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Communication Solutions (CS), a woman-owned business, experienced fast growth at its inception, and then found itself slowing after the mid-2000s recession. The firm provides consulting services, primarily to government agencies. The owners have brought the business to sales of about $10.5 million in 2012, but revenues declined following that peak year because of cutbacks in government spending and founder Jennifer Madison’s detachment from the business. Even though they recognize that it may not be an ideal time to sell, they are tired of running the business and want to sell now, as long as they can pay off their debts.

This case was researched through multiple interviews with Mark and Jennifer, who provided all of the financial data and background. All financial statements given in the case provide actual CS numbers. The name of the company and the names of the owners have been changed, at their request to disguise the company. At the time this case was written, the owners were in negotiation with a potential bidder, and did not want their names or their company name to be used. Market information and information about comparable companies was researched using publicly available financial data bases.

This case has the potential to be used in a variety of classes, depending on what the instructor wishes to emphasize. The author uses the case as a valuation case in a corporate finance class (suitable for undergraduates or MBAs), allowing students practice in discounted cash flow valuation and comparable multiples valuation. It could be used in an investments class which teaches business valuation, particularly in teaching valuation using market multiples. The case could be used in an entrepreneurial finance class. The author uses this case to illustrate the difficulties of business valuation with messy (but real) data.

This case explores small business valuation and exit strategies for founders. Students can put themselves in the position of small business owners who are ready to exit. Students should value the firm using discounted cash flow and multiples valuation, which includes making assumptions about the future growth of the firm. While there is likely to be reasonable agreement on the “as is” valuation, there may be great variation concerning the assumptions and valuations of the company as it could be. Students can discuss (and implement) adjustments made when using large company comparables to value a much smaller company.

This case is particularly applicable for use in courses on entrepreneurship, people management, and business strategy. It is intended to give students an overview of a succession planning strategy, and provide insight into the particular challenges facing founders of small businesses as they identify and prepare a successor for the most senior management role. Given the position of Closed Loop as an early mover technology firm in the insurance industry, this case also explores the strategic business considerations. The case therefore offers students detailed, authentic, and practical lessons on leadership through the personal experiences of a founder-CEO in a high performing organisation.

This case is appropriate for students enrolled in postgraduate programmes such as a Master of Business Administration (MBA) and Executive Education programmes. Although the case learnings are transferrable to more general leadership and change management studies, this case will be particularly useful to students with interests in entrepreneurship, leadership in tech startups, and succession planning.

This case tells the story of a small business’ succession plan journey in two parts. Closed Loop is a small insurance software company that is transitioning from a founder-run startup to manager-run company. Case A follows the 55-year-old founder Alex Martin as he performs a measured succession planning analysis that eventually leads him to promote from within the company. Neevan Chattry is the 33-year-old head of business development who has been with the company for ten years and shows promise as a rising leader. Over the course of 18 months, Alex and Neevan embark on a structured preparation and handover process. The case ends in June 2015 with Neevan taking over as CEO and Alex stepping into the role of board chairperson. Case B picks up two years later when Neevan unexpectedly announces that he is resigning as CEO, leaving Closed Loop in a difficult position. In this case, Alex confronts the mistakes he made over the last three years, both during succession planning and Neevan’s tenure as CEO, as well as how digital disruption in the insurance industry affected the business strategy over this period. The case ends with Alex resuming the role of CEO to lead Closed Loop in a reinvention process. Students are left to analyse the decisions taken by the different leaders and how Closed Loop will fair in the future under Alex’s leadership.

Identify the key components of a strong succession plan, including a careful selection process, mentorship of the successor, communication of the change to internal and external stakeholders, and the withdrawal of the outgoing leader; explore the organisational transitions that companies naturally undergo as they grow and enter different phases of operation and the implications of that change for leadership; discuss the compatibility of different leadership traits, styles, and mindsets with the strategic objectives of the company at different points in time; and provide suggestions and recommendations to owners contemplating succession planning in their organisations.

Teaching notes are available for educators only.

CSS 6: Human Resource Management.

At the dawn of the twenty-first century, Boeing and Airbus, the leading manufacturers of large aircraft, were locked in a battle for market share that drove down prices for their new planes. At about the same time, the two industry heavyweights began developing new aircraft families to address the future market needs they each projected.

