Managerial Policy | Cooper Industries Case | By: Aena Rizvi, Anum Rinch & Rafia Farooqui |
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Introduction:
In 1833, an iron foundry was founded by Charles and Elias Cooper in Mount Vernon, Ohio. Overtime, Cooper became the market leader in pipeline compression equipment. Cooper Industries was around 150 years old and was mostly involved in the manufacturing of engines and compressors to facilitate the flow of natural gas through pipelines. They began expanding it around 1960s and for that, more than 60 manufacturing companies were acquired in the following 30 years. This came to be known as the process of Cooperization and some re-known companies became a part of the Cooper banner to form a highly successful and
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They even made sure that they were deeply involved in all the acquisitions they made so that they do not end up making mistakes by acquiring a wrong company.
Cooper’s President, Gene Miller’s ideology was to not restrict operations to the production of engines only. This was reflected in the business decisions when Cooper began to diversify and widen its product ranges. Cooper’s acquisition strategies were well planned and they were not left to the professional managers on the grounds that they could do justice to any product categories or manufacturing processes. Great importance was given on understanding the culture and customs of the areas in which Cooper operated and diversification only took place when the prospects looked profitable. There was a limit to diversification and special attention was paid to the timing of acquisitions. Most of the companies that Cooper aimed at acquiring were market leaders who maintained records of high quality manufacturing. Cooper’s journey was not about acquisitions and additions only. After a business had served its useful purpose, it was divested because clinging to the past would only reduce chances of future success. Between 1970 and 1988, Cooper divested 33 businesses.
Cooper also ventured into the aircraft service business by purchasing Dallas Airmotive which was mainly involved in the repair and lease of jet engines as well as the distribution of aircraft parts and supplies. After this, Cooper
MTC initially needed to obtain substantial investment capital due to two main factors: a research-heavy industry, and the need to create most of the markets for its products. Although the founders' goal was to become a major manufacturing company, they did estimate that the company would need $50 million in capital before it would become self-sufficient. Their initial financing model was to first recruit a superior technical team, use that to attract additional equity investment and development funding from interested corporations, and then develop manufacturing capabilities. Commercial sales began 2.5 years after inception, and MTC is nearing the break-even point in 1990.
With striking speed, American society underwent a transformation that concentrated wealth in the hands of a few, while creating tension and acrimony as industrialists leveraged their clout to influence government. During the Gilded Age, America's industrial economy exploded, generating unprecedented opportunities for individuals to build great fortunes but also leaving many farmers and workers struggling merely for survival. Overall national wealth increased more than fivefold, a staggering increase, but one that was accompanied by what many saw as an equally staggering disparity between the rich and the poor. Industrial giants like Andrew Carnegie and John D. Rockefeller revolutionized business and ushered in the modern corporate economy,
There were many issues facing the country during the time corporations took power. During the time , The railroad
Burlington Coat Factory, as known as Burlington, is an American discount department stores headquartered in Florence, New Jersey started on 1972. Today, Burlington is one of the largest off price department retailers in the United States.
It has been the major factor behind their success and can be seen as their business strategy.
A few weeks earlier, John M. Case, board chairman, president, and sole owner of the
After several failed attempt of internal diversification, they realized the lack of knowledge of their management about businesses outside the automotive area. so acquisition brought them quick fix where it brought already knowledgeable people in respective areas in their payroll.
1 We recommend Cumberland Metal Industries capitalize on their evolving position as a leader in the curled metal industry and effectively launch their new curled metal cushion pads to be positioned as the “new industry standard” in the pile driving market. In order to successfully launch this product, we first and foremost recommend that CMI acquire a patent to prevent this product from being copied and imitated, thus avoiding the entry of competitors. The associated value and advantages of CMI’s metal cushion pads are evident from the results of the two comparative performance tests by Colerick and Fazio. CMI pads drove piles 33 percent faster than asbestos per hour and lasted the entire job while also eliminating the downtime required
Prior to the consideration of Carborundum as an acquisition target, Kennecott, a copper company, pursued an acquisition of Peabody, a coal company, for $285 million in cash in 1968. There are two main rationales behind the acquisition of Peabody by Kennecott. First, to stabilize the high volatility in Kennecott’s profitability due to sharp changes in copper prices and increasing competition from copper producers in Chile, Zambia, Peru, and Zaire, LDCs whose reliance on copper
What is Cooper’s corporate strategy? How does it create value? What are its key resources?
Introduction: From the Gigaplex paper we can see the impact of customer influence on the project’s outcome. CyCorp, a small organization was awarded a contract to enhance the performance of communication protocols that Gigplex used. For CyCorp this was a very important project. We can see this from the intention of Blair Borman, The VP of engineering who expressed the same intention and made sure that he was kept in the loop as he had to manage proceedings to enable future collaboration with Gigaplex.
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The vision of Cooper Industries, as stated in the case, was to do an ‘outstanding job at the unglamorous part by making necessary products of exceptional quality.’ The goal was to operate in industries that had become somewhat of a necessity for consumers. Examples of such industries include: power transmission, hand tools, drilling and others. Cooper industries had started in 1833, as an iron foundry, and had existed most of its 150 years as a small sized maker of engines and compressors. However, all this changed in the 1960s, when the management decided to expand the company to lessen its dependence on the capital expenditures of the cyclical natural gas business.
They have tried to become as large as they can by using merger and acquisition technique to
The group has organically and through a series of strategic acquisitions in its relatively short