BASM 502: CORPORATE STRATEGY

Program: Full-time MBA

Course Outline

COURSE INFORMATION

Instructor: Jen Brown

Email: jen.brown@sauder.ubc.ca

Class meeting times:

March 7 April 4 (P4) Tuesdays & Thursdays BASM 502-001 10:00 AM to 12:00 PM (DL 125)
BASM 502-002 2:00 PM to 4:00 PM (HA 133)

Office Hours: By appointment.

Course website: connect.ubc.ca

COURSE OUTLINE

BASM 502 covers four major topics that build directly on the concepts presented in BASM 501. Again, these
topics are intellectual tools and conceptual frameworks that are useful for answering the question How can a firm
earn long-run profits?

BASM 502 will examine the issues at the core of a firms decisions about the boundaries of its operations.
Scope of the Firm In which business opportunities and stages of production should firms be involved
and which should they leave to other firms?
Costs of coordination What are the coststangible and intangibleof coordinating firm activities using
either the market or ownership?
Growth How should a firm negotiate the pressures that growth places on a successful strategy?

TEACHING APPROACH

Because the aim of the course is build your own critical and analytical thinking abilities, you will spend much of
your time preparing for and engaging in class discussion. In advance of the course, I will provide you with the set
of required readings for the course.

My commitment to students is that every assigned reading will be discussed explicitly in class. In return, I expect
students to be prepared for our discussions.

Some of our discussions will be based on business cases. Cases tend not to have a single, tidy solution.
However, there are always better and worse answers, and valid and invalid inferences. Cases never contain all
the information you would like to have to make a decisionin this way, they are very much like real life. You may
find it frustrating to be pushed to make a decision or take a stand when you are not sure whether it is the right
one; this is the nature of real-world business decision-making. Cases often offer conflicting information. They will
require you to make judgment calls. This kind of ambiguity is also a feature of real-world business decisions.
Strategy is a field that asks a big question and so necessarily draws on many of the other functional areas of
business. This course aims to give you an overall vision of how the different areas fit together in contributing to
the success of the firm.

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

PREPARATION

Preparing for case discussions means more than just reading the cases. Each case assignment will include
several preparation questions, as well as a one-page assignment that will help you articulate some of your
thinking about the case in advance of the discussion. I encourage you to review the questions before reading the
case and make some notes after reading the case in order to be prepared for class.

Much of our time in class will be spent discussing articles that describe current strategy issues facing companies
in a variety of industries and contexts. You are expected to have read these articles and to be prepared to discuss
them. There is no explicit preparation task to do as you complete the conceptual readings, but it is a good idea
always to be asking yourself, Do I believe this argument? Where else does it apply? When would this approach
not be useful?

If for some reason you are not prepared for class, I expect you to let me know before class. I know that you are
juggling other classes and other commitments; you dont need to give me an explanation. However, if you havent
told me otherwise, then you have implicitly committed to be ready to contribute to the class if I should call on you.

READINGS

Information about how to access the required readingscases and popular press articleswill be posted to
Connect. A few of the readings for class are actually videos that are also available on Connect.

There is no required textbook for BASM 502. If you want a textbook for reference, I recommended The
Economics of Strategy by David Besanko, David Dranove, Mark Shanley and Scott Schaefer, 6th Edition. The
textbook readings listed in the syllabus are for background only. You are not explicitly assigned to read them, but
may find them to be a useful resource.

I will expect you to have read and to be prepared to discuss all of the material assigned for the day, except the
optional material from the textbook.

ADDITIONAL COURSE MATERIALS

The following materials will be posted on Connect.

Assignments: I will post the individual assignments to Connect in the Assignments folder. You will
submit your work there, too.

Slides and handouts from class: I will bring hard copies of the slides to class and will post them to the
Day-by-Day folder on Connect after class. Anything additional that I hand out in class will also be posted
to Connect. If you miss something or lose something, you can find it there.

Extras: In the Day-by-Day folder on Connect, I will also post items related to our class discussions.
These items, labeled Extras, provide additional examples where the tools or frameworks discussed in
class would have useful application.

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

No course material (including slides, handouts, assignments, exercises, and exams) may be shared outside of the
classroom without my permission. Do not share it across sections, cohorts or years; post it on the Internet; or
reproduce or distribute it in any way outside of this class. Please see page 5 for additional information about
academic integrity.

