Walmart_Project

MGMT 449

GUIDELINES OF FINAL PROJECT PAPER

The paper assignment provides you with an opportunity to apply the ideas and frameworks of the course.  The paper assignment has several parts, each of which is described in detail below.[footnoteRef:1] [1: The guidelines are adapted from Dr. Anita McGahan’s (University of Toronto) class material]

 

        Choose a company.  Choice of a company is a crucial step in the assignment.  In selecting a company, please ensure that necessary information is available .   This step should be completed on the project workshop (see syllabus).

        Gather information.  After selecting a company, you are responsible for gathering the information necessary to complete the paper. This information includes financial performance, industry context, and competitive strategy . I will review the progress of what you have completed this part in the middle of semester (the week right after Midterm exam).

        Analyze the company’s profitability and produce a group presentation as well as a term paper.  Students are expected to use what you have learned from this class to analyze the company’s profitability as the topic for the paper. The assignment is to identify the basic industry and competitive conditions that drive the company’s financial performance, and to evaluate the implications for the company’s profitability over the forthcoming five years.  During the class sessions, you will be provided with substantial materials in the form of cases and lectures on the relevant frameworks.  Following completion of your presentation, you are expected to turn in your paper.  This deliverable is due on the presentation week.

 

Each of these steps requires considerable reflection and commitment, and they are described here in further detail.

 

Choose a Topic

Choice of a topic is critical to successful completion of the paper.  The first step is to choose a company as the subject of the analysis.  You will not be required to consult the company directly for material.   Please choose a company that is publicly traded and adequate information should be publicly available through Annual Reports, financial analysts, and the business media

The second step is to choose one company as the subject of the paper.  In some cases, the company may highly concentrate on a single line of business (or virtually in a single line of business).  For example, consider the Coors Brewing Company.  Although Coors participates in biotechnology, over 85% of its revenues are attributable to its main line of business, which is the brewing of beer.  For the purpose of the project, Coors could be considered a single-business company, and the choice of this company would be very appropriate.

 

In other cases, the appropriateness of the company selection is more difficult.  For example, General Electric participates in a broad range of businesses, including aerospace, broadcasting, white goods (i.e., appliances), and finance.  The company’s sales are distributed broadly across the lines.  If General Electric were selected for your project, then the next step would be to choose one line of business for the study.  Before choosing the specific line, you should check the company’s Annual Report (or other source of financial statements) to make sure “whether” information on financial performance broken down by business lines is available. 

 

 

Gather Information

Once you have selected a company, you should gather information for this paper as soon as possible. Each group should be prepared to address the following questions regarding the selected company.  Information on financial performance is particularly important to successful completion of the paper.  Potential sources of information include Annual Reports, 10K filings, and press releases; reports in the business press; trade journals; and the student's own experience.   You might also find it valuable to look for information through our library’s database (Mergent Online; LexisNexis; IBISworld; EBSCO Business Premier). The video tutorials of useful databases can be found via this link: https://libraryguides.fullerton.edu/mgmt449/videos). The following questions serve as a checklist illustrating the type of information that you could gather.

 

1.   Financial Performance

a.     What has been the return on assets in each of the past five years at the corporate level?  What has been the return on sales in each of the past five years? 

b.     What portion of the company’s assets and sales has been attributed to different line of businesses in each of the past five years?   (For public companies, this information may be reflected in the segment data contained in the Annual Report.)

d.     How has the stock price changed over the past five years? Why?

e.     Has the company gone through any restructuring in the past five years?

 

2.     Industry Structure

a.      What are the geographic and product boundaries of the industry?  Is the industry global, or can it be characterized regionally or nationally?  Within reason, try to define the industry as narrowly as possible.

b.     What are the total revenues over the last five years for the industry as a whole?

c.      What are the names of the leading two to five competitors in this business? Are there significant groups of smaller competitors?  Can the smaller competitors be characterized into groups?

d.     What is the profitability in each of the last five years for each of the major competitors (they may be publicly traded companies)?

e.      What is the estimated market share of each of the leading competitors over the past five years?

f.       Can you characterize the purchase process followed by buyers of the company’s products or services?  Does the purchase process involve the direct comparison of products or services across rivals, or are buyers usually loyal to a specific provider?

g.      Are the company’s buyers price sensitive?

h.      If the buyer doesn’t purchase from either the company or its direct competitors, does it have any other alternative?  What are the closest substitutes that are available if a buyer elects (or is forced) not to purchase from the company or its direct rivals?

i.       What are the major components of cost for the company and its direct rivals?  Who are the strategically important suppliers of raw materials and other inputs in the company’s business?  You may find it useful to consider employees as suppliers.

j.       Do the suppliers have much bargaining power in their negotiations with the company and with its rivals?

k.     Would an outsider have to incur a lot of expense to enter the industry?  Would it be difficult to achieve the economies of scale and the distribution network to enter the industry?  Are there any other barriers to entry?

3.  Company’s Strategy

a.     What is the company’s strategy in this business?

b.     Has the company established any quantitative goals for this business? For example, does it have a targeted market share or profitability?

c.      Does the company charge a price premium over its rivals, or is its product/service priced low?

d.     What unique resources has the company accumulated over the years?  You may find it useful to consider HR policies, Top Management Team, Brand Capital, Distribution capability, manufacturing expertise, or an unusual source of supply. 

e.      Value-Chain Process qeustion: How are these resources influencing the company’s financial returns in this business?  Do they help lower its costs, or do they help raise the price that customers are willing to pay?

f.      Does the company suffer from any unusual strategic problem?  For example, has it developed a poor reputation, or does it lack an important capability?

