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Grocery store chain Winn-Dixie had rapidly expanded in an effort to become a national retailer, and by 1999 it had more than 1,000 stores. The company began manufacturing its own products, reasoning that by owning more of the supply chain, it could offer the customer less expensive options. With its new geographic focus and manufacturing facilities, Winn-Dixie attempted to secure a position as a low-cost provider with a national presence. Instead of improving the company's position in the market, however, this strategy crippled both the short- and long-term prospects for Winn-Dixie. The company paid a high premium to expand and increased its leverage without ever realizing the purposed synergies. In fact, there were dis-economies of scale because the distribution, marketing, and administrative costs had risen along with the increased revenue. The expansion and inefficient manufacturing added complexity to its distribution network, and with a greater debt load and less cash, the company was unable to reposition itself in the market when its low-cost provider strategy failed. Not only was the company unable to pursue other opportunities but it also did not have the cash to properly maintain many of its existing stores, which quickly became run down. Winn-Dixie was stuck as a general grocer with few options at a time when the industry was rapidly evolving. Following faulty strategies of expansion, supply chain changes, and increased debt, Winn-Dixie declared bankruptcy. Students will take the view that Paul “Flip” Huffard, lead consultant from Blackstone LP, had in determining the valuation and new capital structure of the company. These decisions would be critical, as they affected what each creditor class would receive and whether Winn-Dixie could emerge from bankruptcy.

Students will: 1. Assess the importance and negative financial impact of past strategic moves, and suggest possible future strategic directions and the expected benefits of such changes. 2. Learn quantitative valuation methods for a company in Chapter 11 and their effects on stakeholders. 3. Learn the elements of a plan of reorganization, including the capital structure, treatment of multiple creditor groups, and management compensation. 4. Discuss sources and uses of capital during a Chapter 11 turnaround.

The learning outcomes of this study are as follows: ■ understand organizational turnaround and its sustainability;■ applying the understanding of turnarounds to distinguish between operational and strategic levers of a turnaround strategy; ■ analyze and evaluate past and present turnarounds from a sustainability perspective; and ■ formulate managerial actions to make turnaround sustainable.

Braithwaite Company Ltd. (Braithwaite) was a specialized engineering firm headquartered in Kolkatta, India. It primarily undertook structural steel fabrication to make railway wagons and bridge structures. It was incorporated as a private enterprise almost a century back. However, since its nationalization five decades ago, it has been operating as a public sector undertaking (PSU) under the aegis of Indian Railways, a department of the Government of India. The case documents the past three decades of the firm’s journey, during which it experienced three episodic turnarounds. Details of the first two turnarounds are presented as the background, in light of which sustainability of the third turnaround is to be examined. The case explores the sustainability of organizational turnarounds from the perspective of the current Chairman and Managing Director (CMD), the case protagonist. Braithwaite underwent financial and operational distress in 1992, 2005 and 2015 and negotiated them under different leaders. These leaders from diverse backgrounds used distinct tactics and strategies to bring about organizational turnarounds. The case provides data and information to assess the sustainability of the third turnaround. Hence, it allows a class to explore the paradoxical observation that while “turnaround” inherently implies sustenance of good performance over time, turnaround sustainability is not spontaneous in the real world. The case deals with the performance issues of PSUs, which make significant contributions to the national economy in the case of emerging economies (for example, 5%–8% of the Indian National gross domestic product is contributed by PSUs; https://swarajyamag.com/ideas/psus-are-crucial-for-indias-growth-but-only-if-they-play-a-strategic-role). Under government ownership and management, the poor performance of PSUs is often attributed to bad decision-making by its top management. In contrast, Braithwaite’s top management’s sound contextual decision-making resulted in a jump in its performance during each turnaround phase, but unsound fundamentals resulted in the unsustainability of the turnarounds. Hence, the case enables an exploration of the unique challenges faced by PSU that emanate from legacy roles, monopolistic markets and dual purpose – the concurrent pursuit of profits and social welfare. Consequently, the case allows an examination of the reasons for the distress of PSUs and the viability of turnaround strategies in the context of the broader Business–Government–Society landscape in emerging economies.

The case is written for use in the MBA elective course covering “Strategic Revival and Turnaround Strategies.” It can be used at the beginning of the course to identify reasons for organizational failure/distress or in the later part of the course to discuss the implementation of operational and strategic turnaround strategies.

Teaching notes are available for educators only.

CSS 10: Public Sector Management.

The case delves into the significant factors contributing to the steep decline of Sintex shares, examining both external and internal factors. Internally, the primary drivers were the expansion plan, the demerger decision, financial mismanagement and the delayed and inadequate integration of Information Technology (IT) into the business.