ASSESSMENTS

Case assignments 5% + 5%
Individual strategy analysis 15%
2 x In-class questions 5% + 5%
Exam 50%
Participation 15%

Here are some details about assignments and assessments:

Case assignments (5% + 5%) due before class on the day of the case discussion

There are four cases in BASM 502 for which you must write a one-page response to a preparation question.
(Note that I will post preparation questions, but there is no assignment question to submit for the Lego or Cola
Wars case.) Three of these case assignments will be graded on a credit/no-credit basis. Together, these three
case assignments will account for 5% of your final grade for BASM 502. One of your case assignments (randomly
chosen) will be graded in more detail and that case assignment will be worth 5% of your final course grade. The
preparation question and assignments for each case will be posted in the Assignments section of the Connect
site. You may discuss these assignments with members of your study group, or with others in the course, but the
final write up should be your own. You must upload your answer to Connect before the start of class on the day
of the case discussion.

If you need guidance, format your submissions with 1-inch margins, 10- or 12-point font, and 1.5- or double-
spacing. Reasonable variation in formatting style is fine; dramatic variation is not. Please ensure that your name
appears on your document.

In-class individual analysis (5% + 5%) completed in class on March 14 and March 28

In recent years, I have had several students indicate that they would like more opportunities to see exam-style
questions before facing the real deal at the end of the period. I will give you a sample exam before the end of the
course, but you will also have two pre-exam opportunities to assess your grasp of course content. You can think
of these as early warning signalsif you get positive feedback, then you can carry on as-is; if you get less-than-
positive feedback, then you can adjust your approach (with my help, if you want).

During our class sessions on both March 14 and March 28, I will give you 20 minutes to prepare and submit an
answer to a question related one or more of the topics covered in previous class sessions. You will provide a brief
(1-2 paragraph) answer and submit your work at the end of the allotted time. Your answer will be graded on
quality (correctness and effectiveness). Each of these in-class analyses is worth 5% of your final grade. Because
of the size of the classes and short timeline for the course, there will be no opportunities to make up for missed
in-class analyses; students who fail to submit an answer will receive zero for this component of the grade for
BASM 502.

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

Individual strategy analysis (15%) due by Saturday, March 25 at 11:59pm

During the course, you are required to write a two- to three-page analysis that applies one of the course concepts
from BASM 502 to a strategy situation that is not one from the course readings, cases or in-class examples. For
example, you might come across a technology company that has a particularly compelling sustainable
competitive advantage or a service company that is trying a new approach to organizing the firms activities. You
may choose a strategy that has been a success, one that has failed, or one whose outcome is still uncertain.

Your analysis should describe the relevant details of the setting in one or two paragraphs. The rest of the analysis
should show how the course concept applies to the situation. Your grade depends entirely on how well you apply
the concept to the situation that you have chosen, not whether you have chosen a really cool problem or
company. The more focused and specific a situation you choose, the better your analysis is likely to be. For
example, dont try to analyze the strategy of Apple. Instead, you could analyze Apples outsourcing strategy.
The best analyses will be those in which applying the course concept reveals something insightful about the
situation that isnt initially obvious. In other words, I want you to show me that you have learned something about
the firms strategy by applying the concept to the situation.

To give me context for evaluating your analysis, you must include with your submission some kind of
documentation that describes the situation that you are analyzing. A newspaper or magazine article is the most
straightforward source, although websites, annual reports, or other sources are acceptable.

You may turn in the individual strategy analysis at any point during the course, but you must upload it to Connect
by Saturday, March 25, 2017 at 11:59pm. I will return your graded analysis (with comments) during our final class
session on Thursday, April 6.

If you need guidance, format your submissions with 1-inch margins, 10- or 12-point font, and 1.5- or double-
spacing. Reasonable variation in formatting style is fine; dramatic variation is not. Please ensure that your name
appears on every page of the document.

Exam (50%) scheduled by the RHL Graduate School office

The exam will be during the Sauder-specified exam period, scheduled by the RHL Graduate School office. You
will be allowed to bring in one 8.5 x 11 inch, double-sided sheet of notes to the exam. More detailed information
about the content and format of the exam will become available as the date approaches. Please do not make
plans that conflict with this exam. Of course, UBC provides exceptions for students who require religious or
medical accommodations.

Class participation (15%)

The class participation grade provides you with an added incentive to prepare for classthe value of your own
learning should be the primary incentive. Case discussions work well as learning tools when everyone
participates.

Your participation will be graded on quality, not volume. You should provide insights, observations, inferences, or
conclusions that not only express your argument, but also defend your analysis. Your comment should be
relevant to the topic at hand and should advance the discussion. A simple opinion is not very valuable without any
justification. I value comments that respond to, elaborate on, lend support to, contradict, or correct a comment by
one of your classmates. Counter-productive comments include opinions without a justifying argument, pure
repetition of previous point, and rambling, vacuous or disparaging comments.

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

Discussion constitutes a large portion of our class time; you will have ample opportunity to participate. I will cold
call in class, both to give you an incentive to prepare for class and to make sure the discussion does not collapse
to a handful of students. At a minimum, everyone in class should be prepared to answer all of the case
preparation questions handed out in advance.

