Case Study-1
HERO CYCLES PVT. LIMITED
Hero Bicycles Pvt. Ltd. is a Ludhiana-based bicycle manufacturing company. Hero is one of the biggest bicycle manufacturing companies in the world. Basically, Hero has attained its present commanding heights after long years of struggle. It started as a sole proprietorship concern in 1950. Mr. C. L. Munjal who owned a bicycle repair shop in Ludhiana has four sons who joined hands with their father and established a partnership concern. Now, this company has developed into a Pvt. Ltd. Company. There are several companies at present in Hero Group which manufacture a wide range of products, viz., mopeds, motorcycles, shock-absorbers, bicycles, spare parts, textile fibres, etc. at present, Hero group has many professional managers working in their various companies which have
become public limited (widely held) companies but Hero Bicycle still remains a private limited
company (narrowly held). Lala type tendencies are very ostensively visible in the functioning of this
group as a whole and more particularly in the Hero Bicycles Pvt. Ltd. As a result, many employees of
this company and the group as a whole are not a highly satisfied lot. But still Hero Group and Hero
Cycles in particular are working as highly efficient and profit making unit in their business.
Lately, Hero started experiencing a cut-throat competition in the bicycle business in the home and
world markets. They have started experiencing some flatness in their sales and profit curves.
Recently, Hero Cycles Pvt. Ltd. recruited an M.B.A. Miss Anuradha Goswami. Miss Anuradha who
specialised in Marketing, was the first M.B.A. to be recruited from the outside as there was an
emphasis to recruit only technically equipped people like engineers, etc., without management
qualifications. But some of the sons of the four brothers of Hero Group are having technical as well as
management qualifications. Even some of these third generation, Hero Promoters and managers are
M.B.A.’s from some reputed universities. They have lot of management exposure in India as well as
abroad as they keep on touring domestic and international markets quite frequently. The chairman,
Mr. Ravinder Lall is also a very ambitious and dynamic man who talks of promoting a Hero culture
among Hero Group employees as a whole. He aspires to take bigger strides and make the group as
one of the few big business houses in India. He intends to start his own training college to impact
management training to his group employees and also to managers of other companies.
One day, Mr. Ravinder Lall called his marketing Manager Mr. Siripat Dass in his cabin and
discussed with him in detail the marketing problems facing Hero Cycles Pvt. Ltd. Mr. Dass told Mr.
Ravinder Lall, “Sir, our main problem is that we are continuing our manufacturing on traditional lines
hence many problems of marketing are the result of that. We never tried to have a feel of the
consumers in domestic as well as in international markets. To be very frank sir, we must undertake
some marketing research projects so that we can understand the purchase behaviour of bicycle buyers.
Also there is a need to understand the dealers’ view-points through certain dealers’ surveys.” I think
you can guide and instruct Ms. Anuradha Goswami on this and she would be able to carry out the
research work. Ask her to prepare a research report on the basis of collected research data.”
Mr. Dass summoned Miss. Anuradha to his cabin and asked her to prepare a research proposal
and get it approved to study buyers’ and dealers’ behaviour within ten days. Miss Anuradha started
the maiden exercise of preparing a research design from that moment onwards. She established the
study objectives as follows:
1. To study the buyers’ needs and behaviour after establishing certain basic attributes of bicycles
needed by them.
2. To study the dealers’ attitudes towards Hero Bicycle policies and its products.
3. To distinguish the rural buyers’ needs and attitudes from those of the urban buyers.
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Ms. Anuradha decided to adopt an exploratory research design because much secondary data
were not available. She wanted to collect primary data on the buyer’s and dealers’ attitudes. For this,
she decided to take a sample of 100 buyers (males and females) from each of the urban and rural
population from and around Ludhiana city in the samples. She decided to include some juveniles,
children and students. In the samples, she decided to take a sample of 50 dealers from the North
Indian States. Buyers’ sample was to be taken on the judgement and convenience basis whereas
dealers’ sample was to be taken on the random stratified sampling basis.
She decided that data collection from buyers will be carried out with the help of a structuredundisguised
interview schedule. Personal interviews would also be conducted with the dealers with
the help of a separately designed interview schedules. She decided that many questions on each
schedule would be on attitude measurement on the pattern of Likert Scaling Techniques covering the
bicycle attributes like price, quality, colour, availability of spare parts, repair costs, sleekness in looks,
durability etc.
Further, Ms. Anuradha decided that data thus collected would be categorized in favorable and
unfavorable categories (with regard to attributes) and z-test would be applied to examine the
significance after calculating the mean scores. Ranking of various attributes will also be carried out.
General profile of consumers and dealers will also be prepared on the basis of their biographic
information like age, sex, qualifications, income, place of living, etc.
Finally, it was decided that two outside investigators (MBA students) would be engaged for the
purpose of survey who would collect and compile the survey results.
She assumed that survey would be having certain limitations as the samples would be small in size
because of limited time within which the research report is to be prepared. But she justified that
buyers and dealers attitudes would be same even in larger sample as people have similar viewpoints
regarding bicycles.
1. Was the problem identification and formulation systematically carried out? Discuss and put forward your viewpoints for improvement in this regard.
2. Whether the objectives were decided and listed in an appropriate manner? Whether hypothesis were to be formulated? What can be the hypothesis in this case?
Case Study-2
Over the past two years Linux has spread like wildfire through corporate data centers. Companies
once dependent on expensive proprietary systems from Sun, IBM, or Hewlett-Packard have replaced
them with dirt-cheap Dell or no-name servers that are Intel powered and loaded with the Linux
operating system. Linux now runs almost 15 percent of all servers and is growing at about 23 percent
a year. And even mainframe systems have joined in, with IBM estimating that over 10 percent of its
mainframe sales are for running Linux applications.
Though PC users haven’t switched to Linux – less than 1 percent of all computers run Linux – a
2002 survey by CIO magazine found that almost 30 percent of chief technologists were considering
moving their companies’ PCs to a Linux PC operating system like Windows. Wal-Mart, which began
selling Lindows-ready PCs on its website in September 2002, had such success with that offering
that by Christmas it was having trouble meeting demand. Almost every major PC electronics maker,
from HP in printers to Epson in scanners, is making sure it has Linux-compatible offerings. And Sun
has poured millions of dollars into its Star Office software suite, which gives Linux users programs
that work like – and more important, are compatible with – Microsoft PowerPoint, Word, and Excel.
