9B21M021

URBAN AXES: FIRST MOVER IN US EXPERIENTIAL ENTERTAINMENT

Marilyn Anthony and Shreshthi Mehta wrote this case solely to provide material for class discussion. The authors do not intend to
illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other
identifying information to protect confidentiality.

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Copyright © 2021, Ivey Business School Foundation Version: 2021-03-12

In early 2017, chief financial officer Krista Paton reviewed the 2016 financial performance of her fledgling
company (see Exhibit 1), Urban Axes, and could not believe the numbers. Started as a “side hustle” by Krista
and partners Shaun Hurley, Stuart Jones, and Matt Paton in 2016, Urban Axes was the first axe-throwing
entertainment venue in the United States. The business opened one location in Philadelphia, Pennsylvania, in
September 2016, and by late December 2016 Urban Axes had already far exceeded the financial modelling
that Krista had designed to identify low-, medium-, and high-performance earnings objectives.

Krista and her co-founders had some big decisions to make. Given the business’s enormous early
acceptance by customers, the earnings potential of Urban Axes’ unique business model, and the business’s
first-mover position, what options did Urban Axes have for expansion? How quickly should the co-founders
make their move? Would Urban Axes be a career bull’s eye and generate enough earnings for the partners
to quit their day jobs and go all in on axe throwing?

AN UNLIKELY ENTREPRENEUR

In many ways, Krista, age 34, did not fit the profile of an entrepreneur. As an undergraduate, she explored
many areas of interest, beginning with computer science and ending with a degree in Spanish and modern
languages, with minors in international business and computer science. While an undergraduate, Krista
worked nearly full-time in retail for mobile phone service provider Sprint Corporation before moving into
the company’s internal audit department.

Exposure to auditing led to Krista’s pursuit of a master of business administration in finance, which in turn
led to her first job in the finance department of the international consumer goods corporation Procter &
Gamble Company (P&G). Krista’s initial P&G position in Cincinnati, Ohio earned her recognition as a
high-potential employee. A series of promotions within a variety of product lines followed, including roles
as senior internal auditor, Bounty financial analyst, customer team finance manager, Canada household
needs finance leader, and Gillette upstream finance and strategy manager. The promotions had involved
transfers—in 2011 to Philadelphia, Pennsylvania, and in 2013 to Toronto, Ontario, Canada. Krista
attributed her rapid growth at P&G to intellectual curiosity, something she felt came naturally to her. “I like
to look at a question, form a hypothesis, and then collect and use data to prove or disprove those
assumptions. That was a behaviour P&G really encouraged and valued in its employees.”

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Page 2 9B21M021

As a high-potential woman in finance, Krista was excited to be part of a large company with rich
opportunities for travel and career advancement. She also capitalized on P&G’s mentoring. Early on, she
identified a senior female executive whose leadership style she admired and wanted to emulate. Her mentor
was “strong and decisive, but also a very good listener. In meetings she was a little less loud and more
reserved. She asked thoughtful questions, considered the information, and then made clear decisions. I
thought she was everything you want a leader to be.”

Thinking back on her early successes at P&G, Krista recalled telling a co-worker, “I intend to be a P&G
lifer. I really like working for ‘the Man.’” However, the postings to Philadelphia and Toronto had had
unintended consequences and set the stage for a reluctant entrepreneur to make a dramatic career change.

A BIRTHDAY PARTY GIVES RISE TO BUSINESS OPPORTUNITY

When Krista moved to Toronto in 2013, axe throwing1 as indoor experiential entertainment was just
starting.2 Participants would throw axes at a wooden target and attempt to “stick” the axe for points, scoring
more if they hit the bull’s eye. Krista was part of one of the first social groups to celebrate a friend’s birthday
party by throwing axes together. She recalled thinking, “This was so much fun; it must exist in the United
States.” She did some quick research, discovered that it did not yet exist in the United States, and said to
her then-boyfriend, Matt Paton, “This would go great in Philly.” She and Matt called two friends, Shaun
and Stuart, both Australians with successful careers in information technology (IT), who flew to Toronto
to check out the opportunity. Shaun and Stuart immediately shared Krista’s excitement about launching axe
throwing in the United States (see Exhibit 2).

