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This case is based on Weatherford International’s settlement with the Securities and Exchange Commission (SEC) and the Department of Justice (DOJ). Both the SEC and the DOJ were critical of Weatherford for its violations of the Foreign Corrupt Practices Act and for its “inadequate internal controls.” This case explores the Foreign Corrupt Practices Act (FCPA) violations and issues related to internal controls.

Case study.

This case is based on Weatherford International’s settlement with the SEC and the Department of Justice. Weatherford provided equipment and services in the oil and gas industry. Because international markets were growing faster than domestic markets, Weatherford made a strategic decision to pursue growth in international markets. The oil and gas industry has high levels of operating risk as did the countries that Weatherford decided to pursue operations in. However, despite the decision to take on additional risk, Weatherford failed to implement adequate systems of internal controls. The title of the case “A Perfect Storm” refers to Weatherford’s trifecta of operating in an industry with high levels of corruption risk, countries with high levels of corruption risk and failing to implement adequate internal controls despite those high operating risks (Department of Justice, 2013). Weatherford was ultimately assessed a $152m penalty for its violations of the FCPA that included bribery, volume discounts, improper payments and kickbacks.

Undergraduate and graduate auditing classes.

The learning outcomes are as follows: to understand the problem of informality and how it develops, taking advantage of the control flaws of public and private institutions and its growth by the legitimacy of society; to analyze the role of the regulatory body in its fight against informality from the area of its influence, which is the energy sector; to analyze the economic and social impact of a solution like the one proposed in the case; to analyze the impact at the level of public policies of solutions such as the one proposed in the case; and to review the strategy of the hand of technology that can achieve the development of original solutions to fight against informality.

The case study was written on the basis of a real success story that explains the development of a technological solution that allowed the Supervisory Agency of Energy and Mining of Peru to effectively deal with informality in the commercialization of fuels, which became a reference in the region. The story begins by recreating the system that existed for the commercialization of fuels and how the shortcomings of this system itself encouraged the appearance of informal merchants who benefited from the situation. It also explains how the regulatory authority decides to deal with this problem by creating a special unit that confronts this issue and how, after some failures, an original strategy was able to be designed with the help of technology to control informality.

Business schools, where different aspects can be analyzed, such as the strategy used in the supply chain of informal or formal commerce. It is also recommended for use in master’s programs in specific sectors, such as public management or energy management. Finally, it can also be used in entrepreneurship, given that informal entrepreneurship is considered as a new line of research in this field.

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CSS 11: Strategy.

Resource-based view (RBV) theory (Barney, 1991; Barney and Mackey, 2016; Nagano, 2020) states that a firm’s tangible and intangible resources can represent a sustainable competitive advantage (SCA), a long-term competitive advantage that is extremely difficult to duplicate by another firm, when it meets four criteria (i.e. not imitable, are rare, valuable and not substitutable). In the context of this case, we believe there are three sources of SCA to be discussed using RBV – the major league soccer (MLS) team player roster, the use of artificial intelligence (AI) technologies to exploit this roster and the league’s single-entity structure: • MLS players: it has been widely acknowledged that a firm’s human resource talent, which includes professional soccer players (Omondi-Ochieng, 2019), can be a source of SCA. For example, from an RBV perspective, a player on the Los Angeles Galaxy roster: > cannot play for any other team in any other league at the same time (not imitable and are rare), > would already be a competitive player, as he is acquired to play in the highest professional league in the country (valuable) and > it would be almost impossible to find a clone player matching his exact talent characteristic (not substitutable) anywhere else. Of course, the roster mix of players must be managed by a capable coach who is able to exploit these resources and win championships (Szymanski et al., 2019). Therefore, it is the strategic human resource or talent management strategies of the professional soccer team roster that will enable a team to have the potential for an SCA (Maqueira et al., 2019). • Technology: technology can also be considered a source of SCA. However, this has been a source of contention. The argument is that technology is accessible to any firm that can afford to purchase it. Logically, any MLS team (or for that matter any professional soccer team) can acquire or build an AI system. For many observers, the only obvious constraint is financial resources. As we discuss in other parts of the case study, there is a fan-based assumption that what transpired in major league baseball (MLB) may repeat in the MLS. The movie Moneyball promoted the use of sabermetrics in baseball when making talent selection (as opposed to relying exclusively on scouts), which has now evolved into the norm of using technology-centered sports analytics across all MLB teams. In short, where is the advantage when every team uses technology for talent management? However, if that is the case, why are the MLB teams continuing to use AI and now the National Basketball Association (NBA), National Football League (NFL) and National Hockey League are following suit? We believe RBV theorists have already provided early insights: > “the exploitation of physical technology in a firm often involves the use of socially complex firm resources. Several firms may all possess the same physical technology, but only one of these firms may possess the social relations, cultural traditions, etc., to fully exploit this technology to implementing strategies…. and obtain a sustained competitive advantage from exploiting their physical technology more completely than other firms” (Barney, 1991, p. 110). • MLS League Single-Entity Structure: In contrast to other professional soccer leagues, the MLS has one distinct in-built edge – its ownership structure as a single entity, that is as one legal organization. All of the MLS teams are owned by the MLS, but with franchise operators. The centralization of operations provides the MLS with formidable economies of scale such as when investing in AI technologies for teams. Additionally, this ownership structure accords it leverage in negotiations for its inputs such as for player contracts. The MLS is the single employer of all its players, fully paying all salaries except those of the three marquees “designated players.” Collectively, this edge offers the MLS unparalleled fluidity and speed as a league when implementing changes, securing stakeholder buy-ins and adjusting for tailwinds. The “socially complex firm resources” is the unique talent composition of the professional soccer team and most critically its single entity structure. While every team can theoretically purchase an AI technology talent management system, its application entails use across 30 teams with a very different, complex and unique set of player talents. The MLS single-entity structure though is the resource that supplies the stability required for this human-machine (technology) symbioses to be fully accepted by stakeholders such as players and implemented with precision and speed across the entire league. So, there exists the potential for each MLS team (and the MLS as a league) to acquire SCA even when using “generic” AI technology, as long as other complex firm factors come into play.