Backed by technology titans such as Intel, IBM, Hewlett Packard, and Dell, Linux is just now
going mainstream. From DaimlerChrysler to Tommy Hilfiger – not to mention just about every
major brokerage on Wall Street – Linux is gaining ground. Coming from near zero three years ago,
Linux grabbed 13.7 percent of the $50.9 billion market for server computers in 2002. That figure is
expected to jump to 25.2 percent in 2006, putting Linux in the No. 2 position, according to market
researcher IDC. And get this: Starting in 2003, No. 1 Microsoft’s 59.9 percent share in the
backwards. Even the surprise but shaky assault on Linux by SCO in its suit of IBM is not expected
to slow the steady growth of Linux.
Meanwhile, Linux is finding its way into countless consumer-electronics gizmos, including Sony
PlayStation videogame consoles and TiVo TV-program recorders. “Has Linux come of age? The
answer is absolutely, positively, unequivocally yes,” says Steven A. Mills, group executive for IBM
Software.
How did Linux make the jump into the mainstream? A trio of powerful forces converged. First,
credit the sagging economy. Corporations under intense pressure to reduce their computing bills
began casting about for low-cost alternatives. Second, Intel Corp., the dominant maker of processors
for PCs, loosened its tight links with Microsoft and started marking chips for Linux; at the same time
a resurgent IBM made a $1 billion investment in Linux compatibility across its entire product line.
This made it possible for corporations to get all the computing power they wanted at a fraction of the
price. The third ingredient was widespread resentment of Microsoft and fear that the company was
on the verge of gaining a stranglehold on corporate customers. “I always want to have the right
competitive dynamics. That’s why we focus on Linux. Riding that were will give us choices going
forward,” says John A. McKinley Jr., executive vice-president for global technology and services at
Merrill Lynch Co., which runs some key securities trading applications on Linux.
Using open-source software like Linux is a no-brainer for many companies. It’s stable and can be
fixed easily if bugs appear, and you can’t beat the price. But some companies and government
organizations are taking their commitment to open source a step further by actively participating in
the open-source community that develops Linux. When their developers write patches, modifications
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or new implementations of open-source software for in-house use, these organizations are releasing
that new code back to the open-source community, thereby assisting in the software’s ongoing
development.
What’s the payoff? It makes for better software. “If we find a bug or a problem, we’re interested
fixing that problem. We’re also interested in not fixing it again in the next version,” explains Robert
M. Lefkowitz, director of open-source strategy at Merrill Lynch & Co. in New York.
This is why Merrill Lunch sent the fixes it made to open-source software during one of its
projects back to the open-source community. “The way a typical open-source project works is that
there is a core team in the open-source community with direct access to modifying the code on its
central website,” Lefkowitz says. “People who want to contribute to that community submit their
code, which is looked at by a core team and integrated if found appropriate.”
For all contributions, Lefkowitz emphasizes the importance of creating a corporate policy with
help from the departments that could be affected by open-source involvement. At Merrill Lynch, an
eight-member Open-Source Review Board determines when contributing is appropriate.
1. Should businesses continue to switch to the Linux operating system on servers and mainframes?
Why or why not?
2. Should the IT departments of companies like Merrill Lynch contribute their software
improvements to the open-source community for products like Linux? Explain your reasoning?
Case Study-3
This case is based on an actual incident which took place in an Army Unit deployed in field area. A part of a Battery (about ¼ of an Artillery Regiment) was deployed in a snow bound high altitude area of Kashmir. This was the first time, an artillery unit was deployed in an area with roads and tracks still under development. Preparation of this area for such a development needed a lot of digging for guns, pits for ammunition storage, living place of the personnel, slit trenches and weapon pits for local ….
incident very sympathetically and promised to assist in whatever way he could. This officer was a contemporary of the unit in a previous station and had excellent relations and interaction with the unit. Some items were offered by the workshop officer and replaced accordingly. The vehicle was made roadworthy again within a fortnight and put on road for duty. All the enquiries were dispensed with and there was no loss of face by anyone at any level. It is pertinent to mention that it had snowed in that location as soon as the recovery party came out of the hills.
QUESTIONS:
1. Which factors contributed to motivate the troops to go ahead for such a difficult task as recovering a damaged vehicle from such a difficult and treacherous terrain and getting it repaired in such a short time?
2. Which incidents indicate the importance of good interpersonal relationships with juniors, peers and superiors and what is the importance of good interpersonal relationships?
Case Study-4
The stakes were high for Gene Elliot, whose on-the-job injuries were estimated to be serious enough
to merit at least a $2.4 million settlement. But who should pay for his injuries: Turner Construction
or B&C Steel? Or should he be forced to pay for at least part of his injuries because of his own
carelessness?
Gene Elliot worked for Mabey Bridge and Shore, a small business that rented temporary steel
pedestrian foot bridges to other companies. The temporary bridges had to be put together by the
renter, and Gene Elliot’s job was to go to the site where the steel bridge was going to be installed,
show the renter how to bolt the bridge sections together and how to install the bridge over a river or
waterway, and inspect the bridge to make sure it was done properly and according to Mabey
Bridge’s high standards. Elliot was a devoted hard worker who strove to do everything possible to
ensure that a bridge installation was successful and according to Mabey’s standards.
Turner Construction was a general contractor hired to build Invesco Field at the Mile High
Stadium in Denver, Colorado. Part of the job involved installing a temporary pedestrian bridge over
the Platte River near the stadium. Turner Construction subcontracted (hired) B&C Steel to build and
install the bridge, which Turner Construction would pay for. B&C Steel was a small company that
specialized in putting together and installing steel structures like those Mabey Bridge rented out.
B&C Steel would pick up the bridge, put it together, and install it for Turner.
Turner Construction rented the long steel bridge from Mabey Bridge. Mabey Bridge agreed that
the rental included the services of Gene Elliot, who would be loaned to Turner to instruct and inspect
the bridge assembly and installation. B&C Steel’s workers picked up the bridge sections from
Mabey Bridge’s warehouse and drove them to the river but didn’t unload the bridge sections where
they had to be assembled. B&C then had to move the sections to the correct site but didn’t plan for
the fence, guardrails, and trolley tracks that were in the way and later had to work around these
obstructions. B&C Steel began bolting the bridge sections together. When Elliot inspected the job,
he found the bridge had been bolted together upside down. Elliot made B&C do the job over, while
he climbed up and down and over the bridge, continuously checking and making sure that all the
bolts were tight and all the pieces were in the right place so that the installation would be a success.
When the bridge was finished, B&C workers used a truck to move the long steel structure to the
edge of the river. Unfortunately, B&C had not adequately checked the route and their truck hit a low
hanging power line, which sparked and started a fire. The fire department arrived and put out the
fire. Afterwards, the installation job continued.
