...Good Year Tire and Rubber Company Case Analysis Background Goodyear Tire and Rubber Company is a profitable business which was founded in 1898. When 38 year old Frank Seiberling purchased the company he knew nothing on the longevity and success it would bring. Mr. Seiberling installed a down payment on the first Goodyear plant with a borrowed amount of $3500.During the late 1800s and early 1900s cotton and rubber were considered the lifeblood of the industry. At the time of Goodyear’s founding the existence of bicycles was fresh and business was booming at an increasing rate. With faith and the determination of 13 employees Goodyear’s initial production line consisted of bicycle and carriage tires, horseshoe pads and poker chips. With now a new need for bicycle tires being a demand for consumers Goodyear carved its mark in history as the world’s largest tire company in 1916. Strategic Issues and Problems In early 1992 Goodyear began to consider a previously declined proposal of Sears. This previously declined proposal now would benefit Goodyear because the company suffered a loss of $38 million. Good year’s market share and customer retention are both decreasing and this is becoming the overarching problem for the company. The factors to consider before making a decision on the sears proposal at hand are: 1. Goodyear brand tires reportedly declined in market share by 3.2% 2. About 2 million used or worn out Goodyear tires were being replaced at sear automotive...
Words: 697 - Pages: 3
...opinions on cases and how she speaks during a hearing. One case that stood out that Ruth Bader Ginsburg wrote an opinion on was United States v. Virginia, in 1996. In this case, the United States sued Virginia and the Virginia Military Institute, stating that VMI's solely male admission policy violated the Fourteenth Amendment's Equal Protection Clause. Ginsburg, a strong advocate of woman's rights, wrote and made it clear that women should be able to obtain the same privileges as men, including being allowed to apply to the Virginia Military Institute. Another case that Ruth Bader Ginsburg had a strong opinion on was Ledbetter v. Goodyear Tire & Rubber Company in 2007. This case was about Lilly Ledbetter who sued her employer of 19 years, Goodyear Tire & Company, due to gender discrimination. The company had been paying the male employees more than Ledbetter because she was female and that violated the Civil Rights Act of 1964. The Supreme Court voted 5-4 in favor of Goodyear though, because Goodyear countered that same clause stating that discrimination complaints are to be filed within 180 days of the violation. Ginsburg did not agree with this ruling and argued that Ledbetter couldn't have filed her complaint sooner because she isn't know she was being discriminated against. When President Obama was elected into office in...
Words: 959 - Pages: 4
...Harvard Business School 9-292-040 September 13, 1991 The All American Pipeline In late 1984, The Goodyear Tire and Rubber Company faced the likely prospect that within several months it would receive some of the crucial permits it needed to begin construction on the All American Pipeline, which was projected to be the longest crude oil pipeline in the United States. Goodyear needed to place orders with pipe manufacturers immediately so it could begin construction as soon as the permits were granted, and meet the company's goal of starting operations in the first quarter of 1987. These orders would represent the first significant sum of money committed to the project, which was larger than any other in Goodyear's 86-year history. The pipeline was projected to cost as much as $2 billion, with pipe representing the project's single largest component. The Goodyear Tire and Rubber Company Goodyear was the largest tire producer in the world. In 1983 the company had revenues of $9.7 billion and net income of $305 million. See Exhibits 1 and 2 for Goodyear's income statements and balance sheets. Tires and related transportation products accounted for 75% of both revenue and assets and approximately 70% of operating income. Goodyear held 22% of the worldwide market in tires, followed by Michelin with 18%, and Firestone with 10%. However, Goodyear's market position varied widely geographically. In North America the company held the lead with a 29% share, followed by Firestone...
Words: 6282 - Pages: 26
...Chapter 18 Capital Budgeting and Valuation with Leverage 18-4. Suppose Goodyear Tire and Rubber Company is considering divesting one of its manufacturing plants. The plant is expected to generate free cash flows of $1.5 million per year, growing at a rate of 2.5% per year. Goodyear has an equity cost of capital of 8.5%, a debt cost of capital of 7%, a marginal corporate tax rate of 35%, and a debt-equity ratio of 2.6. If the plant has average risk and Goodyear plans to maintain a constant debt-equity ratio, what after-tax amount must it receive for the plant for the divestiture to be profitable? We can compute the levered value of the plant using the WACC method. Goodyear’s WACC is [pic] Therefore, [pic] A divestiture would be profitable if Goodyear received more than $47.6 million after tax. 18-5. Suppose Alcatel-Lucent has an equity cost of capital of 10%, market capitalization of $10.8 billion, and an enterprise value of $14.4 billion. Suppose Alcatel-Lucent’s debt cost of capital is 6.1% and its marginal tax rate is 35%. a. What is Alcatel-Lucent’s WACC? b. If Alcatel-Lucent maintains a constant debt-equity ratio, what is the value of a project with average risk and the following expected free cash flows? [pic] c. If Alcatel-Lucent maintains its debt-equity ratio, what is the debt capacity of the project in part b? a. [pic] b. Using the WACC method, the levered value of the project...
