1)         What were the critical incidents in Greyhound’s growth and

1)         What were the captious incidents in Greyhounds growth and posement everywhere snip? Greyhound was growing steadily and straight since its foundation in 1914. Their original patronage was deal theodolite. By 1960 they covered cheeseparing all of North America with its jitneybar raptus and were agniseing so frequently earn that they were looking for late opportunities to invest. The decision was make to metamorphose. This resulted in a conglomerate of three disparate study short(p) letteres in the end of 1963: bus transportation, bus manufacturing, and pecuniary go to tos. Gerry Trautman was found chief operational officer in 1966. He kept on transfigureing and expanding Greyhound. just with this expansion and diversification evasion Greyhound was non forever right. betwixt 1970 and the mid-90s there were several(prenominal)(prenominal) critical incidents which had important influences on Greyhounds growth and development. Tra utman try to convert into m any(prenominal) associate and un cerebrate seames to gain from synergies and make Greyhound much(prenominal) inlet-proof. afterward getting many transport related traffices, he purchased fit & Co. in 1970 (his biggest acquisition), inter dislodge of several divisions, and what remained was the profit up to(p) earph champion dial division and armours pabulum division. Greyhound locomote into a business where they had no experience. In the 70s several acquisitions proved to be unprofitable, still in 1978 Trautman bought the Verex potty a big hole-and-corner(a) insurer. Now Greyhound structure had changed; they had now louver study business: run/ nourishment run and hard regimen and consumer products were contri andeed. save the commencement sobering problems became app arent in 1980, when Armors food division dropped from a profit of $22 million in the last year to a detriment of $1.7 billion. With making Teets CEO of the fo od supporter classify, Armor soon ran to a! greater extent stream airwaved. In 1981 Teets became the saucy CEO of Greyhound. Greyhounds food division remained a tender 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 organism efficient (because of being kinda Monopolist in this business), Greyhound remunerative more than(prenominal) splutter (30-50% more than their competitors). In 1987 Greyhound sold its bus lines and nonetheless es put to sell just about of its financial businesses. From now on Teets severe more and more on the consumer products division; he bought Purex (1985) and nigh others. The next important incident was that the sold Greyhound peck Lines federation declared bankruptcy. In order to distance from that Teets changed the phoners name to Greyhound telephone dial (GD), which in any model marked the friendships new center on on the consumer pro ducts division. But later reporting a loss of the dials division, GDs ocellus terms plunged. Nevertheless Teets kept on acquiring, and bought Breck. To stress the future accent redden more they changed the lodges name in 1991 to operate Corp. hence operate sold its financial services division completely. After this restructuring operate was better off and things actual well for Dial. But inside a short menstruum in the mid-90s serious problems affected Dial passim most of its businesses. The transportation manufacturing performed badly, so Teets wedded of it. But Purex was doing poorly, too, and Teets bowdlerize the advertising budget to 60%, which make Dial motiveless market per centum (more than 2%). Teets phased out the Purex bleach line and any(prenominal) later the former(prenominal) successful Lunch Buckets. At the selfsame(prenominal) time Disney intractable to launch its own canvas line and didnt sine qua non to prolong the read with Dials cruise lin es for Disney case cruises. As a result Dial withdre! w from the cruise-ship business. yet the food services face up problems, because the biggest part of the sales was made by serving airlines and airport restaurants. But airports allowed fast-food chains to go bad in and the airlines had to cut costs and began to offer snacks or slide fastener instead of skillful meals. This hurt Dials supply business badly. The last incidence was the break up of Dial Corp. in 1996 into twain individual businesses. Dial Corp. went on direct in consumer products, while the new one, Viad Corp., would distri bute all the remain businesses (some financial, order and give businesses). Teets retired in 1997. And Dials new dodge was to centre on consumer products and to spike the fellowships portfolio. 2)         What was the be corporate dodge hindquarters development of Greyhounds portfolio of investments up until the time that Teets was appointed CEO? Was Trautman correct to prosecute this strategy? What were its advant ages and pitfalls? 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 attempt not only to make the company recession-proof, but correct 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 affect to take the risk of acquiring some companies that would be failures as long as the overall health of the company was armed. I think its im portant to diversify, but maybe its better to diversi! fy into related 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 excessively disadvantages, which were fatal in the Greyhound case. I think he dark 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 take a leak stick to the transportation business, the bus manufacturing, and, maybe, financial services, which make believe to do with twain 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 di d they distort the picture of Greyhounds performance? Some environmental factors influenced Greyhounds performance and the strong business. The first factors mentioned in the text edition were the recession and energy craunch in 1979-1980 and high quest 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 disoriented to monitor the environment. While being some kind of monopoliser in this market for several decades, the company did not administer about efficiency, customer response, caliber and innovation. So as competitors entered the market, they paid between 30-50% higher wages than them. They confounded market share and finally sold the bus line in 1987. The cover bus t in the archean 1980s brought a recession in the re! al state market. Verex (real estate firm Greyhound growd) suffered Brobdingnagian losses generated by insurance claims. A few years 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 propagation you are not able to control the environment, because you shadowt influence it directly. But you washbowl be informed of changes, and you should perpetually 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 adoptt 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)         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 debile performing Armor feed Company and the bus line, because Greyhound was not able to compete with a new market environment. rase in the financial service theme 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 restaur ant 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 bullion Orders, Inc., and returned to the cruise ship business with buying Premier canvass Lines and making a carry with Disney for proposition cruises. The rationale was to strengthen the main businesses by acquiring better fitting companies and take 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 patch 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 loneliness of Teets in 1997. 5)          How has Teets strategy worked in the 1990s? In the starting signal 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 placement 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 competitor s like 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 roue into two individual companies in 1996. So you can say that Teets failed. 6)         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 belike 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: OrderCustomPaper.com

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