Mgmt 499: Cases in Strategic Management Individual Case Assignment - Due \"See our class schedule and/or the due date assigned in our associated D2L class dropbox. Case: Please review the assignment instructions for the specific case that you will be using. This assignment is an individual assignment, worth 15 out of the 100 points for the semester. Present your analysis from the point of view of a consultant hired to advise the Chairman of the Board. Thus, your audience is familiar with all the facts of the case; do not waste time restating case data. Your objective is to analyze, interpret, draw conclusions, make recommendations and projections that are unique and must be explained and justified. The following guidelines should help you in writing this case study The time period is the one covered by the case as reported in the textbook. No outside research is allowed. if you quote something, put it in quotes, and list the page number after the quote. Make use of concepts and theories from the text and class discussions. You need not cite the text directly nor should you explain/develop the concepts or theories. Please assume that I have knowledge and understanding of management theories. Simply make the logical connections between the concept or theory and the case issue to which it applies. The case must be typed, 11 or 12-pt. font, double-spaced, with one-inch margins. It will probably be six to ten pages in length (excluding appendices), but it can be shorter or longer if you wish. Use APA format for this assignment. Use section headers in your report - the section header for each section is italicized in the list below. Your report should be well organized, succinct, and well written. The report should read as a unified piece of work and flow smoothly. Number pages consecutively from beginning of document to the end. PROOFREAD! In addition to content, grammar, spelling, and style are important! I will take off points for not following these guidelines and for submitting sloppy reports. See my note about plagiarism at the end of this document. Note about appendices: I have listed the four appendices you must include. Remember to be as complete as you can in your appendices, so that when you discuss a few of the items in your text, you can be confident that they are the key items to mention. I suggest you create the appendices first, even though they appear last in your report. They are intended to give you data to justify your conclusions in the text of the report. For each item below, I use the following rubric in my scoring: Weak (.5-.6): Acceptable (.7 - .8) Strong (.9 - 1): Major topic is present, but major items are omitted, presented without justification, or inaccurately described. Every sub-topic is present, Every sub-topic is covered thoroughly yet concisely. Course concepts used accurately, Justification of conclusions obviously based on data, analysis Conclusions are specific, with details and examples used to illustrate the concepts. The following are the requirements for the text portion of the report: Introduction (1 point). Introduce the case in one or two paragraphs describing the market(s) the firm competes in, a summary of the key attributes of their products, and a general description of how well they are performing. State the central question or issue presented in the case. Keep this brief, since your audience knows the details. External Analysis (1 point). Describe the key external opportunities and threats from the point of view of a PESTEL analysis. Also, What competitive forces seem to have the greatest effect on industry attractiveness (based on the Five forces). Is the pace of rivalry quickening and becoming more intense? Why or why not? Internal Analysis (1 point). Describe strengths and/or issues you found in the Financial Analysis. Describe the most critical strengths and weaknesses you found in the value chain. What are the key value drivers and cost drivers in this firm? What are the firm's core competencies? Do any of them lead to a sustainable competitive advantage? Use the VRIO framework to justify your claims. Business Level Strategy (2 points). State and justify which generic business level strategy dominates the firm. Use the capabilities and activities in the value chain as evidence for your conclusion by describing the ways those competencies and resources increase value (in the eyes of the customer) or how they help reduce costs. Describe the level of consistency throughout the firm regarding the business level strategy - do the activities support the business level strategy, or do they seem to contradict each other? Corporate Strategy (2 points). Where in the industry value chain does the firm compete, and in which product markets? Discuss their current level of vertical integration, horizontal integration and diversification. Analyze these activities - are they successful, should they do more or less? Discuss the organizational forms they have used to pursue corporate strategy - mergers and/or acquisitions, strategic alliances, etc. Why do you think they have chosen those methods? Any key issues in their corporate strategy? Global Strategy (1 point). How much pressure is there for cost reductions, and for local responsiveness? Describe the current global strategy and provide evidence about how the firm's resources and competencies support the given pressures regarding costs and local responsiveness. Describe entry modes have they usually used, and whether they are they appropriate for the given strategy. Any key issues in their global strategy? Proposed Alternatives (2 points). Based on your Strategic Alternatives Matrix and the issues identified in the opening paragraph, choose 2 alternatives to develop further, and justify your choice based on the items from your SWOT that would be affected by that choice (threats and/or weaknesses mitigated, opportunities and/or strengths exploited, etc). One of the proposed alternatives should be relatively short term and would not cost much, and one should be relatively long term and would require significant investment. For each of the proposed alternatives, describe risks and/or benefits to at least two internal stakeholders, and two external stakeholders. Recommendation and Implementation (2 points) Select and justify, based on urgency and importance, one of your alternatives and describe an action plan to accomplish the recommendation: State a measurable goal - what results would need to be reviewed to determine if additional changes were needed? List at least one input control and one output control that would support this implementation and include at least 5 steps they need to take to accomplish the recommendation. Appendices (1 point each): Financial Analysis (Include a Strategic Financial Analysis): SWOT Analysis (use the template in the DropBox) Strategic Alternatives Matrix (use the template in the DropBox) Deductions will be taken for typos, word usage, grammar, incomplete sentences, and/or incorrect format. Strategic Alternatives Matrix for Medtronic External Factors Internal Factors Strengths: (S1): Cutting edge, minimally invasive product development (S2): Robust product portfolio across 8 divisions (S3): Consistent unit cost reductions throughout product lifecycle (S4): Data collection and analysis provides strategic advantage in decision making (S5): Vendor relationship and process improvement capabilities produce consistently excellent quality Opportunities: (O1): Target the growing over 60 population in the US. (O2): Target the rapidly growing populations in the emerging markets of Africa, Asia and South America (O3): Focus on post-surgical monitoring devices to reduce costs and re-admittance (O4): Acquire venture capital backed startups to supplement product portfolio (O5): Leverage increase in tele-medicine to diagnose and treat previously unreachable populations. Threats: (T1): Affordable Care Act produces uncertain business climate in near term. (T2): Global economic downturn threatens to slow revenues, impart currency losses. (T3): Early detection and non-surgical treatments brought about by technological advancement threaten revenues. (T4): Single payer health care systems in foreign countries threaten to lock out certain regions. (T5): Foreign competitors have lower labor and regulatory costs. SO Alternatives: 1. Develop cutting edge products in telemedicine sector. (S1, O5) ST Alternatives: 1. Develop products and technologies that can be used for early detection. (S1, T3) 2. Use data analysis capabilities to isolate root cause of re-admittance and adjust procedures to minimize incidence. (S4, O3) 2. Form and expand partnerships with vendors in foreign markets with lower labor and regulatory costs. (S5, T5) 3. Develop products that target the specific chronic diseases of the emerging markets. (S1, O2) 3. Form consultancy relationship with domestic or foreign governments to leverage strength of data analysis capabilities. (S4, T4) Weaknesses : (W1): CRM product development lags behind other divisions (W2): Allegations of unethical behavior call in to question integrity and culture (W3): Regulatory issues have caused slowness in getting products to market (W4): Medtronic lacks a unified marketing strategy across divisions (W5): Frequent acquisitions have led to quality issues at subsidiaries. WO Alternatives: 1. Acquire companies with a cardiac rhythm management specialty to supplement product portfolio(W1,O4) 2. Develop and sell products in markets that have less robust regulatory approval processes(W3,O2) 3. Acquire companies with a distinctive or core competency in marketing and sales(W4, O4) WT Alternatives: 1. Develop CRM products in emerging markets with lower costs. (W1, T5) 2. Acquire foreign competitors that have strong regulatory and quality track record (W5, T5) 3. Develop lower cost, less innovation intensive CRM products for global markets. (W1, T2) SWOT Analysis for Medtronic Strengths Weaknesses Strength that leads to a sustained competitive advantage: 1. Product callbacks can incur significant costs to 1. New leadership team that has experience in the 2. Pending litigations produce financial costs and medical device industry and is committed to strengthening and growing the company. poor media exposure. Core Competencies: management (CRM) and implantable cardioverter defibrillator (ICD) product proliferation. 2. Strategic acquisition of complementary businesses that grow the company's capabilities. 3. Top management commitment to diverse product portfolio that includes seven core businesses. 4. Ability to continue Increasing international presence for sales, marketing, R&D, and manufacturing the company. 3. Overdependence on matured cardiac rhythm 4. Mandatory disclosure of conflict materials may increase costs in diligence of identifying sources. 5. Unplanned sterilization capacity shortages could have adverse impact to operations as this is essential in order to ship product. 5. Able to continuously streamline organization to create speed, agility and flexibility. Other capabilities: 6. Production systems are able to custom build to meet unique specifications. External Opportunities External Threats 1. The world's population is aging and will require medical attention in the form of devices and hardware. Boston Scientific is in a good position to capitalize on this. 1. Health care reform in the U.S. will create mandatory health care for people who cannot afford it. This will increase the demand for medical devices and procedures, but will drive up costs and cut profitability. 2. Greater spending from BRIC countries creates new opportunities as there are more consumers with health insurance and middle class incomes. 3. Medical technology advances are increasing life expectancy. As people live longer, they will require more medical treatment. This is good for business. 2. Increased regulatory scrutiny will affect/increase product development and deployment costs. 3. Decreasing and/or absence of R&D tax credits will increase costs of bringing new products to the market. 4. Increase in development of surgical technologies. Many hospitals and clinics are replacing and/or purchasing new surgery equipment. Boston Scientific manufactures this type of equipment. 5. An industry trend is that larger companies are acquiring smaller firms to expand intellectual property, product offerings and market share. Boston Scientific has been very active in this trend and continues to do so. 4. Cardiovascular device market is highly competitive and is showing signs of market saturation. This will affect Boston Scientific as they are heavily invested in this market. 5. The world economic recovery is slow and the unemployment rate remains high. Many consumers do not have health insurance, which may drive down demand depending upon health care reform