 

You may not be able to answer all of the questions, or may have trouble understanding the importance of some of the questions.  During the curricular sessions, you will be exposed to case studies and to lectures that will clarify the importance of the questions.  In some cases that involve some missing data, the faculty and student will be able to find a solution that will enable the student to complete the assignment.

 

Analyze the Company’s Profitability and Produce a Paper on a group basis

Students are expected to use the course’s ideas and frameworks to analyze the company’s profitability today, and its prospects for performance over the next five years.  The deliverable is expected to be about ten pages in length (double space and one inch of margin; APA or Chicago style of format); title page, table of content, abstract, references, figure/tables/appendices are excluded from 10 pages. The first section should be a financial analysis that divides the sources of the company’s performance in the selected line of business into a component associated with the industry and a component associated with the company’s competitive position within the industry.  The second section is supporting detail to explain the industry’s structure and profitability.  The third section deals with impending changes to the industry structure over the next five years.  The forth section is supporting detail to explain the company’s internal resources/capabilities as well as the sustainability of the company’s competitive position. The fifth section is a recommendation based on the analysis.  The following outline provides more details and a suggested outline. You may find it is not easy to complete all of the sections within the limit of 10 pages. If so, use the appendix section to put less relevant materials there. As for the outline of presentation, see another document in Titanium.

 

1.     Introduction and Analysis of Financial Performance

 Indicate the company’s name and line of business, and define the industry in which it competes.

 Report the financial performance of the company within this business over the past five years.

 Report the average financial performance of firms in the industry.  Identify whether the industry is above- or below-average in profitability.

 Identify whether the company has a competitive advantage based on the difference between its performance and the industry average.

 Provide a broad overview of the issues that the company is facing.

 

2.     Analysis of Industry Structure

a. Describe the total revenues and profitability of the industry over the past few years

b. Explain the underlying driving forces that cause the profitability of the industry.

 3.  Analysis of Forthcoming Change in the Company’s Industry

a. What major trends are likely to affect the profitability of the industry?  Which are likely to improve profitability and which are likely to damage profitability of the industry as a whole?

b. Are the trends likely to have particularly strong impact on the company?

c. Are there trends (beyond the industry-level) that are likely to have particular impact on the company’s competitive advantage or disadvantage? Are there major threats to the sustainability of the company’s position?

4.  Analysis of the Company’s Competitive Position

a. Identify the company’s strategy

i.   What are the company’s quantitative goals for market share and profitability?

ii.  How do the company’s products/services differ from those of rivals?  Does the company achieve a premium price or lower cost?

iii.  What are the critical resources and capabilities that distinguish the company from its competitors?

iv.    Does the company have unusual problems that put it at a competitive disadvantage?

 

5.  Recommendations

a. What are you conclusions after the analyses in Step 2, 3, and 4?

b. What alterative options does the company face for improving its financial returns over the next five years?

c.  What strategic actions/initiatives do you recommend given your analysis of the options available to the company?

d. How does your strategic initiative/action fit with the external (Step 2 & 3) and internal analysis (Step 4) you have undertaken?

e. How would you suggest the company to execute your recommendation (e.g. incentive/reward system, modify organizational structure, change corporate culture, hire/develop new talents)?

Your paper should be typed double spaced and 12 point font. The paper length is limited to a max of 10 pages. You should have a cover page, table of contents and number the pages, appendix for figures and tables. These pages do not count toward the 10 page maximum. Use APA for the Style format of the paper – reference section should be attached “after” the end of the main text, rather than within the text.

With regards to presentation, you group is responsible for delivering a pre-recorded video as well as the original presentation slides. Submit both of your video and slides to Canvas before the deadline. For the format of pre-cording, it is your group’s choice although I strongly recommend either using Zoom or Youtube). After your presentation is recorded, you should check the quality. Slides without voice recorded or cannot be heard will cause serious point reduction. Each group has 20 minutes (using visual aids to bring out the main findings of the project). The presentation shall also cover all the issues listed above and will reach a recommendation supported by the data.

4

Rubric for Final Project Paper

Group: Case Company name:

	Criterion	Total points	Level 1 Poor	Level 2 Acceptable	Level 3 Good	Level 4 Superior	Score
CONTENT OF PRESENTATION	1. Problems (or issues) clearly identified and fully addressed?	10
	2. Add new knowledge to our understanding of in-class concepts? Help people see the importance of the company selected?	10
	3. Communicate well to audiences? · Clear writing · No grammar/typo errors, etc. · Follow a style of format consistently	10
RIGOR OF ANALYSIS	4. Use models and frameworks appropriately? Provide just one or multiple frameworks? Provide conclusions after analysis?	20
	5. Support qualitative arguments well? Is logic sound?	10
	6. Support quantitative (financial and market analysis) argument with evidence?	10
PRACTICABILITY OF RECOMMENDATION	7. Recognize alternative options? Explain their pros and cons well?	10
	8. Defend the main option recommended? Does recommendation directly and fully solve the problem/issue?	10
	9. Deal with implementation issues? · Incentives for implementing the initiative · Systems for controlling the direction · Design execution in the functional level (marketing, HR, R&D, logistics, finance) · Consider resistance to changes?	10