Missing class: Learning to articulate your arguments and to evaluate and respond to the arguments of others is an
important part of what you will learn in this class. If you miss class, you will miss this, and there isnt a way to
make it up. As a result, you should make every effort not to miss class. If you miss class or are late, it will lower
your class participation grade. UBC provides exceptions for religious holidays and ongoing medical conditions. If
you must miss class, you should do the readings, prepare and turn in the assignments on time (late assignments
will not be accepted), and arrange to get notes from a friend about what you missed in class. Recall that I will post
the slides (and anything else that I hand out in class) to Connect. Excessive absences will affect your final grade.

COURSE AND INSTITUTIONAL POLICIES

Attendance: As per RHL policy on Professionalism, Attendance and Behaviour, students are expected to attend
100% of their scheduled classes. Students missing more than 20% of scheduled classes for reasons other than
illness will be withdrawn from the course. Withdrawals, depending on timing, could result in a W or an F
standing on a students transcript. Students must notify their instructors at the earliest opportunity if they are
expected to miss a class due to illness. A medical note from a licensed, local doctor is required if more than 20%
of scheduled classes for a course are missed due to illness. Students are required to notify the Student
Experience Manager if they are absent from two or more classes due to illness.

Tardiness: As per RHL policy on Professionalism, Attendance and Behaviour, students are expected to arrive for
classes and activities on time and fully prepared. Late arrivals may be refused entry at the discretion of the
instructor or activity lead. Students arriving halfway through a scheduled class, or later, will be treated as absent
for that class.

Electronic Devices: As per RHL policy on Professionalism, Attendance and Behaviour, laptops and other
electronic devices (cellphones, tablets, personal technology, etc.) are not permitted in class unless required by
the instructor for specific in-class activities or exercises. Cellphones and other personal electronic devices must
be turned off during class and placed away from the desktop. Students who fail to abide by the RHL lids down
policy will be asked to leave the room for the remainder of the class. Research has shown that multi-tasking on
laptops in class has negative implications for the learning environment, including reducing student academic
performance and the performance of those sitting around them.

Late Assignments: Late submissions will not be accepted and will receive a grade of zero.

Course Material: No course material (including slides, handouts, assignments, exercises, and exams) may be
shared outside of the classroom without my explicit permission. Do not share it across sections, cohorts or years;
post it on the Internet; or distribute it in any way outside of this class. I take this policy seriously for several
reasons. First, the classroom experience requires ideas to be new the learnersif you share material outside of
the course, you deprive other students of these learning-by-doing opportunities. Second, I have devoted
considerable time and energy to building this intellectual property to benefit students in my classes, and I want
your help to ensure that its integrity (and a sense of academic fairness) is maintained. Finally, sharing it beyond
the classroom enables or promotes plagiarism and other forms of academic dishonesty.

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

ACADEMIC INTEGRITY

All UBC students are expected to behave as honest and responsible members of an academic community.
Failure to follow appropriate policies, principles, rules and guidelines with respect to academic honesty at UBC
may result in disciplinary action.

It is the students responsibility to review and uphold applicable standards of academic honesty. Instances of
academic misconduct, such as cheating, plagiarism, resubmitting the same assignment, impersonating a
candidate, or falsifying documents, will be strongly dealt with according to UBCs procedures for Academic
Misconduct. In addition to UBCs Academic Misconduct procedures, students are responsible for reviewing and
abiding by RHLs policy on Academic Integrity.

CONTACT INFORMATION

You can reach me by email at jen.brown@sauder.ubc.ca. I am also available to meet with you by appointment. I
dont have regular office hours only because I have found that they dont work very well for MBA students
packedand variedschedules. However, I am very happy to meet with you! Please send me a meeting request
or an email with a set of possible times. If you need to reach me by phone, my office number is 604-822-8355.
That said, email is a much more reliable way to get in touch with me.

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

DETAILED COURSE SCHEDULE

SUSTAINABLE COMPETITIVE ADVANTAGE

1. March 7 (Tuesday)

Nothing to submit before session 1

2. March 9 (Thursday)

Nothing to submit (Thats rightI will post prep questions but you dont need to hand anything in!)

P. Thiel, Competition is for Losers, Wall Street Journal, September 12, 2014.

Heterogeneity
M. Delio, Loud Hogs for Easy Riders, Salon.com, May 19, 2003.

Appropriability
B. Philbin and C. Driebusch, Merrill Plots Raid on a Vulnerable Rival, Wall Street Journal, October 1, 2012.
S. Hansen, How Zara Grew Into the Worlds Largest Fashion Retailer, New York Times, November 9, 2012.

Foresight
J. Stewart, How, and Why, Apple Overtook Microsoft, New York Times, January 29, 2015.

CASE: LEGO Friends: Leveraging Competitive Advantage (Kellogg 5-312-500)

Optional textbook reading: pp. 363-390, 77-83.

