Lauren Sterna, Jennifer Eccles, Scott Addison, Clint
Chapman, Craig Crowell, and Collin Gillaspie

Appendix 1: How to do a
Comprehensive Case Analysis
What is a Case?
 Simply a short story of a company and the strategic issues its strategic decision makers are facing.
What Should a Case Analysis Include?
 A case analysis usually includes 6 parts: external analysis, internal analysis, strategic issues, strategic alternatives, recommendations, and implementation.

How to do a Comprehensive Case
Analysis: External Analysis
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Includes a description of the opportunities and threats found in the specific and general external environmental sectors.
General sectors include economic, demographic, sociocultural, political-legal, and technological forces.
Based on the analysis of these sectors you should describe what opportunities and threats you see in each area, and why you see them.

How to do a Comprehensive Case
Analysis: Internal Analysis
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Includes strengths and weaknesses found in the internal functional areas that include production-operations, marketing, HR management, R&D, information systems, and financial-accounting. Also, an assessment of top managers, and culture and structure of the organization.
Do not leave out a through financial analysis, because this is how strategic managers base their decisions. This should cover 4 parts: ratio analysis and comparison to industry trends, graphs and charts of sales, profits, and other financial measures, financial strengths and weaknesses, and a statement of the overall financial condition.

How to do a Comprehensive Case
Analysis: Strategic Issues
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Issues are weaknesses that need to be corrected, opportunities that need to be taken advantage of based on strengths and distinctive competencies, or possible threats that need to be avoided or buffered against.
Focus on what the issue is and why it is a problem, these need to come from the information that was included in your previous analysis.

How to do a Comprehensive Case
Analysis: Strategic Alternatives
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You need to develop at least 2 alternatives to the current situation when addressing strategic issues.
Describe who, what, when, and where to the question “What is the alternative being proposed?”

How to do a Comprehensive Case
Analysis: Recommendations
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Once the alternatives have been developed, you are ready to make choices about what alternatives you are choosing and why, also which are being rejected and why.
Do not forget to explain how your alternatives will resolve the strategic issue.

How to do a Comprehensive Case
Analysis: Implementation
 Implementation of course is always the decision of the organization, so you need to include descriptions of how things would have to take place, and where the funding would come from to put those changes into place.

How to do a Comprehensive Case
Analysis: Written and Oral Presentation
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The written analysis should cover all 6 parts described and include anything that is required for the analysis.
Oral presentations need to be easy to follow and sometimes requirements are included with the oral presentation, so follow them exactly.

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Simple, fun, and profitable
36 consecutive years of profitability
Began service in 1971 with 3 planes flying to Houston,
Dallas, and San Antonio
Herb Kelleher, cofounder said, “A lot of people figured us road kill at that time.”

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The strategic approach that Southwest took was unlike any other airline company at the time
In the early 1970’s the airline industry was characterized by:
 High fares
 Inconvenient flight schedules
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Complicated ticketing
Long and inconvenient flying experiences

 They wanted something to be simple
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Get customers to their destinations
When they want to get there, on time
Lowest fare
Have a good time while doing it
Fly short-haul routes where the fares are comparable to driving

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Southwest is known for the nation’s low-fare and high customer satisfaction
Serves as short and medium haul routes with single-class service for mostly business and leisure travel
Point-to-point service
79% of customers fly non-stop with an average trip length of
846 miles

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Use a single type of aircraft- Boeing 737
More than 530 aircrafts with an average age of 9 years
Fuel Hedging- where they pay for gas upfront for the right to buy fuel at certain prices
Use of technology- automated processes southwest.com- first airline to establish website
Downtown and conveniently located airports

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Great service at low prices
The American Customer Satisfaction Index ranked Southwest first among airlines for highest customer satisfaction for 14 years
Customer Service Commitment
Southwest’s mission statement establishes a foundation for its commitment to servicing customers

A Black Eye for the Company- Plane
Maintenance and Inspection Trouble
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In early 2008, two FAA officials had noticed problems with some of the planes
Southwest had failed to do required inspections because
Southwest officials tried to keep the problems hidden
8% of the fleet was grounded until inspections were completed
In March 2009, SW announced that they resolved all issues and are now working with the FAA to ensure safety for the public

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High-spirited, irrelevant culture
At the company headquarters there are over 10,000 pictures of employees
Their focus is the customers
Southwest went where no other airline had gone beforeblogging- Nuts about Southwest
Southwest’s people are their most valuable asset
More than 4 out of 5 employees are union members

