case study 2 case analysis of risk uncertainty and managing incentives 2

Description: ECO550 Week 9, Case Study 2: Cases Analysis of Risk, Uncertainty and Managing Incentives

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Unacceptable Below 70% F Fair 70-79% C Proficient 80-89% B Exemplary 90-100% A 1. Evaluate a companyâ€s recent (with in the last year) actions dealing with risk and uncertainty.

Points Range: 0 (0.00%) – 21.67933 (6.99333%)

Did not submit or did not address the subject

Points Range: 21.7 (7.00%) – 24.77933 (7.99333%)

Partially evaluates a companyâ€s recent (with in the last year) actions dealing with risk and uncertainty. Offer advice for improving risk management.

Points Range: 24.8 (8.00%) – 27.87933 (8.99333%)

Satisfactorily evaluates a companyâ€s recent (with in the last year) actions dealing with risk and uncertainty. Offer advice for improving risk management.

Points Range: 27.9 (9.00%) – 31 (10.00%)

Thoroughly evaluates a companyâ€s recent (with in the last year) actions dealing with risk and uncertainty. Offer advice for improving risk management.

2 Offer advice for improving risk management

Points Range: 0 (0.00%) – 32.519 (10.48999%)

Did not submit or did not address the subject

Points Range: 32.55 (10.50%) – 37.169 (11.98999%)

Partially offered advice for improving risk management.

Points Range: 37.2 (12.00%) – 41.819 (13.48999%)

Satisfactorily offered advice for improving risk management

Points Range: 41.85 (13.50%) – 46.5 (15.00%)

Thoroughly offered advice for improving risk management

3. Examine an adverse selection problem your company is facing and recommend how it should minimize its negative impact on transactions.

Points Range: 0 (0.00%) – 32.519 (10.48999%)

Did not submit or did not address the subject

Points Range: 32.55 (10.50%) – 37.169 (11.98999%)

Partially examines an adverse selection problem your company is facing and recommend how it should minimize its negative impact on transactions

Points Range: 37.2 (12.00%) – 41.819 (13.48999%)

Satisfactorily examines an adverse selection problem your company is facing and recommend how it should minimize its negative impact on transactions.

Points Range: 41.85 (13.50%) – 46.5 (15.00%)

Thoroughly examines an adverse selection problem your company is facing and recommend how it should minimize its negative impact on transactions.

4. Determine the ways your company is dealing with the moral hazard problem and suggest best practices used in the industry to deal with it.

Points Range: 0 (0.00%) – 32.519 (10.48999%)

Did not submit or did not address the subject

Points Range: 32.55 (10.50%) – 37.169 (11.98999%)

Partially determines the ways your company is dealing with the moral hazard problem and suggest best practices used in the industry to deal with it.

Points Range: 37.2 (12.00%) – 41.819 (13.48999%)

Satisfactorily determines the ways your company is dealing with the moral hazard problem and suggest best practices used in the industry to deal with it.

Points Range: 41.85 (13.50%) – 46.5 (15.00%)

Thoroughly determines the ways your company is dealing with the moral hazard problem and suggest best practices used in the industry to deal with it.

5. Identify a principal-agent problem in your company and evaluate the tools it uses to align incentives and improve profitability.

Points Range: 0 (0.00%) – 32.519 (10.48999%)

Did not submit or did not address the subject

Points Range: 32.55 (10.50%) – 37.169 (11.98999%)

Partially identifies a principal-agent problem in your company and evaluate the tools it uses to align incentives and improve profitability.

Points Range: 37.2 (12.00%) – 41.819 (13.48999%)

Satisfactorily identifies a principal-agent problem in your company and evaluate the tools it uses to align incentives and improve profitability.

Points Range: 41.85 (13.50%) – 46.5 (15.00%)

Thoroughly identifies a principal-agent problem in your company and evaluate the tools it uses to align incentives and improve profitability.

6. Examine the organizational structure of your company and suggests ways it can be changed to improve the overall profitability.

Points Range: 0 (0.00%) – 43.276 (13.96%)

Did not submit or did not address the subject

Points Range: 43.4 (14.00%) – 49.476 (15.96%)

Partially examines the organizational structure of your company and suggests ways it can be changed to improve the overall profitability.

Points Range: 49.6 (16.00%) – 55.676 (17.96%)

Satisfactorily examines the organizational structure of your company and suggests ways it can be changed to improve the overall profitability.

Points Range: 55.8 (18.00%) – 62 (20.00%)

Thoroughly examines the organizational structure of your company and suggests ways it can be changed to improve the overall profitability.

