978-1259278211 Case 2 Solution Manual Part 1

Unlock access to all the studying documents.

View Full Document

Teaching Note: Case 2 – Edward Marshall Boehm, Inc.

Case Objectives

1. To provide an introduction to the conceptual framework of strategic management.

2. To introduce students to the process of problem identification and potential solution

See the table below to determine where to use this case:

NOTE: This is a COMPREHENSIVE case, so this Teaching Note covers concepts from all

chapters in the text. Instructors can move from chapter to chapter, or focus on specific chapters at

their discretion.

Chapter Use Key Concepts

1: Strategy Concept Leadership for strategic management; sustainable competitive

2: External

Environment

Industry competition five forces; general environmental factors

3: Internal Analysis Value-chain analysis; resource-based view of the firm; VRIN

5: Business-Level

Strategy

Competitive strategy; generic strategies

Strategy

Strategies

9: Strategic Control Informational vs. behavioral control

10: Organizational

Design

Organizational structure; functional structure

Leadership

Innovation

Case Synopsis

Edward Marshall Boehm, Inc. was a small, high-quality porcelain art objects company that was

very successful, particularly at producing images of vanishing species of birds. These pieces are

complex sculptures selling from $100 to over $20,000, and are sought by some sophisticated

collectors. The company was run by Mr. and Mrs. Boehm (pronounced “beam”): he was the

Teaching Plan

It’s possible to ask students to read this short case in class during the 2nd or 3rd class meeting, after

they’ve had a chance to read and discuss Chapter 1. Despite its brevity, this case can be used to

demonstrate how all the components of strategic management are necessary in order to achieve a

competitive advantage and makes a great point about the need for a business-level strategy. The

Edward Marshall Boehm story contains short examples of almost all the major concepts

contained in the textbook, so the instructor can use the case with Figure 1.3 to show how

strategic analysis, formulation, and implementation are linked. Either use the case PowerPoint

slides or ask the discussion questions directly. As students respond, either write answers on the

board or refer to the PowerPoint slide answers.

NOTE: As you will see in the Case Update, Boehm appears in danger of closing for good, so

enterprising students who may have done some research on their own might question the value

of discussing a case where the strategy eventually was unsustainable. Point out that this doesn’t

matter. When the case was written, the company, started in a basement in New Jersey in 1949,

was still recognized as creating some of the most outstanding porcelain art available. Ask

students to put themselves in the shoes of the Boehms, and analyze the strategic environment as

it existed when the Boehms were still alive. What advice might students give that could protect

the legacy of this company?

Summary of Discussion Questions

Here is a list of the suggested discussion questions.

1. What are the strategic challenges facing Edward Marshall Boehm? What business are

they in, and what strategy should they choose? Is there a certain sequence of actions that

would be best to take when developing a competitive strategy?

Discussion Questions and Responses

Referencing Chapter 1: Introduction and Analyzing Goals and Objectives

1. What are the strategic challengers facing Edward Marshall Boehm? What business

are they in, and what strategy should they choose? Is there a certain sequence of

actions that would be best to take when developing a competitive strategy?

Strategy is all about the ideas, decisions, and actions that enable a firm to succeed. See Chapter

1, Exhibit 01: Strategic management consists of the analyses, decisions, and actions an

organization undertakes in order to create and sustain competitive advantages:

●strategy directs the organization toward overall goals and objectives;

●includes multiple stakeholders in decision making;

Strategic management involves

●Analysis of strategic goals (vision, mission, strategic objectives), and of the internal and

●Decisions – Formulation about what industries to compete in, and how to compete in

●Actions -Implementation to allocate necessary resources and design the organization to

An interesting question that the instructor can ask at this point is: What business is Edward

Marshall Boehm in? Some students might say porcelain manufacturing; some might say art. The

Leaders face a large number of complex challenges. Leaders must be proactive, anticipate

change and continually refine changes to their strategies. This requires a certain level of

See Chapter 1, Exhibit 06: The primary role of the organizational leader is to articulate vision,

mission and strategic objectives. Leaders must communicate their initial vision of the

How well did Mr. Boehm seem to do this? It appears from the case that his passion, his love, was