B&C workers set up a crane on the other side of the river near a retaining wall, and a strong nylon
strap was strung from the crane, over the water, and tied to one end of the bridge, which was set on
rollers. The B&C crane would lift and pull the bridge over the river to its side, while workers on the
other side of the river pushed on their end of the bridge. The work began, and as the pulling crane
held the bridge suspended in the air about a quarter of the way over the river, Elliot noticed that the
retaining wall which was supporting the crane on the other side of the river was beginning to
collapse, causing the crane to begin to tip sideways. The B&C crane operator on the other side began
to untie the strap holding the bridge, Concerned that once the strap was cut the bridge would fall into
the river and the installation would end in failure, Elliot ran up on the bridge and gave the standard
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emergency OSHA all-stop signal that all construction workers know means not to move anything.
But the bridge, still attached to the crane, somehow moved, and Elliot felt, sustaining numerous
pelvic injuries and a severed urethra (the tube that carries urine). The cause of the movement was
never established.
Elliot sued Turner Construction and B&C Steel for negligence resulting in economic losses of
$28,000, noneconomic injuries of $1,200,000, and permanent impairment of $1,200,000. These
figures were established by a qualified expert in the field of worker injuries and were not seriously
contested.
Turner Construction, however, denied its responsibility. It claimed that Turner was Elliot’s
temporary employer and workers’ compensation law required employees to pay only the economic
looses, here only $28,000, suffered by their employees. Turner Construction pointed to the law,
which stated: “Any company leasing or contracting out any part of the work to any lessee or
subcontractor, shall be constructed to be an employer and shall be liable to pay [only] compensation
for injury resulting therefrom to said lessees and subcontractors and their employees.” Turner
Construction claimed that Mabey was a subcontractor to Turner, so Turner should be construed to be
Elliot’s temporary employer. Moreover, Colorado’s worker’s compensation law, which was
designed to ensure that employers always paid for workers injuries “grants an injured employee
compensation from the employer without regard to negligence and, in return, the responsible
employer is granted immunity from common law negligence liability.”
B&C claimed that it, too, was not responsible, because according to the law a company is not
responsible for negligence when an injury is not “reasonably foreseeable” to the company. B&C
contended that a reasonable person could not have anticipated that placing the crane near to the
retaining wall and subsequently attempting to remove the nylon strap holding up the bridge might
end by prompting someone to get on the bridge in an attempt to save it from falling into the river. On
the other hand, B&C claimed, since “Elliot chose to remove himself from a secure and safe position
and placed himself in one that he understood was potentially unsafe,” Elliot was himself responsible
for his injuries.
Elliot claimed that he was not really Turner’s employee, since he was working for Mabey. He
also argued that B&C had shown a pattern of negligence from the time that the bridge was received
until the time that it was installed. B&C and its employees, he said, were unprepared for the project
and negligently failed to adequately plan for it, as shown by the sequence of events leading up to his
injury. B&C there fore did not exercise the degree of care that a reasonably careful person should
have exercised in similar circumstances and so was liable to him for his injuries. He himself was not
responsible, he said, because good, devoted employee would try his best to ensure that the bridge
installation did not end in failure, and he would have been perfectly safe if the standard OSHA allstop
signal had been followed by B&C employees, as he had a right to expect it to be.
1. In your judgement, and from an ethical point of view, should Turner Construction and/or B&C
Steel pay for all or part of the $2,428,000 (if part, indicate which part)? Explain your view?
2. In your judgement, is the Colorado worker’s compensation law to which Turner Construction
appealed fair? Explain your view?
Case Study-5
Most companies store reams of data about their customers. The IT challenge has been how to
integrate and massage that information so the business units can respond immediately to changes in
sales and customer preferences.
Hency Schein Inc. (www.henryschein.com) has it figured out. The $2.8 billion distributor of
health care products designed and built a data warehouse with an in-house team of six IS
professionals. CIO Jim Harding says he knew that having the right skills was critical to the data
warehouse project, yet at the time, Schein had zero warehousing experience in its IT shop. So he and
Grace Monahan, vice president of business systems, hired people for what they call “Team Schein.”
Because Harding had chosen two key tools for the data warehouse – data extraction software
from Informatica Corp. and user query and reporting software from Micro Strategy Inc. – the focus
was on finding people who had experience with those tools. So Monahan hired three people from
outside: project director Daryll Kelly, data modeler Christine Bates, and front-end specialist Rena
Levy, who’s responsible for the user interface and data analysis, as well as user support and training.
Dawen Sun, who handles extract, transform, and load issues, and database administrator Jamil
Uddin hold two other key positions. Another term member is rotated in form Schein’s application
development group.
Besides having the right skills, the other top priority was ensuring data quality. “It seems kind of
obvious,” says Harding, “but sometimes these projects forget about quality, and then the data
warehouse ends up being worthless because nobody trusts it.” So at the outset of the project, the
team interviewed about 175 potential business users to determine the information they needed to
access and the reports they wanted to see. Plus, the team analyzed the old paper reports and the
condition of the data housed in the company’s core transaction system. Monahan says those steps
brought to light the importance of cleansing data in a system that’s designed for transactional
purpose but not suitable for a data warehouse. That led to a long period of standardizing
transactional codes in order to produce the sales reporting that business analysts needed.
“It’s in-house people who have this gold coin of knowledge of how their systems really work,
which data is really good and not so good, and how the end users really want to use the data,”
Kimball says. “Data quality is the hardest part of the project, because it’s very time-consuming and
detailed, and not everyone appreciates it unless they’ve been through a couple of projects, like Daryll
has,” Harding says.
And there was yet another tedious obstacle. The data warehouse was designed to provide a very
granular level of detail about customers, “so we can slice and dice at will,” Harding says. But the
result was sluggish system performance. So the team created summary tables to make the queries
work faster, and those tables needed to be tested. It was a lengthy process, Harding says, but in the
end, it worked very well. The journey has taken well over two years. The system went live 18
months ago but “really came into its own” in February, Harding says.
Of course, building a data warehouse is a never-ending job. New companies are acquired,
products are added, customers come and go, and new features and enhancements are ongoing. But
from an IT standpoint, the data warehouse is complete and has 85 percent of the data is to provide
the European operation with its own data warehouse system and tie it into in the U.S.
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Harding says his project will surely justify the costs, but he lacks hard numbers. “We didn’t have
a formal ROI that you could track later. I don’t even know how you would do it,” he says. “The
reason we’re doing the project is because of the value it brings to the business.”
