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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 |
| "What
Makes GE Great," pp. 90-104: In many ways, General Electric
seems an unlikely choice to top FORTUNE's list of the most admired
companies in America. After all, it isn't the world's biggest or
most profitable company, nor is it the fastest growing or most
valuable. Its stock has been practically inert for years. But among
businesspeople, whose opinions form the basis of the annual listing,
GE holds a place of honor because it consistently behaves in ways
other companies only wish they could, both in good years and in
bad. First and foremost, the company has set the agenda of management
ideas and practices that other companies have followed for the
past hundred years. As those ideas and practices have outgrown
their effectiveness and fallen out of favor, GE was the first to
abandon them and unabashedly change direction, boldly pioneering
into conceptual managerial territory and establishing an intellectual
leadership like no other in the business world. GE's leaders don't
fear change as many others do, so the company weathers market changes,
technological advances, and fluctuations in consumer needs with
tremendous aplomb, giving it a serious edge over competitors. Finally,
GE tirelessly develops its talent, without hesitating to get rid
of underperformers. Through an upfront process of constant appraisal,
the company lets its employees know what they're doing right — and
wrong — in a way that many other companies simply cannot
stomach. Students analyze why General Electric has remained a dominant force in American business for more than a century. Discussion Questions:
"How Toyota Does It" pp. 107-124: As American automotive behemoths Ford Motor Company and General Motors stress over their decreasing revenues and declining market shares, Japan's Toyota has become the first non-U.S.-based company to crack the top 10 of America's most admired companies. And why not? In 2005, it earned $11.4 billion — more than all other major automakers combined — and it produces nearly 50% more automobiles today than it did just five years ago. At least part of Toyota's success is due to its business philosophy, which, according to Jeffrey Liker, author of The Toyota Way, is, "Go slow, build on the past, and thoroughly consider all implications of decisions, yet move aggressively to beat the competition to market with exceptional products." Consider the case of the Prius, Toyota's revolutionary hybrid vehicle, which made its U.S. debut in July 2000. First conceived in 1993 as an economical, eco-sensitive alternative to the traditional internal combustion engine, the gas-electric Prius is rock-solid proof that Toyota is not only a fine manufacturer but also a truly great innovator. Of course, it wasn't easy. The company had to overcome punishing deadlines, skeptical dealers, finicky batteries, and its own risk-averse culture to bring the hybrid to market. But if the measure of a great company is how well it can overcome big obstacles, then Toyota has more than proven itself worthy of its lofty position on FORTUNE's list. This article reveals how Toyota brought the Prius to market in spite of technological potholes, impossible demands, and multiple miscalculations. Discussion Questions:
"The Unlikely Revolutionary," pp. 132-144: What happens when someone with the "potential" to be a great CEO is already on the job, and further, has taken it upon himself to deconstruct and rebuild the largest, most formidable financial institution in the world? For the answer, one need look no further than Citigroup, where Charles (Chuck) O. Prince III is leading the charge. Prompted by a string of Citi scandals, Prince has endeavored to put ethics on an equal footing with profitability. He also has spurned the growth-by-acquisition route that his predecessor and mentor, Sandy Weill, plied so superbly during his tenure, in favor of organic growth, which requires a more efficient, centralized and systematized corporate culture than the one Weill bequeathed to him. Reviews of his performance are, to put it generously, mixed. The company has seen a slew of high-ranking, experienced managers exit in the past year, and a swelling chorus of current and former employees is questioning his reengineering of the company. Investors are getting antsy too, with Citi's stock returning just 10.8%, including dividends, since Prince took the helm two-and-a-half years ago, vs. 34% for the S&P 500. While no one is calling for his head just yet, it is clear to everyone at Citi — including Prince himself — that he needs to show some real results soon if he intends to gain much-needed support inside and outside the company. In this article, students evaluate Chuck Prince's performance to date as CEO of Citigroup. Discussion Questions:
"Inside the Great Firewall of China," pp. 148-158: In Communist China, the proliferation of the Internet — that universal bastion of freedom of expression — is creating a moral dilemma for American tech companies and keeping government censors on their toes. Some of the most respected leaders in the tech industry, including Cisco, Sun Microsystems, Microsoft, Yahoo, and Google, have collaborated with the Communist Party's effort to block access within China to content the state deems inappropriate for public consumption. But while big-name American companies are taking the heat, Chinese Internet companies are quietly springing up to service China's 110 million Internet users. Baidu.com, Bokee.com, Sohu.com, and Alibaba.com are already competing soundly with their Western counterparts in China. The country's dysfunctional stock markets and backward venture capital rules have forced most Chinese Internet startups to go abroad for financing and to list on stock exchanges, and investors like Morgan Stanley, Goldman Sachs, and UBS have been happy to oblige. As incomes in China rise, and more low-income farmers migrate to urban areas, Internet use is expected to explode. That's good news for Chinese online entrepreneurs and their foreign investors. It also might spell the undoing of China's great firewall. As the Chinese people become increasingly tech-savvy, Beijing's efforts to control the vast and fluid Internet will likely become more and more futile. Students take a closer look at the growth of the Internet under the oppressive eye of the Chinese government. Discussion Questions:
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