SCHOOL OF BUSINESS ADMINISTRATION

UNIVERSITY OF TENNESSEE AT MARTIN

DEPARTMENT OF ACCOUNTING, MANAGEMENT,

AND INFORMATION SYSTEMS

COURSE NUMBER AND TITLE: Management 490 Business Policy

COURSE DESCRIPTION: A Capstone course focusing on policy, strategy, and the integration of all business functional areas, including analysis of the implications and relevance of social, ethical, environmental, competitive, and international considerations for top-level organizational decisional making.

COURSE PREREQUISITES: This course requires completion of all other business administration core requirements and senior class standing.

TEXT: CRAFTING AND IMPLEMENTING STRATEGY BY THOMPSON & STRICKLAND

WALL STREET JOURNAL

COURSE LEARNING OBJECTIVES:

1. Develop and use analytical abilities needed for strategic decision-making including conceptual and quantitative data analysis.

2. Reexamine, integrate, and apply previous course material within the content of the strategic management concept.

3. Develop and refine the ability to express ideas and conclusions verbally and in written form.

4. Develop ability to lead class discussions designed to produce comprehension and consensus with respect to strategic business policy decisions.

COURSE REQUIREMENTS:

1. Individual students are responsible for meeting prerequisites, requirements, and objectives. Faculty are to provide quality instruction, leadership, and support student academic efforts.

2. Use of personal computers or mainframe computers is often required to develop solutions for written cases and/or other course assignments.

3. All cases and other assignments are due on the date specified by the course instructor. The professor may grade late cases, but these assignments will count for a grade of zero.

4. Strict compliance with course prerequisites is required.

COURSE CONTENT:

UNIT 1. Strategic Management and Case Analysis: Basic Concepts and review of analytical

business decision-making. Review of creative problem-solving, mission, goals, and objectives and international business operations.

UNIT 2. Strategic Management and Business Policy-Environmental Considerations: oppor-tunities and constraints; international business management, ethics and social responsibility.

UNIT 3. Strategic Development and Management of Strategy Process: Analysis of strategy,

strategic alternatives, social responsibility, and entrepreneurship values as the environment influences these. Competition and the free enterprise process in an international environment.

UNIT 4. Strategy Implementation, Evaluation, and Strategic Alternatives: Selection of various

strategic alternatives considering social responsibility, management of values, community relations, governmental relations, and environmental concerns.

INSTRUCTOR: Tommy Cates

OFFICE HOURS: 11:00-12:00 MTWTh,

OFFICE PHONE: 587-7307 E-MAIL: tcates@utm.edu

OFFICE: Room 213 Business Administration Building FAX: 587-7231

URL: http://fmc.utm.edu/~tcates

CLASS PROCEDURES AND REQUIREMENTS:

1. Assignments shown below reflect the plan for presentation of course materials and will be

followed as closely as circumstances permit. Adjustments may however, be made from time to time by class announcement. Each student is responsible for compliance with all announced adjustments.

2. Attendance Policy is that all students are required to attend all classes. Student participation and interaction is important and needed to achieve course objectives at the levels expected.

3. Course Grading criteria are based on the following: (1) Written cases (70%), in class participation (10%), the first exam (5%), a second exam (10%) and final exam (5%).

4. All cases are to be submitted typed (a typewriter or word processor), the length assigned, when due, and in format determined in class.

5. Failure to comply with the Student Handbook will adversely affect a student's grade. The degree of this effect is totally at the professor's prerogative.

6. On designated days students will be expected to discuss the information that has been

printed in the Wall Street Journal the previous week (through the previous day). Participation in this discussion will count toward the participation credit within the course grade. Also, one half the midterm and one half the final exam will be based on the Wall Street Journal.

The first page of your case should begin with your Student Identification Number and the name of the case in the upper right corner. Then, staple the pages in the upper left corner. No cover page, paper clips, or folders will be needed. You will need to use the following general format to present your case analysis. All cases need to be typed. All sections except the "Data Profile" are to be double spaced. You are limited to a maximum of five pages for the body of each case, but there can be unlimited appendices. Three spelling errors or grammatical errors in a case will earn a grade of zero. Not calculating all of the ratios for a particular case will result in a failing grade for a case. A proper financial analysis of the case will include your explanation of the information available in the ratios. For example, I know that the current ratio is current assets divided by the current liabilities, and this does not constitute analysis. It is up to you to discuss what the profitability, liquidity, leverage, and activity ratios mean to the current financial condition of the firm. You will also need to discuss the economic conditions which the firm was facing during the time frame of the case. Also, you will need to consider these points when you design the strategy for the future of the companies in the cases. Each section of your case should be subtitled as follows.

