...Unit Seven – The Lennar Company Case Study Analysis Kaplan University School of Business MT460 Management Policy and Strategy Author: Edna McEwen Professor: Dr. Strouble Date: June 29, 2015 LENNAR CORPORATION’S JOINT VENTURE INVESTMENTS Company Name: The Lennar Company Topic of the Week: Create a case study analysis focusing on the company’s abuse and fraudulent activities relative to CSR and business ethics. Synopsis of the Situation The Lennar Company faces the damage caused by the Fraud Discovery Institute’s claims, the financial crisis, mortgage defaults, and dramatic fall in house prices, particularly in some of their active markets. The country is in the midst of an economic recession that began in 2007, and on top of that, the company has been accused of operating a ponzi scheme and profiting while allowing investors to lose money. On the day of the announcement by the Fraud Discovery Institute, the company’s stock price took a dramatic fall. The problem is, the person that founded the Fraud Discovery Institute is a ‘reformed’ crook who has made it his mission to expose fraudulent behavior of others as a way of redeeming himself from some of the negative things he has done. The question is, is he really reformed, or is this just another scheme he has plotted to gain access to company’s information so he can pounce when the company is most vulnerable. Alternative Solutions Since Lennar’s mission statement states...
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...The Fruits of Legitimacy:Why Some New Ventures Gain More from Innovation Than Others Summary: New Ventures play a vital role in the development of any company.In addition,the actions of new ventures may even spur large, incumbent firms into action, thus accelerating the pace of technological change.The new ventures success depend upon their ability to produce new products.Sometimes even amongst the ventures producing the same good they have different fates.One of the difficulties faced by the new ventures is the liability of being new to the business. Potential stakeholders view firms in these industries with skepticism. An important way that new ventures can overcome the liability of newness and increase their gains from new products is by taking actions that provide them with legitimacy in the eyes of stakeholders. new ventures can gain legitimacy by creating associations with more established entities, either external or internal to the firm. Article Review: This article is written by Raghunath Singh Rao, Rajesh K. Chandy, & Jaideep C. Prabhu.In this study, the role of a variety of legitimizing actions have been highlighted and empirically tested. In order to legitimize the new ventures in the eyes of the stakeholders different actions can to undertaken.It has also been shown that these legitimizing actions may not always work together. Among internal means of gaining legitimacy, four types of actions has been proposed: historical, scientific, market, and locational...
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...Executive Summary Joint venture is method or an approach which allows companies to further their interest internationally without taxing their resources b having a partner who is compatible to work on the project albeit in short term or long term project. Joint venture allows companies to pool their resources together and benefit each of the companies in reaching their potential. Apart from that, joint venture also allows company to complement each other short coming with what they do best. This is evidently shown when discussing Daicel Evonik Ltd where Daicel Chemical Industries Ltd and Huels AG complement each other in term market knowledge and technological capabilities know-how among them. But then, joint venture does have limitation where culture plays an important barrier to achieve success. In Danone Co. Ltd and Wahaha Co. Ltd which will be discussed further, the dissolution of ventureship between these two companies can be attribute to communication particularly in conflict management. Thus, managing cultural differences is important especial in term of managing conflict among the partners. Conflicts are parts of life and may appear in any organization. They particularly often occur in hybrid organizations whose parents coming from different cultures, different countries with different ways of thinking and doing things. Knowing how to management conflict with proactive approach (minimize conflicts to happen) and reactive approach (resolve conflicts) is crucial for firms...
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...How Venture Capital Works by Bob Zider Harvard Business Review Reprint 98611 HarvardBusinessReview NOVEMBER – DECEMBER 1998 Reprint Number Michael e. porter CLUSTERS AND THE NEW ECONOMICS OF COMPETITION 98609 daniel golem an WHAT MAKES A LEADER? 98606 carl shapiro and hal r . varia n VERSIONING: THE SMART WAY TO SELL INFORMATION 98610 stewart d. friedm an, perry christensen, and jessica d e gro ot WORK AND LIFE: THE END OF THE ZERO-SUM GAME 98605 bob zider HOW VENTURE CAPITAL WORKS 98611 henry mintzberg COVERT LEADERSHIP: NOTES ON MANAGING PROFESSIONALS 98608 andy bl ackburn, m at t halprin, HBR CASE STUDY THE CASE OF THE PROFITLESS PC 98603 and ruth veloria ja mes c. anderson and james a. narus idea s at work bill gross first person BUSINESS MARKETING: UNDERSTAND WHAT CUSTOMERS VALUE THE NEW MATH OF OWNERSHIP PETER F. DRUCKER 98607 hbr cl a ssic THE DISCIPLINE OF INNOVATION peter l . bernstein 98601 98604 bo oks in review ARE NETWORKS DRIVING THE NEW ECONOMY? 98602 Before you can understand the industry, you must first separate myth from reality. HOW VENTURE CAPITAL WORKS BY BOB ZIDER nvention and innovation drive the U.S. economy. What’s more, they have a powerful grip on the nation’s collective imagination. The popular press is filled with against-all-odds success stories of Silicon Valley entrepreneurs. In these sagas, the entrepreneur...
