Case Analysis
Understanding Case Analysis
Review
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What are Case Studies?
- Case studies are written summaries of real-life business situations based upon data and research. In reading a case study a picture of what has happened to a company over a period of time can be gained. These could include events such as organizational change and strategy decisions within an organization as well as outside factors and influences.
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What are Case Studies (cont.)?
- A case study can be a shortened, second hand version of a real-life situation. It enables students to appreciate and analyze real problems and events faced by people in business. Case studies are also used to illustrate theory studied in class and allow that theory to be applied.
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ANALYZING A CASE STUDY - WHAT YOU NEED TO DO!
- The purpose of the case study is to let you apply the theories and concepts you've learned when you analyze the issues facing a specific company.
- - To analyze a case study, therefore, you must equip yourself with the relevant theoretical knowledge and then examine closely the issues with which the company is confronted.
- - Most often you will need to read the case several times once to grasp the overall picture of what is happening to the company and then several times more to discover and grasp the specific problems
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Role of the Case Analysts
- The main task of the analyst is to study the situation described in the case carefully, identify the major problem(s) and related issues, and suggest (and justify) a specific course of action.
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Three Dimensions to Understand and Analyze Cases
To successfully understand and analyze a case, one has to consider three major dimensions: analytical, conceptual, and presentation.
The analytical dimension of the case raises the question, “What is the case analyst’s task with respect to the key decision or issue of the case?”
The conceptual dimension of the case is concerned with the question, “What theories, concepts or techniques might be useful in the understanding and/or resolution of this case situation?”
The presentation dimension of the case is concerned with understanding how the information about the situation is presented and raises the question, “What is really important and relevant information here and what is still missing?”
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The First Read
Read the case quickly for familiarity and general understanding of what the case is about
- Gain a feel of what the case is about
- As you read jot down the ideas that come to you.
- Think about major problems and issues present
- What sort of organization is the case about?
Goods, services, government, non-profit, combination
- Who are the main stakeholders? How are they affected?
- What is going on in the external environment
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The Second Read
- Re-read the case slowly
- Does this read confirm the issue that you identified in the first read?
- Study any exhibits carefully (e.g. Org. Charts, Figures, etc.)
- Decide what the main/strategic issues are.
- Distinguish between real problems and symptoms of problems
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Recommendations
- There is no problem with only one sensible course of action to solve it. Therefore, it is the quality of your analysis and your justification for selecting a certain alternative that counts.
- Make sure that your recommendations are logical and practical
- You could recommend a perfectly good solution, but receive poor evaluation because your reasoning is not consistent with the solution recommended.
- Make sure your recommendations are in the decision-maker’s power
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HOW TO ANALYZE A CASE
- Look for problem(s): Do not just rephrase the obvious problems stated in the case but try to identify the real problems faced by the organization.
- Identify alternatives: After identifying the problem, start thinking about the various alternatives available to the organization. There are usually more than two alternatives. Once you identify the alternatives list the pros and cons of each alternative. This will help you revise the alternatives later in the decision making process.
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HOW TO ANALYZE A CASE (Cont.)
- Define the Crucial Issues: The crucial issues are those conditions which affect the feasibility of the various alternatives. They serve as organizing points around which facts can be grouped and deductions drawn.
- Recommendations: Indicate which of the alternative paths of actions the organization should follow. Your conclusion should weight the importance of each alternative. You need to make sure that the recommendations flow from the analysis and involve a managerial decision making.
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Key Indicators of How Well
the Strategy is Working
- Trend in sales and market share
- Acquiring and/or retaining customers
- Trend in profit margins
- Trend in net profits, and ROI.
- Overall financial strength and credit ranking
- Efforts at continuous improvement activities
- Trend in stock price and stockholder value
- Image and reputation with customers
- Leadership role(s) -- technology, quality, innovation, e-commerce, etc.
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What Are the Firm’s Strengths, Weaknesses, Opportunities and Threats ?
- S W O T represents the first letter in
S trengths
W eaknesses
O pportunities
T hreats
- For a company’s strategy to be well-conceived, it must be matched to both
Resource strengths and weaknesses
Best market opportunities and external threats to its well-being
S
W
O
T
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Identifying Resource Strengths
and Competitive Capabilities
- A strength is something a firm does well or a characteristic that enhances its competitiveness
- Valuable competencies or know-how
- Valuable physical assets
- Valuable human assets
- Valuable organizational assets
- Valuable intangible assets
- Important competitive capabilities
- An attribute that places a company in
a position of market advantage - Alliances or cooperative ventures with capable partners
Resource strengths and competitive capabilities are competitive assets !
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Identifying Resource Weaknesses
and Competitive Deficiencies
- A weakness is something a firm lacks, does poorly, or a condition placing it at a disadvantage
- Resource weaknesses relate to
- Deficiencies in know-how or expertise or competencies
- Lack of important physical, organizational, or intangible assets
- Missing capabilities in key areas
Resource weaknesses and deficiencies are competitive liabilities !
