Case 26 – Kmart: Striving for a Comeback

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Kulliyah of Economics and Management Sciences
International Islamic University
Department of Business Administration
Course:
Strategic Management
Course Code:
MGT 4760
Level:
Undergraduate
Credit hours:
3
Semester Offered:
II (2004/2005)
Pre-requisite courses: MGT 3050 (Decision Science)
MKTG 3010 (Marketing Principles)
FIN 3010 (Financial Management I)
FIN 3011 (Financial Management II)
Class schedule:
Section 1:
Section 2
Tuesdays and Thursdays
Tuesdays and Thursdays
2.00 – 3.20 p.m.
3.30 – 4.50 p.m.
Seminar Room 7
Seminar Room 7
Grading scheme:
1.
Continuous evaluation:
60 marks
a) Mid-term examination:
20 marks
b) Quizzes (two):
10 marks
c) Case analysis & presentation: 10 marks
d) Project paper work:
20 marks
2.
Final examination:
40 marks
Course instructor:
Prof. Dr. Azhar Kazmi
Contact:
Room 419 (Level 4) Extension: 4740 azharkazmi@iiu.edu.my
Consultation hours:
Mondays / Wednesdays 10.00 – 11.00 a.m.
With prior appointment at other time
Course objectives
Strategic management is the process to understand competitive forces operating in the
external environment and to develop competitive advantages within the organization.
This course is an integrative, capstone course designed to integrate the knowledge you
have gained in the various courses learned during your previous study in the
undergraduate program. Being an integrative course, it aims at inculcation of the
analytical skills so necessary to understand the myriad factors that govern
organizational success. The course thus has stringent requirements in terms of
application of the knowledge to real-life situations described in case studies. The
students are expected to apply themselves to a dedicated understanding of the
concepts, theories, and principles of strategic management and to attempt to relate
these to the cases and situations discussed in the classroom.
Teaching methodology
The teaching methodology consists of participative lecturing and case analysis and
presentation aimed at the development of the understanding of the concepts, theories,
and principles of strategic management and their application to case analysis. The
project paper writing is aimed at the development of analytical skills at understanding
of, and writing about, a real-life organization. Presentation of case and project paper is
designed to enhance the verbal skills and to defend one’s reasoning in the classroom.
Textbook
Thompson, Jr. A. A., John E. Gamble, and A. J. Strickland III: Strategy- Winning in
the Marketplace International Edition, 2004, McGraw-Hill - Irwin
Supplementary reading
Azhar Kazmi: Business Policy and Strategic Management 2nd Edition Tata McGrawHill
Jeffrey S. Harrison: Strategic Management of Resources and Relationships –
Concepts and Cases International Edition, 2003, John Wiley
Michael A Hitt, R. Duane Ireland and Robert E. Hoskisson Strategic Management –
Competitiveness and Globalization 4th. Edition, South Western College Publishing
Thomson Learning
Thomas L Wheelen and J. David Hunger Strategic Management and Business Policy
Prentice-Hall
Management journals and magazines such as Harvard Business Review, Malaysian
Business, etc.
Internet-based resources related to strategic management
2
COURSE SCHEDULE
Week 1
29.11.2004 – 3.12.2004
Chapter 1: What is Strategy and Why is it Important?
Introduction to Islamic perspectives to strategic management
Week 2
Chapter 2: Analyzing a Company’s External Environment
6.12.2004- 10.12.2004
The socio-cultural and political context of Islam
Sultan Selangor’s birthday –
11.12.2004
13.12.2004 – 17.12.2004
Chapter 3: Analyzing a Company’s Resources and Competitive Position
The perception of resources in Islam
Week 4
20.12.2004 – 24.12.2004
Christmas – 25.12.2004
Chapter 4: Crafting a Strategy – The Quest for Competitive Advantage
Competition from Islamic perspectives
Quiz 1: Wednesday 22December 2004/ 8.00 – 8.30 p.m.
Week 5
27.12.2004 – 31.12.2004
New Year – 1.1.2005
Chapter 5: Competing in Foreign Markets
Week 6
3.01.2005 – 7.01.2005
Chapter 6: Diversification – Strategies for Managing a Group of Businesses
Week 7
10.01.2005 – 14.01.2005
Chapter 7: Building a Capable Organization
Mid-term examination
Wednesday12 January 2005/ 8.30 – 10.30 p.m.
