Study Cases Strategic Management

8/6/2019 Study Cases Strategic Management

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Capsule 1: The bold entrepreneurialstyle of Ted Turner

Robert E.: Ted Turner is in the great tradition of the individualentrepreneur who had a dream and backed it with his money andhis sweet

Ted Turner III president and chairman of TurnerBroadcasting System, Inc.

Turner was not only a business man and entrepreneur, but als aflambuoyant character and a public figure;


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Building the TSB Enterprise 24 year-old in charge of his father advertising enterprise, company that

had $6 million debts;

Had an opportunity to sell it, but refused;

He persuaded lenders to wait for a while;

Sold off some assets to improve the company`s cash position, arranged forsome innovative financing, reworked contracts with customers, hired a

sales force;

By 1969 the dept was paid off;

New growth perspectives: acquisition of 2 radio station in Chattanooga( TN, USA) 1970 acquisition of Channel 17; he applied strategic steps in order to

get Atlanta TV viewers to watch Channel 17 instead of other channels: Convinced advertisers to buy time in Channel 17; Strengthened the signal of Channel 17; Broadcasting old movies and reruns of popular shows; Seized the opportunity to air 5 NBC network shows; Acquired rights to televise the Atlanta Braves major league baseball games


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Building the TSB Enterprise

Acquisition of a UHF station, WRET-TV in Charlotte, North Carolina(personal funds); Conducted a series of televised Beg-a-thons, asking Charlotte viewers for

financial support (over 36000 contributions were received, ranging from 25cents to $80);

1975 - billboard advertising was spun off from Turner Communication andbecame Turner Advertising, with Ted Turner as majority stockholder;

January 1976 - Turner Communication (TC) acquired the Braves club(baseball team of Atlanta);

1977 the company acquired a 95% limited partnership interest in Hawks,Ltd. , owner of the Atlanta Hawks professional basketball team;

Broadcasting live games of the Braves and Hawks on Channel 17;

1978 T C acquired a limited partnership interest in Soccer, Ltd. , theowner of the Atlanta Chiefs professional soccer team;

Also in 1978 the company sold its AM and FM stations on Chattanooga for$1.050.000 cash, realizing a pre-tax gain of $395.000;


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Building the TSB Enterprise In 1979 three important developments:

The company launched plans for the Cable News Network(CNN), the first 24-hour all news programming network forcable television operators, to begin operations in June 1980;

By the end of 1979 the company has invested $6.816.000, acquired

and begun renovations of a headquarters facility, hired key personnel,and obtained purchase commitments to provide the programming;

The Turner Communication Corporation became TurnerBroadcasting System, Inc.

An agreement to sell WRET-TV in Charlotte to Westinghousefor $20 cash, plus the assumption by Westinghouse of thestation`s obligations for film programs;


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Building the TSB Enterprise In 1981 the business of Turner Broadcasting System

(TSB) consisted of: The operations of WTBS-TV;

The CNN, a 24-hour comprehensive news channel available toUSA cable television systems;

100% ownership of the Atlanta Braves professional majorleague baseball team

Equity interests in limited partnership operating the AtlantaHawks professional NBA basketball team and the AtlantaChiefs professional soccer team

A management service contract (including all personnel) tooperate Turner`s outdoor advertising business, withoperations based in Atlanta and Chattanooga,TN.


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Ted Turner`s style of managing His approach to business and dealing with people was both

colorful and controversial;

Seldom he hesitated to say exactly what he thought;

In 1981, during the baseball strike the rumor has it that heremarket that all players should be drowned and the reams

restaffed from scratch;

Writers and journalist appended him different labels, likeCaptain Outrageous, Terrible Ted, the Mouth of the South,honest, petulant, loud, profane, impulsive, egotistical, ruthless,money-grumbling, sincere and chauvinistic;

He was described as having a strong sense of what to do andwhen to do it. Complementing his sense of direction and senseof timing was a knack for picking capable managers to workunder him. He delegated authority readily;


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Ted Turner`s style of managing As a general rule, he did not supervise them closely,

preferring instead to let them to do their jobs, with aminimum interference from his side, as long as things wereprogressing satisfactorily;

He had a positive thinking and greater innocence : it can`t bedone? Let`s find out if things were not so good, he wascapable of short temper tantrums;

He had a trying to win conception, he liked to turn losersinto winner, in sports and in business;

He didn`t look at himself as a win at all costs practioner: I don`t thing that winning is everythingBe kind and fair and

make the world a better place to live, that`s importantPeoplewant leadership, somebody to rally around, and I want to be aleader.


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Capsule 2: Ted Turner and managing the totalenterprise: A short exercise of what general

management is or is Not

Exercise

Understanding the job of a GM-an analogy: GM is like a football coach;

He is both coach and player both managing through peopleand achieving results alone;

There is a balance that need to be established betweenplaying and coaching/doing and managing: the larger and morediversified the organization is being managed, the greaterthe proportion of time spend on managing (achievingorganizational results through the activities of others)rather than doing (achieving organizational results throughone`s own personal actions)


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Capsule 3: How to tell a good onefrom a bad one

Objectives need to meet five specifications: An objective should relate to a single, specific topic (itshould not be abstract);

An objective should relate to a result, not to an activity to

be performed;

An objective should be measurable;

An objective should contain a time deadline for its

achievements;

An objective should be challenging but achievable.


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How to tell a good one from abad one

Poor objectives, avoid them: Our objective is to maximize profits (not measurable, no

deadline);

Our objective is to increase sales revenue and unit volume (notmeasurable,2 topics, no deadline indicated);

Our objective in 1984 is to boost advertising expenditures by15% (is not an objective, is an action);

Our objective is to be a pioneer in research and developmentand to be the technological leader in the industry (overlyambitious, too many topics, not very clear);

Our objective is to be the most profitable company in ourindustry (not specific enough, challenging - but may not beachievable).


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Capsule 4: The alternatives to Managing withObjectives

Managing by Extrapolation (MBE) relies upon the principle if it ain`t

broke, don`t fix it; the future will take care of itself and things willwork out alright;

Managing by Crisis (MBC) based upon the belief that the forte of anyreal good manager is solving problems; MBC is a form of reacting, ratherthan acting and of letting events dictate the whats and whens ofmanagement decisions;

Managing by Subjectives (MBS) this approach emerges in the absence ofany organizationwide consensus or clear-cut directives on which way tohead what to do about the company`s issues and problems; do your ownthing the best way you know how; the mystery approach, objectivesand plans to achieve them are never clearly articulated by seniormanagement;

Managing by Hope (MBH) decisions are taken on the hope that they willwork out and that good times are just around the corner; solid analysisand results-oriented action plans are absent;

All of the types presented above represent muddling-through types ofapproaches ways of Managing by Wandering Around (MBWA). It is

doubtful that those kind of approaches can lead to performance.

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Study Cases Strategic Management