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| Note: The FORTUNE Preview Guide is created in HTML. If you are unable to properly view the cover image, Course Connector, or hyperlinks, please view the online version at http://www.fortuneeducation.com/preview_guides/index.html. |
| COURSE CONNECTOR |
| ARTICLE SUMMARIES AND QUESTIONS |
| "Can Nike Still Do It Without Phil Knight?" pp. 58-68: Sneaker guru Phil Knight has stepped down as CEO of the most powerful shoe company in the world, passing off the shoelaces to his successor, Bill Perez, formerly of the S.C. Johnson company. Although Nike has experienced ups and downs throughout its 32-year span, its current $23 billion market cap is more than three times that of Adidas, the No. 2 sneaker seller in the world. Nike makes 40% of all branded athletic footwear sold in the United States – an amazing feat for a company where the managerial style is loose, laid-back, and sometimes absent. No one at Nike can put a finger on the secret to Knight's success, but everyone there agrees that Bill Perez has big shoes to fill as he tries to get a handle on the inner workings of Phil Knight's kingdom.
By reading this article, students will begin to understand that some companies find success when they "just do it" – and do it better than others. Discussion Questions:
"GM Hits the Skids," pp. 71-74: Despite a slash in prices and the introduction of the sleek Pontiac G6, General Motors is finding itself going downhill with no brakes. It ended its first quarter with a 24.4% market share, down three full points from the same time last year, and expects to lose $850 million for the quarter, instead of breaking even as originally forecasted. Stock prices are down, inventory is up, and the cost of retiree health benefits is spiraling out of control, costing GM $5.3 billion this year – up $1 billion from last year. Chairman and CEO Rick Wagoner isn't interested in restructuring, eliminating brands, or reducing his workforce, so the consumer is likely to suffer, as cash incentives are diminished and gas prices go up. This article shows students that just because your company is one of the Big Three, don't assume you won't have to fight to stay there. Discussion Questions:
"One False Move," pp. 80-91: For a while, David Bonderman was flying high as his Texas Pacific Group bought failing companies and sold them at outrageous profits. He's been credited with turning around Continental and America West airlines, Oxford Health, Del Monte Foods, PETCO, and J. Crew, to name a few. However, his biggest failure was the overblown and poorly planned attempt to buy Portland General Electric, an Enron company. Being attached to the Enron name ended up being the least of Bonderman's problems, as he grappled with Oregon's quirky regulatory processes and the requirement that a utility sale provide a benefit to the utility's ratepayers. Bonderman hit one brick wall after another, and despite his best maneuverings, he pulled out after the utility commission denied his proposal. This article can help students learn a great deal about strategy, marketing, and the remarkable influence of a crowd of people. Discussion Questions:
"Inside the Shakeup at Sony," pp. 94-104: Sony isn't the first – and won't be the last – company this year to yield surprise twists and turns as it replaces its departing CEO. Nobuyuki Idei overlooked more obvious candidates and named non-Japanese and non-engineer Sir Howard Stringer as the next chairman and CEO of the media giant. Previously responsible for U.S. operations, Stringer has demonstrated his leadership ability, having worked with other Sony executives to slash $700 million a year in U.S. overhead costs. Despite his success in the U.S. market, Stringer has a tough road ahead, as he tries to bring Sony into the era of convergence and open communication – without being able to speak the language himself. Students going for their MBA or marketing degrees will be interested to learn about the changes happening over at Sony, which could affect the future of consumer electronics. Discussion Questions:
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