Words: 881 - Pages: 4
...Harvard Business School 9-292-040 September 13, 1991 The All American Pipeline In late 1984, The Goodyear Tire and Rubber Company faced the likely prospect that within several months it would receive some of the crucial permits it needed to begin construction on the All American Pipeline, which was projected to be the longest crude oil pipeline in the United States. Goodyear needed to place orders with pipe manufacturers immediately so it could begin construction as soon as the permits were granted, and meet the company's goal of starting operations in the first quarter of 1987. These orders would represent the first significant sum of money committed to the project, which was larger than any other in Goodyear's 86-year history. The pipeline was projected to cost as much as $2 billion, with pipe representing the project's single largest component. The Goodyear Tire and Rubber Company Goodyear was the largest tire producer in the world. In 1983 the company had revenues of $9.7 billion and net income of $305 million. See Exhibits 1 and 2 for Goodyear's income statements and balance sheets. Tires and related transportation products accounted for 75% of both revenue and assets and approximately 70% of operating income. Goodyear held 22% of the worldwide market in tires, followed by Michelin with 18%, and Firestone with 10%. However, Goodyear's market position varied widely geographically. In North America the company held the lead with a 29% share, followed...
Words: 6777 - Pages: 28
...The Fundamentals of International Business | | Assignment question: There are several theories that seek to explain why FDI takes place. These theories try to explain why firms go to the trouble of acquiring or establishing operations abroad. Such theory includes Dunning’s Eclectic Paradigm, Vernon’s Life Cycle and Knickerbocker’s Model to name a few. Your academic paper should illustrate the use of such theories to evaluate the rationale for foreign direct investment for a leading player in your chosen industry. | | | | Student: Matteo Noris ID: 10224550 Course: (BA) International Business Assignment Due Date: 25th January 2012 Unit Tutor: Agnieszka Chidlow Matteo Noris ID: 10224550 Fundamentals of the International Business Submission Date: Wednesday 25th January 2012 Weighting: 30% of the total mark for the Unit * Chosen Assignment Question : 2 Foreign Direct Investment There are several theories that seek to explain why FDI takes place. These theories try to explain why firms go to the trouble of acquiring or establishing operations abroad. Such theories include Dunning’s Eclectic Paradigm, Vernon’s Life Cycle and Knickerbocker’s Model to name a few. Your academic paper should illustrate the use of such theories to evaluate the rationale for foreign direct investment for a leading player in your chosen industry. Contents Page Contents Page 2 Abstract 3 Introduction 3 Main Body 4 Conclusions 8 References...
Words: 2604 - Pages: 11
...Case Study: Midas BUS 644 Operations Management Dr. Snell May 19, 2014 Case Study: Midas Specialization is a two-edged sword. When an organization specializes, they become experts in a particular process, product, or operation. In exchange for this deeper knowledge and ability in one factor, the organization typically suffers a loss of width in the marketplace therein reducing their potential customer base. Efficiencies should certainly be derived from this specialization and with efficiency may come greater profitability. When examining such an organization, a case study is useful to help break down the scenario and discover real-world effects of specialization. In this paper, the company Midas will be reviewed for their operational efficiencies, potential weaknesses and other negative impacts, and how, through analysis of these factors, a better business paradigm can be developed and implemented. Midas provide vehicle services related to exhaust, brakes, and shock absorbers. They do not offer general automotive services but rather specialize in those three areas. As described by Vonderembse and White (2013), this provides Midas with a number of advantages. Firstly, the limited services allows Midas to maintain a much more limited inventory which enables the workers to have the parts they need readily at hand near where work is being performed. Because of the focus on specific tasks, tools, training, and skills are also specialized and customized to fit the...