Krista’s first move was to contact the lead axe-throwing organization in Toronto to learn if it had plans for
US expansion and would consider partnering with Krista’s group. The organization claimed that it already
had US expansion plans. Krista’s enthusiasm cooled as she told herself, “What do we know about running
an axe business? Let’s keep thinking about it.”

Krista recalled that after an especially bad day at an unrewarding job, one of her potential partners
announced to the group, “I’m doing this. Are you in or out?” The Toronto organization had not made any
movement into the United States, so Krista’s friends started looking for real estate in their target
Philadelphia market. Very shortly thereafter, Urban Axes was born.

“We all approached Urban Axes as something we’re going to dip our toe in,” Krista recalled. The planning
and supervisory responsibilities were divided among the partners. As the only woman and the only
American on the founding team, Krista experienced some professional and cultural struggles. Matt, Shaun,
and Stuart were all Australian men with IT backgrounds and had previously worked together. They shared
a cultural outlook, an easygoing temperament, and a history as colleagues and friends. Krista jokingly
described the three as “basically all the same guy.” As the only partner with a financial background, Krista
tended to think differently about the business challenges and solutions. What made the partnership work,
however, was a shared set of values about business integrity and a willingness to keep a dialogue going to
resolve any differences.

1 Axe throwing started as a sport in 2006 in Toronto, Ontario, Canada.
2 “A Brief History of the Axe and Axe Throwing,” BATL, February 14, 2020, accessed January 25, 2021,
https://batlgrounds.com/history-of-axe-
throwing/#:~:text=Back%20in%202006%2C%20a%20group,creation%20of%20a%20worldwide%20sport.

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Page 3 9B21M021

Krista described their balance of power and their method for conflict resolution in the following way:

At the end of the day, we have the same fundamental beliefs and goals. We recognized [that] we’re on
the same side. We want to do things correctly. That was a lucky thing that we shared common values,
since it is not something you can really know about someone until you work with them. A lot of times
we’d say, “Let’s keep talking about it.” Eventually we’d get to a vote, which is not very Australian.

Voting was rarely needed, Krista said, but it worked for the partners as the most equitable method of
finalizing decisions.

Gender played a conscious and important role in Urban Axes’ initial concept. In many stories and cultures,
the stereotypical lumberjack wielding an axe was a strong, burly, and usually bearded man. 3 To avoid biases
and to appeal to all genders, Krista served as the face of the company. In addition, the group hired a woman
as their first general manager to launch the Philadelphia location and manage day-to-day operations. “We
made conscious choices about me being the face of the company,” Krista stated. “We wanted Urban Axes
to be inviting and approachable. We wanted to avoid the stereotype that axe throwing is only for bearded,
tatted dudes in their 30s. We wanted to be welcoming to all genders and ages from the very beginning.” To
reinforce this image, Urban Axes managers and staff represented a mix of genders and appearance, and
were hired for personality and customer service aptitude. The positioning worked, and Urban Axes quickly
attracted a broad mix of customers, from corporate events to bridesmaid celebrations.

EXPERIENTIAL ENTERTAINMENT INDUSTRY

While still only a small segment of the overall entertainment industry, the experiential entertainment
segment was growing. The size of the location-based (or experiential) entertainment industry was expected
to grow to US$17 billion4 by 2023.5 Attracted by the growth potential, many businesses that originally
focused on selling only goods modified their business model to include location-based experiences.
Companies such as Baskin-Robbins and Taco Bell were investing in location-based experiences via
museums, hotels, and other initiatives.6

Perhaps better known in this segment were trends such as escape rooms,7 jewellery- and bead-making shops,
and ceramics-decorating stores, as well as bigger brands such as Topgolf,8 Punch Bowl Social,9 and Dave &
Buster’s.10 The target audience of this segment tended to be millennials, with men and women often dividing

