All Cases For Global Strategy, 5th Edition by Mike Peng by AnswerDone

All Cases For Global Strategy, 5th Edition Mike Peng

GS5E Integrative Case 1 THE CONSULTING INDUSTRY Mike W. Peng (University of Texas at Dallas) CASE DISCUSSION QUESTIONS 1. Of the five forces affecting the consulting industry, which one is the most significant? Only the bargaining power of suppliers (universities, business schools, as well as individual students and job candidates) is relatively weak or nonthreatening. Four other forces— bargaining power of buyers (clients), rivalry among competitors, threat of new entrants, and threat of substitutes—are strong. Which one is the most significant can generate a great debate. One likely outcome is perhaps all four are more or less equally important or threatening, creating a ―perfect storm‖ (see reference #2: C. Christensen et al., 2013, Consulting on the cusp of disruption, Harvard Business Review Ooctober: 107-114). COVID is likely to make the perfect storm even more stormy. 2. As a potential new entrant, which segment of the broad consulting industry will provide the best likelihood of success? A new entrant primarily faces two choices: (1) high-end, high-stakes, high-margin, but one-off projects (such as traditional stratgey consulting); or (2) low-end, more-routine, low-margin, but continuous work (such as accounting and data analytics). Before COVID, even at the Big Three firms—McKinsey, Bain, and BCG—revenue from traditional strategy consulting decreased from 20% of total revenue in 2013 to 10% in 2019. In the post-COVID era, given the devastated budgets at numerous (potential client) firms, revenue for consulting firms from (1) is not likely to be strong. Therefore, (2) is likely to be a most viable choice. 3. Based on this analysis, how would you prepare yourself to have the right combination of educational qualifications and practical experiences in order to compete successfully in that segment? In practical terms, students are advised to double major. They not only need to acquire the bigpicture, ―strategic‖ perspectives that the current course endeavors to develop, but also need to demonstrate proficiency in basic, ―tactical‖ activities such as accounting, data analysis, IT, and marketing. A second major (or minor) outside the business school may be helpful as well, as it can bring in a novel perspective to the usual curriculum provided by a business school education, and ultimately to the solutions recommended by you as a consultant.

Many courses are project-based, and many companies and nonprofit organizations offer internships. Students shold seek such opportunities to expand their experiences beyond the classroom. Consulting is about working with and helping people. Finally, many professors bring in guest speakers, who are often experienced professionals. Students are advised to reach out to them, first by introducing students themselves to the speakers and then seeking their advice on career and life. Building and leveraging networks and relationships is an important part of the repertoire for aspiring consultants. 4. As a consultant to the consulting industry, please advise how consulting firms can best prepare themselves for competition in the post-coronavirus environment. From a resource-based view, as the case alluded to at the end, consulting firms thrive on agility. While some individual firms have failed or disappeared, the successful ones have transformed themselves throughout history. Being agile about the new threats and pivoting toward opportunities is part of the industry‘s DNA. COVID has highlighted the crucial shortage of expertise in operations and flexible supply chains, public health, HR (with a focus on managing and motivating remote workers), and international trade (expertise in areas such as tariffs and regulations is more, not less, important during the era of deglobalization). Therefore, consulting firms are advised to rapidly develop expertise in and pivot toward these areas. From an industry-based view, the positioning of high-end firms will probably need to go midmarket, and that of mid-market firms will probably need to go down-market—into the messy world of implementation. As clients become more value conscious and more knowledgeable about the consulting industry, consulting firms will need to pick up more implementation work, which may not be glamarous and high-margin, but may be more enduring in terms of engagement (such as McKinsey Solutions). From an institution-based view, consulting firms may be interested in organizing themselves to require some sort of certification in an effort to raise entry barriers. There are no entry barriers at present. Any individual or company can enter at will. As the industry becomes more professional, leading consulting firms can take a page from the playbook of accounting firms, law firms, and medical professions that require a CPA, a JD, and an MD, respectively. This will require collective efforts, not only among consulting firms themselves but also in collaboration with other stakeholders such as business schools, academic asssociations (such as AACSB, AIB, AOM, and SMS), and professional and industry organizations (such as AMA).

GS5E Integrative Case 2 THE ASIA PACIFIC AIRLINE INDUSTRY Mike W. Peng (University of Texas at Dallas) © 2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

