Greyhound Dial

Greyhound Dial Case

What environmental factors affected Greyhound’s businesses?
Macroenvironment affects the intensity of rivalry within an industry.
 Demographic
 Technological o High production costs, inefficient plants o Products they would acquire are easy and inexpensive to imitate by much larger companies
 Cultural o 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
 Economic o Hoped vast array of business would be recession proof o 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 o 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