Lou Ferraro, vice president and general manager of Schein’s medical group, says the business
benefits are outstanding. He can now figure out who his most profitable customers are, target
customers for certain types of promotions, and look at the business by product categories or sales
territories. Ferraro says the data warehouse also helps select customers for direct-mail marketing
campaigns that range “upward of million pieces annually.”
One of the most valuable features of the data warehouse has been the ability it gives users to add
more fields to reports as they are using the system. “Once you create a basic report, draw a
conclusion, and drill further based on those assumptions, it allows you to use that data and go even
further, as opposed to creating a new report, and another and another,” Ferraro says. The IT
department used to create, edit, revise, run, download, reprogram, and print piles of paper reports –
daily, weekly, monthly and quarterly – for the analysis of sales and market trends. But today,
business users search, sort, and drill down for that information themselves in a fraction of the time.
The data warehouse has become “a part of our culture,” says Harding. “It’s got that kind of aura
about it within the company.”
1. What are some of the key requirements for building a good data warehouse? Use Henry Schein
Inc. as an example.
2. What are the key software tools needed to construct and use a data warehouse?
Case Study-6
A company has a central warehouse in Chicago that supplies the demand of three branch warehouse: one in Baltimore, one in New Orleans, and one in Cleveland. The following tables provide the relevant data:
Warehouse Safety Stock Lead Time Order Quantity On-hand
Baltimore 50 2 periods 350 250
New Orleans 100 1 period 200 150
Cleveland 80 2 periods 500 200
Chicago 200 2 periods 1500 750
Gross requirements on the branch warehouses:
Period 1 2 3 4 5 6 7 8 9
___________________________________________________________
Baltimore 100 80 150 90 100 85 110 120 100
New Orleans 70 65 75 50 90 80 75 80 55
Cleveland 110 90 65 135 85 70 140 100 60
1. Determine DRP records for all four warehouses?
2. What will be the DRP structure for the above four warehouses?
Case Study-7
Allen Specialty Company, located in Detroit, Michigan, manufactured a line of Ballpoint pens, and
mechanical pencils and, in the past five years, had added a line of stationary. Allen products were sold to
stationary and office supply wholesalers and retailers, as well as to department stores, discount houses,
drugstores, variety stores, and supermarkets. A field sales force of eighty-two persons operated out of six
district sales offices. Allen management believed that a critical factor in the company’s sales success was
the coordination of its national advertising and the activities of Allen salespeople and dealers.
The sales promotion program was the responsibility of the sales promotion manager, Jack Biggerstaff,
and his staff, in conjunction with the sales planning committee at Allen headquarters in Detroit. The sales
planning committee consisted of the managers of merchandising, advertising, and marketing research.
The sales promotion plan, for both new and existing products, described objectives; roles of salespersons
and dealers; anticipated sales; the national, local, and trade advertising; and point-of-purchase displays,
deals, premiums, and contest offers.
With approval of the sales promotion plan by the sales planning committee and the sales promotion
manager, Jack Biggerstaff, the sales promotion department prepared sales promotion kits for the Allen
sales staff. The kit included advertising proofs, products samples, illustrations of the point-of-purchase
displays, samples of premiums offered, and a description of the special deal or context featured in the
promotion.
The sales promotion department prepared a timetable for each promotion plan, showing the date when
each advertisement appeared in various media. The timetable was distributed to the sales force and
dealers to enable them to time their sale and advertising to coincide with the national advertising, thereby
achieving full impact from the advertising.
When the sales promotion plan was approved by headquarters, it was presented to Allen sales personnel
at meetings in each of the six district sales offices. The sales promotion manager and the field sales
promotion manager, who reported to the former and whose job was to work with Allen salespeople and
dealers on sales promotion projects, made the presentation. Following the meetings, the field sales
promotion manager trained the salespeople in proper presentation of the promotion and called on key
dealers to enlist their support.
The sales promotion program used with a recent new product introduction was typical of Allen’s efforts.
In addition to the objectives and timetables, the sales promotion program included(1) selling tools for
Allen sales people- circular letters describing the promotion, a visual presentation portfolio for making
promotion presentations, product samples, reprints of consumer advertisements; (2) selling tools for Alen
dealers- presentation kits for selling the new product to consumers , mail circulars for delears to send to
consumers, mailing folders for use by dealers, sample folders, and a considerable amount of prize money
for dealers sales personnel; and (3) advertising support for Allen dealers- advertising in national media
and sample folders to be sent to consumers who responded to a coupon offer.
The sales promotion programs were presented one each week in the district offices in late November and
December. When the schedule was announced, Mike Halloran, assistant sales manager in charge of the
Pacific Northwest district called Jack Biggerstaff to complain that the sales promotion orientation session
in his district had been scheduled for December 27 during the quiet week when many of his salespeople
had found extra time to spend with their families and when several had customarily taken short skiing
vacations, Biggerstaff explained that the promotion plan would not be completed by home office
personnel in the six sales regions, it was not possible to schedule more than one a week. It was tough, but
Halloran’s district had drawn the bad week this year.
Halloran responded that he thought the sales promotion sessions were a waste of time anyhow. His
salespeople lost two productive days in these sessions, and, in his opinion, knowledge of details of the
Allen Company’s advertising and promotion plans didn’t make the sales rep’s job of selling to
wholesalers and retailers any easier. Anyhow, it was the responsibility of the field sale promotion
manager to work with the individual salespeople and call on key dealers. He also complained that when
these sessions were scheduled in mid-November, they interfered with sales productivity in the busiest
season of the year.
1. Evaluate the Allen Specialty Company’s organization and plan for coordinating sales and
advertising?
2. How should Biggerstaff answer Halloram’s complaint?
Case Study-8
Tech Knowledge is a start-up founded in 1997 by Robert Thyer. The company is a distributer of
presentation technologies, including computer based projection systems, video equipment, and
display technologies. The firm has 25 employees and does $5 million in sales. It is growing rapidly.
The owner, Robert Thyer, would like to netsource the back-office functions of the firm because the
company does not have an internal IT capability. The applications to be netsourced would include
sales and distribution, financial accounting, and inventory management.
TechKnowledge would like to source SAP or another ERP vendor via a hosting arrangement. It
does not expect to do much customization, and it does not have any legacy systems.