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Table 4.1: SWOT Analysis -
What to Look For
Potential Resource Strengths
Potential Resource Weaknesses
Potential Company Opportunities
Potential External Threats
Powerful strategy
Strong financial condition
Strong brand name image/reputation
Widely recognized market leader
Proprietary technology
Cost advantages
Strong advertising
Product innovation skills
Good customer service
Better product quality
Alliances or JVs
No clear strategic direction
Obsolete facilities
Weak balance sheet; excess debt
Higher overall costs than rivals
Missing some key skills/competencies
Subpar profits
Internal operating problems . . .
Falling behind in R&D
Too narrow product line
Weak marketing skills
Serving additional customer groups
Expanding to new geographic areas
Expanding product line
Transferring skills to new products
Vertical integration
Take market share from rivals
Acquisition of rivals
Alliances or JVs to expand coverage
Openings to exploit new technologies
Openings to extend brand name/image
Entry of potent new competitors
Loss of sales to substitutes
Slowing market growth
Adverse shifts in exchange rates & trade policies
Costly new regulations
Vulnerability to business cycle
Growing leverage of customers or suppliers
Reduced buyer needs for product
Demographic changes
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Examples: Distinctive Competencies
- Sharp Corporation
- Expertise in flat-panel display technology
- Toyota, Honda, Nissan
- Low-cost, high-quality manufacturing capability and short design-to-market cycles
- Intel
- Ability to design and manufacture ever more powerful microprocessors for PCs
- Motorola
- Defect-free manufacture (six-sigma quality) of cell phones
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Identifying a Company’s
Market Opportunities
- Opportunities most relevant to a company are those offering
- Best prospects for profitable
long-term growth - Potential for competitive advantage
- Good match with its financial and organizational resource capabilities
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Strategic Management Principle
A company is well-advised to pass on a particular market opportunity unless it has or can build the resource capabilities to capture it!
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Identifying External Threats
- Emergence of cheaper/better technologies
- Introduction of better products by rivals
- Intensifying competitive pressures
- Onerous regulations
- Rise in interest rates
- Potential of a hostile takeover
- Unfavorable demographic shifts
- Adverse shifts in foreign exchange rates
- Political upheaval in a country
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Strategic Management Principle
Successful strategists aim at capturing a company’s best growth opportunities and creating defenses against external threats to its competitive position and future performance!
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Role of SWOT Analysis in
Crafting a Better Strategy
- Developing a clear understanding of a company’s
- Resource strengths
- Resource weaknesses
- Best opportunities
- External threats
- Drawing conclusions about
how - Company’s strategy can be matched to both its resource capabilities and market opportunities
- Urgent it is for company to correct resource weaknesses and guard against external threats
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Porter's Five Forces Model
- The risk of new entry by potential competitors
- The degree of rivalry among established companies within an industry
- The bargaining power of buyers
- The bargaining power of suppliers
- The threat of substitute products
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Case Analysis Guidelines:
- All groups are required to prepare each case study prior to coming to class
- Please read “ The Use of Cases in Management Education”
- You will hand in your typed 1-5 page answer , at least answer these questions in the case write-up .
- It will be necessary to do more than just attack the questions head-on. For example, a WOTS-Up (weaknesses, opportunities, threats and strengths) analysis might help.
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Case Analysis Guidelines Cont.:
- First Paragraph:
- Don’t repeat the case, and do not cite the case in the footnotes…that just takes up space.
- Use the “elevator method” of reporting
- What is the real value of the message of this case?” Or “What is the point of this case—what can we learn from it?
- Analysis Section:
- what caused what to happen and the consequences of this causal sequence?
- business environment (usually customers, competitors and occasionally government) and historical context—how the firm got where it is.
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Case Analysis Guidelines Cont.:
- Recommendations:
- what to do next .
- outcomes are not = to case solutions
- Research:
- search on the company and the industry and technology. The second level in the search is on concept ?
- Cite these sources in footnotes at the bottom of the page.
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Planning
- Plan what you will write before you start writing a good copy.
- Make sure you identify the member of the group with best writing skills and assign him the task of editing the final report and blending everyone’s writing styles.
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WRITING A CASE STUDY ANALYSIS
- An introduction to the case
outline briefly what the company does, how it developed historically, what problems it is experiencing, and how you are going to approach the issues in the case write-up.
- The strategic-analysis section
do the SWOT analysis, analyze and discuss the nature and problems of the company’s business-level and corporate strategy, and then analyze its structure and control systems
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WRITING A CASE STUDY ANALYSIS (Cont.)
- Solutions and Recommendations
Be comprehensive, and make sure they are in line with the previous analysis so that the recommendations fit together and move logically from one to the next
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WRITING A CASE STUDY ANALYSIS (Cont.)
- Following are some minor suggestions that can help make a good analysis even better.
1. Do not repeat in summary form large pieces of factual information from the case
2. Make sure the sections and subsections of your discussion flow logically and smoothly from one to the next.
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WRITING A CASE STUDY ANALYSIS (Cont.)
3. Avoid grammatical and spelling errors. They make the paper sloppy.
4. In some instances, cases dealing with well-known companies don’t include up-to-date research because it was not available at the time the case was written. If possible, do a search for more information on what has happened to the company in subsequent years.
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