Sintex, a prominent private sector company listed in the Indian stock markets, operated in the textile and plastics sectors. However, in 2017, Sintex underwent a demerger into two separate entities: Sintex Industries Limited (SIL) and Sintex Plastics Technology Limited (SPTL). While SIL focused on textiles, SPTL dealt with plastics. However, soon after the demerger, the share prices of both companies began plummeting, leading to significant losses for investors. This case investigates the reasons behind this decline through a step-by-step analysis.

This case is suitable for postgraduate students pursuing an MBA, MMS and executive programs such as PGDBM and PGDM, with a specialization in business strategy. It is also beneficial for participants in management development programs (MDPs) designed for higher level executives. Additionally, the case can serve as training material for executives undergoing strategic role training within an organization. It is recommended to teach the case toward the end of the course, where the instructor can provide a summary of the previous classes’ teachings.

CCS7: Management Science

Islamic Banking has been in the limelight since the recession of 2008. Although around for a long time, it is enjoying a renaissance of sorts. This case provides an introduction.

EMBA and/or MBA introduction to banking, senior semester undergraduate, specialization in Islamic Banking.

This case is written in the form of an interview with Meezan Bank, one of the leading financial institutions in the Islamic banking sector. It is based on primary as well as secondary data obtained via interviews and documentary analysis.

This is an analytical case and not a decision-making one. The main theme of the case revolves around analysing what Islamic banking is, the challenges that Meezan has faced, the pros and cons of doing business this way and the future issues it can face.

Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

CSS 7: Management Science.

Controladora Comercial Mexicana, a Mexican retailer, had successfully managed the bankruptcy process and was ready to emerge from its problems, primarily caused by speculation and excessive debt, and begin operations anew. Was the restructured Comerci capable of regaining its position as a premier retailer, and more importantly, was the firm capable of repaying the high level of debt that it carried following bankruptcy reorganization? How strong was the reorganized firm? Had Comerci truly left its problems behind in bankruptcy court, or would history repeat itself? How could Comerci raise funds needed for growth – through additional debt? Though asset sales?

This case was researched using publicly available information, including the company's financial statements, bankruptcy filings, news stories about the bankruptcy and financial data bases (e.g. ISI Emerging Markets, Economática, Capital IQ, etc.) to obtain information about the competitors and from financial analysts.

This case is intended for advanced undergraduate or MBA electives in finance. Students should have a basic understanding of valuation and financing before attempting this case. The case could also be used in a corporate finance or banking class to illustrate bankruptcy and credit risk, or could be used in an international business class to illustrate the differences between USA and international bankruptcies.

By reading and understanding this case study, students are expected to: 1.Able to understand and review the impact of unethical practices from accounting perspective; 2.Able to make an analysis of how one unethical act triggers a series of forced unethical acts (ripple effect); 3.Identify the unfair practices as well as be proactive in preventing unfair practices in the business day to day affairs; 4.Able to relate the function of various ratios (current ratio, quick ration, debt to asset ratio, debt to equity ratio etc.) and its impact on the business performance; and 5.Able to apply various lean quality tools, doing the root cause analysis in identifying and solving problems.

T.M. Exports (TME) was an India-based privately owned and operated enterprise. The company had a brilliant employee named Sanjay, who was a 12-year veteran. TME’s Business Intelligence (BI) department at TME head office, Kanpur, India, ostensibly learned on April 8, 2019, from the rumors about a brand-new vehicle dished out to Sanjay by his friend who made fortune worth of millions from certain transactions. To add fuel to the fire, another incident surfaced concerning a warehouse keeper, Mohit, who was also involved in embezzlement in one of the sales offices. On May 16, 2019, BI reported these two incidents to the internal auditor who launched an internal investigation to get to root of this case. Consequently, the company owner, Tariq Mahmood got himself caught up in a dilemma to fire both Sanjay and Mohit only or restructure the organization for better transparency and integrative approach in future. Moreover, the newly appointed Chief Executive Officer had the dilemma of keeping high safety stock to maximize service level or keeping conservative safety stock and rely on-spot market-buying if demand spiked. He decided and instructed all the warehouses to keep higher inventories to meet the forecasted demand, considering unexpected spikes in demand witnessed historically. Thus, increase in inventory caused panic in the sales department as demand was sluggish. He, therefore, offered high discounted prices to liquidate the stock. This study integrated the theories of accounting/financial ratio metrics, accounts reconciliation, business ethics and lean tools. It was demonstrated in this case that the irregularities in sales accounting and their inability of reconciliation had a serious impact on business performance. The concept of total reward was also invoked to understand the disruptive and unscrupulous practices.

This case has been particularly focused on undergraduate and postgraduate early-stage-level students pursuing business or commerce program, particularly those specializing in accounting (sales accounting) and human resource management courses.

Teaching notes are available for educators only.

CSS 1: Accounting and Finance.

