Managing a Business/case study


please help me to answer the following case study.


Case study
As tastes become global, firms are responding more and more with truly global products. These are introduced more or less simultaneously in most countries of the world with little or no local variation. This is leading to what has been aptly called the “global super market”. For example in 1990, Gillette introduced its Sensor Razor at the same time in most nations of the world and advertised in with virtualy the same TV spots (ad campaign) in nineteen countries in Europe and North America. By 1998, Gillette had sold more than 400 million of the razors and more than 8 billion twin-blade cartridges, and it had captured an incredible 71 percent of the global blade market. In 1994, Gillette introduced an upgrade of the Sensor Razor called Sensor Excel with a high-tech edge. Then in April 1998, Gilette unveiled the Mach 3,the company’s most important new product since the sensor, It has three blades with a revolutionary edge produced with chip making technology that took five years to develop. Gillette developed its razor in stealth secrecy at the astounding cost of over $750 million and spend another $300 million to advertise it. Since it went on sale in july 1998, the March 3 has proved to be an even bigger success than the Sensor Razor. Gillette expects the March 3 to generate annual revenues in excess of $1 billion by 2001.
The trend towards the global super market is rapidly spreading in Europe as borders fade and as Europe’s single currency (the Euro) bring price closer across the continent. A growing number of companies are creating “Eurobands” – a single brands for most countries of Europe-and advertising them with “Euro-ads” which are identical or nearly identical across countries, expect for language. Many National differences in taste will, of course, remain; for example, Nestle markets more than two hundred blends of Nescafe to cater to difference into tastes in different mrkets. But the converging trend in tastes around the world is unmistakable and is likely to lead to more and more global products. This is true not only in foods and in expensive consumer products. This is true not only in foods and in expensive consumer products but also in automobiles, tyres, portable, computers, phones and many other durable products.
1)   Analyse the Gillete Global products.
2)   Discuss the views of Gillete in global market.
3)   Analyse the case and write your own comments.


Workers and Management at Whirlpool Appliance’s Benton Harbor plant in Michigan have set an example of how to achieve productivity gains, which has benifited not only the company and its stock holders, but also Whirlpool customers, and the workers themselves.
Things were not always rosy at the plant. Productivity and quality were not good.
Neither were labour management relations. Workers hid defective parts so management would not find them, and when machines broke down, workers would simply sit down until sooner or later someone came to fix it. All that changed in the late 1980s. Faced with the possibility that the plant would be shut down. Management and Labour worked together to find a way to keep the plant open. The way was to increase productivity producing more without using more resources. Interestingly, the improvement in productivity did not come by spending money on fancy machines. Rather, it was accomplished by placing more emphasis on quality. That was a shift from the old way, which emphasized volume, often at the expense of quality. To motivate workers, the company agreed to gain sharing, a plan that rewarded workers by increasing their pay for productivity increases.
The company overhauled the manufacturing process, and taught its workers how to improve quality. As quality improved, productivity went up because more of the output was good, and costs went down because of fewer defective parts that had to be scrapped or reworked. Costs of inventory also decreased, because fewer spar parts were needed to replace defective output, both at the factory and for warranty repairs. And workers have been able to see the connection between their efforts to improve quality and productivity.
Not only was Whirlpool able to use the productivity gains to increase worker’s pay, it was also able to hold that laid on price increases and to funnel some of the saving in to research.
1.   What are the two things that Whirlpool Management did to achieve productivity gains ?
2.   Who was benefited from the productivity gains ?
3.   How are productivity and quality related ?
4.   How can a company afford to pay it workers for productivity gains ?


The Hindustan Toys Ltd., (HTL) is producing toys for children. The potential for its product in the market is consistently growing. Now the HTL is using a machine whose original cost was Rs. 72,00,000. This machine was installed two yeaes earlier and its current market value is only Rs.16,00,000. This machine has a life span of 12 years with zero salvage value. The HTL is using a straight line method of depreciation and is plying tax at the rate of 50 per cent.
The Management of the company is planning to replace the machine by a higher capacity machine. The proposed cost of new machine is Rs.75,00,000 and its salvage value is Rs.10,00,000. The new machine is capable of increasing the output by Rs.20,00,000 (from 2,00,000 to 2,20,000). The company is quite confident that the demand for the Company’s product will not fall below Rs.2,20,00,000. It is also estimated that the new machine will save Rs.10,00,000 per annum by its efficiency. The company is to follow the same straight line method of depreciation. The company’s total depreciation cost is presently Rs.1,20,00,000. The cost of capital for the company is8 per cent and its annual costs are Rs.8,00,00,000. The tax rate applicable to the company remains unchanged at 50 per cent.
The company was about to take a decision whether or not to replace the first machine with the second one when the company came in contact with a financial institution which was ready to provide long-term finance to the company at the cost of 8 per cent per annum. Given the easy availability of finances now, the fir could consider a second alternative. Another type of new machine was available for Rs.1,40,00,000. It has a ten year life span and is estimated to save Rs.25,00,000 per annum compared to the first machine. The salvage value of this machine is estimated at Rs.20,00,000. The tax rate for the company remains at 50 per cent.
1)   Should the company replace the first machine with the second one?
2)   Will the decision of the company be affected by the emergence of the possibility of the third machine? How?
3)   As Manager, how would your decision be affected if new model machines are expected to be in the market in about three years and that it provides additional savings per year with the same cost, asset life and salvage value as the first machine?
4)   Are there any quantitative factors which require consideration in the practical situation?


