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Strategic ManagementStrategic ManagementStrategic ManagementStrategic Management
Study casesStudy cases
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Capsule 1: The bold entrepreneurialstyle of Ted Turner
Robert E.: Ted Turner is in the great tradition of the individualentrepreneur who had a dream and backed it with his money andhis sweet
Ted Turner III president and chairman of TurnerBroadcasting System, Inc.
Turner was not only a business man and entrepreneur, but als aflambuoyant character and a public figure;
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Building the TSB Enterprise 24 year-old in charge of his father advertising enterprise, company that
had $6 million debts;
Had an opportunity to sell it, but refused;
He persuaded lenders to wait for a while;
Sold off some assets to improve the company`s cash position, arranged forsome innovative financing, reworked contracts with customers, hired a
sales force;
By 1969 the dept was paid off;
New growth perspectives: acquisition of 2 radio station in Chattanooga( TN, USA) 1970 acquisition of Channel 17; he applied strategic steps in order to
get Atlanta TV viewers to watch Channel 17 instead of other channels: Convinced advertisers to buy time in Channel 17; Strengthened the signal of Channel 17; Broadcasting old movies and reruns of popular shows; Seized the opportunity to air 5 NBC network shows; Acquired rights to televise the Atlanta Braves major league baseball games
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Building the TSB Enterprise
Acquisition of a UHF station, WRET-TV in Charlotte, North Carolina(personal funds); Conducted a series of televised Beg-a-thons, asking Charlotte viewers for
financial support (over 36000 contributions were received, ranging from 25cents to $80);
1975 - billboard advertising was spun off from Turner Communication andbecame Turner Advertising, with Ted Turner as majority stockholder;
January 1976 - Turner Communication (TC) acquired the Braves club(baseball team of Atlanta);
1977 the company acquired a 95% limited partnership interest in Hawks,Ltd. , owner of the Atlanta Hawks professional basketball team;
Broadcasting live games of the Braves and Hawks on Channel 17;
1978 T C acquired a limited partnership interest in Soccer, Ltd. , theowner of the Atlanta Chiefs professional soccer team;
Also in 1978 the company sold its AM and FM stations on Chattanooga for$1.050.000 cash, realizing a pre-tax gain of $395.000;
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Building the TSB Enterprise In 1979 three important developments:
The company launched plans for the Cable News Network(CNN), the first 24-hour all news programming network forcable television operators, to begin operations in June 1980;
By the end of 1979 the company has invested $6.816.000, acquired
and begun renovations of a headquarters facility, hired key personnel,and obtained purchase commitments to provide the programming;
The Turner Communication Corporation became TurnerBroadcasting System, Inc.
An agreement to sell WRET-TV in Charlotte to Westinghousefor $20 cash, plus the assumption by Westinghouse of thestation`s obligations for film programs;
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Building the TSB Enterprise In 1981 the business of Turner Broadcasting System
(TSB) consisted of: The operations of WTBS-TV;
The CNN, a 24-hour comprehensive news channel available toUSA cable television systems;
100% ownership of the Atlanta Braves professional majorleague baseball team
Equity interests in limited partnership operating the AtlantaHawks professional NBA basketball team and the AtlantaChiefs professional soccer team
A management service contract (including all personnel) tooperate Turner`s outdoor advertising business, withoperations based in Atlanta and Chattanooga,TN.
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Ted Turner`s style of managing His approach to business and dealing with people was both
colorful and controversial;
Seldom he hesitated to say exactly what he thought;
In 1981, during the baseball strike the rumor has it that heremarket that all players should be drowned and the reams
restaffed from scratch;
Writers and journalist appended him different labels, likeCaptain Outrageous, Terrible Ted, the Mouth of the South,honest, petulant, loud, profane, impulsive, egotistical, ruthless,money-grumbling, sincere and chauvinistic;
He was described as having a strong sense of what to do andwhen to do it. Complementing his sense of direction and senseof timing was a knack for picking capable managers to workunder him. He delegated authority readily;
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Ted Turner`s style of managing As a general rule, he did not supervise them closely,
preferring instead to let them to do their jobs, with aminimum interference from his side, as long as things wereprogressing satisfactorily;
He had a positive thinking and greater innocence : it can`t bedone? Let`s find out if things were not so good, he wascapable of short temper tantrums;
He had a trying to win conception, he liked to turn losersinto winner, in sports and in business;
He didn`t look at himself as a win at all costs practioner: I don`t thing that winning is everythingBe kind and fair and
make the world a better place to live, that`s importantPeoplewant leadership, somebody to rally around, and I want to be aleader.
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Capsule 2: Ted Turner and managing the totalenterprise: A short exercise of what general
management is or is Not
Exercise
Understanding the job of a GM-an analogy: GM is like a football coach;
He is both coach and player both managing through peopleand achieving results alone;
There is a balance that need to be established betweenplaying and coaching/doing and managing: the larger and morediversified the organization is being managed, the greaterthe proportion of time spend on managing (achievingorganizational results through the activities of others)rather than doing (achieving organizational results throughone`s own personal actions)
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Capsule 3: How to tell a good onefrom a bad one
Objectives need to meet five specifications: An objective should relate to a single, specific topic (itshould not be abstract);
An objective should relate to a result, not to an activity to
be performed;
An objective should be measurable;
An objective should contain a time deadline for its
achievements;
An objective should be challenging but achievable.
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How to tell a good one from abad one
Poor objectives, avoid them: Our objective is to maximize profits (not measurable, no
deadline);
Our objective is to increase sales revenue and unit volume (notmeasurable,2 topics, no deadline indicated);
Our objective in 1984 is to boost advertising expenditures by15% (is not an objective, is an action);
Our objective is to be a pioneer in research and developmentand to be the technological leader in the industry (overlyambitious, too many topics, not very clear);
Our objective is to be the most profitable company in ourindustry (not specific enough, challenging - but may not beachievable).
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Capsule 4: The alternatives to Managing withObjectives
Managing by Extrapolation (MBE) relies upon the principle if it ain`t
broke, don`t fix it; the future will take care of itself and things willwork out alright;
Managing by Crisis (MBC) based upon the belief that the forte of anyreal good manager is solving problems; MBC is a form of reacting, ratherthan acting and of letting events dictate the whats and whens ofmanagement decisions;
Managing by Subjectives (MBS) this approach emerges in the absence ofany organizationwide consensus or clear-cut directives on which way tohead what to do about the company`s issues and problems; do your ownthing the best way you know how; the mystery approach, objectivesand plans to achieve them are never clearly articulated by seniormanagement;
Managing by Hope (MBH) decisions are taken on the hope that they willwork out and that good times are just around the corner; solid analysisand results-oriented action plans are absent;
All of the types presented above represent muddling-through types ofapproaches ways of Managing by Wandering Around (MBWA). It is
doubtful that those kind of approaches can lead to performance.