Aircraft take many years to develop, so by the time the new planes made their inaugural flights, significant changes had occurred in the global environment. First, emerging economies in the Asia-Pacific region and elsewhere were growing rapidly, spawning immediate and long-term demand for more aircraft. At the same time, changes to the market for air travel had created opportunities for new products. These opportunities had not gone unnoticed by potential new entrants, which were positioning themselves to compete against the market leaders.

In October 2007, the Airbus superjumbo A380 made its first flight. The A380 carried more passengers than any other plane in history and had been touted as a solution to increased congestion at global mega-hub airports. Four years later the Boeing 787, a smaller long-range aircraft, was launched to service secondary cities in a point-to-point network.

The case provides students with an opportunity to analyze the profit potential of the global aircraft manufacturing industry in 2002 and in 2011. Students can also identify the actions of participants that weakened or intensified the pressure on profits within the industry.

Audio format (.mp3 file) available with purchase of PDF. Contact cases@kellogg.northwestern.edu for access.

Founded in 1971 and acquired by CEO Howard Schultz in 1987, Starbucks was an American success story. In forty years it grew from a single-location coffee roaster in Seattle, Washington to a multibillion-dollar global enterprise that operated more than 17,000 retail coffee shops in fifty countries and sold coffee beans, instant coffee, tea, and ready-to-drink beverages in tens of thousands of grocery and mass merchandise stores. However, as Starbucks moved into new market contexts as part of its aggressive growth strategy, the assets and activities central to its competitive advantage in its retail coffee shops were altered or weakened, which made it more vulnerable to competitive threats from both higher and lower quality entrants. The company also had to make decisions on vertical integration related to its expansion into consumer packaged goods.

Understand how strategy needs to be adapted to new contexts. Understand how to manage tradeoffs involved in growth. Be able to identify possible threats to competitive advantage as a result of growth.

The case of Bertelsmann China: Supply Chain for Books (B) is situated in China in the beginning of 2006. Bertelsmann Direct Group, the Chinese subsidiary of the worldwide Bertelsmann AG, is one of the leading book retailers in the country. Supply chain management is essential for success in retailing, which is why Bertelsmann puts a lot of effort into the optimization of its supply chain design. As costs are paramount to importance in the low-margin book retailing sector, linear programming methods are applied to optimize the network

Marketing, Sports marketing and Social media marketing.

Graduate level.

This case, based on field research and multiple secondary sources, documents the 12-month period since early 2014 during which Cricket South Africa (CSA) developed the Protea Fire brand for their national men’s cricket team, known as the Proteas. In mid-2014, Marc Jury, the Commercial and Marketing manager of CSA set up a project team to take the previously in-house Protea Fire brand public. With the 2015 Cricket World Cup in Australia and New Zealand less than a year away, Jury worked with a diverse project team of Proteas players, cricket brand managers and external consultants to build a public brand identity for the national team, to nurture greater fan affinity and to mobilize South Africans behind their team for the World Cup. The project team developed a range of Protea Fire multimedia content as the core of the campaign. These included video diaries, scripts which were written by the Proteas players themselves, player profile videos, motivational team-talk videos and good luck video messages featuring ordinary and famous South Africans. Having invested in creating this content, the project team faced the difficult task of allocating a limited media budget to broadcast and amplify the content. Another significant challenge was to ensure that the Proteas team values were authentically communicated across all content, including via the social media strategy using Twitter, Instagram and YouTube. As the World Cup tournament kicked off on February 14th 2015, South Africa was well placed to overcome their previous inability to reach a final, although Jury wondered whether another exit in the knockout round would weaken the strong and positive emotions the Protea Fire campaign had ignited. With the last two balls remaining in South Africa’s semi-final game against New Zealand on March 24th 2015, and the home team requiring just five runs to win, Jury joined 60 million South Africans hoping that Protea Fire was strong enough. The case concludes with South Africa losing the semi-final game and Jury turning his attention to how the #ProteaFire campaign should respond.

This study aimed to analyse the development of a sport team brand and a megaevent campaign; to assess the efficiency and effectiveness of a marketing campaign; and to consider appropriate brand responses to the team’s failure to deliver on expectations.

CSS 8: Marketing.

The student's task is to develop a comprehensive strategy for Briggs & Stratton, which is facing severe competition and margin pressures. A major component of the strategy to be considered is whether to implement economic value added (EVA) as a new performance measurement for management. The case is designed to serve as an introduction to how to compute and use EVA. It emphasizes the importance of performance evaluation as part of a larger strategic plan. A teaching note is available to registered faculty, as well as two video supplements to enhance student learning.

