Summary of the case
Steve Shamrock, an experienced businessman, launched Cyberplay as an educational, high-tech computerized family "edutainment" center. Steve had exceptional people skills that enabled him to raise money for Cyberplay among family and friends. Cyberplay promptly won several national awards for retail store design and technological innovation in education, and was featured in the several business magazines. The company prepared to rapidly deploy 200 stores. After two years, only two stores were open and it was apparent that the original business concept was not going to work. Cyberplay had a competitive edge that it could maintain until other trainers started offering the same accommodations. One of the greatest threats to Cyberplay was the constant lowering of computer prices, enabling potential Cyberplay customers to buy their own computer systems and play the games at home. The company made a strategic shift to corporate software training, and quickly garnered some major contracts. The implications of this shift were profound on core competencies, organizational structure, staffing, marketing, capital commitments etc. The case picks up with Shamrock trying to sort out what must change and what can remain the same. These dilemmas are compounded by the strong corporate culture, and cash flow concerns. Moreover, Cyberplay is contemplating whether it should take its training online, and if it does, what further changes would be required. The cash burn rate was about $250,000 per month and the company's capabilities no longer seemed to match its strategy.
Statement of Problem
Cyberplay has incurred significant losses during its first three years in business with losses of approximately million of dollars that being lost within the past year alone. The company had defaulted on million of bank debt and of corporate debt putting it in desperate straits in terms of keeping its doors open and repaying its obligations Cyberplay needs to turn...
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