CASE DISCUSSION QUESTIONS 1. Pick a major Asia Pacific country such as Australia, China, India, Indonesia, Japan, or Korea. Identify how incumbents fight new entrants. Do the incumbents make the right strategic choices? Incumbents primarily use pricing to fight new entrants. Because incumbents have more flights going to different markets (an airline market is defined by a pair of two cities—departure and destination cities), they can cross-subsidize the price wars in markets with new entrants by using profits made from other markets. In contested markets, new entrants are thus forced to match the prices. This is the right strategic choice if the overall size of new entrants is smaller than that of incumbents. However, if new entrants are formidable competitors elsewhere (such as Middle East-based supercarriers or leading US giants), they can afford to fight price wars with Asia Pacific incumbents for a long time. But incumbents will still most likely choose to fight price wars with them—unless incumbents choose to exit the invaded markets. 2. For the majority of the airlines mentioned in the case, do they use a cost leadership strategy or a differentiation strategy? Why is such a strategy popular? Most of them use a cost leadership strategy. Because airline service is primarily a commodity business (flying people from point A to point B), it is difficult to operate a differentiation strategy. 3. What airlines will be the winners and losers in the post-coronavirus environment? Since the industry environment is relatively homogenous for most(if not all) airlines, the industry-based view is important. But the resource-based and institution-based views will be more important analytical tools. From a resource-based view, airlines that can keep their cost under control will be winners. Relative to full-service (legacy) airlines, low-cost (discount) airlines may have advantages in surviving longer. From an institution-based view, airlines that can bag big chunks of bailout funds from their governments are going to emerge as winners that survive the onslaught of COVID. In this aspect, legacy airlines, which are often state-owned (or previously state-owned), may have advantages.

GS5E Integrative Case 3 LEGO’S SECRETS Mike W. Peng (University of Texas at Dallas)

CASE DISCUSSION QUESTIONS 1. From a VRIO standpoint, what are LEGO’s resources and capabilities that contribute to its success? LEGO‘s resources and capabilities excel along VRIO dimensions. Some of these are tangible, most obviously the LEGO blocks that can stimulate children‘s imagination and creativity. Some are intangible, such as (1) relentless innovation and experimentation, (2) insisting on excellence (such as ―Only the best is good enough‖), and (3) capabilities to leverage a mutually reinforcing ecosystem—toys, games, books, magazines, competitions, retail stores, theme parks, and now movies. 2. From an industry-based view, how would you characterize the five forces governing competition in the toy industry? Competition primarily takes place among large leading players (such as Mattel, which is most famous for its Barbie) and numerous smaller, specialty players. The bargaining power of suppliers does not seem significant. However, the bargaining power of buyers—fickle kids and their parents—is significant, as there is intense competition for kids‘ attention and parents‘ limited budget dollars for toys. The threat of new entrants is strong, as entry barriers are not high. The threat of substitutes, such as video games, is significant. Overall, the turbulence of this industry is no kidding. 3. What are some of LEGO’s weaknesses and potential sources of concern? Demographically, LEGO is only going after half of the children population: boys age seven to 16. Its efforts to attract more girls to play LEGO have not been noticeably successful. LEGO is underrepresented in emerging economies such as China and India. While in most developed economies, LEGO can rely on parents (especially fathers), who grew up playing LEGO, to buy LOGO toys for their children. In China and India, LEGO needs to fight for the attention of first-generation users—children themselves. Not all LEGO‘s business areas are profitable. For example, its theme parks struggle to become profitable.

GS5E Integrative Case 4 BMW AT 100 Klaus Meyer (Ivey Business School)

CASE DISCUSSION QUESTIONS 1. What are BMW’s key resources and capabilities? 2. How has BMW been able to maintain and extend these resources and capabilities for more than 100 years? These two questions require some outside-of-the-case research, as the case focuses more on the future challenges, as opposed to BMW‘s historical accomplishments. A useful framework is the VRIO analysis introduced in Chapter 4. A proven icebreaker is to ask if any students (or their families) have any experience driving a BMW. 3. What are the main competitive threats for BMW in 2016? [NOTE] Some of the following information is not from this Integrative Case. It is from the best companion case for this Integrative Case—Chapter 2 Closing Case: ―The Future of the Automobile Industry.‖ It is clear by 2016, the automobile industry in the next 20 years will look very different from how it has looked in the last 100 years. People of the future may no longer view individually owned cars powered by internal-combustion engines (ICEs) as their main way to move around. Electrification, autonomous driving, and ride sharing represent the biggest competitive threats to the industry and its leading incumbents such as BMW, since the car displaced the horsedrawn carriage. The car in the future is very likely to be battery-powered, driverless, and shared. A series of new entrants—ranging from Tesla to Google and Uber—have recently invaded the industry. Founded in 2003, Tesla aspired to mass-manufacture battery-powered electric vehicles (EVs) to displace ICE-based cars. Incumbents such as BMW had to respond by launching their own EVs. At the same time that EV makers are challenging ICE-based incumbents, how cars are operated has also been disrupted by ride-sharing operators such as Uber, Lyft, and Didi. Since most privately owned cars stay parked 23 hours of a day, keeping cars running can clearly reduce precious urban land wasted on parking. If a shared car can get people to where they want to go at any time, private ownership may become less relevant. At approximately 90 million a year, car sales worldwide may have peaked. The average American family may cut its car ownership from 2.1 vehicles in 2020 to 1.2 by 2040. © 2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.