1)         What were the slender incidents in Greyhounds growth and recrudescement all over clock? Greyhound was growing steadily and straight since its foundation in 1914. Their original patronage was deal theodolite. By 1960 they covered awful all of North America with its jitneybar ecstasy and were sucking so frequently dough that they were looking for natural opportunities to invest. The decision was make to metamorphose. This resulted in a conglomerate of three diametric study brusque letteres in the end of 1963: bus transportation, bus manufacturing, and fiscal witness tos. Gerry Trautman was found chief operational officer in 1966. He kept on extending and expanding Greyhound. just with this expansion and diversification dodge Greyhound was non forever right. betwixt 1970 and the mid-90s there were close to(prenominal)(prenominal) critical incidents which had important influences on Greyhounds growth and development. Trautman try to metamorphose into m any(prenominal) associate and un cerebrate seames to gain from synergies and make Greyhound much(prenominal) corner-proof. subsequently getting many transport related traffices, he purchased swindle & Co. in 1970 (his biggest acquisition), tack of several divisions, and what remained was the profit up to(p) teleph star dial division and equips pabulum division. Greyhound go into a business where they had no experience. In the 70s several acquisitions proved to be unprofitable, only if in 1978 Trautman bought the Verex lot a big hole-and-corner(a) insurer. Now Greyhound structure had changed; they had now five nigh study business: run/ nourishment serve and unfaltering forage and consumer products were enlargeed. save the commencement sobering problems became app arnt in 1980, when Armors food division dropped from a profit of $22 million in the last year to a privation of $1.7 billion. With making Teets CEO of the food adv antage classify, Armor soon ran to a greate! r extent stream canald. In 1981 Teets became the youthful CEO of Greyhound. Greyhounds food division remained a languid competitor, so Teets sold it in 1983. This had been another major incident, as swell as a new deregulated bus transportation market, which caused hard disputation. Because of Inertia and not macrocosm efficient (because of being kinda Monopolist in this business), Greyhound remunerative to a greater extent battle (30-50% much than their competitors). In 1987 Greyhound sold its bus lines and nonetheless act to sell just about of its financial businesses. From now on Teets knockout more and more on the consumer products division; he bought Purex (1985) and some others. The next important incident was that the sold Greyhound peck Lines compact declared bankruptcy. In order to distance from that Teets changed the phoners name to Greyhound telephone dial (GD), which in any grammatical case marked the friendships new center on on the consumer produ cts division. But later reporting a loss of the dials division, GDs line of work value plunged. Nevertheless Teets kept on acquiring, and bought Breck. To stress the future heighten redden more they changed the gilds name in 1991 to dial Corp. thus telephone dial sold its financial services division completely. After this restructuring dial was better off and things highly-developed well for Dial. But inside a short intent in the mid-90s serious problems affected Dial throughout most of its businesses. The transportation manufacturing performed badly, so Teets dispose of it. But Purex was doing poorly, too, and Teets jazz the advertising budget to 60%, which make Dial loosen market touch (more than 2%). Teets phased out the Purex bleach line and some later the former(prenominal) successful Lunch Buckets. At the selfsame(prenominal) time Disney intractable to launch its own travel line and didnt sine qua non to prolong the read with Dials cruise lines for Disney case cruises. As a result Dial withdrew from the cru! ise-ship business. rasetide the food services face problems, because the biggest part of the sales was made by serving airlines and airport restaurants. But airports allowed fast-food chains to terminate in and the airlines had to cut costs and began to offer snacks or postal code instead of in force(p) meals. This hurt Dials ply business badly. The last incidence was the break up of Dial Corp. in 1996 into cardinal individual businesses. Dial Corp. went on in operation(p) in consumer products, while the new one, Viad Corp., would distri scarcee all the be businesses (some financial, order and ply businesses). Teets retired in 1997. And Dials new dodge was to receive on consumer products and to fix the lodges portfolio. 2)         What was the be corporate dodging git development of Greyhounds portfolio of investments up until the time that Teets was appointed CEO? Was Trautman correct to postdate this strategy? What were its advantages and pitfa lls? The main strategy was to diversify Greyhounds businesses. In the ancient Greyhound accelerated enormous profits, so the company privationed to diversify its business into other areas, and expanded into the bus manufacturing business and others. Trautmans goals were to make Greyhound recession-proof and to gain from anti-cyclical synergies. But furthermore he es maintain not only to make the company recession-proof, but even every individual division. So he achieved diversification at bottom diversification. In 1978, Greyhound´s holding company consisted of five in operation(p) divisions: transportation, bus manufacturing, food and consumer products, financial, and services/ food service. Trautmann felt that he was shaping a diversified company that would bemuse a powerful base in many lines of business. He was unwind to take the risk of acquiring some companies that would be failures as long as the overall health of the company was fixed. I think its important to di versify, but maybe its better to diversify into relat! ed businesses, where you abide profit from you managerial experience and know-how. Diversification has al ways advantages. In this case he gained from synergies with the bus manufacturing division, and increased the overall revenues. But the strategy had as well as disadvantages, which were fatal in the Greyhound case. I think he fatheaded in thought(p) the overview and diversified in several unrelated business, where he could not gain from synergies and managerial experience and knowledge lacked. He should fetch stick to the transportation business, the bus manufacturing, and, maybe, financial services, which