17.01.2005 – 21.01.2005
Eid-al-Azha 21.012005
Week 3
Mid-semester break
Week 8
24.01.2005 – 28.01.2005
Chapter 8: Managing Internal Operations – Actions that Facilitate Strategy
Execution
Week 9
31.01.2005 – 4.02.2005
Chapter 9: Corporate Culture and Leadership
Strategic leadership from Islamic perspectives
Quiz 2: Wednesday 3 February 2005/ 8.00 – 8.30 p.m.
Week 10
7.02.2005 – 11.02.2005
Chinese New Year 9/10.02.2005
Muharram – 10.02.2005
Chapter 9: Corporate Culture and Leadership - continued
Social responsibility and ethics from Islamic perspectives
Week 11
14.02.2005 – 18.02.2005
Case presentations
Project paper presentations
Week 12
21.02.2004 – 25.02.2005
Case presentations
Project paper presentations
Week 13
28.02.2005 – 4.03.2005
Case presentations
Project paper presentations
Week 14
7.03.2005 – 11.03.2005
Case presentations
Project paper presentations
Revision period
14.03.2005 – 17.03.2005
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Evaluation details
The student evaluation will be according to the scheme outlined below.
1.
Continuous evaluation:
60 marks
e) Mid-term examination:
20 marks
f) Quizzes (two):
10 marks
g) Case analysis & presentation: 10 marks
h) Project paper work:
20 marks
2.
Final examination:
40 marks
Mid-term examination The examination will be held as per the schedule announced.
It will consist of multiple-choice questions and short-essay type questions.
Quizzes Two quizzes, each of 5 marks, will be given containing multiple-choice and
true/false types of questions on the dates announced in the schedule.
Case analysis and presentation As you will soon realize after a few sessions, strategic
management is better studied through the analysis and discussion of case studies. You
will form yourselves in groups of four-five students in the first session and report to
me. For sections containing a larger number of students the group size may go up to
six. The groups will be allocated cases by me from the textbook. Each group will
make an analysis based on the questions provided in Annexure 1 and make the oral
presentation in the class as per a schedule to be announced separately. No written
case analysis is required. The evaluation will be individual for each member of the
group based on his/her originality of ideas, demonstration of effective communication
skills, and satisfactory answering of questions posed in the class.
Written project paper Each group (the same as for case presentation) would prepare a
project paper by writing an informative corporate profile of any one local or an
international company or a non-corporate organization operating in Malaysia and
based in the Klang Valley.
It is suggested that the project paper could cover most or all of the following areas:







Brief Company history, background, and growth
Management structure and organization chart
Analysis of Company’s external environment
Analysis of Company’s resources and competitive position
Strategies employed at present at business-level and corporate-level
Corporate culture and leadership in the company
Future plans and prospects of the company
 Summarized balance sheet and profit and loss account for the last 3 - 5 years, if
available (in a page or two as appendix to the project paper)
 Bibliography / References
Please note that the above list of content is only suggestive. You may alter the
contents to suit the requirements of the project paper you are writing. You are most
welcome to contact me as soon as you finalize the outline of the project paper before
going ahead to write it.
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The information for writing the project paper should be obtained directly from sources
such as interviews, visits, and company documents. The Internet resources could also
be accessed. But you must make sure that you give the sources of information that
you use for writing the project paper in the form of a bibliography / references at the
end.
The length of the project paper profile should be between 15 to 20 A-4 size pages
typed in Times Roman 12 sized font with adequate margins on the left and right sides.
The cover page should only contain the following information;



Title of the project paper (Name of the company, its location, etc.)
Names of the students in the group with their Matric Number, Program, and
Level
Date of submission
The last page of the project paper should contain a bibliography listing the sources
used for writing.
The project paper will be presented before the class as per the schedule announced
separately. The evaluation for the project paper is out of 20 marks out of which 10
marks are allotted to the oral presentation in the classroom and 10 marks to the
written project paper. For the oral presentation each student will get individual marks
based on his/her originality of ideas, demonstration of effective communication skills,
and satisfactory answering of questions posed in the class. For the written project
report all members in a group will get the same marks. I will judge the report on the
basis of its quality of writing, proper sequence of topics, cleanliness of work, and its
aesthetic appeal.
Submission deadline: Each group will submit the written project paper immediately
after its presentation in the classroom.