The case builds upon the theoretical literature in strategy and decision-making under uncertain, complex and ambiguous situations inherent in nascent industries (Eggers and Moeen, 2019). It also bases its analysis of the central decision in the case, the merger between Aphria Inc. and Tilray, on the pertinent literature on mergers and acquisitions (DePamphilis, 2015). DePamphilis (2015). Mergers, acquisitions, and other restructuring activities: An integrated approach to process, tools, cases, and solutions. 8th ed. Academic press, San Diego, CA. Eggers and Moeen (2019). Entry Strategy for Nascent Industries: Introduction to a Virtual Special Issue. Strategic Management Journal. 42 (2), pp. 1–15.

Assessing/reassessing sources of competitive advantage and recognizing how changes in policy and technologies and globalization can change industry dynamics. Identifying the challenges that companies face when developing strategy in nascent and emerging industries and the related (sub)sectors. Analyzing a merger and deciding if it is warranted, financially and strategically. Applying industry analysis to understand dynamic forces impacting an industry, the attractiveness of an industry and how industry structures affect a company’s strategy.

The global cannabis industry emerged after Canada, selected states in the US and some other countries across the world started to legalize recreational and/or medical cannabis. Similar to any industry in its nascent stages, the industry structure was undefined, product definitions and categories were unclear and competitive landscape was evolving. It was key for decision makers such as Irwin Simon, the CEO of Aphria Inc., to devise a strategy that would enable the firm to navigate the tides of the nascent industry. Simon had a background in consumer packaged goods industry and was a proponent of gaining market power through industry consolidation moves such as mergers and acquisitions. In 2020, encounters with Tilray’s CEO presented Simon with a merger opportunity with potentials for complementarities and cost savings. The challenge for Simon was to convince the Aphria’s shareholders that the potential gains from this move outweighs its challenges.

Strategy courses (undergraduate and graduate level) • During a session on nascent industry analysis, to illustrate how companies decide whether to enter a market, how to grow and position themselves. • During a session on mergers and acquisitions, to illustrate how a company can use such strategies to gain market power and pursue consolidation. International business courses (undergraduate and graduate level) • During a session on navigating the tides of an industry that is in its nascent stage, both at the individual country level and at the global level. Cannabis industry courses (undergraduate level) • During a session on the national and global prospects of the industry from an investment, entrepreneurial or policy-making perspective. • During a session on mergers and industry consolidation strategies.

This case presents some of the entrepreneurial challenges faced by a female leader in the technology sector who conceived a new product based on her passion to help others especially those most disadvantaged.

Upon completion of this case study, students should be able to prepare supply chain and distribution analysis that considers ethics and sustainability, integrate philanthropic efforts as part of an organizational strategy and recognize strategies to promote equity within and beyond an organization.

Connie Stacey (she/her) is an entrepreneur and president of Growing Greener Innovations, an award-winning battery energy storage company based in Alberta, Canada, with a mission to end energy poverty globally. With the emergence of COVID-19 as a global pandemic in 2020, Stacey turned her attention to an innovation called Project Rescue, a ventilator that uses non-identifying patient vitals to track data. It serves as a pandemic early warning system, addressing two key challenges: pandemic data are prone to error, and real-time information is non-existent after the pandemic has spread. This new product was conceived based on her passion to help others, especially those most disadvantaged. This multi-faceted case focuses on the many challenges that Stacey and her team needed to address. The dilemma in this case centres on establishing supply chains amid a pandemic, as well as prioritizing the corporate social responsibility elements of philanthropy and equity within her organization (and beyond).

This case is appropriate for third- or fourth-year undergraduate or graduate-level students.

In addition to “call out boxes” throughout the case and teaching note, additional readings/links/videos are outlined below. (These supplementary materials, “Teaching Tips”, are included in the teaching notes as well.)

CCS 11: Strategy.

This case serves as an introduction to the concept of economic value added (EVA). The student is placed in the position of Valmont's CFO to decide whether EVA can live up to its promise to motivate managers to act like shareholders and ultimately lead them to make value-enhancing decisions that can reverse Valmont's weak earnings and lackluster stock-price performance. The case works best if students are acquainted with the concepts of cost of capital and net present value. The teaching note that is available for registered faculty explains how to incorporate the accompanying six-minute video supplement.