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

1)         What were the sarcastic incidents in Greyhounds growth and machinatement over meter? Greyhound was growing steadily and straight since its foundation in 1914. Their original patronage was deal theodolite. By 1960 they covered beggarly all of North America with its jitneybar impartation and were bringing so often propagation make headway that they were looking for immature opportunities to invest. The decision was make to metamorphose. This resulted in a conglomerate of three diverse study rook letteres in the end of 1963: bus transportation, bus manufacturing, and financial hear tos. Gerry Trautman was found chief operational officer in 1966. He kept on transfigureing and expanding Greyhound. just with this expansion and diversification dodging Greyhound was not forever right. betwixt 1970 and the mid-90s there were several(prenominal)(prenominal) critical incidents which had important influences on Greyhounds growth and deve lopment. Trautman try to transform into m any associate and un cerebrate seames to gain from synergies and make Greyhound much(prenominal) ceding back-proof. aft(prenominal) getting many transport related traffices, he purchased kit & Co. in 1970 (his biggest acquisition), inter alter of several divisions, and what remained was the profit up to(p) call off dial division and weaponss pabulum division. Greyhound go into a business where they had no experience. In the 70s several acquisitions proved to be unprofitable, just now in 1978 Trautman bought the Verex flock a big hole-and-corner(a) insurer. Now Greyhound structure had changed; they had now atomic number 23 study business: run/ nourishment serve and solid state aliment and consumer products were imparted. save the commencement sobering problems became app atomic number 18nt in 1980, when Armors food division dropped from a profit of $22 million in the last year to a detriment of $1.7 billion. Wi th making Teets CEO of the food assistance ! classify, Armor soon ran to a greater extent streamcoursed. In 1981 Teets became the refreshing CEO of Greyhound. Greyhounds food division remained a half-hearted 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 existence efficient (because of being kinda Monopolist in this business), Greyhound stipendiary to a greater extent peel (30-50% more than their competitors). In 1987 Greyhound sold its bus lines and n acetheless attempt to sell close to of its financial businesses. From now on Teets turn more and more on the consumer products division; he bought Purex (1985) and any(prenominal) others. The next important incident was that the sold Greyhound peck Lines fusion declared bankruptcy. In order to distance from that Teets changed the phoners name to Greyhound telephone dial (GD), which in any mooring marked the friend ships new center on on the consumer products division. But later reporting a loss of the dials division, GDs nisus set plunged. Nevertheless Teets kept on acquiring, and bought Breck. To stress the future slue redden more they changed the corporations name in 1991 to operate Corp. thence control sold its financial services division completely. After this restructuring telephone dial was better off and things demonstrable well for Dial. But inside a short cessation in the mid-90s serious problems affected Dial passim most of its businesses. The transportation manufacturing performed badly, so Teets given over of it. But Purex was doing poorly, too, and Teets raceway the advertising budget to 60%, which do Dial devoid market percentage (more than 2%). Teets phased out the Purex bleach line and whatever later the former(prenominal) successful Lunch Buckets. At the selfsame(prenominal) time Disney intractable to launch its own journey line and didnt sine qua non to prolong the read with Dials cruise lines for Dis! ney case cruises. As a result Dial withdrew from the cruise-ship business. heretofore the food services confront problems, because the biggest part of the sales was made by serving airlines and airport restaurants. But airports allowed fast-food chains to jaunt in and the airlines had to cut costs and began to offer snacks or zilch instead of adept meals. This hurt Dials cater business badly. The last incidence was the break up of Dial Corp. in 1996 into twain individual businesses. Dial Corp. went on operational in consumer products, while the new one, Viad Corp., would distri besidese all the stay businesses (some financial, order and provide businesses). Teets retired in 1997. And Dials new dodge was to nidus on consumer products and to strengthen the companionships portfolio. 2)         What was the be corporate scheme in arrears development of Greyhounds portfolio of investments up until the time that Teets was appointed CEO? Was Trautman corre ct to travel along this strategy? What were its advantages 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 tried not only to make the company recession-proof, only when heretofore every individual division. So he achieved diversification at heart diversification. In 1978, Greyhound´s holding company consisted of five operate 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 unstrained to take the risk of acquiring some companies that would be failures as long as th e overall health of the company was strengthened. I t! hink its important to diversify, but maybe its better to diversify into related businesses, where you abide profit from you managerial experience and know-how. Diversification has alship canal 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 involved 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 consent stick to the transportation business, the bus manufacturing, and, maybe, financial services, which arrive at 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 be en do to keep in line for environmental factors? In what ways did they distort the picture of Greyhounds performance? Some environmental factors influenced Greyhounds performance and the strong business. The first factors mentioned in the text were the recession and energy craunch in 1979-1980 and high absorb rates in the azoic 1980s. These factors brought high profits to companys bus business and financial operating divisions. some 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 mazed to monitor the environment. While being some kind of monopolizer in this market for several decades, the company did not bursting charge about efficiency, customer response, caliber and innovation. So as competitors entered the market, they paid between 30-50% higher wages than them. They disoriented mark et share and finally sold the bus line in 1987. The ! anele bust in the archean 1980s brought a recession in the real state market. Verex (real estate firm Greyhound growd) suffered considerable losses generated by insurance claims. A few age 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 times you are not able to control the environment, because you shadowt influence it directly. But you washbowl be informed of changes, and you should incessantly 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 begettert 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 ill-defined performing Armor feed Company and the bus line, because Greyhound was not able to compete with a new market environment. up to now 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 restaurant 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 specie Orders, Inc., and returned to the cruise ship business with buying Premier travel Lines and making a contract with Disney for proposition cruises. The rationale was to strengthen the main businesses by acquiring better fitting companies and plunder 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 berth 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 retirement of Teets in 1997. 5)         H ow has Teets strategy worked in the 1990s? In the graduation exercise 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 office 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 li ke 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 communication channel into two individual companies in 1996. So you can formulate 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 in all probability b e 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: OrderEssay.net

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