PMTC in the business of Metal cutting tools and Metal forming tools, is engulfed in competition with national as well as international players. PMTC,s products are used by capital goods and other engineering industries. The business is cyclical in nature depend on capacity utilization levels in user industries.
Gokul Chand, the MD of PMTC had been urged by the distributors in recent meeting, to introduce high-tech metal cutting tools and new models using the latest technology. They felt that, this would help them fight the dumping of cheap second hand machinery and increase the domestic as well as export market share. Gokul chand realized the implications of the distributor’s suggestions. This would increase the R and D budget tremendously. A fully automated production line would put pressure on finances. A greater variety of tools, models etc. would require inventory space. Machines need to be trained again, especially in running the latest, fully automated robots and gadgets.
Reflecting on previous staff-meetings, Gokul Chand realized that marketing people always wanted to greater variety of models but never appreciated the huge financial burden such as decision would imply. PMTC, after all, carried through its operations all along with just a few models quite successfully. In such a scenario, Gokul Chand felt that there is no need to go in for new models. Instead, he thought the focus should be on improving existing models and reducing the cost and price. The customer now-a-days is more interested in getting value for money. However, to be on safe side, he sought the opinion of a consulting form in this regard.
i)   What do you think is the mission of the enterprise?
ii)   What kind of opportunities and threats exist in the forms external environment?
iii)   How would you go about evaluating the strengths and weaknesses of the firm? What factors are critical for success of failure?
iv)   To the successful, an organization must be an open system, what does this mean and how does it apply in this case?

Case Study:
Jyothi Gupta is a Senior Vice President at a medical equipment manufacturing firm based in New Delhi, he had came up to occupy the senior position in such a big firm due to determination, urge to learn and grow, and total commitment to any job assigned to her. She had valued all such qualities and without any gender bias would encourage all with such skills to work hard and give their best to the organization.
Molly Mathews was one such sales manager who had proved her ability in successfully solving all the challenging assignments given to her. It was this ability and attitude which made the organization send Molly to Korea to bag a deal as a strategic partner with a Korean distributor, Huzen.
Just before lunch, Jyothi’s personal secretary brought her a fax from one of the company’s Korean distributors where the latter was asking why was the company not considering him as a strategic partner and sending a woman to work out the agreement? Jyothi recalled her meeting with the president, Manohar Pandit when the later had suggested sending Molly to Korea to sign the deak. Manohar had emphasized that Koreans placed a lot of importance on personal connections and business people spent a lot of time in maintaining such harmonious relationship. When Jyothi had expressed fears about sending a woman (Molly) because of their (Koreans ) value system which teaches that woman have to obey the male members of the society and must occupy only lower job status that their male counterparts. Manohar had brushed aside her inhibitions by saying that now with so many companies such as LG, Hyundai, Samsung etc., setting up base in India, they must have seen Indians (both males and females) matching and working neck to neck in all business activities and transactions. Thus thay must be more receptive to accept business talks from such an able and qualified person as Molly.
Towards the evening, Jyothi received an email from Molly which read as “These Korean people just don’t listen when I talk. They feel everything is fine as things are functioning as it should and object to any suggestion made by me. I feel they are just not willing to communicate with me. What should I do? Can you help me?-Molly.
Since Manohar had gone to attend an International conference, Jyothi had to take a decision whether to recall Molly and send another man to represent the company? or follow the Company’s policy of letting the most efficient employee (here Molly) to persist and workout an agreement with the Korean distributor.
Questions for discussion:
i)   Do you feel Molly has a communication problem or is it a cross cultural communication barrier? Explain with reasons.
ii)   Can you suggest ways in which Jyothi can solve this problem?
iii)   How would you help Molly to streamline her communication process, it she were asked to continue to try and strike a deal?