7. Use of at least 5 academic quality references.

One has been published in the last 6 months

Points Range: 0 (0.00%) – 10.819 (3.49%)

Did not submit or did not include citations or references in work

Points Range: 10.85 (3.50%) – 12.369 (3.99%)

Used enough references however not all were of academic quality, and one has been published in the last 6 months

Points Range: 12.4 (4.00%) – 13.919 (4.49%)

Did not use enough references however all were of high quality and citations/references were appropriately done, and one has been published in the last 6 months

Points Range: 13.95 (4.50%) – 15.5 (5.00%)

Used 5 or more academic quality reference and citations were appropriately done, and one has been published in the last 6 months

8. Clarity, writing mechanics, and formatting requirements

Points Range: 0 (0.00%) – 10.819 (3.49%)

Student did not submit the assignment or there are so many errors that work is confusing to read. APA citation not attempted

Points Range: 10.85 (3.50%) – 12.369 (3.99%)

Several errors(5-6) in grammar, formatting and APA citation.

Points Range: 12.4 (4.00%) – 13.919 (4.49%)

A few errors (3-4) in grammar, formatting and APA citation but not so much that .

Points Range: 13.95 (4.50%) – 15.5 (5.00%)

Minimal (0-2) errors in grammar, formatting and APA citation.

Picking a Firm for Your Final Assignment

Posted on: Wednesday, February 26, 2020 12:30:00 AM EST

The final live session looking at what you are expected to do on the second/final case study will be on the week 8 page today. I have provided my presentation notes.

Also, remember part of the preparation for the final case study are the weekly discussions. Make sure you view the feedback videos each week. The feedback videos for week 7 have been added to the week 7 page. Take a look.

Now the first step to doing well on the case study is your choice of a firm that is/has faced a challenge in the last six months. You want to pick a firm in which you are really interested or a firm facing a challenge in which you are particularly interested. Make this something you want to understand. So, I know it can be hard to think about picking. Here are some things to consider.

First, one category to think about could be a challenge arising from dealing with regulators. Examples, the T-Mobile-Sprint merger has been cleared by DOJ. After protectedly long struggle to get past the charges of potential monopoly are they ready for the merger? Another example of facing up to regulatory challenges are Juul/Altria who must deliver to the FDA by May 12th evidence that their product is safe. More over it must provide evidence public benefits in helping people reduce dependency on cigarettes. But the biggest challenge may be can they also demonstrate that they can deter use by those underage.

A second category are companies facing the challenge of a new CEO. Succession transitions can be very messy. Heineken’s new CEO has a hard act to follow. Outgoing CEO Francoius von Boxmeer generated high rates of annual sales, 5.6% per WSJ “CEO Succession at Heineken’s: CEO Need Strong Head for Mixing Drinks”, and grew the company portfolio 170 brand to 300 by expanding Heineken’s past it strong market base in Europe. But growth in world sale of beer is declining, so it may be a hard act to follow. Other new CEOs include Alphabet gets new CEO who will refocus on Ads and United Airlines new CEO will have to take on both new labor talks and the fact that United has a large fleet of 737 MAXs

Then there is a new CEO at Boeing, but with continue fall out over short cuts taken in gaining initial approval for the MAX 737 the question remains, can Boeing turn the corner on re-gaining approvals for the MAX and then can they re-gain the confidence of buyers? There are multiple pressures on Boeing, with MXA production still suspended and orders for future production gone, can they recover? What is the impact on the Boeing supply chain as suppliers find they can’t manager prolonged suspension in production? Finally, in the latest twist the Boeing Board adds two new members. Is this a move to help support to new CEO or is the board searching for a radical change in management?

Now we come to GE. GE has shed thousands of jobs as it seeks to get out of some businesses in order to focus on it strongest places in the market. One of those strengths has been airplane technologies. It has been a supplier to Boeing, but GE also his ties to Airbus. Will the fall off in it business with Boeing be offset by the rising sales and production of Airbus?

There are two other great stories both of which are connected to discussions we will be having. In week 9 we will look at the question of what went wrong at Wells Fargo and the massive fraud of creating accounts for customers who never agreed to owning those accounts. Wells Fargo is now on it third new CEO since the incident. They have just announced a $3 billion settlement with the Justice Department and the SEC, but the long battle back is not over. Among other things the cost of settlements has drain resources that would otherwise have gone to new investments. AND the settlement with the Justice Department is about the past. Wells Fargo still has not obtained a clean bill of health from the Federal Reserve (FED) over continuing questions about poor corporate governance and it is barred from some growth opportunities until it demonstrates to the FED that is has establish adequate governance. It is still a long road if this iconic business is to be saved.

The second story is connected to the discussion in week 10 about HP. HP once the mightiest of high tech companies hope to fend off a hostile takeover by Xerox. For now HP is proposing to buy back massive amounts of stock to boost stock prices and raise the ROI for stockholders. Can they do it? There are lots of doubters.

Make this project something personal. Test you growing skills by taking a deep dive into current issue or challenge.

See you in the discussion.

Dr. Isley