1. What factors should it use to evaluate each of these potential hosts?
2. What controls should be in place to monitor the hosting arrangement?
HERO CYCLES PVT. LIMITED
Hero Bicycles Pvt. Ltd. is a Ludhiana-based bicycle manufacturing company. Hero is one of the biggest bicycle manufacturing companies in the world. Basically, Hero has attained its present commanding heights after long years of struggle. It started as a sole proprietorship concern in 1950. Mr. C. L. Munjal who owned a bicycle repair shop in Ludhiana has four sons who joined hands with their father and established a partnership concern. Now, this company has developed into a Pvt. Ltd. Company. There are several companies at present in Hero Group which manufacture a wide range of products, viz., mopeds, motorcycles, shock-absorbers, bicycles, spare parts, textile fibres, etc. at present, Hero group has many professional managers working in their various companies which have
become public limited (widely held) companies but Hero Bicycle still remains a private limited
company (narrowly held). Lala type tendencies are very ostensively visible in the functioning of this
group as a whole and more particularly in the Hero Bicycles Pvt. Ltd. As a result, many employees of
this company and the group as a whole are not a highly satisfied lot. But still Hero Group and Hero
Cycles in particular are working as highly efficient and profit making unit in their business.
Lately, Hero started experiencing a cut-throat competition in the bicycle business in the home and
world markets. They have started experiencing some flatness in their sales and profit curves.
Recently, Hero Cycles Pvt. Ltd. recruited an M.B.A. Miss Anuradha Goswami. Miss Anuradha who
specialised in Marketing, was the first M.B.A. to be recruited from the outside as there was an
emphasis to recruit only technically equipped people like engineers, etc., without management
qualifications. But some of the sons of the four brothers of Hero Group are having technical as well as
management qualifications. Even some of these third generation, Hero Promoters and managers are
M.B.A.’s from some reputed universities. They have lot of management exposure in India as well as
abroad as they keep on touring domestic and international markets quite frequently. The chairman,
Mr. Ravinder Lall is also a very ambitious and dynamic man who talks of promoting a Hero culture
among Hero Group employees as a whole. He aspires to take bigger strides and make the group as
one of the few big business houses in India. He intends to start his own training college to impact
management training to his group employees and also to managers of other companies.
One day, Mr. Ravinder Lall called his marketing Manager Mr. Siripat Dass in his cabin and
discussed with him in detail the marketing problems facing Hero Cycles Pvt. Ltd. Mr. Dass told Mr.
Ravinder Lall, “Sir, our main problem is that we are continuing our manufacturing on traditional lines
hence many problems of marketing are the result of that. We never tried to have a feel of the
consumers in domestic as well as in international markets. To be very frank sir, we must undertake
some marketing research projects so that we can understand the purchase behaviour of bicycle buyers.
Also there is a need to understand the dealers’ view-points through certain dealers’ surveys.” I think
you can guide and instruct Ms. Anuradha Goswami on this and she would be able to carry out the
research work. Ask her to prepare a research report on the basis of collected research data.”
Mr. Dass summoned Miss. Anuradha to his cabin and asked her to prepare a research proposal
and get it approved to study buyers’ and dealers’ behaviour within ten days. Miss Anuradha started
the maiden exercise of preparing a research design from that moment onwards. She established the
study objectives as follows:
1. To study the buyers’ needs and behaviour after establishing certain basic attributes of bicycles
needed by them.
2. To study the dealers’ attitudes towards Hero Bicycle policies and its products.
3. To distinguish the rural buyers’ needs and attitudes from those of the urban buyers.
Examination Paper of Semester III
IIBM Institute of Business Management 4
Ms. Anuradha decided to adopt an exploratory research design because much secondary data
were not available. She wanted to collect primary data on the buyer’s and dealers’ attitudes. For this,
she decided to take a sample of 100 buyers (males and females) from each of the urban and rural
population from and around Ludhiana city in the samples. She decided to include some juveniles,
children and students. In the samples, she decided to take a sample of 50 dealers from the North
Indian States. Buyers’ sample was to be taken on the judgement and convenience basis whereas
dealers’ sample was to be taken on the random stratified sampling basis.
She decided that data collection from buyers will be carried out with the help of a structuredundisguised
interview schedule. Personal interviews would also be conducted with the dealers with
the help of a separately designed interview schedules. She decided that many questions on each
schedule would be on attitude measurement on the pattern of Likert Scaling Techniques covering the
bicycle attributes like price, quality, colour, availability of spare parts, repair costs, sleekness in looks,
durability etc.
Further, Ms. Anuradha decided that data thus collected would be categorized in favorable and
unfavorable categories (with regard to attributes) and z-test would be applied to examine the
significance after calculating the mean scores. Ranking of various attributes will also be carried out.
General profile of consumers and dealers will also be prepared on the basis of their biographic
information like age, sex, qualifications, income, place of living, etc.
Finally, it was decided that two outside investigators (MBA students) would be engaged for the
purpose of survey who would collect and compile the survey results.
She assumed that survey would be having certain limitations as the samples would be small in size
because of limited time within which the research report is to be prepared. But she justified that
buyers and dealers attitudes would be same even in larger sample as people have similar viewpoints
regarding bicycles.
1. Was the problem identification and formulation systematically carried out? Discuss and put forward your viewpoints for improvement in this regard.
2. Whether the objectives were decided and listed in an appropriate manner? Whether hypothesis were to be formulated? What can be the hypothesis in this case?
Case Study-2
Over the past two years Linux has spread like wildfire through corporate data centers. Companies
once dependent on expensive proprietary systems from Sun, IBM, or Hewlett-Packard have replaced
them with dirt-cheap Dell or no-name servers that are Intel powered and loaded with the Linux
operating system. Linux now runs almost 15 percent of all servers and is growing at about 23 percent
a year. And even mainframe systems have joined in, with IBM estimating that over 10 percent of its
mainframe sales are for running Linux applications.
Though PC users haven’t switched to Linux – less than 1 percent of all computers run Linux – a
2002 survey by CIO magazine found that almost 30 percent of chief technologists were considering
moving their companies’ PCs to a Linux PC operating system like Windows. Wal-Mart, which began
selling Lindows-ready PCs on its website in September 2002, had such success with that offering
that by Christmas it was having trouble meeting demand. Almost every major PC electronics maker,
from HP in printers to Epson in scanners, is making sure it has Linux-compatible offerings. And Sun
has poured millions of dollars into its Star Office software suite, which gives Linux users programs
that work like – and more important, are compatible with – Microsoft PowerPoint, Word, and Excel.