This case relied on information that was widely reported within media, press interviews by MLS officials, announcements by various organizations, journal articles and publicly available information on MLS. All of the names and positions, in this case, are actual persons.

MLS started as a story of dreaming large and of quixotic adventure. Back in 1990, the founders of the MLS “sold” the league in exchange for the biggest prize in world soccer – the rights to host the 1994 Fédération Internationale de Football Association World Cup before they even wrote up the business plan. Today, the MLS is the highest-level professional men’s soccer league competition in the USA. That is a major achievement in just over 25-years, as the US hosts a large professional sports market. However, MLS has been unable to attract higher broadcasting value for its matches and break into the highest tier of international professional soccer. The key reason is that MLS matches are not deemed high quality content by broadcasters. To achieve higher quality matches requires many inputs such as soccer specific stadiums, growing the fan base, attracting key investors, league integrity and strong governance, all of which MLS has successfully achieved since its inception. However, attracting high quality playing talent is a critical input the MLS does not have because the league has repeatedly cautioned that it cannot afford them yet to ensure long-term financial sustainability. In fact, to guarantee this trade-off, the MLS is one of the only professional soccer leagues with an annual salary cap. So, the question is: how does MLS increase the quality of its matches (content) using relatively low cost (low quality) talent and still be able to demand higher broadcast revenues? One strategy is for the MLS to use AI playing technology to extract higher quality playing performance from its existing talent like other sports leagues have demonstrated, such as the NFL and NBA. To implement such a radical technology-centric strategy with its players requires the MLS to navigate associated issues such as human-machine symbioses, risking fan acceptance and even altering brand valuation.

The case is written and designed for a graduate-level (MBA) class or an upper-level undergraduate class in areas such as contemporary issues in management, human resource management, talent management, strategic management, sports management and sports marketing. The case is suitable for courses that discuss strategy, talent management, human resource management and brand strategy.

The case includes theoretical references to family business, organizational culture, resource-based value and leadership.

The case combines primary and secondary data. There is ample public information about Martin Guitar including histories of the company and its instruments. These were used for background. Primary data were provided by the company in the form of customized data and interviews.. The case writer has served Martin Guitar as a consultant and also plays Martin instruments. The case writer had numerous opportunities to interview Chris and his key lieutenants.

In 2019, C.F. Martin IV (Chris) was in his fourth decade leading one of the America’s oldest family-owned companies, C.F. Martin & Co., Inc. Martin Guitar is a globally known maker of fine guitars that are prized by collectors, working musicians and amateur musicians. Chris was raised in the family business and took on the CEO’s position at the age of 30. The case describes the company’s management practices and the culture that has emerged from them. In 2019, at age 64, Chris confronted issues faced by his predecessors over multiple generations: how to prepare the company for succession, and maintain its strong performance as a family-owned company in a dynamic industry environment.

The case is designed for a management course for upper-level undergraduates.

