1Right, Jason and Karin,
2now I asked you to look at the case study for Box Telecom as part of your exam assessment.
3It's interesting because they are in the middle of problems at the moment
4and I want you to track how they deal with them.
5Let's start with you, Karin.
6Having read through the case study,
7can you just summarise what the problems were that Box Telecom had to take on board?
8Um, yeah...
9Well of course what first came to their attention was that, despite a new advertising campaign,
10they were suffering from falling sales -
11and this is something that had many causes.
12On top of that immediate problem,
13what had also happened over the last two years was that,
14although they had invested in an expansion plan,
15they had to face up to increased competition.
16And, before they had a chance to get to grips with the effects of that,
17they were stalled by a strike
18and it was just when they were thinking about making a colossal investment in new machinery for their plants.
19So they were really in trouble.
20Yes, I think that's fair.
21And Jason, you contacted the company, didn't you?
22What did the company define as the reasons for these problems?
23Well, I think they've hit on the right things -
24it would be easy to say they had invested too heavily, or at the wrong time,
25but in fact, the signs were good
26and what they were set back by was high interest rates.
27At the same time, their longer-term problems, which were affecting their market share,
28were eventually credited to poor training -
29and having looked at the details in their last report I think that's right.
30So, onto the larger issues then.
31Karin, what do you think the company will do?
32Obviously they have the choice of accepting the very favourable terms that another company - KMG Plc - have given them to buy them out.
33That would mean creating a new company with a new image.
34Or they could decide on a bolder move and offer some new shares if they wanted.
35But I think they're much more cautious than that
36and expect they will start trying to find individuals who'd be prepared to back them with some of the capital they need.
37Well, you mustn't always assume that dramatic problems require dramatic solutions.
38Sometimes there's a simple fix such as changing the guy at the top.
39If they truly are cautious,
40then I suspect they will seek to shut down some of their shops.
41But a more ambitious approach,
42and one which I think would have more chance of success,
43would be to alter how they're running things -
44the management layers and the processes.
45So, in your analysis, try to think of all the options.
46Jason?
47Yes, it's interesting because I've found it a really useful company to study.
48Its problems cross all types of industries
49and it's lucky it's so big -
50a smaller or even medium-sized company would have gone under by now.
51Ah well in fact, what I want you two to do
52is to go away when we've finished our discussion today and write a report.
53We've looked in general at the telecommunications market in the UK over the last few sessions
54and I want you to take Box Telecom as an example
55and suggest some ways in which they might overcome their problems.
56And outline the reasons why you think as you do -
57but try and keep it intrinsic to the company
58rather than dragging in other examples.
59Is that okay, Karin?
60Yes, I think I can do that.
61Personally I've got great hopes for it.
62I think it will recover.
63That advertising campaign they did was very strong
64and they're very innovative with their products - they set new trends.
65The company's got to recover, don't you think, Jason?
66Hmm... I'm not sure.
67I think it can but it's not a foregone conclusion
68unless they manage to attract the right level of investment.
69The company definitely needs a boost
70and to attract more highly skilled workers if their recovery is to be long-lasting.
71When I was talking to the marketing manager
72he said to me that he thinks the company had got a great management team
73but he would say that, wouldn't he?
74but they are suffering from having to work with outdated production machinery
75and that could cost a lot to put right.
76Well, personally I think the stock market is to blame.
77I think they were expecting too much of the company
78and then inevitably it looked bad when it didn't perform.
79The market should have had more realistic expectations.
80And I disagree with you about the advertising campaign, Karin.
81That's where they could do with some innovation - to get sales kick-started.
82Anyway, let's see what you come up with...