3 Raphael Samuel and Paul Thompson, The Myths We Live By (London: Routledge, 1990), 132–136.
4 All dollar amounts are in US dollars.
5 Liquid Media Group Ltd., “Liquid Media Selects Romans from Mars to Headline YDX VR Experience across 14 Arenas,”
press release, November 14, 2019, accessed January 25, 2021, https://www.globenewswire.com/news-
release/2019/11/14/1947507/0/en/Liquid-Media-Selects-Romans-from-Mars-to-Headline-YDX-VR-Experience-Across-14-
Arenas.html.
6 Baskin-Robbins, “Baskin-Robbins Unveils Next Generation ‘Moments’ Store Design,” press release, November 28, 2018,
accessed January 25, 2021, https://news.baskinrobbins.com/news/baskin-robbins-unveils-next-generation-moments-store-
design; Michelle Gross, “Taco Bell’s New Hotel ‘The Bell’ Is Now Open,” Forbes, August 8, 2019, accessed January 25, 2021,
https://www.forbes.com/sites/michellegross/2019/08/08/taco-bells-new-hotel-the-bell-is-now-open/#2735a36865a3.
7 “What Is an Escape Room?,” The Escape Game, October 15, 2018, accessed January 25, 2021,
https://theescapegame.com/blog/what-is-an-escape-room/.
8 Topgolf was a global sports entertainment company headquartered in the United States. Topgolf (website), accessed January
25, 2021, https://topgolf.com/us/.
9 Punch Bowl Social was a place for people to gather with friends and families to have a good time enjoying great food, drinks,
and entertaining games. The company had several locations in the United States. Punch Bowl Social (website), accessed
January 25, 2021, https://punchbowlsocial.com/.
10 Dave & Buster’s was an American restaurant and entertainment business. Dave & Buster’s (website), accessed January
25, 2021, https://www.daveandbusters.com/.

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https://news.baskinrobbins.com/news/baskin-robbins-unveils-next-generation-moments-store-design

https://news.baskinrobbins.com/news/baskin-robbins-unveils-next-generation-moments-store-design

https://www.forbes.com/sites/michellegross/2019/08/08/taco-bells-new-hotel-the-bell-is-now-open/#2735a36865a3

What Is An Escape Room? (2021)

https://topgolf.com/us/

Home page

https://www.daveandbusters.com/

Page 4 9B21M021

by type of entertainment. The size of the location-based experiences industry was $218.6 million in 2015 and
was expected to grow at a compound annual growth rate of 32.1 per cent from 2019 to 2025.11

The US Census Bureau stated that the estimated number of US millennials in 2017 was 56 million people.
The data further showed that millennials were the largest generation by population in the United States
Exhibit 3 shows the US census by generation in 2017.12 As the largest generation currently in the US
workforce, millennials would soon reach their prime earnings years. This generation commanded an
estimated annual consumer spending power of $1.3 trillion. A study by Harris Group analyzed the spending
habits of millennials and discovered that 78 per cent preferred to spend money on experiences over goods.13
Spending on concert tickets, athletic events, or cultural experiences was becoming increasingly popular.

The study also found that 69 per cent of millennials experienced “FOMO”—that is, fear of missing out.
Millennials dedicated about 59 per cent of their income to experiences and the remaining 36 per cent to
goods. With the rise in social media platforms such as Facebook, Twitter, and Instagram, it was important
for millennials to maintain their social identity and regularly update their social status. Creating, sharing,
and capturing pictures of memories was very important to millennials and helped them in finding like-
minded individuals and creating a sense of community, especially when sharing experiences such as unique
forms of entertainment.14 The rise in this trend of social media use supported the growth of businesses such
as Urban Axes that offered distinctive and fun location-based experiences.

The consumer price index for urban consumers in the United States was 140 in 1992, and it had risen
steadily over the decades to 240 in 2016.15 This rise in the consumer price index indicated an increase in
wages and standard of living. According to the 2015 American Community Survey, median household
income for rural households was $52,386, about 4 per cent lower than the median for urban households,
$54,296. About 13.3 per cent of people in rural areas lived in families with incomes below the official
poverty thresholds. The poverty rate for people in urban areas was 16 per cent.16 This showed that the
standard of living in urban areas was higher than in rural areas.