Problem Statement

This is a statement of the overall strategic problem the company faces. It will take from one to three lines to present this section. In each case you will have in this course, the problem will have something to do with the strategy of the firm. You should begin by thinking of strategy as the overall operations of the firm. One definition of strategic management of the firm is "the sum of all the managerial decisions " within that firm. Based on this, a strategic plan is a set of policies that will guide the managers in their decision-making. Based on this approach, the "Problem Statement" will not address a narrow area of the firm, such as, marketing or personnel. You will find that you will gravitate toward your major, then it will seem that 90% of your efforts will be devoted to finding and correcting things outside your major. Reading chapters 1, 2, and 3, will support this approach to the case.

Your understanding of the concept of strategy will be enhanced if you will study Chapter 1. A flowchart (p. 4) of the strategy of a company is give and it is also shows an important idea: that strategic management is a circular process. It is continually under review and revision. Chapter 1 continues with a discussion of the importance of entrepreneurship and the tendency of the firm to accept the personality of the CEO. This is particularly important in this class since the CEO is usually instrumental in formulating the strategic plan for the company. It is also important for you as future decision makers to understand the importance of each manager in development of the strategy of the firm. This may have impact on you as you face your employment in the future. The actual functioning of the general manager is covered in pages 18-19.

Data Profile

This section presents the relevant information that supports the Problem Statement. Some students see this section as a chance to discuss the problems the company faces, but you should go further to discuss all of the factors that affect the future of the company. There are two general ways to present this information: SWOT and internal/external processes.

SWOT. This analysis process is discussed in your text and stands for Strength, Weaknesses,

Opportunities and Threats (See pages 105-113). Your major obstacle in case writing will be an over-abundance of information. The SWOT analysis will allow you to categorize the facts which are relevant to the case. For example, is a fact a positive factor for the future of the company? If so, it might go under either strengths or opportunities. One thing that you should note in particular: different people may look at a point from different perspectives, so the facts may seem to be strength to someone but seem as a weakness to someone else. This will be particularly true as you begin to look at different strategic plans.

Internal/External processes. This is just another way to categorize the facts surrounding the case. In this part, you would need to look at the internal events and factors that might control the future of the company. What resources are available to the company to accomplish a particular strategy? This would be the natural point to discuss the financial condition of the firm. Also, what human resources, managerial experiences, etc., are available? External conditions include anything outside the company that is important to the situation for the company. This section should include economic conditions concerning the time frame of the case. You should include anything in preparing the case while it was published before the ending of the time of the case. One final point in this type of analysis is a discussion of the competition for the firm. Who are the competitors? What resources are available to them? Again, your perception or this information may make you different from your fellow students. Much of the information about the competitors is available in the library, and it is cataloged by the Standard Industrial Classification (SIC) code. Competitive and industry analysis is imperative for any firm. Porter's Five Forces Model (pages 73-85) are all ways of handling the vast amounts of information available to you in these areas. In most of your classes, you have some rules which apply to the in that class. In this class, the experience curve concept is one of these rules. Two marketing theories are also important in studying strategic management: product life cycle, and results of the PIMS (Profit Impact of Marketing Study). One of the points in PIMS suggested that the firm with the largest market share was typically the most profitable in the industry.

In essence, you are trying to define the current strategy of the firm. If a firm exists in a particular form, what factors cause this structure? Is the firm using all of the available resources as efficiently as possible? Is it reaching all of its customer groups?

There is a relationship between the "Data Profile" and the "Problem Statement." Many students view the "Data Profile" as a section which supports, clarifies, and interprets the "Problem Statement." You are laying groundwork for a new strategy for the firm.

This is the end of your discussion of the historical section of the case. The majority of the research work and "library time" has been demonstrated up to this point. Everything from here on must deal with the future of the company. You should be at the end of the first page or just barely beginning the second page. If your "Data Profile" goes longer, you are sacrificing a chance to demonstrate your knowledge of business in the "Implementation." I will assume that you do not have much of this knowledge, and I will deduct most points. From this point on this case, they will need your creative abilities to explain how you would run the company.

Alternative Solutions

This section suggests how you were thinking when you were trying to find new strategy. What did you consider as possibilities? This is not some frivolous section of the case. At some point during the semester, you may be required to select one of your alternatives which you have not discussed in the paper and write a paper in class which implements that strategy.