3. March 14 (Tuesday)

v Submit the one-page individual case question for the IBM case before session 3
v In-class assignment: Individual analysis (based on concepts from previous class sessions)

Strategy and change

Podcast of Episode 403 NUMMI by the radio program This American Life. (This is a 1-hour podcast. You
may listen to it while you commute, washing dishes, etc., but you do need to listen to it before class.)
The Last Kodak Moment? The Economist, January 14, 2012.
Video: After the Kodak Moment, C. Archdeacon and J. Woo, New York Times, March 20, 2015.

CASE: IBM: ADAPTING STRATEGY TO A CHANGING ENVIRONMENT

4. March 16 (Thursday)

Submit the one-page individual case question for the Nucor case before session 4

CASE: NUCOR AT A CROSSROADS (HBS 9-793-039)

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

BOUNDARIES OF THE FIRM

5. March 21 (Tuesday)

Nothing to submit before session 5

Coordination and synergies
D. Cimilluca, E. Schwartzel, and P. Ziobro, Hasbro in Early Talks to Buy DreamWorks Animation, Wall
Street Journal, November 12, 2014.
A. Martin, Car Sharing Catches on as Zipcar Sells to Avis, New York Times, January 2, 2013.
C. Holahan, Googles DoubleClick Strategic Move, Businessweek, April 14, 2007.
S. Ovide, Microsofts Web Woes to Wipe out Profit, Wall Street Journal, July 3, 2012.

Challenges to coordination
S. Carey, Web of Air Routes: Merger Makeover, Wall Street Journal, March 2, 2012.
S. Carey and J. Nicas, United Continental Is Still Shaky Five Years After Merger, Wall Street Journal, July 8,
2015.
J. Mouawad, Delta-Northwest Mergers Long and Complex Path, New York Times, May 18, 2011.

Optional textbook reading: pp. 61-76, 83-92.

6. March 23 (Thursday)

Nothing to submit before session 6

Incentive and information costs of coordination
I. Urbina, In Gulf, It was Unclear Who Was in Charge of Rig, New York Times, June 5, 2010.
A. Zimmerman and N. Shah, American Taste for Cheap Clothes Fed Bangladesh Boom, Wall Street
Journal, May 12, 2013.
R. Huq, The Economics of a $6.75 Shirt, Wall Street Journal, May 16, 2013.
S. Banjo, Inside Nikes Struggle to Balance Cost and Worker Safety in Bangladesh, Wall Street Journal,
April 21, 2014.
A. Satariano and P. Burrows, Apples Supply Chain Secret? Hoard Lasers, Bloomberg Businessweek,
November 3, 2013.

Foreclosure and the mark-up fallacy

S. Carey and A. Gonzalez, Delta to Buy Refinery in Effort to Lower Jet-Fuel Costs, Wall Street Journal, April
30, 2012.

Optional textbook reading: pp. 98-127, 401-421, 132-144, 146-158.

Individual strategy analysis: Due by Saturday, March 25, 2017 at 11:59pm

(I will return your analysis with a grade and comments during our final class session.)

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BASM 502: CORPORATE STRATEGY

Program: Full-time MBA
Course Outline

7. March 28 (Tuesday)

Nothing to submit (Thats rightI will post prep questions but you dont need to hand anything in!)
In-class assignment: Individual analysis (based on concepts from previous class sessions)

C. Terhune, Growing Pains: To Bag Chinas Snack Market, Pepsi Takes Up Potato Farming, Wall Street
Journal, December 19, 2005.
V. OConnell, Diamond Industry Makeover Sends Fifth Avenue to Africa, Wall Street Journal, October 26,
2009.

CASE: COLA WARS CONTINUE: COKE AND PEPSI IN 2010 (HBS 711462)
D. Cimilluca, B. McKay, and J. McCracken, Coke Nears Deal for Bottler, Wall Street Journal, February
25, 2010.
M. Esterl, Coke Under Pressure as Sales Abroad Weaken, Wall Street Journal, July 30, 2014.

8. March 30 (Thursday)

Submit the one-page individual case question for the Disney case before session 8

CASE: THE WALT DISNEY CO.: THE ENTERTAINMENT KING (HBS 9-701-035)
M. Graser, Disney Buys LucasFilm, New Star Wars Planned, Variety, October 30, 2012.

STRATEGY & GROWTH

9. April 4 (Tuesday)

Submit the one-page individual case question for the Starbucks case before session 9

CASE: STARBUCKS: A STORY OF GROWTH (Kellogg 5-211-259)
S. Strom, Starbucks Aims to Move Beyond Beans, New York Times, October 8, 2013.

WRAP-UP & SUMMARY

10. April 6 (Thursday)

Nothing to submit before session 10

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