Words: 1507 - Pages: 7
...Sales and Distribution Management Program Credit Course Code : PGPM : 3 : SL MM 606 Class of Sessions : 2012 : 30 Objective To make the student aware of issues related to sales force management focusing on ―selling‖ as a tool of Marketing Communication. The study of Channel Management offers an appreciation of logistics of information and goods, and exposes students to the types of systems required to optimize organizational efficiency through this function. Learning Objective: The aim is to prepare students to manage sales and channel teams for different types of selling, with the purpose of enhancing value based output and productivity Learning Outcomes: REFERENCE BOOKS Sales Management - Decisions, Strategies and Cases. 5ed Marketing Channels: A Relationship Approach Sales & Distribution Management Sales Management Sales and Distribution Management – Text & Cases Retailing Management – Text & Cases, 2 nd AUTHOR / PUBLICATION Richard R Still, Edward W Cundiff, Norman A, P Govoni- PCI Coughlan, 7th ed IUP Panda / Sahadev Havaldar / Cavale. Tata Mcgraw Hill - 2007 Pradhan, Swapna. Tata McGraw-Hill - 2006 e Faculty teaching the subject in all PGPM Campuses should refer Articles, Journals, Websites. Detailed Syllabus Introduction: Emerging Trends in S & D, Linking S & D Role & Responsibility of Sales person: - Cross Functional Linkages, Types of selling, Value Proposition, Lifetime Customer Value Creation- Key Accounts Management. Selling Skills: Communication...
Words: 762 - Pages: 4
...CAR TYRES | AN Industry Overview | This project looks at the Car Tyre industry in India and how the Distribution channel helps this industry to grow and serve the needs of the End consumer. | PROJECT DONE BY:VIKRAM FALOR : DM14157RAMYAA RAMESH : DM14266AMIT SHUKLA : DM14104 | Introduction:- The Indian Tyre Industry is a critical part of the Auto Sector and there is a huge interdependent on those of the Automobile players. The Indian tyre industry accounts for approximately 5.0% of the Global tyredemandgeneratingrevenuesofapproximately`30,000cr for FY2011. Out of which 90-95% has come from the domestic market. There are around 40 tyre manufacturers in India and the top 10 tyre player’s account for approximately 90-95% of the total tyre production in India. The growth in domestic tyre industry was negatively impacted by the global slowdown in2009.Nevertheless,the industry experienced are mark able recovery in 2010. This growth was primarily driven by strong revival in automobile demand on the back of improvement in macro economy and easing of interest rates. The Indian Tyre Industry produced 119.2 mn units of tyres (1.5mntonnes) in 2010‐11. On an average, In Indian early 60.0% of the production is for replacement market, followed by 25.0% sold to OEMs directly and the balance is exported. Globally, the OEM segment constitutes 30.0% of the tyre market, exports 10.0% and the balance from replacement market. Exports turnover for India during 2010‐11 stood at `3,600cr...
Words: 5143 - Pages: 21
...CHOICE W. Chan Kim* INSEAD Peter Hwang** Baruch College Abstract. This paper makes a case directed towards establishing the importance of global strategic considerations in choosing multinationals'entry mode. Specifically,it is our contention that beyond the environmental and transaction-specificfactors well established in the literature to affect the entry mode decision, we should also consider the strategicrelationshipa multinational envisages between its operations across borders in reaching this decision. After incorporating various global strategic variables into an eclecticframeworkof the factorsinfluencing entrymode the choice, this paper tests both the validityof the overall framework and the importance of each entry mode determinant in differentiating among entry modes. This is done based on ninety-six multinational managers' responses to a survey questionnaire concerning their entry mode decision experiences. The results suggest that an express incorporationof global strategicvariables into an analysis of the entry mode decision is warranted. This paper is concerned with the critical decision of multinationals' foreign entry mode choice. While existing studies have already identified a diversity of variables that influence this decision, in our view these variables can or essentiallybe collapsedinto one of two categories:environmental ftansactionspecific factors. Common to existing studies identifying these factors is their underlying assumption that each entry decision...
Words: 3800 - Pages: 16
...Laure MULLER BS5 2D STRATEGIC MARKETING TRENCO STUDY CASE 10.18.11 ISM MBA PROGRAM 1 Laure MULLER BS5 2D Introduction The operating conditions of a tire are more severe in Africa than in the rest of the world, said Alfredo Nembo, sales manager of Pirelli to the African continent. Weather, road conditions, intensive use of vehicles: tires that travel 100,000 km in Europe do not exceed 35 000 km in Africa. But Pirelli has solid experience in areas comparable to those of Africa: South America, Turkey. Our truck tires, for example, are enhanced compared to that Pirelli sells in Europe to better respond to high temperatures and loads. ".The African market and in our subject the Egyptian market is different from what we know in western countries. The marketing approach is different and strategies ...