The learning outcomes are as follows: to be able to evaluate early warning signs/red flags through financial statement analysis; to be able to analyse company’s credit or debt servicing using a thorough process of fundamental analysis; to be able to analyse and decode the financial health of an organization through different financial tools applicable according to the industry such as default probability and financial ratios; and to be able to synthesize credit rating framework and role of credit rating agencies in the bond market.

In late January 2019, the allegation by an online investigative portal about the misuse of the Dewan Housing Finance Corporation Ltd. (DHFL) money by its promoter for buying asset abroad was the start of the fall of the non-banking finance company giant. This was followed by a series of downgrade by credit rating agencies on its debt and eventual default on its interest payment on 4 June 2019 which upset multiple portfolio investors and the regulators. Investors became sceptical about the regulator’s policy and inefficiencies of credit rating agencies in predicting the default along with asset management houses which were expected to guard investors’ interest. One investor, Shikhar Pachori, decided to scrutinize all hidden information on DHFL to investigate if DHFL crisis arises because of unknown factors which was not in control of management or if it a clear negligence on the part of all involved parties. The case tries to emphasize the aspect of Asset-Liability Management and process of credit analysis while looking for red flags which aids in identifying any stress in company’s financial or any potential default by company.

This case can be used in the advance level of post-graduate finance course or MBA program for elective/specialization courses such as Financial Statement Analysis, Financial Institutions and Market and Fixed Income.

Teaching notes are available for educators only.

CSS 1: Accounting and Finance

Recognize the interest groups of the business as stakeholders and shareholders. Understand the role of strategic corporate social responsibility (CSR) in attaining competitive advantage for the firm. Apply the techniques of financial statement analysis such as common-sized financial statements and ratio analysis. Analyze the overall financial position of the company such as its liquidity, solvency and profitability position. Evaluate the appropriateness of various CSR activities given the size of the company, its business model and financial position. Create a suitable CSR policy draft incorporating the critical elements of a CSR policy that enables the firm to operationalize it and fulfill the disclosure norms.

The management of Ball Industry Limited (BIL) had overlooked the mandatory requirement of CSR policy formulation. The company had not yet spent anything on CSR since the regulation had come into force. The company’s financial position was not healthy. Still, it fell under the regulatory clause as a borderline case and must spend 2% of its average three years’ profit on CSR activities. The company had previously ignored the requirement of formally drafting a CSR policy and deciding about the actions it might want to carry out. Now that the regulator had started sending show-cause notices to several companies who had not yet begun CSR, BIL was under immense time pressure to draft its CSR policy and initiate the relevant CSR activities. Emily, the chief operating officer of BIL, was assigned the task of preparing the blueprint of the CSR policy of the company and made it available for discussion in the upcoming meeting. The task at hand was to formulate a sound CSR policy under the constrained financial state considering its strategic planning, including the SWOT analysis, competitive environment and the overall general market and economic conditions. She submitted that rather than a vanilla CSR activity, strategic CSR would support the firm to differentiate itself from competitors. She was struggling to formulate a CSR strategy that could achieve both economic and social goals.

The case will be most suitable for use in undergraduate and graduate courses.

Teaching notes are available for educators only.

CSS 1: Accounting and finance.

The learning outcomes are as follows: developing an understanding of financial statement analysis among students; students would be able to calculate various ratios, understand their meaning and interpret them to take a financial decision; and exploring the relationship between financial leverage and risk.

Amtek Auto is a leading auto-components manufacturer established in 1988 which entered into bankruptcy in through the order of Reserve Bank of India in 2017. The company started with a humble beginning and later on the promoter decided to expand exponentially both through organic as well as inorganic growth in past 15 years. To grow a company kept on taking debt which made it riskier and deteriorated its financial position over a period. The case covers a 10-year timeline from 2008 to 2017. It gives an opportunity to analyze its financial statements to understand how its decisions shaped its performance

The case aims for students to take a comprehensive view of the financial statement analysis of Amtek Auto including the following: vertical and horizontal analysis; comprehensive ratio analysis including liquidity, profitability, leverage and turnover ratios with special emphasis on debt as a double-edged sword; analysis of Armtek Auto’s financial performance over a period of 10 years.

Teaching Notes are available for educators only.

CSS 1: Accounting and Finance.

This case looks at the design and implementation of a risk management strategy. It reviews the early moves by Great Plains Energy (GPE) to establish a corporate-wide Enterprise Risk Management program. The corporate Chief Risk Officer is Andrea Bielsker. Andrea appointed Jana Utter to take charge of coordinating the design and implementation of the ERM program. Utter faces a number of challenges. She has had to first conceptualize the program given the charge by the Board of Directors, then design a process by which she identifies the risks that the corporation faces, assist in designing measures for the risks, and work with the various divisions and functional areas to put processes in place to mitigate the identified risks.