CHAPTER 1

CASE STUDY

Equity Technologies COrporation

Equity Technologies Corporation knows what it means to be prepared. Located in Mobile,

Alabama, the company has long had plans and procedures in place to counter the threat
posed by hurricanes and other severe weather. For instance, Equity Technologies promotes
family and individual preparedness and has set up a means of communicating with
employees when dangerous weather threatens. Employees carry laminated cards with
contact information for supervisors and a voice recorded call-in number with updates about
the company's status.

But it was the risk of Y2K related disturbances that motivated Equity Technologies to get
serious about its disaster preparedness and business continuity plans. "We are a small
company which does business around the world. To be competitive my clients must feel
confident that we are ready for anything," said Equity Technologies Corporation's President
and CEO Cathy Anderson-Giles. "It wasn't hard to put together a plan, you just have to make
it a priority."

First the company identified workers to serve as key contacts for the 72-employee operation.
These key contacts then established safety and security teams which analyzed Equity
Technologies Corporation's entire emergency process.

The teams realized that communication between the company and the outside world was
the single most important operational factor in an emergency. As a result, Equity
Technologies purchased generators to power the phone system during utility outages and
trained co-workers to set them up within seven minutes. Not only does the company have
emergency plans and procedures in place, it has made a commitment to review the plans
and tools each year at the start of the hurricane season. "We have the annual review on our
corporate calendar," said Anderson-Giles. "Being prepared means being ready for any kind
of emergency, be it hurricane, utility disruption or man-made disaster."

1. Does equity technologies corporation practice strategic management ? why or why not?
Yes, because Equity Technologies Corporation is always prepared for any bad weather and can be
equipped with a way of communicating with your family as well as a set up for employees when
dangerous weather looms.
2. Why does equity technologies corporation give or not give importance to strategic
management?
They place great value on strategic management since without it, all of their aims and objectives
would be meaningless. They continually examine their techniques in order to be successful as
their settings change.
3. Do you agree with the steps taken by President and CEO cathy Anderson-giles to become
competitive? Why or why not?
Yes, since the CEO made it a major priority in the plan she developed. We all know that
communication is essential during a natural catastrophe, and being competitive indicates that
they are confident and prepared for anything.
4. What other actions will you consider to provide future direction to equity technologies
corporation?
For me, an action plan is needed to establish specific measures and track their implementation.
You must monitor the action plan to ensure that the steps are followed
By keeping the plan alive, the team may create a new action plan for the following 12 months
based on the lessons you've learned.

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 CHAPTER 2
CASE STUDY

WALMART DE MEXICO

When Walmart de México y Centroamérica decided to buy the power generated by the Electrica
del Valle de México’s (EVM) wind farm, EVM’s struggling project received a significant boost.
While the proposed wind farm was located in an area with abundant wind resources, absent a
creditworthy off-taker the project would not have been able to line up financing. With Walmart
de México’s 15-year PPA (Power Purchase Agreement) in hand, the developers were able to gain
financial backing, buy and erect the turbines, and begin generating electricity by 2010.

For Walmart de México, becoming the wind farm’s off-taker accomplished a number of
important objectives. EVM guaranteed electricity at below the rates charged by Mexico’s state-
controlled utility, shaving costs for the famously thrifty retailer. In addition, the project allowed
Walmart de México to get closer to some of its sustainability goals. The wind farm would supply
electricity to 348 Walmart de México facilities in central Mexico, providing 18% of the electricity
Walmart de México consumed in Mexico in 2010.

The wind farm was just one part of the efforts Walmart de México was undertaking in the
sustainability area. The company had pledged to meet ambitious goals, looking to reduce waste
in its and its suppliers' operations. In the energy area, the company was hoping to receive 50% of
its energy from renewable sources by 2015, even in a period of rapid growth, increasing its
square footage in Mexico by 12% in 2012 alone. All told, the efforts of Walmart de México had
made it the world’s leading retailer in the area of sustainability—a distinction the company
hoped to build on.

The success of the EVM wind farm had ignited Manuel Gómez Peña’s thinking about further
renewable energy projects. Gómez, Walmart de México’s Director of Sustainability, was
considering ways the project financing structure might be further adapted to allow Walmart de
México to participate in and benefit from other projects. Gómez was also considering the mix of
renewable energy sources. In addition to wind, solar and mini-hydroelectric projects were
possibilities that Walmart de México could consider.

Any project that Walmart de México undertook had to work in concert with Mexico’s electricity
grid and rate-making structure. Mexico’s political leadership had announced a commitment to
electricity from renewable energy sources, to move the country away from its traditional
reliance on natural gas and oil. Mexico’s government-controlled electricity utility had simplified
the transmission rates for renewable energy and had constructed a few projects of its own.
However, there were no special feed-in-tariffs for renewable energy and only a few tax
incentives for the construction of renewable energy projects. Furthermore, there was a dearth
of independent project developers with the resources and expertise to build large-scale projects.

Gómez also had to take into account Walmart de México’s capabilities and focus. While the
company had made sustainability a priority, corporate officials were loathe to take on projects
that took them too far from the company’s central activity of retailing. The company’s
investment group analyzed sustainability projects on the same basis as any other project,
concentrating on return on investment.
Gómez believed that the situation called for creative thinking.

1. How could the company leverage its sterling credit rating to get renewable energy projects off
the ground?

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 Walmart has more than 180 energy projects in operation or planned around the world such as
micro wind on parking lots, biodiesel generators and fuel cells are among the initiatives.
The fact that the wind farms was founded in areas that have substantial wind resources, their
projects wouldn’t be able to get finance in the absence of a credit off taker. The 15-year
agreement in place were able to get financial support build turbines and begin producing power
by 2010.

2. For the EVM wind farm, Walmart de México's equity investment was minimal, just sufficient to
meet the requirements for Mexico's self-supply tariff. Should the company take a larger equity
position in further energy projects, rather than simply serving as an off-taker?

Yes, since Walmart de Mexico operates 180 sustainable energy projects worldwide, including the
solar, micro-wind on parking lots, biodiesel engines, and fuel cells. In addition, they are
constructing 150 solar panels in seven countries, 26 fuel cell installations in the United States,
and onsite micro-wind, large-scale wind, solar water heating, and thermal in markets such as
Canada, Chile, China, Mexico, and the United States. They also buy green energy to power stores
like electrica del valle de Mexico, which is supplied by five off-site utility wind power in 348
stores in Texas, 350 stores from Duke Energy's wind farm in the Netherlands, and 14 stores in
Northern Ireland. Improving the grid, we’re dedicated to collaborating with stakeholders to make
the grid as renewable and efficient as possible.

3. What technologies should Walmart de México employ to achieve its renewable energy goals?
There are many ways to consider renewable energy they must Manuel Gómez Peña’s ways in mix of
renewable enrgy sources like solar and mini-hydroelectric projects.

4. Should the company hold a portfolio of projects or just concentrate on one technology?
Yes

5. How could Walmart de México expand the program to the other central American countries in
where it operates?

6. Is there a way to include suppliers into a renewable energy program?

CHAPTER 3
EXERCISES

1. Explain why the demographic and global segments need to be included in performing a societal
environmental analysis.
2. Describe how a societal environment analysis is conducted

CHAPTER 4
EXERCISES

1. Give the different barriers to the bargaining power of a buyer.

2. State the different instances where substitute products pose threats to an industry.

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