Philadelphia was the most populous city in the state of Pennsylvania. The city had more than 100 colleges
and more than 340,000 students, ranking fifth in the country for number of college students. Attracted by
lower rents and more-affordable lifestyles, many young New Yorkers were moving from New York City
to Philadelphia. According to the US Census, an average of 3,500 New Yorkers moved to Philadelphia each
year between 2006 and 2010.17

11 Grand View Research, Location-Based Entertainment Market Size, Share & Trends Analysis Report by Component
(Hardware, Software), by End Use (Amusement Park, 4D Films), by Technology, by Region, and Segment Forecasts, 2019 –
2025, November 2019, accessed January 25, 2021, https://www.grandviewresearch.com/industry-analysis/location-based-
entertainment-market.
12 Pew Research Center, “U.S. Population by Generation (2017),” accessed March 08, 2021, www.pewresearch.org/fact-
tank/2018/04/11/millennials-largest-generation-us-labor-force/.
13 Eventbrite, Millennials: Fueling the Experience Economy, accessed January 25, 2021, http://eventbrite-
s3.s3.amazonaws.com/marketing/Millennials_Research/Gen_PR_Final.pdf.
14 Ibid.
15 Statista, Consumer Price Index (CPI) of All Urban Consumers in the United States from 1992 to 2019, January 2020,
accessed January 25, 2021, https://www.statista.com/statistics/190974/unadjusted-consumer-price-index-of-all-urban-
consumers-in-the-us-since-1992/.
16 Alemayehu Bishaw and Kirby Posey, “A Comparison of Rural and Urban America: Household Income and Poverty,” United
States Census Bureau, December 8, 2016, accessed January 25, 2021, https://www.census.gov/newsroom/blogs/random-
samplings/2016/12/a_comparison_of_rura.html.
17 Alfred Lubrano, “Are Flocks of New Yorkers Moving to Philadelphia (and What Does It Mean If They Are)?,” Philadelphia
Inquirer, June 11, 2019, accessed January 25, 2021, https://www.inquirer.com/news/new-york-philadelphia-real-estate-
curious-philly-fishtown-20190611.html.

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https://www.grandviewresearch.com/industry-analysis/location-based-entertainment-market

https://www.grandviewresearch.com/industry-analysis/location-based-entertainment-market

http://eventbrite-s3.s3.amazonaws.com/marketing/Millennials_Research/Gen_PR_Final.pdf

http://eventbrite-s3.s3.amazonaws.com/marketing/Millennials_Research/Gen_PR_Final.pdf

https://www.statista.com/statistics/190974/unadjusted-consumer-price-index-of-all-urban-consumers-in-the-us-since-1992/

https://www.statista.com/statistics/190974/unadjusted-consumer-price-index-of-all-urban-consumers-in-the-us-since-1992/

https://www.census.gov/newsroom/blogs/random-samplings/2016/12/a_comparison_of_rura.html

https://www.census.gov/newsroom/blogs/random-samplings/2016/12/a_comparison_of_rura.html

https://www.inquirer.com/news/new-york-philadelphia-real-estate-curious-philly-fishtown-20190611.html

https://www.inquirer.com/news/new-york-philadelphia-real-estate-curious-philly-fishtown-20190611.html

Page 5 9B21M021

Population growth, increased consumer spending on location-based experiences, a rising consumer price
index, and higher urban household income made Philadelphia an attractive market for Urban Axes.

FIRST-MOVER AXE THROWER: BUILDING A BUSINESS AND A BRAND

Although the partners had extensive corporate experience, they did not conduct a sophisticated market
analysis or feasibility study before launching Urban Axes.

According to Krista, “We weren’t giving up our day jobs—this was a side hustle. We could limit our risk.
If a lot of things had gone differently, we might not be here today. If we had to personally guarantee a long-
term lease, for example, that might have changed things.” According to Krista, the partners’ start-up
planning process involved developing a marketing plan; detailed financial models for low-, medium-, and
high-performance targets; and general operating principles derived from the team’s observations at axe-
throwing venues in Toronto. They decided not to conduct market surveys of potential customers, as even
their closest friends gave skeptical responses. “What we kept hearing when we ran the idea by people was
‘Really, you’re going to do that?” Krista laughingly remembered. “We’d say, ‘Trust us. You’re going to
love it,’ and we were right.”

Krista’s extensive finance experience proved to be invaluable preparation for building Urban Axes:

It gave me a great understanding of many aspects of business. I got to see anything related to
numbers, which is really everything. How much do we spend on marketing? Why did we choose
those programs? Are they good investments? How does our supply chain work? I was involved
with tax complexities, vendor negotiations, customer relationships—those were all things I had
exposure to over the years, which gave me a very broad business understanding.