Backed by technology titans such as Intel, IBM, Hewlett Packard, and Dell, Linux is just now
going mainstream. From DaimlerChrysler to Tommy Hilfiger – not to mention just about every
major brokerage on Wall Street – Linux is gaining ground. Coming from near zero three years ago,
Linux grabbed 13.7 percent of the $50.9 billion market for server computers in 2002. That figure is
expected to jump to 25.2 percent in 2006, putting Linux in the No. 2 position, according to market
researcher IDC. And get this: Starting in 2003, No. 1 Microsoft’s 59.9 percent share in the
backwards. Even the surprise but shaky assault on Linux by SCO in its suit of IBM is not expected
to slow the steady growth of Linux.
Meanwhile, Linux is finding its way into countless consumer-electronics gizmos, including Sony
PlayStation videogame consoles and TiVo TV-program recorders. “Has Linux come of age? The
answer is absolutely, positively, unequivocally yes,” says Steven A. Mills, group executive for IBM
Software.
How did Linux make the jump into the mainstream? A trio of powerful forces converged. First,
credit the sagging economy. Corporations under intense pressure to reduce their computing bills
began casting about for low-cost alternatives. Second, Intel Corp., the dominant maker of processors
for PCs, loosened its tight links with Microsoft and started marking chips for Linux; at the same time
a resurgent IBM made a $1 billion investment in Linux compatibility across its entire product line.
This made it possible for corporations to get all the computing power they wanted at a fraction of the
price. The third ingredient was widespread resentment of Microsoft and fear that the company was
on the verge of gaining a stranglehold on corporate customers. “I always want to have the right
competitive dynamics. That’s why we focus on Linux. Riding that were will give us choices going
forward,” says John A. McKinley Jr., executive vice-president for global technology and services at
Merrill Lynch Co., which runs some key securities trading applications on Linux.
Using open-source software like Linux is a no-brainer for many companies. It’s stable and can be
fixed easily if bugs appear, and you can’t beat the price. But some companies and government
organizations are taking their commitment to open source a step further by actively participating in
the open-source community that develops Linux. When their developers write patches, modifications
Examination Paper of Semester III
IIBM Institute of Business Management 4
or new implementations of open-source software for in-house use, these organizations are releasing
that new code back to the open-source community, thereby assisting in the software’s ongoing
development.
What’s the payoff? It makes for better software. “If we find a bug or a problem, we’re interested
fixing that problem. We’re also interested in not fixing it again in the next version,” explains Robert
M. Lefkowitz, director of open-source strategy at Merrill Lynch & Co. in New York.
This is why Merrill Lunch sent the fixes it made to open-source software during one of its
projects back to the open-source community. “The way a typical open-source project works is that
there is a core team in the open-source community with direct access to modifying the code on its
central website,” Lefkowitz says. “People who want to contribute to that community submit their
code, which is looked at by a core team and integrated if found appropriate.”
For all contributions, Lefkowitz emphasizes the importance of creating a corporate policy with
help from the departments that could be affected by open-source involvement. At Merrill Lynch, an
eight-member Open-Source Review Board determines when contributing is appropriate.
1. Should businesses continue to switch to the Linux operating system on servers and mainframes?
Why or why not?
2. Should the IT departments of companies like Merrill Lynch contribute their software
improvements to the open-source community for products like Linux? Explain your reasoning?
Case Study-3
This case is based on an actual incident which took place in an Army Unit deployed in field area. A part of a Battery (about ¼ of an Artillery Regiment) was deployed in a snow bound high altitude area of Kashmir. This was the first time, an artillery unit was deployed in an area with roads and tracks still under development. Preparation of this area for such a development needed a lot of digging for guns, pits for ammunition storage, living place of the personnel, slit trenches and weapon pits for local ….
incident very sympathetically and promised to assist in whatever way he could. This officer was a contemporary of the unit in a previous station and had excellent relations and interaction with the unit. Some items were offered by the workshop officer and replaced accordingly. The vehicle was made roadworthy again within a fortnight and put on road for duty. All the enquiries were dispensed with and there was no loss of face by anyone at any level. It is pertinent to mention that it had snowed in that location as soon as the recovery party came out of the hills.
QUESTIONS:
1. Which factors contributed to motivate the troops to go ahead for such a difficult task as recovering a damaged vehicle from such a difficult and treacherous terrain and getting it repaired in such a short time?
2. Which incidents indicate the importance of good interpersonal relationships with juniors, peers and superiors and what is the importance of good interpersonal relationships?
Case Study-4
The stakes were high for Gene Elliot, whose on-the-job injuries were estimated to be serious enough
to merit at least a $2.4 million settlement. But who should pay for his injuries: Turner Construction
or B&C Steel? Or should he be forced to pay for at least part of his injuries because of his own
carelessness?
Gene Elliot worked for Mabey Bridge and Shore, a small business that rented temporary steel
pedestrian foot bridges to other companies. The temporary bridges had to be put together by the
renter, and Gene Elliot’s job was to go to the site where the steel bridge was going to be installed,
show the renter how to bolt the bridge sections together and how to install the bridge over a river or
waterway, and inspect the bridge to make sure it was done properly and according to Mabey
Bridge’s high standards. Elliot was a devoted hard worker who strove to do everything possible to
ensure that a bridge installation was successful and according to Mabey’s standards.
Turner Construction was a general contractor hired to build Invesco Field at the Mile High
Stadium in Denver, Colorado. Part of the job involved installing a temporary pedestrian bridge over
the Platte River near the stadium. Turner Construction subcontracted (hired) B&C Steel to build and
install the bridge, which Turner Construction would pay for. B&C Steel was a small company that
specialized in putting together and installing steel structures like those Mabey Bridge rented out.
B&C Steel would pick up the bridge, put it together, and install it for Turner.
Turner Construction rented the long steel bridge from Mabey Bridge. Mabey Bridge agreed that
the rental included the services of Gene Elliot, who would be loaned to Turner to instruct and inspect
the bridge assembly and installation. B&C Steel’s workers picked up the bridge sections from
Mabey Bridge’s warehouse and drove them to the river but didn’t unload the bridge sections where
they had to be assembled. B&C then had to move the sections to the correct site but didn’t plan for
the fence, guardrails, and trolley tracks that were in the way and later had to work around these
obstructions. B&C Steel began bolting the bridge sections together. When Elliot inspected the job,
he found the bridge had been bolted together upside down. Elliot made B&C do the job over, while
he climbed up and down and over the bridge, continuously checking and making sure that all the
bolts were tight and all the pieces were in the right place so that the installation would be a success.
When the bridge was finished, B&C workers used a truck to move the long steel structure to the
edge of the river. Unfortunately, B&C had not adequately checked the route and their truck hit a low
hanging power line, which sparked and started a fire. The fire department arrived and put out the
fire. Afterwards, the installation job continued.
