YEAR 1 – TERM 3
Term three takes you through nine core courses, including the Fundamentals of Entrepreneurial, Operations Strategy, and Management.
General managers are responsible for the success of the organizations they lead. To achieve this result, one of the critical tasks of the executive team is to formulate a successful business strategy.
In this course, we will focus on the formulation of the strategy for the business of a firm.
Competitive strategy formulation involves analyzing the industry you are in, determining how to position your firm within the competitive business environment, and developing the capabilities to be successful.
Other important facets of strategic management, such as corporate strategy (how to successfully combine different businesses) and strategy execution (the steps to translate a formulated business strategy into action) are not covered in depth in this class, but rather are offered as electives in the second year. Several other second-year courses build on this capstone course in competitive strategy, such as Competitive Dynamics, Industry and Competitive Analysis, Strategy in Luxury Goods Industries, Managing Corporate Growth, Globalization and Strategy, Strategy and Sustainability, Strategy Execution and Organizational Change, Responsible Investment, the Day- To-Day of a General Manager, the Management of Family Businesses, and Boards of Directors.
In this course we will look at corporate long-term financing. The ultimate goal of corporations is to undertake profitable projects (e.g. a plant expansion) and finance them efficiently (e.g. issuing debt or equity). The time and uncertainty of investment payoffs make these problems non-trivial and essential for long-term success. Corporate Finance answers the following questions: How can we value and choose projects? How should corporations obtain financing? What is the value of a company? How much value does a specific strategy add to the firm?
The aim of this course is to give you a framework to understand these issues in theory and in practice.
We will see how to apply discounted cash flow methodologies to value firms, stocks, corporate bonds, and risky projects. We will use the CAPM model to estimate a firm’s cost of equity and we will learn how to estimate the weighted average cost of capital (WACC). We will analyze the impact of the firm’s capital structure to its value. We will discuss whether firms should reinvest their profits or pay out dividends to their shareholders. Lastly, we will apply these methods to consider the value created (or destroyed) by several types of financial transactions (MBOs, IPOs, M&As, etc.)
Fundamentals of Entrepreneurial Management is an integrative capstone course in entrepreneurship. It is based on the insight that in today’s business environment entrepreneurial management skills are key for general managers and entrepreneurs alike. The course introduces cutting-edge materials – tools, frameworks, perspectives – that allow you to acquire the basics of entrepreneurial management.
At the same time, the course encourages you to adopt a holistic perspective on building new businesses, and it asks you to synthesize and apply what you have learned so far in the program.
Global Economics is an introductory economics course that develops an analytical framework to help you understand the environment in which firms operate.
“We have too many specialists and too few men and women who can design a coherent set of manufacturing policies and keep them coherent in dynamic, changing competition, technologies and economics.”
Wickham Skinner, Harvard Business School, 1996
The past decades were full of buzz words that turned out to be just that: during the 1980s, “strategic diversification” and “synergies” (e.g., Daimler-Benz and its venture into aerospace), during the 1990s “disintermediation” (e.g., Webvan, Kozmo, etc.) and the 2000s the decade of “irrational exuberance” (e.g., the total market volume of financial services was a multiple of the “real” economy). During these decades companies that did not follow the crowd (e.g., “shareholder-value” bandwagon) were often frowned upon and criticized for being overly cautious. The time since the beginning of the great financial crisis of 2008, however, has shown that organizations with a stringent focus on adapting their core competencies to the needs of their customers have not only survived the crisis, but are doing extremely well. Many of these companies have one thing in common: small profit margins that force them to think very carefully about any “big” ideas. Closely linked to this process of adapting their business to their customers’ needs is the question of operations strategy: operations management is about how an organization does things within a given framework of assets, while operations strategy is about how it makes the most intelligent use of its assets and resources to support its business strategy. That will be the focus of this course.
Business decision-making involves the analysis of the information available, which is frequently presented in the form of quantitative data. In this course, we use simple techniques, based on linear regression equations, to illustrate how the analysis of quantitative data can help the manager in the decision-making process. The examples used cover various aspects of business activity, such as pricing, customer relationship management and sales forecasting.
Until recently, the knowledge of Information Technology (IT) and its application in the enterprise had been confined to the IT Department. Not anymore. Today – in the Digital Age – successful business manager must not only know how to interpret a P&L statement and read a balance sheet but also understand “digital” and anticipate its impact on business.
The Digital Age is fueled by the drastic reduction in the cost of processing, storage, and communication, creating a high-density digital environment that has seen the world move from 100 million connected PCs to the current 6.8 billion mobile devices in just a few years. Technology today is both available and affordable. This creates a new phenomenon where individuals incorporate cutting-edge digital technologies in their personal lives before businesses get a chance to adopt and implement them. In a way, this leads to a new kind of digital divide – that between society and business. Customers and employees of the younger generation come with new expectations that companies are not prepared to meet. To address this challenge, today’s business leaders must be able to think digital. Thinking digital does not equal thinking IT. Digital focuses much less on process automation, transactions, and efficiency, and much more on creating new value-added experiences and interactions with customers, employees, and business partners. Ultimately, it enables the firm to generate new revenue by finding unique ways to combine its physical and digital resources.