The financial models that Krista built started with a base case to cover costs and make a little side money.
Most of the fixed costs were predictable. The one big unpredictable variable was how many people would
want to pay money to throw axes. The co-founders’ approach to risk mitigation meant that they would
retain their day jobs, set limits to their capital investment exposure, build contingency plans into their
business plan, and enter into an initial lease agreement that did not require a personal guarantee.

THE URBAN AXES EXPERIENCE IN PHILADELPHIA

For their first location, the partners selected a 6,000-square-foot former industrial building in the gentrifying
neighbourhood of Kensington, Philadelphia. The site combined several key location factors: sufficient
space to install multiple target lanes, a mix of commercial and residential properties, and easy access. The
rough, authentic look of the space complimented axe throwing.18

Since it was situated within a residential neighbourhood, the Urban Axes site had to ensure that its hours of
operation and occupancy limits both complied with zoning and met the approval of the neighbourhood
association. As a novel business type, Urban Axes applied for a permit under the nightclub licensing rules.
Finding an insurer willing to underwrite such an unfamiliar business posed steep challenges as well,
especially since Urban Axes offered a “bring your own bottle” option that required all customers to show

18 “Urban Axes Intro,” YouTube video, 1:00, posted by “Urban Axes Philadelphia,” April 5, 2017, accessed January 25, 2021,
https://www.youtube.com/watch?v=9obBKAy4wWQ.

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proof of age of 21 years or older.19 From both an insurer and a potential customer perspective, safety
concerns posed an early and serious obstacle to acceptance. Mixing axes and alcohol seemed like a reckless
idea. Krista’s team knew that safety had to be a top priority in the design and implementation of their plans.

The customer experience was loosely based on the Canadian model, adapted to US entertainment norms. Each
group of six to 12 guests received a coach to stay with them through their 2.5 hours of training and play. The
training began with safety. All rules within the business were carefully designed with customer and staff safety
as their number-one priority. The partners knew that any injuries would spell the end of their business.

Coaches, who were hired based on personality (as no one had experience with axe throwing), demonstrated
to customers how to hold and throw the axe to score points on a bull’s eye-style target that was similar to
but much larger than a dartboard. The coaches’ performance became an early differentiation for Urban
Axes. Coaches were trained to make the guest experience safe, unique, memorable, and fun. Training
represented a significant expense for the business. Each new hire completed 60–80 hours of rules and safety
training based on Urban Axes’ in-house training manual. Next, trainees “shadowed” an experienced coach
and gradually assumed a larger role under their coach’s supervision before taking on their own guests.

Krista noted that her three Australian partners brought their cultural values to the company structure. They
designed a compensation package that was generous compared to those offered by most service industry
jobs. The Urban Axes package for all staff included living wages; benefits, such as health insurance for all
full-time employees; and a type of quarterly profit-sharing plan. The partners chose to invest in employees,
with the goal of attracting and retaining high-quality employees, minimizing turnover, and ensuring a
consistently high quality of customer experience. Originally, staff were not allowed to accept tips, though
eventually tipping became optional for customers.

The key to building a one-of-a-kind business was word-of-mouth marketing based on a superior customer
experience. Urban Axes wanted its guests to feel just as Krista had when she went to that Toronto birthday
party—that it was so much fun, you just had to do it.

ENTER THE COPYCATS

Urban Axes launched in September 2016, and within six months, the first competitors had set up shop in the
vicinity of Philadelphia. The Urban Axes team anticipated numerous new entrants within the next six months.
Urban Axes watched newcomers poach its staff, imitate its style, and engage in competitive pricing. The
partners thought about what they could make proprietary about Urban Axes. As first movers, they believed
they had a sustainable competitive advantage. As Krista said, “It was huge in this business. Being the first one
was powerful. It gave us the opportunity to set the tone for the industry. We’ve established axe throwing as a
super fun activity, very controlled, very safe. Not all our competitors have been able to set that same tone.”

As for its unique attributes, Krista described Urban Axes by saying, “We’re better because operationally
we’re extremely strong. Having three partners in IT, we’ve developed some tools that make us way more
organized, put together, and professional than some of our competitors. Some are visible to customers,
some are not—the way we book and do scheduling, for instance.”