ANSWER: Hi Sonu,

I have tried my best to answer the queries and hope they may help you in understanding the cases comfortably. If you like the answer, please don't forget to rate the author (i.e. me) and the answers. For more details on business analysis visit:


1)   Analyse the Gillette Global products.

Ans: Gillette took the revolutionary step by entering into the campaigning in the global super market mode. Starting from early 90s to the entry in new millennium Gillette has followed the same mode of campaigning. This mode of campaigning helped the Gillette to introduce their products in the global market and within no time they have covered the global consumers. The products which were accepted by global consumers warm-heartedly are sensor razors and Gillette mach 3. These products have marked there global presence and company has kept the promise by delivering quality products.

2)      Discuss the views of Gillette in global market.

Ans: Gillette is the major brand for men around the world and it is accepted by majority of people due to its world class products. With the changing trends in the marketing and endorsing the products and with the introduction of the global campaigning many product companies have accepted the idea of endorsing the products in most of the nations at the same time. Gillette has also done the same in early 90s and endorsed its first product sensor razor in different European and Asian countries. It has also accepted the idea of Euro-band and has joined the league of campaigning for the same currency countries.

3)      Analyse the case and write your own comments.
Globalization has brought changes in the ideas and mode of thinking of people. This has brought forward the new mode of campaigning called global super market which allows the  product companies to market their products in multiple nations at the same time. It not only increases the popularity of the product but also revenue increases manifold. With the introduction of common currency "Euro" for the European countries the mode endorsement has changed tremendously and the product companies have no problem in following the league of "Euro-ads". This globalization has definitely made the life easy of both the buyers and the sellers. The differences in the taste with the change in nationalities cannot be avoided but the consumers are accepting the foreign tastes and products warm-heartedly. This is true for different consumer products and industries.


1.      What are the two things that Whirlpool Management did to achieve productivity gains ?

Ans: When whirlpool was on the edge of closing its operations, the management decided to rethink on the policies and in late 80s they found a way to increase the profit margins. The two steps taken by the management were:
a. Increase the relations between management and the labors. The management decided to bridge the gaps in thinking of management and labors. They invited the labors' representatives to present their opinions and later developed common solutions to increase the faith of labors in the management.

b. Focus on quality. In the late 80s whirlpool decided to focus on quality products and encouraged the labors to come forward with different solutions. Later labors started
sharing the details of the machines and in case of any fault they started reporting immediately to the managers. Thus, instead of installing fancy machines with the help of labors, whirlpool increased productivity gains by focusing on quality work.

2.      Who was benefited from the productivity gains ?

Ans: With the increase in the profit margin not only the management but the labors were benefited. The management started sharing profit with the labors and in turn labors worked more sincerely and this lead to the remarkable growth. With the quality products, the consumers were also benefited and the faith in whirlpool increased again.

3.      How are productivity and quality related ?

Ans: Its directly proportional relation. Better the quality, more will be the demand and in turn more productivity. The better quality can not only be delivered by fancy machines but also by having faith in the labors. The management should think about the regular training of the workers and the workers should be informed about the usage of the machinery. This certainly brings down the cost of spare parts.

4.      How can a company afford to pay it workers for productivity gains ?

Ans: With the regular training about new methodologies and techniques to the workers, they learn about the usage of the machinery and thus instead of installing new fancy machines the good quality products can be developed by using old machines. The cost spend on spare parts decreases and this in turn increases the profit margin. The smart usage of machinery and re-use of spare parts also decreases the overall cost invested on the manufacturing. In this way the ratio of profit margin can be increased.


<Out of scope, may be sometime later I would be able to answer this.>


i)      What do you think is the mission of the enterprise?
Ans: PMTC wants to establish itself in the field of metal forming and cutting tools. But due to the presence of the domestic and international brands they are not able to get the expected response in the market. PMTC has not got major success in the field and thus the MD is more concern about the R&D budget. In this dilemma the suggestions of the marketing team is also not much helpful. In simple words. "PMTC wants to expand its business in the local market and export market share by focusing on the existing models and refining them to maintain the balance in the cost and price".

ii)     What kind of opportunities and threats exist in the forms external environment?

a. Establish the value in the local market
b. Use of new technologies in the machines
c. Introduction of new engineering industries

a. Already brands in the market
b. More space required to install new machinery
c. Skilled labors are required
d. Impact on the marketing funds
e. Capacity utilization decreases
f. Increasing demand of market

iii)    How would you go about evaluating the strengths and weaknesses of the firm? What factors are critical for success or failure?

a. Faith of managing director on existing models
b. Understanding of the processes

a. Limited R&D budget
b. Only few successful models
c. Presence in market is limited
d. Marketing team is not in sync with MD and it is more demanding
e. Marketing team doesn't understand the implications of fully automated line

Critical Factors:
a. Know your strengths and weaknesses and work accordingly
b. Should have scope of accommodating the changing trends
c. R&D team must be updated with latest techniques
d. Workers should get proper and regular training
e. Cost and price should be balanced to increase the revenue share

iv)     To the successful, an organization must be an open system, what does this mean and how does it apply in this case?

