Objectifs

To understand the appropriate activity and business scope of an organization (vertical integration and diversification decisions) and the sources of value creation in a multi-activity (vertically integrated or diversified) organization, including the quality of corporate governance.

To develop a capability to analyze cases, work in multinational teams and present your arguments both orally and in writing.

To acquire a competence in searching for and analyzing real company data.

In sum, to equip you to be able to successfully participate in corporate scope/development decisions and management processes.

Should organizations diversify? Or are all diversified firms like Vivendi or Tyco doomed to fail? What do successful diversifiers like Disney, GE or Nestlé do? Why do some companies manage to grow and successfully diversify through acquisitions? In this course we will answer these and other related questions.

In the quest for greater profitability, corporations have to make critical decisions about the direction and means for their future development and growth (including divesting some of their units!). This course focuses on the challenges top managers and their advisors (consultants and investment bankers) face in determining the set of activities firms should engage in. Furthermore, the course will expose students to the challenges that both top and middle-level managers face in managing diversifying acquisitions as well as divestment processes. Finally, the course will also address structural, control and incentive issues in managing a diversified, multi-business corporation.

Contenus

Discussion of textbook readings and company cases on diversification, corporate parenting and divestment (Ciba-Geigy, Cooper Industries, Disney, GE, Nestlé, Vivendi, ...).

Course project to analyze the corporate strategy and value creation of a Swiss diversified company of your choice, in order to make recommendations.

Références

Collis, D. and Montgomery, C. 2005. Corporate Strategy. Boston, Irwin/McGraw-Hill, 2nd edition.

Pré-requis

A general strategy/business policy or competitive/business strategy course is recommended.

IMPORTANT: For pedagogical reasons (group project), the course is limited to 36 students. All interested students are welcome to apply by Feb 17 noon and to attend the first session. Students will be selected after the 1st session and will be asked to commit to the course.

Evaluation

1ère tentative

Examen:

Sans examen (cf. modalités)  

Evaluation:

1) Short paper dealing with Part I of the group project described below (20 % of the final grade). To be handed in at the beginning of Session 8.

2) A 15-minutes professional presentation of Part I of the group project on Session 8, plus 5 min Q&A (10 % of the final grade). All group members should be present.

3) A 20-minutes professional presentation of Part II of the group project on Session 14, plus 10 min Q&A (25 % of the final grade). All group members should present.

4) One individual case memo (20 % of the final grade). It must not exceed 3 pages of text, appendices (figures and tables) not included. Start with a paragraph for the executive summary and address the following question (unless indicated otherwise): What is your evaluation of the company corporate strategy at the end of the case and, based on it, what are your recommendations to the Board of Directors? You should write them as if you were an internal or external consultant advising the firm'€™s Board of Directors.

5) Individual class participation (25 % of the final grade). The participation grade is a function of the number and quality of contributions to each session. A high overall participation grade requires several good contributions in each session.

Rattrapage

Examen:

Sans examen (cf. modalités)  

Evaluation:

For the retake exam (€rattrapage€), in order to be re-evaluated, the student must: have attended at least 12 of the 14 classes, submit an individual written case analysis (2-3 pages long) to cover the individual case analysis portion of his or her grade (50 % of re-evaluation grade), and submit an individual written project report (5-10 pages long) to cover the group project portion of his or her grade (50 % of re-evaluation grade). If the student received a passing grade on the individual portion of the grade, s/he does not need to re-submit it. The same applies to the group project portion of the grade.