Krista’s competence in financial management added accurate forecasting and budgeting to the
organization’s skill sets. With a solid handle on budgeting and financial analysis, the fledgling group was

19 Individuals aged 21 or older were allowed to consume alcohol under state law in Pennsylvania.

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Page 7 9B21M021

confident they could self-fund. Their financial plan included risk mitigation to help them avoid going into
debt or being compelled to trade equity for outside investors.

Still, Urban Axes had to learn a lot more about its competitors. Marketing became a greater expense, pricing had
to be re-examined, and the group re-evaluated the value proposition of their customer experience. As Krista
summed up, “We felt the need to communicate our value proposition better and get more consumer insight.”

FIRST MOVER OR FOOTNOTE?

After barely four months of operations, Urban Axes’ healthy financial performance led Krista to believe
that the business had enormous growth potential. But she was also aware that past achievements would not
always translate into successes in the future. Krista had lived in Philadelphia and had a good understanding
of the market, labour, and business laws of the state. To enter new markets in other states, the team would
need to understand local regulations and evaluate demographics. The operating procedures would have to
be varied by state. The company would also need to grow its organizational capacity to manage multiple
locations. Krista would have to create new financial …

BUS 290 Case Study S21

BUS 290 Case Assignment Instructions – May / June 2021

Case Instructions

• This case will be prepared individually.
• You will submit a report of about 1200 to 1500 words. Submit in Word format (not

Pdf or Pages).
• Your main task for this case is to recommend a viable strategy for Urban Axes.

Case Purchase

We are using a Ivey case this term – Urban Axes. You will need to register as a student
and then access the Course pack for the case. The case costs $4.50 CAD. Do NOT share
your case – this is a copyright violation. I will be checking the course pack list and will
only mark cases from students who have completed the case purchase.

1. Go to the Ivey Publishing website at www.iveycases.com
2. Log in to your existing account or click “Register” to create a new account and follow

the prompts to complete the registration. If registering, choose the “Student User”
role.

3. Click on this link or copy into your browser:
https://www.iveycases.com/CoursepackView.aspx?id=29215

4. Click “Add to Cart”.
5. You may choose to order in either print or digital format.

o To order the material in digital format, check “digital download” and click
“OK”.

o To order a printed copy for delivery, enter the print quantity required and
click “OK”. Please note that shipping charges will apply.

6. Go to the Shopping Cart (located at the top of the page), click “Checkout”, and
complete the checkout process.

7. When payment has been processed successfully, an Order Confirmation will be
emailed to you immediately and you will see the Order Confirmation screen.

o If you ordered digital copies: Click “Download your Digital Items” or go to
“My Orders” to access the file.

o If you ordered printed copies: Your order will be printed and shipped within
2 to 3 business days.

You can contact Ivey Publishing during business hours if there are any issues accessing the

content, and you can also let me know.

Ivey Publishing: e. [email protected]

t. 519.661.3208 | tf. 800.649.6355

www.iveycases.com

https://www.iveycases.com/

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https://www.iveycases.com/RegisterUser.aspx

https://www.iveycases.com/Coursepackview.aspx?id=29215

mailto:[email protected]

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BUS 290 Case Study S21

Case Preparation Procedure

This is how to analyze the case, NOT how to write up or organize the written report. Refer
to the “Preparing a Case Study: General Guidelines” (on our D2L) for greater detail on case
preparation.

1. Identify the problem(s) or issue(s).

2. Analyze the case data.

a. Identify the constraints or considerations given.
b. Gather pertinent information (from the case) and perform analysis.

i. Remember to carefully analyze the financial information and other
numbers provided.

ii. Consider any available information from the 4 Cs (Company, Consumer,
Channel, Competition) and TREES (Technology, Regulatory, Ecological,
Economic, and Social/Cultural).

iii. Consider the resources, people, and process information provided.
iv. Figure out a SWOT.

Hint: When you are working through the case, some particular things to consider
are:

• What external factors affect Urban Axes’ competitive position? How do these
factors affect the strategy? You may think about using the Five Forces as a tool
for the analysis.

• What generic business strategy has Urban Axes chosen to pursue?
• What are Urban Axes’ resources? How is Urban Axes’ strategy affected by its

resources?

3. Generate the alternatives. Some are given in the case, but you may come up with others.
4. Decide how you are going to make your decision when evaluating alternatives. What

are the most important criteria? Which are less important?