Final examination The final examination will be held as per schedule announced
separately. It will consist of multiple-choice questions, essay-type questions, and a
compulsory case analysis. Students are expected to demonstrate and apply the Islamic
perspectives while answering the essay-type questions.
It is the responsibility of the students to appear in the tests, examinations, and quizzes
and adhere to the submission deadlines. There would be no make-up tests or
examinations. Late submissions, tolerated for a limited duration, shall be penalized by
awarding lesser grades / marks.
-------------------------------
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Annexure 1
CASE STUDY QUESTIONS
(Number of case corresponds to the order in the textbook by Thompson, Gamble and
Strickland)
Case 3 – Sears, Roebuck and Co.
1.
2.
3.
How has Sears’ business model and strategy evolved over the years – what specific
phases or stages do you see during the period from 1886 – 2002?
What pros and cons do you see regarding the strategy Sears implemented in 2000 for
its full-line retail stores? Specifically identify aspects of low cost and/or
differentiation strategy.
What are Sears’ resource strengths and weaknesses? What do you see as Sears’
market opportunities and threats?
Case 5 – Competition in the Bottled Water Industry
1.
2.
3.
What is competition like in the bottled water industry? Evaluate the strengths of each
force. What competitive forces seem to have the greatest effect on industry
attractiveness and the potential profitability of new entrants?
How is the bottled water industry changing? What are the underlying drivers of
change and how might those driving forces change competition in the industry?
What the key factors determine the success of bottled water producers?
Case 7 – Green Mountain Coffee Roasters, Inc.
1.
2.
3.
Do you agree with Green Mountain’s decision to abandon the retail coffee store
segment? Were the retail stores not a good vehicle for introducing consumers to the
Green Mountain brand?
What is your assessment of Green Mountain’s financial performance? Is the
company’s strategy working well?
What recommendations would you make to Green Mountain management to improve
the company’s strategy and performance prospects?
Case 11- Artemis Images
1.
2.
3.
What is the competition in the content management industry like? Which competitive
forces are the strongest? Which are the weakest?
Describe Artemis’ business model. What are the advantages and disadvantages of this
business model? Can Artemis start as a B2C business and evolve into a B2B
business?
What specific challenges does Artemis face as it attempts to raise capital? What
issues need to be addressed?
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Case 13 – Microsoft’s Xbox
1.
2
3.
What is competition like in the video game industry? What does a five-forces analysis
reveal about the nature of the industry and the strengths of each force?
Is the video game industry attractive from the perspective of a company like
Microsoft? Why or why not?
What are Microsoft’s strengths and weaknesses? What do you see as Microsoft’s
market opportunities and threats?
Case 18 – The Earth Moving Equipment Industry
1.
2.
3.
What is your assessment of the competitive forces at work in the earth-moving
equipment industry? Which of the five competitive forces are strongest? Which of the
five competitive forces are weakest?
What are the industry’s key success factors? What does it take for a manufacturer of
the earth-moving equipment to be successful?
What key features describe Caterpillar’s strategy? Komatsu’s strategy? CNH’s
strategy?
Case 23 – Howard Distribution Company
1.
2.
3.
What is your assessment of Harry Stone as the President of HDC? What pluses and
minuses do you see in his performance as CEO? Was he a good choice for the
position following Wallace Davis? What are the benefits and weaknesses of
appointing an outsider as HDC president?
What are the potential impacts of the recent personnel changes Stone implemented on
the company’s culture?
What issues do you see that the Executive Committee needs to address? What actions
would recommend that the Executive Committee take?
Case 26 – Kmart: Striving for a Comeback
1.
2.
3.
What is your assessment of all the internal changes that Hall and his top management
team made to improve store operations, implement the strategy changes, and get
Kmart back on track?
What were primary components of Charles Conaway’s strategy to take on Wal-Mart
and Target? Was the strategy consistent with Kmart’s key resource strengths and
competitive capabilities?
What are the things that Wal-Mart has consistently done better than Kmart? What has
Kmart done better than Wal-Mart? Is Kmart’s strategy better than strategy at Target?
Case 29 – Southwest Airlines: Culture, Values and Operating Practices
1.
2.
3.
What three things impress you most about this company? Why do you think
Southwest appears on Fortune’s list of the most admired airlines in the world?
What weaknesses of problems do you see at Southwest Airlines?
How would you characterize the company’s culture? What are its key elements? Is
Southwest a strong culture company? Why or why not?
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