Academic journal article Journal of the International Academy for Case Studies

Zeit Saic: The Entrepreneurial History of a Family Business in Argentina.(Instructor's Note)

Academic journal article Journal of the International Academy for Case Studies

Zeit Saic: The Entrepreneurial History of a Family Business in Argentina.(Instructor's Note)

Article excerpt

CASE DESCRIPTION

The primary subject matter of this case concerns developing an action plan to attempt to save an old line Argentine manufacturing and service firm in the face of a collapsing economy in Argentina and significant technological change making their main product obsolete. The primary focus is that of general management and as such encompasses most of the business disciplines, but stresses primarily finance, marketing and corporate strategy issues. Secondary issues include the role of preparing and analyzing financial statements to aid management decisions and an appreciation of international issues. The case has a difficulty level of four, and is positioned for use in an undergraduate senior level cap stone strategy and policy course. The case is designed to be taught in ten class hours and is expected to require about five hours of outside preparation by students.

CASE SYNOPSIS

This case follows the career of George Brown, particularly in relation to Zeit, S.A.I.C., his family's business. After an on and off early association with Zeit, George, late in his career, joined the Company permanently in 1990 as V.P. In 1998, against the objections of his family, he purchased full control of the Company. That year was momentous since it began a steep decline in the business fortunes of Zeit precipitated by both changing technology and the Argentine financial collapse. The setting for student recommendations is in the middle 2003, near the bottom of the Argentine depression.

INSTRUCTORS' NOTES

Recommendations for Teaching Approaches

Suggested case questions follow. These questions have been tested with management students at Pontifical catholic University of Argentina during Spring 2005 and were found to be useful and entertaining for students. We welcome your comments after application in your courses. Our answers to the suggested questions can be found following the questions.

SUGGESTED CASE QUESTIONS

1. The case mentions Avenida de Mayo in Bs.As. Most Argentines would have a good idea where it is located. Few non-Argentines would, but the smart ones would quickly be able to find out, at least those with an adequate international perspective. Use your skill and knowledge to decide what is the most notable man-made object reasonably near the intersection of 4th Avenue and 63rd Street in Brooklyn, New York, USA. How about the intersection of Tverskaya Ulitsa and Okhotny Ryad in Moscow, Russia?

The internet is an excellent source for information such as this. Two good options for the "Brooklyn" question are YAHOO Map and Mapquest (both of which serve the USA and Canada.) In both cases the address (or intersection) is input and a map of the area results. The boundaries of the map can be expanded or contracted at will. Doing so with the Brooklyn address shows the location to be near "The Narrows," the connection for Upper and Lower New York Harbor, which is spanned by the very impressive. Verrazano-Narrows Bridge, the suggested answer. The following link will take you there: www.mapquest.com

Similar interactive maps are unavailable for many countries, including Russia. But, maps particularly of major cities are generally available. Search engines such as Google are good choices to start. Inputting "Moscow, Russia map" gave many choices, including the following link: http://www.euroave.com/maps/frame1.php?xcity=moscow

Looking about carefully, it is obvious that the intersection is near the Kremlin--the suggested answer.

2. Exhibit 3 provides sufficient information for you to prepare a rudimentary financial accounting based income statement and a statement of cash flows for each quarter. For our purposes, assume that operating cash flow is defined as net earnings + depreciation - capital expenditures. Also assume the income tax rate is 35% and that all taxes other than income taxes are already included in expenses listed. …

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