5. Analyze and evaluate the alternatives according to the criteria you have chosen.

Make sure that you have addressed the following considerations:

a. Does the chosen alternative fit the SWOT?
b. What are the positives and negatives of the strategy you are pursuing?

6. Select the preferred alternative. Justify your choice.

7. Develop the action plan

a. What are the specifics to the implementation?
b. Consider resources required, timelines.

BUS 290 Case Study S21

Structure of the Written Report

1. Title page
2. Introduction and Summary of Key Facts
3. Data Analysis
4. Problem (Issue) Statement
5. Alternative Generation
6. Key Decision Criteria and Constraints
7. Alternative Analysis
8. Recommendations
9. Action and Implementation
10. Exhibits and Calculations (if merited)

Preparing A Case Study

It helps to have a system when sitting down to prepare a case study as the amount of

information and issues to be resolved can initially seem quite overwhelming. The following is

a good way to start:

This task consists of two parts:

1. A detailed reading of the case, and then
2. Analyzing the case.

When you are doing the detailed reading of the case study, look for the following sections:

1. Opening paragraph: introduces the situation.
2. Background information: industry, organization, products, history, competition,

financial information, and anything else of significance.

3. Specific (functional) area of interest: marketing, finance, operations, human
resources, or integrated.

4. The specific problem or decision(s) to be made.
5. Alternatives open to the decision maker, which may or may not be stated in the case.
6. Conclusion: sets up the task, any constraints or limitations, and the urgency of the

situation.

Most, but not all case studies will follow this format. The purpose here is to thoroughly

understand the situation and the decisions that will need to be made. Take your time, make

notes, and keep focussed on your objectives.

Analyzing the case should take the following steps:

1. Defining the issue(s)
2. Analyzing the case data
3. Generating alternatives
4. Selecting decision criteria
5. Analyzing and evaluating alternatives
6. Selecting the preferred alternative
7. Developing an action/implementation plan

Defining the issue(s)/Problem Statement

The problem statement should be a clear, concise statement of exactly what needs to be

addressed. This is not easy to write! The work that you did in the short cycle process

answered the basic questions. Now it is time to decide what the main issues to be addressed

are going to be in much more detail. Asking yourself the following questions may help:

1. What appears to be the problem(s) here?
2. How do I know that this is a problem? Note that by asking this question, you will

be helping to differentiate the symptoms of the problem from the problem itself.

Example: while declining sales or unhappy employees are a problem to most

companies, they are in fact, symptoms of underlying problems which need to

addressed.

3. What are the immediate issues that need to be addressed? This helps to
differentiate between issues that can be resolved within the context of the case, and

those that are bigger issues that needed to addressed at a another time (preferably by

someone else!).

4. Differentiate between importance and urgency for the issues identified. Some
issues may appear to be urgent, but upon closer examination are relatively

unimportant, while others may be far more important (relative to solving our problem)

than urgent. You want to deal with important issues in order of urgency to keep

focussed on your objective. Important issues are those that have a significant effect

on:

1. profitability,
2. strategic direction of the company,
3. source of competitive advantage,
4. morale of the company’s employees, and/or
5. customer satisfaction.

The problem statement may be framed as a question, eg: What should Joe do? or How can Mr

Smith improve market share? Usually the problem statement has to be re-written several

times during the analysis of a case, as you peel back the layers of symptoms or causation.

Analyzing Case Data

In analyzing the case data, you are trying to answer the following:

1. Why or how did these issues arise? You are trying to determine cause and effect for
the problems identified. You cannot solve a problem that you cannot determine the

cause of! It may be helpful to think of the organization in question as consisting of the

following components:

1. resources, such as materials, equipment, or supplies, and
2. people who transform these resources using
3. processes, which creates something of greater value.

Now, where are the problems being caused within this framework, and why?

2. Who is affected most by this issues? You are trying to identify who are the relevant
stakeholders to the situation, and who will be affected by the decisions to be made.

3. What are the constraints and opportunities implicit to this situation? It is very rare
that resources are not a constraint, and allocations must be made on the assumption

that not enough will be available to please everyone.