A mission encompasses both the purpose of the company, as well as the basis for competition

and competitive advantages. Organizations must respond to multiple constituencies if they are to

The mission of Edward Marshall Boehm is clearly stated. The Boehms were interested in: (1)

having Mr. Boehm’s art recognized and honored in the art world, (2) supporting nature and

Anticipating that things might change, the leader must establish strategic objectives to

operationalize the mission statement. That is, objectives help to operationalize the mission

At least one of the objectives established in the case was to further develop the techniques of

high-quality porcelain manufacturing. This objective has implications for how to acquire both

tangible and intangible resources, how to monitor and control performance, and how to analyze

During strategic analysis, the leader does “advance work” to anticipate unforeseen

environmental developments, identify unanticipated resource constraints, assess changes in his or

her preferences for how to manage. During strategy formation, depending on the type of

The basic question strategic management tries to answer is: How can we create competitive

advantages in the marketplace that are not only unique and valuable but also difficult for

Referencing Chapter 2: Analyzing the External Environment

See the segments of the external competitive environment that include competitors, customers,

What business is Boehm in? If the Boehms are considered to be in the business of selling

Regarding the general external environment, Boehm must consider the political/legal, economic

and global, sociocultural and demographic, and technological forces that might affect the ability

Referencing Chapter 3: Analyzing the Internal Environment

See the concept of the resource-based view of the firm, and the three key types of resources:

tangible resources, intangible resources, and organizational capabilities. A firm’s strengths and

capabilities – no matter how unique or impressive – do NOT necessarily lead to a competitive

advantage. The resource-based view of the firm takes the perspective that firms’ competitive

It’s possible that Boehm has all these attributes, based on the valuable, rare, and unique porcelain

In addition, Boehm must assess the relationships between the elements in its value chain.

Remember, value-chain analysis is a strategic analysis of an organization that uses value-creating

activities. Value is the amount that buyers are willing to pay for what a firm provides them and is

Every activity should add value. Take a look at Exhibit 3.1 to see the value chain activities. It

Referencing Chapter 4: Assessing Intellectual Capital

See the concepts of intellectual capital and human capital, both of which are intangible assets

that a company such as Boehm needs to have in order to compete successfully. Intellectual

Human capital involves the individual capabilities, knowledge, skills, and experience of the

company’s employees and managers. This knowledge is relevant to the task at hand, as is the

Referencing Chapter 5: Formulating Business-Level Strategies

See the types of competitive strategies, including the three generic strategies that are used to

overcome the five forces and achieve a competitive advantage:

●Overall cost leadership

oLow-cost-position relative to a firm’s peers

●Differentiation

oCreate products and/or services that are unique and valued

●Focus strategy

oNarrow product lines, buyer segments, or targeted geographic markets

Generic strategies are plotted on two dimensions: competitive advantage and strategic target. The

Given the business the company is in, and Boehm’s goals, low-cost leadership is not an option.

It’s more likely that a focused differentiated strategy would work best. As can be seen by a quick

Referencing Chapter 6: Formulating Corporate-Level Strategies

See the concept of diversification. Diversification is the process of firms expanding their

operations by entering new businesses. Diversification initiatives – whether through mergers and

acquisitions, strategic alliances and joint ventures, or internal development – must be justified by

If Boehm wants to grow, this might be an option. Some possibilities include:

●Mergers and acquisitions

●Strategic alliances

Whatever the choice of initiative, it should create value for all stakeholders – employees,

suppliers, distributors, and the Boehms themselves. The choice of diversification strategy should

create synergy so that all parties gain something they would not have had on their own. Boehm

Referencing Chapter 8: Entrepreneurial Strategy & Competitive Dynamics

See the concept of opportunity recognition, the process of discovering and evaluating changes in

the business environment, such as a new technology, socio-cultural trends, or shifts in consumer

Entrepreneurs must go through a process of identifying, selecting, and developing potential

Edward and especially Helen Boehm seemed very aware of the possibilities here. At the time of

Boehm’s founding there were few fine porcelain manufacturers in the U.S. (NOT IN THE

CASE: As of 2013, over sixty years later, Boehm was the last American porcelain company left