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... Company: Starbucks Country: China Going to do an international joint venture with “----“company in China. Advantages International joint ventures allow for much faster and less costly access to foreign markets than can be achieved by purchasing an existing company in the jurisdiction or starting a new venture. IJVs provide quick access to channels of distribution, and they provide access for the non-resident partner to knowledge and know-how of the local marketplace, which substantially enhances the probability of success for the venture. The resident partner also often has existing relationships with key suppliers and customers, and proficiency in the local language and customs. These benefits can be especially critical to a small or medium-sized business that does not have the capital, resources or Expertise necessary to pursue the opportunity unless it is able to share the risks and the costs through an alliance such as an international joint venture. IJVs allow the partners to move quickly, cost effectively and with credibility (provided by the reputation of the resident partner) in the local marketplace. The parties to an IJV can also take advantage of complementary lines of business and synergies that may exist between the two companies. Disadvantages An international joint venture can result in a frustrating experience and ultimately a failure if it lacks adequate planning and strategy. Factors such as marketplace...
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...PRIMER ON VENTURE CAPITAL IN MAINE . Charles J. Spies III Chief Executive Officer Timothy P. Agnew Principal Author The Finance Authority of Maine and Masthead Venture Partners would like to acknowledge and thank Governor John E. Baldacci, former Governor Angus S. King, Jr. and the Maine Legislature, who have consistently supported the efforts of Maine entrepreneurs, and the programs and services of the Finance Authority of Maine. Through their determination and support, Maine has developed perhaps the best array of programs and services for financing fledgling technology-based businesses of any state in the nation Copyright 2003 Finance Authority of Maine. All rights reserved. No part of this book may be reproduced in any form by any electronic or mechanical means without the prior written permission of the Finance Authority of Maine. Finance Authority of Maine, 5 Community Drive, P.O. Box 949, Augusta, ME 04332-0949 Tel: (207) 623-3263 or (800) 228-3734 TYY: (207) 626-2717 E-mail:info@famemaine.com Web Site: www.famemaine.com April 2003 2 TABLE OF CONTENTS PAGE CHAPTER 1: CHAPTER 2: CHAPTER 3: CHAPTER 4: CHAPTER 5: CHAPTER 6: CHAPTER 7: APPENDIX A: APPENDIX B: INTRODUCTION .................................................................................. 1 WHAT VENTURE CAPITAL IS (AND IS NOT)...................................... 3 HOW VENTURE CAPITAL INVESTORS WORK ................................... 6 HOW TO APPROACH VENTURE INVESTORS...
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...and consumer product sold in the United States. Although the market is growing in China laws and regulations are becoming even stricter. Doing business in another country takes time and research. To often management fails to understand that business values and behaviors done in the United States do not translate to the rest of the world (Daft & Marcic, 2011, p. 105). This could be an area that the president of Rocky River failed to research, and understand what business values his joint venture company Shui Fabrics believes in. CULTURAL CHARACTERISTICS There are cultural characteristics that influence organizations, those characteristic include language, religion, social organization, education and attitudes. Attitude is a big factor in the Rocky River and Shui Fabric joint venture, mainly understanding each other’s value. As noted in the textbook Understanding Management “Attitude toward achievement, work, and people can all affect organizational productivity” (Daft & Marcic, 2011, p. 111). Just as Paul Danvers doesn’t understand that his counter part Chui Wai is very pleased with the five percent return on investment, referring to attitude of the Chinese culture. Understanding each cultures cultural characteristic is key in a successful joint venture and business or partnership. SOCIAL VALUE Managers need to understand the local culture and one way is to understand the differences in social values. Researchers have identified different areas in which...