B&C workers set up a crane on the other side of the river near a retaining wall, and a strong nylon
strap was strung from the crane, over the water, and tied to one end of the bridge, which was set on
rollers. The B&C crane would lift and pull the bridge over the river to its side, while workers on the
other side of the river pushed on their end of the bridge. The work began, and as the pulling crane
held the bridge suspended in the air about a quarter of the way over the river, Elliot noticed that the
retaining wall which was supporting the crane on the other side of the river was beginning to
collapse, causing the crane to begin to tip sideways. The B&C crane operator on the other side began
to untie the strap holding the bridge, Concerned that once the strap was cut the bridge would fall into
the river and the installation would end in failure, Elliot ran up on the bridge and gave the standard
Examination Paper of Business Ethics
IIBM Institute of Business Management 4
emergency OSHA all-stop signal that all construction workers know means not to move anything.
But the bridge, still attached to the crane, somehow moved, and Elliot felt, sustaining numerous
pelvic injuries and a severed urethra (the tube that carries urine). The cause of the movement was
never established.
Elliot sued Turner Construction and B&C Steel for negligence resulting in economic losses of
$28,000, noneconomic injuries of $1,200,000, and permanent impairment of $1,200,000. These
figures were established by a qualified expert in the field of worker injuries and were not seriously
contested.
Turner Construction, however, denied its responsibility. It claimed that Turner was Elliot’s
temporary employer and workers’ compensation law required employees to pay only the economic
looses, here only $28,000, suffered by their employees. Turner Construction pointed to the law,
which stated: “Any company leasing or contracting out any part of the work to any lessee or
subcontractor, shall be constructed to be an employer and shall be liable to pay [only] compensation
for injury resulting therefrom to said lessees and subcontractors and their employees.” Turner
Construction claimed that Mabey was a subcontractor to Turner, so Turner should be construed to be
Elliot’s temporary employer. Moreover, Colorado’s worker’s compensation law, which was
designed to ensure that employers always paid for workers injuries “grants an injured employee
compensation from the employer without regard to negligence and, in return, the responsible
employer is granted immunity from common law negligence liability.”
B&C claimed that it, too, was not responsible, because according to the law a company is not
responsible for negligence when an injury is not “reasonably foreseeable” to the company. B&C
contended that a reasonable person could not have anticipated that placing the crane near to the
retaining wall and subsequently attempting to remove the nylon strap holding up the bridge might
end by prompting someone to get on the bridge in an attempt to save it from falling into the river. On
the other hand, B&C claimed, since “Elliot chose to remove himself from a secure and safe position
and placed himself in one that he understood was potentially unsafe,” Elliot was himself responsible
for his injuries.
Elliot claimed that he was not really Turner’s employee, since he was working for Mabey. He
also argued that B&C had shown a pattern of negligence from the time that the bridge was received
until the time that it was installed. B&C and its employees, he said, were unprepared for the project
and negligently failed to adequately plan for it, as shown by the sequence of events leading up to his
injury. B&C there fore did not exercise the degree of care that a reasonably careful person should
have exercised in similar circumstances and so was liable to him for his injuries. He himself was not
responsible, he said, because good, devoted employee would try his best to ensure that the bridge
installation did not end in failure, and he would have been perfectly safe if the standard OSHA allstop
signal had been followed by B&C employees, as he had a right to expect it to be.
1. In your judgement, and from an ethical point of view, should Turner Construction and/or B&C
Steel pay for all or part of the $2,428,000 (if part, indicate which part)? Explain your view?
2. In your judgement, is the Colorado worker’s compensation law to which Turner Construction
appealed fair? Explain your view?
Case Study-5
Most companies store reams of data about their customers. The IT challenge has been how to
integrate and massage that information so the business units can respond immediately to changes in
sales and customer preferences.
Hency Schein Inc. (www.henryschein.com) has it figured out. The $2.8 billion distributor of
health care products designed and built a data warehouse with an in-house team of six IS
professionals. CIO Jim Harding says he knew that having the right skills was critical to the data
warehouse project, yet at the time, Schein had zero warehousing experience in its IT shop. So he and
Grace Monahan, vice president of business systems, hired people for what they call “Team Schein.”
Because Harding had chosen two key tools for the data warehouse – data extraction software
from Informatica Corp. and user query and reporting software from Micro Strategy Inc. – the focus
was on finding people who had experience with those tools. So Monahan hired three people from
outside: project director Daryll Kelly, data modeler Christine Bates, and front-end specialist Rena
Levy, who’s responsible for the user interface and data analysis, as well as user support and training.
Dawen Sun, who handles extract, transform, and load issues, and database administrator Jamil
Uddin hold two other key positions. Another term member is rotated in form Schein’s application
development group.
Besides having the right skills, the other top priority was ensuring data quality. “It seems kind of
obvious,” says Harding, “but sometimes these projects forget about quality, and then the data
warehouse ends up being worthless because nobody trusts it.” So at the outset of the project, the
team interviewed about 175 potential business users to determine the information they needed to
access and the reports they wanted to see. Plus, the team analyzed the old paper reports and the
condition of the data housed in the company’s core transaction system. Monahan says those steps
brought to light the importance of cleansing data in a system that’s designed for transactional
purpose but not suitable for a data warehouse. That led to a long period of standardizing
transactional codes in order to produce the sales reporting that business analysts needed.
“It’s in-house people who have this gold coin of knowledge of how their systems really work,
which data is really good and not so good, and how the end users really want to use the data,”
Kimball says. “Data quality is the hardest part of the project, because it’s very time-consuming and
detailed, and not everyone appreciates it unless they’ve been through a couple of projects, like Daryll
has,” Harding says.
And there was yet another tedious obstacle. The data warehouse was designed to provide a very
granular level of detail about customers, “so we can slice and dice at will,” Harding says. But the
result was sluggish system performance. So the team created summary tables to make the queries
work faster, and those tables needed to be tested. It was a lengthy process, Harding says, but in the
end, it worked very well. The journey has taken well over two years. The system went live 18
months ago but “really came into its own” in February, Harding says.
Of course, building a data warehouse is a never-ending job. New companies are acquired,
products are added, customers come and go, and new features and enhancements are ongoing. But
from an IT standpoint, the data warehouse is complete and has 85 percent of the data is to provide
the European operation with its own data warehouse system and tie it into in the U.S.