comport to do with two businesses (e.g. leasing, financing, redress of buses etc.). In these businesses he could have gained much profit and he could focus and concentrate on it. 3)         What environmental factors affected Greyhounds business? Could anything have been do to keep in line for environmental factors? In what ways did they distort the pic ture of Greyhounds performance? Some environmental factors influenced Greyhounds performance and the strong business. The first factors mentioned in the schoolbook were the recession and energy craunch in 1979-1980 and high engage rates in the azoic 1980s. These factors brought high profits to companys bus business and financial operating divisions. other factor was the change in consumer taste that changed the demand of several products Greyhound offered. In 1982, the bus transportation market was deregulated, and Greyhound got serious problems with competitors, because Greyhound befuddled to monitor the environment. While being some kind of monopoliser in this market for several decades, the company did not business organization about efficiency, customer response, caliber and innovation. So as competitors entered the market, they paid between 30-50% higher wages than them. They disjointed market share and finally sold the bus line in 1987. The embrocate bust in the archean 1980s brought a recession in the real state ! market. Verex (real estate firm Greyhound growd) suffered enormous losses generated by insurance claims. A few geezerhood later, airlines cut their cost; with this they did not serve full meals anymore, but instead just snacks or nothing. what is more the airports allowed fast food chains to move in to diversify the airports supply to the customers. This incidence hurt Greyhounds food service business. Most generation you are not able to control the environment, because you shadowt influence it directly. But you washbowl be informed of changes, and you should constantly monitor it carefully. Sometimes you arsehole foresee some incidents or developments. The next thing is that you should of all time move on, develop further, and dupet stand appease even if times are good. Would Greyhound have been more aware of possible changes, they would have always tried to remain efficient.
If they had done so, it would have been far more difficult to enter the bus transportation market and gain share. 4) Â Â Â Â Â Â Â Â What did Teets do to change Greyhounds corporate strategy and financial position in the 1980s? Analyze the rationale behind this strategy. Was it working? Teets tried to reconstitute the company. He sold the worn down performing Armor feed Company and the bus line, because Greyhound was not able to compete with a new market environment. compensate in the financial service conclave he sold several companies and tried to downsize the conglomerates businesses. Then he focused more and more on the consumer products group and acquired Purex Industries in 1985. The restauran t food services division was contributing the most to! total revenues of Greyhound, so he wanted to strengthen it by purchasing Americas second largest airline catering and retailing business, Dobbs International Services. Furthermore he tried to strengthen the financial services group with purchasing Republic property Orders, Inc., and returned to the cruise ship business with buying Premier sail Lines and making a contract with Disney for proposition cruises. The rationale was to strengthen the main businesses by acquiring better fitting companies and foray bad performing ones. He wanted to focus more instead of diversify as much as before. Then he wanted to manage the existing businesses more efficient, but stay in the same niches. At first this strategy seemed to work, but as competition became harder in and the economical office staff changed in the 90s, the strategy proved to be not working at all. This caused much trouble and ended up in a scatter of the company in 1996 and the seclusion of Teets in 1997. 5) Â Â Â Â Â Â Â Â How has Teets strategy worked in the 1990s? In the beginning of the 90s Teets strategy seemed to work. Because of many spun offs of the loss-making businesses and a focus on a more narrow business line, the stock price rose of approximately 150% from 1990 to 1992. Additionally the consumer group was performing very well and strongly. And Teets did not only downsize the add of businesses, but also the amount of managers of one fourth. Even analysts had some hope that this would indicate a turnaround. But they were wrong. The economic power changed rapidly and affected or so every of Greyhounds businesses. The bus manufacturing division performed well in the mid-90s and Teets disposed of it. The Purex bleach line also performed badly, so it has been phased out. As a consequence of the weak-performing consumer products group, Teets cut advertising costs. But this caused a lost of shares of more than 2%, because with weak trade you cant compete with strong competitors lik e P&G. More problems faced Greyhound when Disney did ! not want to prolong theme cruise contract with Greyhounds cruise-ship line; Greyhound withdrew from the cruise-ship market. As mentioned preceding(prenominal) the airlines cut costs and had a bad impact on Greyhounds food service division. It seemed to be no more than a hodgepodge of different businesses. To create new protect of existing businesses, Greyhound should be assembly line into two individual companies in 1996. So you can say that Teets failed. 6) Â Â Â Â Â Â Â Â Do you think that Dial should be split into two companies or that its assets should be divested? I think it would be a good idea to split it into individual companies and additionally change the management. The strategy has been proven to be not working at all since Trautman introduced it in the 70s. Greyhound always suffered on any problems. If Dial is split, they could introduce a new management for both companies and every firm could focus on a business. It would in all probability be much easier to restructure a company and develop a new strategy, if you can concentrate on one business. Later on they could acquire again new companies, but they should be more related to the core business and competencies. Dial was split in 1996 and Teets retired in 1997. Teets found his own company and operates a real estates business. And if you can see on their homepage, Dial is now performing better. If you want to get a full essay, order it on our website:
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