Case Study Apple Inc. was founded by Steve Jobs, he served as CEO, then chairman until the day before his death on October 5th 2010. In this case study the key events leading to the decline in stock prices and the loss of a leader will be examined. The History Apple was set up on April 1st, 1976 by Steve Jobs, Steve Wozniak and Ronald Wayne to build, disturb and sell computers. Jobs and Wozniak owed a 45% shake each while Wayne own 10%, which he later sold to Jobs for $800. Today his share would be worth in the region of 3 Billion.
In June 1984, the annual accounts, which were done with the help of the accountant Dickman, were issued to the shareholders, which now included Caparo. Caparo reached a shareholding of 29.9% of the company, at which point it made a general offer for the remaining shares, as the City Code's rules on takeovers required. Once it had control, Caparo found that Fidelity's accounts were in an even worse state than had been revealed by the directors or the auditors. Caparo sued Dickman for negligence in preparing the accounts and sought to recover its losses by determining the difference in value between the company as it had and what it would have had if the accounts had been
Overnight, AIG's stock fell 43%. As indicated by AIG fillings just a month prior to (August 6) such a drop could have activated more than $13 billion dollars in security calls from investors who purchased swaps from the organization and needed their cash back. This is only one case of how the money markets depend upon high credit ratings. As money related firms and markets request higher evaluations, CRAs are influenced to alter their benchmarks. All the more imperatively, once a coming up small organization has a high credit rating, minimizing that rating can push a falling flat organization over the edge as investors escape.
The company slashed the price by Rs.23, finally amounting to Rs.99 for its 200ml bottle. The company experienced an increase of 5 -10% growth in the sales. Head & Shoulders was positioned as a premium brand as a direct competition to HUL’s Clinic All Clear. The price reduction strategy helped P&G eat into HUL’s market share. In 2004, the consumer
These judgements are considered ethical if it is right and unethical if it is wrong. What are the Ethical Issues Involved? Based on the facts given, Charlene Battle, controller for Castle Corporation is preparing the company’s financial statements at year- end. A financial statement is a formal report on the business position and performance, its purpose is to provide information to its users such as suppliers, customers, creditors etc. which will influence them in the decision-making process.
But leadership issues over the years, right from 1980s to the present day, have contributed slowly in the downfall of this giant to gutters. The article talks about this issue in detail by narrating how during the tenures of the different CEOs their mistakes and poor decisions have led to this calamity to the company. Also the different factors such as lack of coherent vision, poor decision making, inability to foresee the future, and make use of technological advancements have been illustrated properly in the article. • Forbes Article of “Businesses Don't Fail - Leaders Do” by Mike Myatt states the reason for failures of businesses. It points out clearly the list of characteristics which are the reasons of failures, how businesses are impacted by poor leaders. • Harley Davidson Motor Company The article on Harley Davidson gives an insight into how good leadership can bring about drastic changes in the fortune of a company.
Thus, the CEO plays a leading role in decision-making. For some boards, they allow the CEO to make the final decision (Rajagopalan and Datta, 1996, p. 196). However, the influence of the CEO on the board depends on his or her relationship with the board members (McDonald et al., 2008, p. 453). The problem arises when the board demonstrates overconfidence in the CEO by failing to consider the information
But there is a debate going on across the corporate world whether the separation of role is good or role duality is better(one person at both the positions). Two contradicting views are there on this issue, one is supported by agency theorists and the other one by the stewardship theorists. The proponent of agency theory say that separating the CEO and Board chair ensures a balance of power and no one has unfettered authority of decision making (Stiles and Taylor, 1993; Blackburn,1994). The CEO is responsible for the initiation and implementation of plans and policies; the board chairman is responsible to see that board of directors monitor and guide the CEO. By combining the roles of CEO and chairman, one person is having so much power that the board
He also predict to stabilize in next year and seek to start growing again by 2017. The launched of Christoph Mueller in Malaysia Airlines is to repair the damage airline’s image since he has an excellent experience when he was the CEO of Ireland’s national carrier Aer Lingus which is a loss-making airline but he managed to turnaround within a year. After reinvent the Malaysia Airlines, the stock price begin rise continually and the estimation from the investors also increase. Hence, CEO reputation is important for the firm
Agency theory suggests that it is important to allocate risks and responsibilities for decision control to parties who are best able to perform them. As a CEO, it is Alan’s responsibility to monitor the firm. As the investors increase their investment in Qantas, the risk and pressure in performance increase. Therefore, increased monitoring intensity shifts risks to managers, who require higher pay to compensate them for the increasingly intense employment risk they must undertake as key executives. Qantas employees should understand that as monitoring intensity increases, managers’ job security is less certain, and they may view it as having to take on extra risk.