Words: 3943 - Pages: 16
...Best Practices In consumer goods Industry in S&D Incentives scheme should be considered Sales Person & Channel Incentives No. of Accounts and sales expected to actual sales Innovative changes to the traditional retail supply chain have been made in attempts to increase the velocity of products through the supply chain and increase the accuracy of inventory management. Crossdocking and distribution center (DC) bypass are two initiatives to increase product velocity. Crossdocking is a process where products flow through facilities designed to consolidate or deconsolidate inbound shipments and re-route them for outbound transportation. Products are not kept in inventory. In a DC bypass process, vendor shipments are made directly to retailers without being stored within a DC. The DC bypass is also referred to as a direct-to store process. Both practices decrease the lead time of delivering orders to the retailer. Sales & Marketing Dept. integration can help better forecast and planning. Happened with IBM. Helps develop link between the marketing spending and actual sales happening, so Sales could see the value of marketing efforts, Marketing’s new product announcements often came be timed when Sales are prepared to capitalize on them. Across India, Reliance Retail serves over 2.5 million customers every week. Its loyalty programme, "Reliance One", has the patronage of more than 6.75 million customers What Value Does Sales Add? To be effective, sales must add...
Words: 2683 - Pages: 11
...Sasha Klaeb WMST 101 7 May 2013 Assignment 4: Women and Work Question 1, The Glass Escalator: In “The Glass Escalator,” Christine Williams studies the way men are treated and their experiences when working in female dominated occupations, and finds that there exists a glass escalator for men working in these jobs. First, although Williams acknowledges that the proportion of men and women in the labor force is approaching parity, there still exists significant job segregation relating to gender. Both men and women are relegated to single sex occupations, meaning that they work in jobs that society deems more appropriate for men and women. What Williams does in this paper is different from other studies because rather than focusing on women in male dominated occupations and the barriers they face, she studies the underrepresentation of males in predominantly “female” occupations. She examines four typically female dominated occupations: nursing, librarianship, elementary school teaching and social work, and studies the implications of men working in female occupations. From these studies, she finds that unlike females in male dominated jobs, men do not face any discrimination and are in fact promoted and move up the ladder at a much faster pace than women. As one employee put it, there is a preference for men in these female occupations. Williams found that the more female dominated the job or specialty was, the greater the preference for men. The glass escalator...
Words: 4569 - Pages: 19
...Fair Compensation Research Team A Patricia Hailey, Cynthia Whitelow, Jim Loncar RES/351 March 22, 2014 Darron Williams Introduction and Problem Statement ABC Company is currently involved in litigation involving a current female employee’s complaint that the company unfairly administers its wage and salary policies between male and female employees performing the same job. The goal of the research is to determine if ABC Company policies are current, ethical, fair, legal, and administered properly throughout the organization. Our hypothesis is that the wage and salary policies of ABC Company are administered ethically and legally across all units of the company. Is there pay equity and discrimination among women and men in the workplace? Congress passed anti-discrimination legislation including the equal pay Act of 1963. Women are still struggling for equal pay in the workplace. According to the Labor Department data show that for 35 to 44 year olds, the earnings ratio of women and men rose from 58 percent in 1979 to 77 percent in 2006 (Labor Department 2006). After researching, the Institute for Women’s Policy Research 2014, states the change in wages for women equal pay is a slow process and it will take nearly fifty years for women to reach the pay as men. The Institute for Women Policy also express that women earn less than men in almost any occupation (Institute for Women’s Policy Research 2014). “A significant wage gap is still with us, and the gap constitutes...
Words: 2217 - Pages: 9
...The Corporation: The Corporation is today's dominant institution, creating great wealth but also great harm. This 26 award-winning documentary examines the nature, evolution, impacts and future of the modern business corporation and the increasing role it plays in society and our everyday lives. The birth of the corporation: How the corporation came to be. Originally, corporations were set up to serve the public good. Corporation lawyers gained rights through the US Supreme Court using the 14th Amendment (set up to protect slaves) that gives them the rights of a person. In the last century, the corporation is given more and more rights while people are increasingly stripped of theirs. Origins of Corporations Although definitions and descriptions of corporations have changed dramatically through the last few hundred years, the first corporation actually began long ago – as early as the sixteenth century. It was a benchmark in the history of money and business, transforming an economy from what was essentially a debt economy (when it came to merchant work) to a state-sponsored enterprise. This type of business was brilliant and revolutionary for the early business world, allowing businesses to take risks and expand in ways they had been unable to do before. The concept spread and grew, and by the seventeenth century, the corporation was well on its way to being an acclaimed and established center for regular commerce. When corporate business came to the newly born United...
Words: 2045 - Pages: 9
