Clayton Industries: Rethinking Strategies in Europe

* Costa must define a generic strategy and concentrate on it through differentiation or cost leadership

“A progressive success story.” Mallaby offers a few words from Jason Furman of New York University in description of the company so many know as

From the standpoint of the company as a whole, should the Clayton processing center be shut down and its work redistributed to other processing centers in the region? Explain.

Transition: Now that we understand how the company started let’s take a look at how it grew during the early

The Whirlpool Europe case provides an opportunity to look at different ways to evaluate a major IT investment the company is considering. To undertake this analysis we have to make a few assumptions because the case does not have all the details needed to estimate benefits and investment cost. However, if you were in a company faced with this situation, these numbers would be available.

The biggest challenge Peter faces is the stagnant growth that Clayton SpA has experienced in recent years, especially with a 5.3% decline in 2008 and 19.4% drop in the first quarter of 2009 for Italy. This lack of sales directly affects receivables and inventory. Coupled with a strong union in Italy (FILM), these two forces directly contribute to the difficulty of fulfilling the 10/10/10 plan. Based on these trends, a “top four in four” years is unlikely unless SpA can

1 two major market areas: The first was to supply products of a type similar to our current electromechanical designs to North American aircraft manufacturers. The second was to design and manufacture electronic products for Europe and North America.

The net present value (NPV) of each option has been calculated and included in Table 1, based on figures from the study group report. Unfortunately, these figures are flawed in the same manner as Wriston’s current performance and accounting mechanisms in that they don’t properly allocate revenue, nor do they recognize inherent manufacturing complexities. The plant closure option’s expected operational gain seems particularly suspect. A better valuation of the new plant options is perhaps

Overall, we have decided that the Merseyside project should be accepted based on the achievement of Diamond Chemicals decision criteria. The project produces a positive NPV of €6.07, holds an IRR greater than their cost of capital at 21.4%, has a payback period less than 6 years at 5.71 years, and adds to earnings per share by generating an extra £.0203 per share. This project satisfies all 4 decision criteria requirements, making Morris’s choice easy in deciding to continue funding the project. Lucy Morris and Diamond Chemicals should go forward with the Merseyside project.

Brazilian multinational corporation, Metalfrio Solutions S.A., is one of the world’s largest manufacturers of plug-in commercial refrigeration equipment. They seek differentiation through innovation and customer relationships, through their brands of Metalfrio, Derby, Caravell and Klimasan, to meet the different needs of their customers (“Metalfrio”). In addition, Metalfrio goes beyond just their point of sales, as they include services along with their products, adding value and uniqueness to the company. However, it has taken many years to get to where they are now.

Clayton Industries was struggling due to the recent recession. However, Clayton SpA was particularly faltering - losing approximately one million dollars a month in mid-2009. Since 2004, Italy had been behind other European countries in revenue growth. Sales declined 5.3% in 2008 and in the first half of 2009 dropped by 19.4% (Bartlett et al., p.3). Accomplishing either corporate initiative set by Buis would be difficult for Clayton SpA. Inventory and receivables were both above 120 days and a reduction of 10 days would be difficult. Several factors, both internal and external, lead to the situation Italy faced at the time.

The purpose of this report is to assess the viability of the acquisition of Royal Paper Corporation’s (Royal) Monticello mill and box plants by Atlantic Corporation (Atlantic). This will be conducted through the evaluation and analysis of whether this project is profitable and also if this is a sound strategic move.

Jim Collins and his research team of 20 compared and contrasted how many companies made the leap to greatness and how other companies didn’t. Based on bundles of evidence and a large quantity of data, he and his team uncovered how

The vision of Cooper Industries, as stated in the case, was to do an ‘outstanding job at the unglamorous part by making necessary products of exceptional quality.’ The goal was to operate in industries that had become somewhat of a necessity for consumers. Examples of such industries include: power transmission, hand tools, drilling and others. Cooper industries had started in 1833, as an iron foundry, and had existed most of its 150 years as a small sized maker of engines and compressors. However, all this changed in the 1960s, when the management decided to expand the company to lessen its dependence on the capital expenditures of the cyclical natural gas business.

Cooper’s corporate strategy is diversification through acquisitions and mergers. This diversification is in both related and non-related businesses to lessen its dependence on the capital expenditures of the natural gas industry. Cooper’s started acquiring low-technology manufacturing companies. The companies were premium-quality products with strong brands names mainly still own by the original family owners that have seen