Greyhound Dial Case
What environmental factors affected Greyhound’s businesses? Macroenvironment affects the intensity of rivalry within an industry.
High production costs, inefficient plants
Products they would acquire are easy and inexpensive to imitate by much larger companies
Trautmans style vs Teets (new)
Trautmans: ambitious about expansion and diversification
Teets: cost cutter, effective hands on manager, liked to stay close to action, domination with labor unions, overall more laid back
Jozoff: P&G veteran, understand how to fashion a business model to promote profitability- saw lack of a differentiated appeal- entered into some joint deals- bring into direct competition
Baum: experience with similar type products (bread&butter)- recognized importance of finding the right strategy- made the products speak and fight for themselves number wise
Hoped vast array of business would be recession proof
There was a recession in the real estate market in 1987 right when Greyhound announced its intention to sell Verex (financial)- bad timing o
1995- wanted to increase company’s ROE and stock price, so began to slash costs- reduce advertising budget o
Trying to create value
Government or Legal
There was a newly deregulated bus transportation market (1981 bill that deregulated the intercity bus business)- had to be able to charge competitive fares- could not be a low cost provider of bus transportation- lost competitive edge
Could anything have been done to control environmental factors?
In the case of leadership of the company- needed to be more accountable for each product line and business etc- grouping things together too much leads to troublesome oversight
More research before announcing big decisions
In what ways did environmental factors distort the picture of Greyhound’s performance?
Way case was written- seemed like something was always going wrong- never...
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