Greyhound Dial

Essay text:

What environmental factors affected Greyhound’s businesses? Macroenvironment affects the intensity of rivalry within an industry. ? Demographic ? Technological o High production costs, inefficient plants o Products they would acquire are easy and inexpensive to imitate by much larger companies ? Cultural o Trautmans style vs Teets (new) ? Trautmans: ambitious about expansion and diversification ? Teets: cost cutter, effective hands on manager, liked to stay close to action, domination with labor unions, overall more laid back ? Jozoff: P&G veteran, understand how to fashion a business model to promote profitability- saw lack of a differentiated appeal- entered into some joint deals- bring into direct competition ? Baum: experience with similar type products (bread&butter)- recognized importance of finding the right strategy- made the products speak and fight for themselves number wise ? Economic o Hoped vast array of business would be recession proof o There was a recession in the real estate market in 1987 right when Greyhound announced its intention to sell Verex (financial)- bad timing o 1995- wanted to increase company’s ROE and stock price, so began to slash costs- reduce advertising budget o Trying to create value ? Government or Legal o There was a newly deregulated bus transportation market (1981 bill that deregulated the intercity bus business)- had to be able to charge competitive fares- could not be a low cost provider of bus transportation- lost competitive edge Could anything have been done to control environmental factors? ? In the case of leadership of the company- needed to be more accountable for each product line and business etc- grouping things together too much leads to troublesome oversight ? More research before announcing big decisions In what ways did environmental factors distort the picture of Greyhound’s performance? ? Way case was written- seemed like something was always going wrong- never could get on top of the market share or any specific business for long before they would have to go do some fixing of something else