Examination Paper of Semester IV
IIBM Institute of Business Management 4
Harding says his project will surely justify the costs, but he lacks hard numbers. “We didn’t have
a formal ROI that you could track later. I don’t even know how you would do it,” he says. “The
reason we’re doing the project is because of the value it brings to the business.”
Lou Ferraro, vice president and general manager of Schein’s medical group, says the business
benefits are outstanding. He can now figure out who his most profitable customers are, target
customers for certain types of promotions, and look at the business by product categories or sales
territories. Ferraro says the data warehouse also helps select customers for direct-mail marketing
campaigns that range “upward of million pieces annually.”
One of the most valuable features of the data warehouse has been the ability it gives users to add
more fields to reports as they are using the system. “Once you create a basic report, draw a
conclusion, and drill further based on those assumptions, it allows you to use that data and go even
further, as opposed to creating a new report, and another and another,” Ferraro says. The IT
department used to create, edit, revise, run, download, reprogram, and print piles of paper reports –
daily, weekly, monthly and quarterly – for the analysis of sales and market trends. But today,
business users search, sort, and drill down for that information themselves in a fraction of the time.
The data warehouse has become “a part of our culture,” says Harding. “It’s got that kind of aura
about it within the company.”
1. What are some of the key requirements for building a good data warehouse? Use Henry Schein
Inc. as an example.
2. What are the key software tools needed to construct and use a data warehouse?
Case Study-6
A company has a central warehouse in Chicago that supplies the demand of three branch warehouse: one in Baltimore, one in New Orleans, and one in Cleveland. The following tables provide the relevant data:
Warehouse Safety Stock Lead Time Order Quantity On-hand
Baltimore 50 2 periods 350 250
New Orleans 100 1 period 200 150
Cleveland 80 2 periods 500 200
Chicago 200 2 periods 1500 750
Gross requirements on the branch warehouses:
Period 1 2 3 4 5 6 7 8 9
___________________________________________________________
Baltimore 100 80 150 90 100 85 110 120 100
New Orleans 70 65 75 50 90 80 75 80 55
Cleveland 110 90 65 135 85 70 140 100 60
1. Determine DRP records for all four warehouses?
2. What will be the DRP structure for the above four warehouses?
Case Study-7
Allen Specialty Company, located in Detroit, Michigan, manufactured a line of Ballpoint pens, and
mechanical pencils and, in the past five years, had added a line of stationary. Allen products were sold to
stationary and office supply wholesalers and retailers, as well as to department stores, discount houses,
drugstores, variety stores, and supermarkets. A field sales force of eighty-two persons operated out of six
district sales offices. Allen management believed that a critical factor in the company’s sales success was
the coordination of its national advertising and the activities of Allen salespeople and dealers.
The sales promotion program was the responsibility of the sales promotion manager, Jack Biggerstaff,
and his staff, in conjunction with the sales planning committee at Allen headquarters in Detroit. The sales
planning committee consisted of the managers of merchandising, advertising, and marketing research.
The sales promotion plan, for both new and existing products, described objectives; roles of salespersons
and dealers; anticipated sales; the national, local, and trade advertising; and point-of-purchase displays,
deals, premiums, and contest offers.
With approval of the sales promotion plan by the sales planning committee and the sales promotion
manager, Jack Biggerstaff, the sales promotion department prepared sales promotion kits for the Allen
sales staff. The kit included advertising proofs, products samples, illustrations of the point-of-purchase
displays, samples of premiums offered, and a description of the special deal or context featured in the
promotion.
The sales promotion department prepared a timetable for each promotion plan, showing the date when
each advertisement appeared in various media. The timetable was distributed to the sales force and
dealers to enable them to time their sale and advertising to coincide with the national advertising, thereby
achieving full impact from the advertising.
When the sales promotion plan was approved by headquarters, it was presented to Allen sales personnel
at meetings in each of the six district sales offices. The sales promotion manager and the field sales
promotion manager, who reported to the former and whose job was to work with Allen salespeople and
dealers on sales promotion projects, made the presentation. Following the meetings, the field sales
promotion manager trained the salespeople in proper presentation of the promotion and called on key
dealers to enlist their support.
The sales promotion program used with a recent new product introduction was typical of Allen’s efforts.
In addition to the objectives and timetables, the sales promotion program included(1) selling tools for
Allen sales people- circular letters describing the promotion, a visual presentation portfolio for making
promotion presentations, product samples, reprints of consumer advertisements; (2) selling tools for Alen
dealers- presentation kits for selling the new product to consumers , mail circulars for delears to send to
consumers, mailing folders for use by dealers, sample folders, and a considerable amount of prize money
for dealers sales personnel; and (3) advertising support for Allen dealers- advertising in national media
and sample folders to be sent to consumers who responded to a coupon offer.
The sales promotion programs were presented one each week in the district offices in late November and
December. When the schedule was announced, Mike Halloran, assistant sales manager in charge of the
Pacific Northwest district called Jack Biggerstaff to complain that the sales promotion orientation session
in his district had been scheduled for December 27 during the quiet week when many of his salespeople
had found extra time to spend with their families and when several had customarily taken short skiing
vacations, Biggerstaff explained that the promotion plan would not be completed by home office
personnel in the six sales regions, it was not possible to schedule more than one a week. It was tough, but
Halloran’s district had drawn the bad week this year.
Halloran responded that he thought the sales promotion sessions were a waste of time anyhow. His
salespeople lost two productive days in these sessions, and, in his opinion, knowledge of details of the
Allen Company’s advertising and promotion plans didn’t make the sales rep’s job of selling to
wholesalers and retailers any easier. Anyhow, it was the responsibility of the field sale promotion
manager to work with the individual salespeople and call on key dealers. He also complained that when
these sessions were scheduled in mid-November, they interfered with sales productivity in the busiest
season of the year.
1. Evaluate the Allen Specialty Company’s organization and plan for coordinating sales and
advertising?
2. How should Biggerstaff answer Halloram’s complaint?
Case Study-8
Tech Knowledge is a start-up founded in 1997 by Robert Thyer. The company is a distributer of
presentation technologies, including computer based projection systems, video equipment, and
display technologies. The firm has 25 employees and does $5 million in sales. It is growing rapidly.
The owner, Robert Thyer, would like to netsource the back-office functions of the firm because the
company does not have an internal IT capability. The applications to be netsourced would include
sales and distribution, financial accounting, and inventory management.
TechKnowledge would like to source SAP or another ERP vendor via a hosting arrangement. It
does not expect to do much customization, and it does not have any legacy systems.
1. What factors should it use to evaluate each of these potential hosts?
2. What controls should be in place to monitor the hosting arrangement?
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