want to get there, on
time Lowest fare Have a good time while doing it Fly short-haul
routes where the fares are comparable to driving
Slide 13
Current Operations Southwest is known for the nations low-fare
and high customer satisfaction Serves as short and medium haul
routes with single-class service for mostly business and leisure
travel Point-to-point service 79% of customers fly non-stop with an
average trip length of 846 miles
Slide 14
Low-Cost Advantage Use a single type of aircraft- Boeing 737
More than 530 aircrafts with an average age of 9 years Fuel
Hedging- where they pay for gas upfront for the right to buy fuel
at certain prices Use of technology- automated processes
southwest.com- first airline to establish website Downtown and
conveniently located airports
Slide 15
Legendary Customer Service Great service at low prices The
American Customer Satisfaction Index ranked Southwest first among
airlines for highest customer satisfaction for 14 years Customer
Service Commitment Southwests mission statement establishes a
foundation for its commitment to servicing customers
Slide 16
A Black Eye for the Company- Plane Maintenance and Inspection
Trouble In early 2008, two FAA officials had noticed problems with
some of the planes Southwest had failed to do required inspections
because Southwest officials tried to keep the problems hidden 8% of
the fleet was grounded until inspections were completed In March
2009, SW announced that they resolved all issues and are now
working with the FAA to ensure safety for the public
Slide 17
Southwests Culture and People High-spirited, irrelevant culture
At the company headquarters there are over 10,000 pictures of
employees Their focus is the customers Southwest went where no
other airline had gone before- blogging- Nuts about Southwest
Southwests people are their most valuable asset More than 4 out of
5 employees are union members
Slide 18
Financial Highlights 36 consecutive years of profitability In
2008, revenues were up 11.8% to over $11 billion even though net
income was down 72.4% A testament of Southwests strategies is to
post a net income
Slide 19
Company Awards and Reognitions One of the most admired
companies- Fortune Magazine Business Weeks Customer Service Champs
Americas Most Shareholder Friendly Companies- Institutional
Investor Magazine Airline of the Year- for excellent air cargo
delivery service *from 2007-2009
Slide 20
The Airline Industry and Major Competitors The airline industry
is extremely competitive One major uncertainty is fuel costs There
are many things that make the industry vulnerable: Capital
intensive Fixed costs Fuel and labor intensive Heavily regulated
and taxed
Slide 21
The Future Keeping costs under control and keeping its culture
alive No longer paying commissions on flights booked by travel
agents Motivating employees to continue to look for innovative ways
to better run the business
Slide 22
McDonalds
Slide 23
On the Downward slope By 2000 known for poor service and
quality Came in last in survey of fast food restaurants in 2001
First time in 15 years more people disliked than liked McDonalds
2002 first quarterly loss
Slide 24
On the Mend 2003 old CEO fired and replaced by Jim Cantalupo
Cantalupo obsessed over the basics(fast service, hot food, and
clean restaurants) Plan to Win Operational Excellence Retake the
lead in Marketing(Im Loving It) Innovation
Slide 25
McDonalds Today Company employees and suppliers aligning fully
Ranked 8 th by BusinessWeek in best global brands Investment in
different restaurant formats including Chipotle Since first
quarterly loss in 2002 they have increased profits every quarter
since
Slide 26
Ford Car manufacturer based in Detroit, MI CEO and President:
Alan Mulally 2008- suffered worst loss ever ($14.8 billion)
Slide 27
Ford History 108 year old company First to manufacture products
using a mass production assembly line. Hits: Model T Mustang (Sold
1 Million in 24 months) Explorer (First SUV) Taurus F-Series
Pickups Failures Pinto (exploding gas tanks) Edsel (unusual design
that never caught on) Firestone Tires/Ford Explorer 1998- CEO
Jacques Nasser tried to diversify the company away from their core
competencies and he was ultimately fired because of the
failures.
Slide 28
Ford Industry and Competitors Industry Technology driven Fierce
competition Fickle customers Manufacturing overcapacity worldwide
Declining demand for certain car models Competitors GM Toyota
Chrysler Honda 2007- beginning of recession and decline in car
sales Early 2008- Ford sells Land Rover and Jaguar to Tata Late
2008- GM and Chrysler took bailout money from the US
Government
Slide 29
Ford Motor Company Today CEO Alan Mulally Came to Ford from
Boeing Way Forward Plan Bold leadership Customer focus Strong
brands Bold, innovative products Great quality Clear pricing
Competitive costs and capacity Four Key Priorities Aggressively
restructure the cmpant to operate profitably at the current demand
and changing model mix Accelerate product development with new
products that customers really want and value while achieving
manufacturing excellence by reducing complexity and improving
quality Obtain financing to do these things and improve the balance
sheet Work together with accountability with all partners
Slide 30
Manufacturing and Product Design 1 st and foremost and
manufacturing company Japanese and Korean car companies out earn
Ford on each car made by delivering more feature at a lower cost.
Ford will close 16 plants and eliminate 44,000 jobs by 2012.
Remaining plants will be as efficient and effective as possible.
Reduce costs by $6 billion by 2010 Mulally demanded that engineers
create uniform parts that could be use on most models. Created a
single global product development organization work together more
effectively to continuously improve quality, productivity, and
speed of product development.
Slide 31
Marketing ONE FORD Marketing Vision The plan is to have common
Ford vehicles competing in global segments. 2010 Ford Focus global
car was introduced The Ford Challenge Asks consumers to compare
their current car to a Ford car. Values statement- The customer is
Job 1. Working closer with dealers.
Slide 32
Employees Laying off employees and offering early retirements
as part of the Way Forward plan. 44,000 by 2012 Increasing
healthcare costs $3.1 billion in 2006 The increasing healthcare
costs will continue to affect the companies ability to meet its
profitability goals.
Slide 33
Corporate Culture Not a drive for perfection, instead they
focus on continuous improvement. Weekly meeting with no
distractions. Use of data and data sharing between divisions.
Change in approach to grooming managers. Commitment to
environmental responsibility.
Slide 34
Financial Ford should break even by the end of this year.
Slide 35
Ford Motor Company-The Future Commitment to ONE FORD In a
global market, success flows from having ONE TEAM working on ONE
PLAN with ONE GOAL in mind. ONE TEAM- Including everyone with a
stake in the outcome in the decision-making process. ONE PLAN-
Changing the way the company has been run. ONE GOAL- Build more of
the products that people want and value.