The cases describe the demise of Arthur Andersen, a firm that had long set the industry standard for professionalism in accounting and auditing. Once an example of strong corporate culture with a commitment to public service and independent integrity, Andersen saw its culture and standards weaken as it grew explosively and changed its mode of governance. The (A) case describes a crisis precipitated by the admission of Waste Management, a major Andersen client, that it overstated its pretax earnings by $1.43 billion from 1992 to 1996. The resulting Securities and Exchange Commission (SEC) investigation ended with Andersen paying a $7 million fine, the largest ever levied against an accounting firm, and agreeing to an injunction that effectively placed the accounting giant on probation. Students analyze the causes of Andersen's problems and advise Andersen leadership. The (B) case covers Arthur Andersen's relationship with Enron, one of the great success stories of the “new economy” boom. When Enron's aggressive use of off-balance sheet partnerships became impossible to hide in autumn 2001, news reports stated that Andersen auditors had engaged in extensive shredding of draft documents and associated communications with Enron. Students are asked to act as crisis management consultants to Andersen CEO Joe Berardino. The (C) case details Andersen's collapse following its indictment and conviction on criminal charges of obstructing justice in the Enron case. Its conviction was later overturned by the U.S. Supreme Court on narrow technical grounds, but by then Andersen had ceased to exist, eighty-nine years after Arthur E. Andersen had taken over a small accounting firm in Chicago. Students can focus on the impact of media on a reputational crisis.

Students will: Identify the teachable moment in a crisis that leaders can leverage as an opportunity to improve a firm's reputation or core identity, to reinforce values, and to drive change, Understand the impact on crisis management of the media landscape and regulatory decision-making, Realize the fragility of corporate cultures and the need to actively maintain them, especially during difficult times,

Human resource management

This case is suitable for use for advanced-level undergraduate students (e.g. in their third or fourth year of study) and graduate-level students enrolled in human resource management, industrial relations, organizational behavior and legal courses (e.g. business law and ethics, employment law). It can be used also in training courses and sexual harassment workshops for employees, particularly those with supervisory responsibilities or who are involved in personnel, training, or industrial relations activities. The case has been class tested with MBA students enrolled in a course on organizational behavior.

In March 2014, William Wong, the CEO of Zejaya Corporation faced a dilemma. He had just been told some disturbing news about Larry Pang, his executive director, which may or may not have legal implications for the company in relation to sexual harassment. Two of his managers had confided in him that Linda Tan, one of his managers who had recently resigned, had asked them to tell him about Pang's repeated attempts to court her in the past several months. He was undecided on how he should handle the problem.

This case was developed for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case provides students the opportunity to learn about the potential ethical and legal issues surrounding workplace romance and sexual harassment at work.

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Diplomatic and consular policies; legal aspects of international relations and Asia regional scenario.

Undergraduate.

In April 2012, high-level officials from China and the USA were about to meet in Beijing in the framework of the bilateral Strategic and Economic Dialogue, organized on a yearly basis. The event was always delicate, due to the ambiguous relationship existing between the two countries, which were at the same time rivals and dependent on one another. That time, the tension previous to the meeting increased significantly: a Chinese human rights activist had just sought and obtained diplomatic protection in the US Embassy in Beijing, thus creating an embarrassing situation for both States' foreign departments […] How could they possibly solve this contentious issue without affecting their already sensitive relationship?

Analytical: to be aware of the political nature of the current Chinese Government; to realize the concrete and practical implications of an Embassy's special status; to balance two contradictory objectives, in a specific situation where none of them can be fully discarded; to contrast and try to combine long-term goals (in this case, to maintain a functioning relationship between two main world powers) with short-term objectives (in this case, how to deal with a Chinese activist that required protection against his own country's security forces); to find a modus vivendi (conciliation) between values and interests; to get convinced that certain kinds of negotiations cannot be conceived through a “win or lose” approach: in this case, the only way out must be respectful of the two parties' core interests; and to take into account that image preservation (“face-saving”) must be included within any country's objectives in any situation involving diplomatic means. Conceptual: the purpose is to familiarize the students with specific concepts, such as: best alternative to a negotiated agreement (BATNA), which is to be mentioned as part of the discussion (it is not included in the case study itself); interdependence; (purported) Group of Two; asylum and refuge; Immunity; and sending state/receiving state.