Ans: Organization must be an open system signifies to getting adapted to the changing trends. There should be scope of introducing new techniques. The different opinions must be listened and the proper action should be taken on the common solutions.In the case of PMTC, the MD is not willing to change the existing models as he is under pressure of financial constraints. The introduction of fully automated lines may impact R&D budget and thus he is not buying the points of marketing team. On one hand he is trying to increase the productivity using the existing models and thus not taking much risk but he has also closed the doors for new techniques on the other hand. He should think for the overall growth of the organization by comparing the present cost and the change in cost after applying the suggestions of marketing team.


i)      Do you feel Molly has a communication problem or is it a cross cultural communication barrier? Explain with reasons.
Ans: Molly is a sales manager and always proved her credibility with her high level performance. So Molly should not have any communication problem as if she would have problem with communicating, she would not be able to express her views in different internal meetings and her seniors like Jyothi would have caught this point. But this has never happened so the problem seems to be with cross cultural communication.
Molly has proved her ability several times but there may be chances that she has not attended any onsite clients and thus not aware of cross cultural communications. As it is well known that Koreans are rigid with their cultures and they always feel that females should obey all the orders from males. This thinking has encouraged the Korean counterparts to not give much importance to Molly's views and thus she is not much comfortable in communicating with Koreans.

ii)     Can you suggest ways in which Jyothi can solve this problem?

a. Can send Korean distributor to pitch-in and handle the current situation
b. Ask Molly to take a break and strategize for next meeting
c. Discuss the current scenario with Molly in detail, may be Molly is nervous and thus becoming scapegoat
d.  Encourage Molly to articulate the views for better understanding
e. Ask Molly to share the working culture of India and explain how male and female work neck to neck in India and in other part of world.
f. Check out with Korean female employees about the basic ethics followed in Korea.

iii)    How would you help Molly to streamline her communication process, it she were asked to continue to try and strike a deal?

a. Make yourself comfortable and friendly with the counterparts before expressing the views.
b. Listen to them properly before mentioning your points
c. Ask for a break if you do not feel comfortable in convincing, strategize and then speak.
d. Articulate the views
e. Point out the common points and use them to convince the counterparts on other points
f. Use less "I" and more "We"
g. Understand your Fear and conquer it. Believe in yourself
h. Plan, prepare, practice before going for presentation
i. Always wear a smile on your face. A smiling face can conquer many conflicts.

---------- FOLLOW-UP ----------

QUESTION: thanks for the answer.
I also want the answers of the following steps
1. case summary
2.identification of problems
3.alternate solution solution
for each case would be helpful if u answer these steps.hope you will answer it soon.


I have tried to answer the additional queries for first case study. For other cases, I would need some time.

PS: If you like the answers, please do not forget to rate me.


4) Case Summary

Ans: Gillette had joined the league of global marketing in the 90s and they have gained maximum profit out of it. The strategy helped them to cover the major global markets and allowed them to endorse their products around the world. The company had introduced its most attractive product for which they have devoted several years in research in most of the nations at once and the result was maximum profits. They have maintained the credibility of the product by maintaining the quality high of the products. The concept of Euro-band also helped Gillette to endorse its products in all European countries using the same currency. This mode of global marketing is the positive effects of the globalization and this has made the life easier of both the buyers and the sellers.

5) Identification of the problems

a. Global marketing needs more initial investment
b. Research required for the different countries and its culture
c. the endorsements should not hurt the sentiments of local people
d. Find the credibility of your product for global marketing

6) Alternate solution

Ans: Endorsing products in the local markets is also necessary. But this entirely depends on the type of product or commodity for which the endorsements are to be made and then the further actions for local or global marketing can be selected.

7) Best solution

Ans: If the company has budget and the management is ready for initial investment, its best to go for Global marketing. It increases the chances of getting recognized manifold and in turn the profit margin is comparatively higher.

8) Implementation

Ans: Endorsements via advertisement agencies operating globally helps in achieving the requirements easily.

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Aniket S Sharma


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