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...SHUI FABRICS Introduction Shui Fabrics is a fabric company based in China. The company is a 50%-50% joint venture between Shanghai Fabric Ltd., Chinese company and Rocky River Industries, U.S. Textile manufacturer. The company produces dye and coat fabric for domestic and international sportswear markets. There are several differences between the American and Chinese views of the company. Let’s discuss some of the ways the two countries differ in regards to the GLOBE project value dimensions. Differences between American and Chinese perspectives The first difference deals with the humane orientation dimension. The Chinese are concerned with job creation, because their unemployment hovers around 20 percent. With this joint venture they would be able to employ around 3,000 people, which is a real contribution to the local economy. The Americans think we should cut workers in order to make a higher profit. The Americans are more concerned with bottom dollar and not the people. The second difference deals with the performance orientation dimension. Chiu Wai, Chinese deputy general manager’s, point of view on the return on investment (ROI) is that they generate an appropriate level of profits “not too little and not too much”, he is satisfied with the 5 percent ROI. Ray Betzell is the American general manager, and his boss and President of Rocky River Industries, is Paul Danvers. Danvers thinks the 5 percent ROI is pathetic and that he expected around 20 percent ROI...
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...BUSINESS ECONOMICS AND MANAGEMENT RESEARCH Internationally Indexed & Listed Referred e-Journal VENTURE CAPITAL IN INDIA D. P. WARNE*; PINKI INSAN** *Chaudhary Devi Lal University, Sirsa, Haryana-125055. **Shah Satnam Ji P.G. Girls College, Sirsa, Haryana- 125055. ABSTRACT India is the largest democracy on the planet and second most populous country in the world. Its extraordinary history is intimately tied to its geography. A meeting ground between the East and the West, it has been invader’s paradise. In the last one and half decades, India has proved itself as a destination for Information Technology (IT) and Business Process Outsourcing (BPO). India is also fast emerging as a major center for cutting-edge research and development (R&D) projects for global multinational companies. Lot of activities are happening in India in various sectors such as IT, BPO, Knowledge Process Outsourcing (KPO), Semiconductors, Biotechnology, Textiles, Manufacturing, and Engineering recently. This study is an attempt to explore the trends and developments in Venture Capital financing in India through an in‐depth analysis of these investments over the last 5 years (2005‐2009). INTRODUCTION The Venture capital sector is the most vibrant industry in the financial market today. Venture capital is money provided by professionals who invest alongside management in young, rapidly growing companies that have the potential to develop into significant economic contributors. Venture capital is an important...
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...BP in Russia Executive Summary This case study “BP in Russia: Settling the Joint Venture Dispute” goes into the major world energy companies and the formation of joint ventures. This case delves into the 50/50 international joint venture (IJV) formed between British Petroleum (BP) and a group of Russian investors, Alfa Group, Access Industries, and Renova known as AAR. This IJV was formed in September 2003 and was known as TNK-BP.1 TNK-BP’s CEO was Robert Dudley in May 2008. This is when the dispute between the British and Russian shareholders started to escalate. AAR thought that BP was treating TNK-BP as a subsidiary and not a JV. The escalation of the conflict got to the point where BP was seriously considering whether they should walk away from the IJV by selling its stake, acquire AAR’s stake or continue the IJV. This case analysis will explore BP and whether it was a good strategy to enter Russia and pursue an international joint venture with consortium AAR. Next the analysis will look at the evolution of the joint venture and examine the unique challenges faced by the international joint venture. Next the study will detail our recommendations regarding the AAR partnership, their implications and steps to implement this. Lastly the case will be updated to the present time. 1. Did BP pursue the right strategy to enter Russia? There are arguments both for and against BP’s decision to enter Russia. Perhaps the biggest disadvantage to BP’s strategy was...
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...Harvard Business School 9-899-062 Rev. December 7, 1998 Walnut Venture Associates (A): RBS Group Investment Memorandum Ralph Wagner pulled his file on the RBS Group, a young company that developed and sold accounting software specifically targeted to software companies. Wagner was a private investor—an “angel”—and a member of an informal group of other investors known as Walnut Venture Associates. (See Exhibit 1 for background information on Walnut) RBS was seeking to raise $2 million in equity capital to fund its growth. Wagner had agreed to take the lead role in evaluating RBS as an investment opportunity for Walnut. While Wagner would spearhead the process, each individual would make his own decision about whether to invest in the company. It was December 26, 1997 and Bob O’Connor, RBS’s founder and CEO, had presented to the Walnut group one week ago. The group had been impressed with O’Connor, with RBS’s business focus, and with the fact that the company had a product, sales and even earnings. Based on this positive first impression, the group had decided to take the next step and begin a more in-depth investigation of the company and its prospects. Half a dozen or so “Walnuters” had indicated an interest in possibly investing, and it was up to Wagner to come up with a due diligence agenda for these individuals. He pulled out RBS’s plan (See Exhibit 2) and began to sort through the issues the group should investigate during this phase, as well as an...