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36 consecutive years of profitability
In 2008, revenues were up 11.8% to over $11 billion even though net income was down 72.4%
A testament of Southwest’s strategies is to post a net income

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One of the most admired companies- Fortune Magazine
Business Week’s Customer Service Champs
America’s Most Shareholder Friendly Companies-
Institutional Investor Magazine
 Airline of the Year- for excellent air cargo delivery service
*from 2007-2009

The Airline Industry and Major
Competitors
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The airline industry is extremely competitive
One major uncertainty is fuel costs
There are many things that make the industry vulnerable:
 Capital intensive
 Fixed costs
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Fuel and labor intensive
Heavily regulated and taxed

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Keeping costs under control and keeping its culture alive
No longer paying commissions on flights booked by travel agents
Motivating employees to continue to look for innovative ways to better run the business

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By 2000 known for poor service and quality
Came in last in survey of fast food restaurants in 2001
First time in 15 years more people disliked than liked
McDonalds
2002 first quarterly loss

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2003 old CEO fired and replaced by Jim Cantalupo
Cantalupo obsessed over the basics(fast service, hot food, and clean restaurants)
“Plan to Win”
Operational Excellence
Retake the lead in Marketing(I’m Loving It)
Innovation

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Company employees and suppliers aligning fully
Ranked 8 th by BusinessWeek in best global brands
Investment in different restaurant formats including
Chipotle
Since first quarterly loss in 2002 they have increased profits every quarter since

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Car manufacturer based in Detroit, MI
CEO and President: Alan Mulally
2008- suffered worst loss ever ($14.8 billion)

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108 year old company
First to manufacture products using a mass production assembly line.
Hits:
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Model T
Mustang (Sold 1 Million in 24 months)
Explorer (First SUV)
Taurus
F-Series Pickups
Failures
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Pinto (exploding gas tanks)
Edsel (unusual design that never caught on)
Firestone Tires/Ford Explorer
1998- CEO Jacques Nasser tried to diversify the company away from their core competencies and he was ultimately fired because of the failures.

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Industry
 Technology driven
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Fierce competition
Fickle customers
Manufacturing overcapacity worldwide
Declining demand for certain car models
Competitors
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GM
Toyota
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Chrysler
Honda
2007- beginning of recession and decline in car sales
Early 2008- Ford sells Land Rover and Jaguar to Tata
Late 2008- GM and Chrysler took bailout money from the US Government

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CEO Alan Mulally
 Came to Ford from Boeing
Way Forward Plan
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Bold leadership
Customer focus
Strong brands
Bold, innovative products
Great quality
Clear pricing
Competitive costs and capacity
Four Key Priorities
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Aggressively restructure the cmpant to operate profitably at the current demand and changing model mix
Accelerate product development with new products that customers really want and value while achieving manufacturing excellence by reducing complexity and improving quality
Obtain financing to do these things and improve the balance sheet
Work together with accountability with all partners

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1 st and foremost and manufacturing company
 Japanese and Korean car companies out earn Ford on each car made by delivering more feature at a lower cost.
Ford will close 16 plants and eliminate 44,000 jobs by 2012.
 Remaining plants will be as efficient and effective as possible.
Reduce costs by $6 billion by 2010
Mulally demanded that engineers create uniform parts that could be use on most models.
 Created a single global product development organization
 “…work together more effectively to continuously improve quality, productivity, and speed of product development.”

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“ONE FORD” Marketing Vision
 The plan is to have common Ford vehicles competing in global segments.
 2010 Ford Focus global car was introduced
“The Ford Challenge”
 Asks consumers to compare their current car to a Ford car.
Values statement- “The customer is Job 1.”
Working closer with dealers.

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Laying off employees and offering early retirements as part of the Way Forward plan.
 44,000 by 2012
Increasing healthcare costs
 $3.1 billion in 2006
The increasing healthcare costs will continue to affect the companies ability to meet it’s profitability goals.

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Not a drive for perfection, instead they focus on continuous improvement.
Weekly meeting with no distractions.
 Use of data and data sharing between divisions.
Change in approach to grooming managers.
Commitment to environmental responsibility.

 Ford should break even by the end of this year.

 Commitment to ONE FORD
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“In a global market, success flows from having ONE TEAM working on ONE PLAN with ONE GOAL in mind.”
ONE TEAM- Including everyone with a stake in the outcome in the decision-making process.
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ONE PLAN- Changing the way the company has been run.
ONE GOAL- Build more of the products that people want and value.