Industry 44 Company DRole of Board of Directors

Peter Miars: Accounting Major-Financial Analysis Concentration. Expected Date of Graduation- May 2011

Chris Allred: Accounting Major-Financial Analysis Concentration. Expected Date of Graduation- December 2010

5 Forces Analysis Threat of Entry

• Low intensity Competing for market share High startup costs Brand awareness is difficult

Power of Suppliers• High intensity

Many different suppliers Power of buyers

• High intensity Buyers can demand better quality and better prices

Substitutes• High intensity

No substitutes for athletic shoes Rivalry

• High intensity Many competitors with same size and power

BSG Strategic Group Map

Companies:

A B C D E,F,G

North America – Year 17

Key Strategic Factors

Three most important in BSG: Improve S/Q rating G* Manufacturing Efficiency

Three most important in real footwear industry:

Establishment of brand names Effective quality control Economies of scale

Critique of Top Management

Top Management’s Response• Improve S/Q rating• Increase Advertising budget• Maintain Retail Support

Board of Directors’ Critique• Company needs the discussed improvements and more• Market share is low, but a higher S/Q rating will help• Credit rating is low, and harmful to growth• For wholesale market, retail demand is significantly below

average

The company has succeeded in its goal to be environmentally responsible, but has not produced results that facilitate further

growth and shareholder value.

Recommendation for Top Management

In order to create and sustain a competitive advantage in relationship with customers, Top Management should offer products at competitive prices while eliminating the impact on the environment as much as possible.

In order to create and sustain a competitive advantage in relationship with shareholders, Top management should increase earnings per share and improve upon their credit rating so investors will feel confident investing in the company.

References "C1321-GL - Global Footwear Manufacturing - Global Industry

Report." IBISWorld 2010. n. pag. Database. 18 Oct 2010. IBISWorld. 2010. Retrieved at North Carolina State University. <http://www.ibisworld.com.www.lib.ncsu.edu:2048/globalindustry/default.aspx?indid=500>.

McGirt, Ellen. How Nike’s CEO Shook up the Shoe Industry. Fast Company, 1 Sep. 2010. Web. 10 Sep. 2010. <http://www.fastcompany.com/magazine/148/artist-athlete-ceo.html?page=0%2C0>.