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This case focuses on ethics issues arising from the tobacco trade. Government as regulator of that trade and guardian of public health faced complex political, financial and ethical issues in discharge of its responsibilities. The harms resulting from tobacco use were well-known and had generally attracted adverse decisions from governments everywhere. The company offering tobacco products for sale, Carreras Ltd., had generally continued to do well financially despite those adverse decisions. Government, in the present case, had introduced legislation to penalize tobacco use in public places, and in so doing, raised several ethical issues such as punishing smokers for using a legal, widely distributed product; classifying cigarettes as harmful to health yet allowing its wide distribution and sale; continuing to derive substantial tax revenue from sale of a harmful product; enabling Carreras to profit from sale of said harmful product; offering little help to smokers to break their nicotine addiction. Students should be asked to identify and recommend solutions to the ethical issues faced by: the government and its “point man”, the Minister of Health as they sought to reduce the public’s use of a harmful product. The smoker who may be even addicted to a product is known to cause or contribute to a host of serious diseases. Students were to identify and recommend solutions to ethical issues faced by the players in the case. One of these players was Carreras whose operations were facing severe regulatory and public relations headwinds. Another was the nonsmoking public whose health was put at risk even though they did not use the product. The sentences could be reworded to read; Carreras, in its continued efforts to justify selling a harmful product. Nonsmokers who, despite not using the product, suffered adverse health consequences because of its use by others.

Cigarette smoking has been linked to a long list of serious diseases including several cancers, cardio-vascular disease, pulmonary ailments and stroke. Despite several government actions over the years to reduce cigarette smoking, it remained widespread and continued to take a heavy toll on public health. The government’s latest gambit, the Public Health (Tobacco Control) Regulations introduced in 2013, represented the first legislation specifically designed to restrain smoking in “public places”. Carreras Ltd., a subsidiary of British American Tobacco (BAT), had been the only significant provider of cigarettes in Jamaica for several decades and in the period allocated for public feedback, mounted a fierce assault on the Regulations, and galvanized other private sector interests to join in that effort. The case addresses the interaction between government’s roles as guardian and financier of public health, the public’s right of choice, and a company’s right to sell a legal product, albeit one deemed harmful to public health. That government derived substantial tax receipts from trade in that product added another layer of complexity to the matter. The Minister of Health, Dr Fenton Ferguson, was the government’s point man and our protagonist.

Final year University students of Management would have been exposed to ethics theories. Many management courses do not devote enough effort to the study of the interplay between the ethical, financial, and legal and the issues that can arise therefrom to complicate decision-making. The case was structured to invite exploration of this interplay.

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CSS 11: Strategy

Bright Lights is a small non-profit organization in Lincoln, NE offering a summer enrichment program to school aged children. Post 9/11, the organization faces challenges in its efforts to sustain financial resources. With enrollment and course offerings on the rise, funding is more important than ever. At the second to the last meeting of the year at which budgets are established, the Bright Lights' Board of Directors asked the Executive Director, Kathy Hanrath, and the Co-Owner/Director of Education Services, Barb Hoppe, to come up with some alternatives for fundraising top present at the final yearly meeting. Kathy has recently attended some sessions on franchising at a local entrepreneurship conference and would like to explore franchising as an option for Bright Lights growth. Kathy feels that franchising might have the potential to both increase performance and funding. This case focuses on issues associated with the exploration of franchising as a method of distribution and capital acquisition for a social organization. It calls attention to the appropriate situations for franchising, the importance of organizational assessment for franchise readiness, and other legal, economical, and organizational considerations.

The Dudley Beauty case illustrates a contemporary branding, management and marketing challenge facing many companies that are 50 plus years old. Movahhed (2016) highlights the six elements to consider during brand strategy: the target audience, the brand promise, brand perception (past, current and future), brand values, brand voice and brand positioning. The times have changed with changing macroenvironmental factors including political, economic, sociological, technological, legal and other environmental (PESTLE) changes that affect a business but which the business does not directly control.

The case is based upon an interview with Dudley Beauty CEO and President Ursula Dudley Oglesby and secondary sources.

The “A Makeover for Dudley’s Q+” case explores the challenges of a second-generation textured hair care and personal care company in the direct selling channel as it faces an aging market and changing business and economic environment. A Black-owned company, begun in 1967 by her parents, Dudley Beauty is led by the founders’ daughter, Harvard College and Harvard Law School-educated, Ursula Dudley Oglesby. At over 50 years old, the company has continually created new textured hair products and has high brand awareness among older Black consumers but has not adequately addressed changing hair trends and shifting communication preferences of younger consumers. The company is at a critical point needing to reach a younger, larger market to survive. The business situation supports marketing, management, strategy, and/or entrepreneurship undergraduate students in understanding how macroenvironmental forces and internal structures affect businesses.

This case is intended primarily for use by undergraduates in a variety of courses. It is suitable for courses in Principles of Marketing, Entrepreneurial Marketing, general Entrepreneurship and Marketing Strategy courses covering topics such as direct selling, the role of environmental factors in business, rebranding efforts using digital and social media marketing and women/minority business owners.