Academic journal article Journal of the International Academy for Case Studies

Cooperative Guatemala, Llc: "An Examination of a Guatemalan Cooperative's Strategic Development"

Academic journal article Journal of the International Academy for Case Studies

Cooperative Guatemala, Llc: "An Examination of a Guatemalan Cooperative's Strategic Development"

Article excerpt

CASE DESCRIPTION

The primary subject matter of this case concerns the development of strategy for confronting barriers to growth facing a small fishing Cooperative in rural Guatemala. The core issues include coming up with ways to evaluate past performance and to evaluate future options. The backdrop for these issues consists of identifying competitive advantages through diversification into identified new businesses. While this case is based on an actual, real set of circumstances, people and organizations; specific names of people, towns and the Cooperatives have been changed for proprietary reasons.

The case lends itself to student project assignments with respect to developing a strategy for "Cooperative Guatemala". Proposed solutions should follow for determining which ventures to accept with particular attention paid to the cultural implications. Furthermore, students should determine the viability of entering various markets based on incomplete information and the lack of full-time general management as identified in the case.

The case has a difficulty level appropriate for a senior course at the undergraduate level or at the graduate level. The case is designated to be taught in 1.5 class hours and is expected to require 2-3 hours of outside preparation by students.

CASE SYNOPSIS

This case explores the establishment and growth of homogenous Cooperatives in a stunted market and some challenges facing diversification of Cooperatives in rural Guatemala. Specific concerns of this case center on the development of strategy for confronting barriers to growth facing a small fishing Cooperative in rural Guatemala, with the added challenges of both strategic and operational decisions being determined solely by the Cooperative's board of directors. The cooperative faces some significant challenges including overcoming lack of education, culturally related decision-making stigmas, and poor organizational structure. These challenges fall within the context of attempting to find competitive advantages through diversification into identified new businesses. Stemming from a search for assistance, the Cooperative eventually was assigned a US Peace Corps volunteer, the viewpoint from whom this case was developed, to assist the Cooperative in providing business administration skills, such as strategy development along with financial and operational control mechanisms, and help improve profitability. A major task of the case is to develop a framework within which the Cooperative can evaluate business opportunities it should pursue.

INTRODUCTION

In the Spring of 2005, fresh from a re-election to a second term (2 years), Juan Pérez faced some rather perplexing issues as President of the Cooperative Guatemala, an integrated-services fishing cooperative in the tiny city of Isla Bonita, Guatemala. No one in the Cooperative was stepping up to take over management of the hardware store, and Francisco, current store manager, had given his two weeks notice. The idea was proposed to hire an outside manager to try his hand at turning the hardware store's burgeoning credit deficit and lagging sales into a once-more profitable venture. With that proposal dismissed, almost as half-heartedly as it was suggested, Juan had to either find someone to run the hardware store, or step into the position himself.

A mason and artisan fisherman by trade, he had no direct knowledge of running a traditional business, but Juan was one of the few Coop members who had actually finished high school. After all, this could be the perfect opportunity to try and put into practice all the training he had been receiving from Rodrigo, a Peace Corps volunteer assigned to Cooperative Guatemala for nearly a year-and-a-half. This could be his chance to prove to the other members that management controls could indeed be implemented, and that it may even improve the profitability of the business.

He knew, however, should he step into the position, he would only be able to do it for a few months before the Cooperative would need to find a long-term competent manager. …

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