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...and potatoes through biotechnology and is worth 400 million dollars. The purpose of this paper is to introduce two strategies to secure funding through venture capital or IPO that supports the company's goals to introduce new products and continue meeting 40% growth targets. Venture Capital Pursing venture capital is an important step for a rapidly growing business, especially when not seeking an IPO (Inc., 2010). The technology developed by Gene One is already on the market and the industry is experiencing a high level of investor interest that gives Gene One an advantage in the venture capital market. However, targeting the right investors makes a significant difference. Gene One is targeting investors that align with the research philosophies that facilitate the research and development team without having to worry about any private agendas. The research and development team will continue developing the innovative technologies expected, aiding the organization to realize its growth potential, and meeting the minimum 40% revenue growth target. Implementation The implementation of this strategy has several steps. The first step is to review the board of directors, CEO, and leadership team to ensure that the right people are in the right place. The company currently lacks the leadership experience in venture capital fund-raising and will hire someone or hire a consulting firm can provide the...
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...Venture Capitalist ENGL106-Week 2 IP American Intercontinental University Kendrick Little April 22, 2012 Abstract This is a paper to define and explain what venture capitalism is as well as what venture capitalists do in their business. Venture Capitalist An venture capitalist a person who provides capital is for the financing of growing, a new upstarting or struggling businesses. Venture capitalists are the general partners in the venture capitalist process. The capital itself provides long term finances to help companies that are not as lucrative as other large companies and it just simply keeps the company from failing. Venture capital can primarily help with a lot of things such as buying out a company, save a struggling one, upstart a new or expand an existing one. The venture capitalist profit is dependent solely on the company they have invested in, if the company is showing good signs of turnaround or having a good amount of success then the venture capitalist has made a good investment and will benefit from the success financially. Venture capitalist usually works very closely with the partner in the venture capital firm which develops a partnership. The general partners of the company role serves as the managers of the firm and will also in some cases take on the role as advisor to the vc’s to which the funds are made. In the Unites States of America venture capital firms can be set up or structured as limitied liability companies, by doing so the...
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...So I stay before the decision whether I try to undertake on my own or join with my friend. It is obvious that both of the way has its risks and advantages. So this decision demands more consideration. To illustrate the decision-making I stay before I imagined the following decision-tree: If I would follow my passion, namely to build up my own venture I have to invest the ~ 51% of the acquired money. The rest would be invested by a venture capital firm, which I have already convinced with my business plan. This investment means from my side almost all of my savings, and a bankruptcy would mean that I have to start my life over. As I know that in nowadays’ always changing business environment the knowledge, the well built business plan, well prepared exit strategy and the confidence are not always enough to be successful, hence I am really scared to take this courageous step on my own. However it gives the biggest freedom regarding my working time, my own leading style, significant control over company decision and it would be difficult to give up my own independence. On the other hand I could join my friends’ venture. This venture needs the...
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...Jul, 2011, 05.06PM IST,PTI Weak IPO market to hurt venture capital industry NEW DELHI: The current level of IPO activity in India as well as the world is "low" to support the health of the venture capital industry , says a study . The survey which was conducted by Deloitte in conjunction with the Venture Capital Associations of India, Brazil, Canada, China, France, Germany, Israel, US and the UK said that high returns generated by IPOs are critical for the sustainence of a healthy venture capital industry. "Clearly the industry continues to feel the ripple effects of the global economic downturn -- most notably in the form of limited exit opportunities," said Mark Jensen, partner, Deloitte & Touche LLP and United States national managing partner for venture capital services. As per the survey over 57 per cent of Indian venture capitalists surveyed stated that current IPO activity levels in the country is low, while globally, more than 80 per cent believe so. "The need for a healthy IPO market is driven primarily by the aspiration to provide superior returns on investments. And there is heightened interest in innovative companies that cater to growing consumer demands," India Private Equity and Venture Capital Association president Mahendra Swarup, said. Only 33 per cent of India venture capitalists said that IPO markets in other geographies were essential to the success of the India venture capital industry, while globally the figure stands at 49 per...
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