The "Alternative Solutions" are strategies that could solve the "Problem Statement" which you

defined at the beginning of the paper. The nature of these alternatives will change from time to time based upon the type of company with which you are dealing. There are two types of strategies discussed in your text: business strategies and corporate strategies. The business strategies are used in companies that only have one major business operation in one industry. Corporate strategies are used for companies that have several different types of operations in different types of operations in different markets. It is normal for business strategies to be subsets of corporate strategies. This type of arrangement follows the idea that a company needs to respond to different industries with different strategies. They typically call these different subsets Strategic Business Units (SBU).

You should have at least four alternative strategies. They should all be mutually exclusive. They

should not be longer than two to four lines.

Solution

This is simply a restatement of one of the alternatives listed in the section above, but this will announce your commitment to implement a particular solution to the exclusion of the other alternative solutions.

Implementation

At this point, you should still be on page two of your case. You will select one of the alternatives you outlined in the section above, and now you are ready to make it work. This section is a "how to" manual for making your strategy work, and it represents about 60% of your writings of the case. Each part of your strategy must be explained, and the interaction of the parts should be demonstrated. For example, businesses must typically make money before they spend it; so I assume that in your strategy, you will follow this simple concept. Use the next three pages to demonstrate how much you have learned in business administration. This section of your case will be related to the rest of your case because you will be expected to solve or minimize the risks which you delineated in the "Data Profile".

Pick the one Alternative Strategy that you feel is most appropriate and describe how you plan to help the company implement this strategy. All of the other alternative strategies are neglected at this point. There are numerous ways to present your Implementation. One is to present a chronological progression. This could be phases of the development of a strategy. Another way of presenting your strategy is to discuss the sections just as you have studied in the School of Business: a section for management, marketing, finance, accounting, etc. These topics would be variable based on each case and the problems that the company is facing. For example, in some cases, the company may need a section entitled "Legal Aspects" or "Research Development."

You are given direction in two other areas by your text. Chapter 9 discusses building resource capabilities and structuring the organization. Chapter 10 explains actual implementation of the strategy through day-to-day activities.

None of these references are meant to diminish the concept that this is a capstone course. Students are encouraged to utilize any and all the materials that you have been taught in the Business Core of the curriculum. Please feel free to use any of the books that you were taught from in these courses as reference materials to help you in preparation of cases in this course.

Competitive Response

In this section, please discuss how you expect the major competitors to respond to your new

strategy. This section is based on your study of the competitors and the strategy which you have

implemented. This section of the case should be no longer than one half page.

Appendices

Appendix A is reserved for your financial analysis of the firm. You should calculate all of the ratios that can be developed based on the data provided or which are available in the library (See pages 626-627). Once you have calculated the ratios, I require that you give your interpretation of the ratios. This does not mean that you define the ratios. I expect you to compare the ratios to previous performance of the company and to performance of the other companies in the industry. If there is no industry, pick key competitors and compare this company to them. It is almost impossible to manage twenty-eight or more ratios mentally at one time. I suggest that you look at the activity ratios, then the profitability ratios, etc. This also means that you will need to write a paragraph about the meaning of the activity ratios, a paragraph about the profitability ratios, etc. Feel free to use Lotus 1-2-3 or any other spreadsheet program to make this task easier. I will fail any case which does not have a complete set of ratios and a thorough analysis.

Your appendices should be used to support, summarize, and clarify the information presented your case. I realize that five pages is not very much room to write about the hours that

you have spent on the cases, so use the appendices wisely. The five typewritten pages are a summary of your efforts. The appendices do not need to be typed. One farther point, if you elect to attach an article or a case as an appendix, I require you to have a paragraph noting the important parts or summarizing that appendix.

Each appendix should have a cover page outlining the major points in that appendix and explaining how that appendix relates tot he case.

Tentative Class

Date Assignments

May 30 Introduction

31 chapters 1-6

June 1 chapters 1-6 and WSJ

2 chapters 1-6

5 Exam 1

6 chapters 6-11 and WSJ

7 chapters 6-11

8 case 1

9 chapters 6-11 and WSJ

12 case 2

13 chapters 6-11 and WSJ

14 Exam 2

15 case 3

16 WSJ

19 case 4

20 exam 2

21 WSJ

22 case 5

23 WSJ

26 WSJ

27 case 6

28 WSJ

29 Final