4. What do the numbers tell you? You need to take a look at the numbers given in the
case study and make a judgement as to their relevance to the problem identified. Not

all numbers will be immediately useful or relevant, but you need to be careful not to

overlook anything. When deciding to analyze numbers, keep in mind why you are

doing it, and what you intend to do with the result. Use common sense and

comparisons to industry standards when making judgements as to the meaning of your

answers to avoid jumping to conclusions.

Generating Alternatives

This section deals with different ways in which the problem can be resolved. Typically, there

are many (the joke is at least three), and being creative at this stage helps. Things to

remember at this stage are:

1. Be realistic! While you might be able to find a dozen alternatives, keep in mind that
they should be realistic and fit within the constraints of the situation.

2. The alternatives should be mutually exclusive, that is, they cannot happen at the same
time.

3. Not making a decision pending further investigation is not an acceptable decision
for any case study that you will analyze. A manager can always delay making a

decision to gather more information, which is not managing at all! The whole point to

this exercise is to learn how to make good decisions, and having imperfect

information is normal for most business decisions, not the exception.

4. Doing nothing as in not changing your strategy can be a viable alternative, provided
it is being recommended for the correct reasons, as will be discussed below.

5. Avoid the meat sandwich method of providing only two other clearly undesirable
alternatives to make one reasonable alternative look better by comparison. This will

be painfully obvious to the reader, and just shows laziness on your part in not being

able to come up with more than one decent alternative.

6. Keep in mind that any alternative chosen will need to be implemented at some point,
and if serious obstacles exist to successfully doing this, then you are the one who will

look bad for suggesting it.

Once the alternatives have been identified, a method of evaluating them and selecting the

most appropriate one needs to be used to arrive at a decision.

Key Decision Criteria

A very important concept to understand, they answer the question of how you are going to

decide which alternative is the best one to choose. Other than choosing randomly, we will

always employ some criteria in making any decision. Think about the last time that you make

a purchase decision for an article of clothing. Why did you choose the article that you did?

The criteria that you may have used could have been:

1. fit
2. price
3. fashion
4. colour
5. approval of friend/family
6. availability

Note that any one of these criteria could appropriately finish the sentence, the brand/style

that I choose to purchase must…. These criteria are also how you will define or determine

that a successful purchase decision has been made. For a business situation, the key decision

criteria are those things that are important to the organization making the decision, and they

will be used to evaluate the suitability of each alternative recommended.

Key decision criteria should be:

1. Brief, and often in point form, such as
1. improve (or at least maintain) profitability,
2. increase sales, market share, or return on investment,
3. maintain customer satisfaction, corporate image,
4. be consistent with the corporate mission or strategy,
5. within our present (or future) resources and capabilities,
6. within acceptable risk parameters,
7. ease or speed of implementation,
8. employee morale, safety, or turnover,
9. retain flexibility, and/or
10. minimize environmental impact.

2. Measurable, at least to the point of comparison, such as alternative A will improve
profitability more that alternative B.

3. Be related to your problem statement, and alternatives. If you find that you are talking
about something else, that is a sign of a missing alternative or key decision criteria, or

a poorly formed problem statement.

Students tend to find the concept of key decision criteria very confusing, so you will probably

find that you re-write them more than once as you analyze the case. They are similar to

constraints or limitations, but are used to evaluate alternatives.

Evaluation of Alternatives

If you have done the above properly, this should be straightforward. You measure the

alternatives against each key decision criteria. Often you can set up a simple table with key

decision criteria as columns and alternatives as rows, and write this section based on the

table. Each alternative must be compared to each criteria and its suitability ranked in some

way, such as met/not met, or in relation to the other alternatives, such as better than, or

highest. This will be important to selecting an alternative. Another method that can be used is

to list the advantages and disadvantages (pros/cons) of each alternative, and then discussing

the short and long term implications of choosing each. Note that this implies that you have

already predicted the most likely outcome of each of the alternatives. Some students find it

helpful to consider three different levels of outcome, such as best, worst, and most likely, as

another way of evaluating alternatives.

Recommendation

You must have one! Business people are decision-makers; this is your opportunity to practice

making decisions. Give a justification for your decision (use the KDC’s). Check to make sure

that it is one (and only one) of your Alternatives and that it does resolve what you defined as

the Problem.

Structure of the Written Report

Different Instructors will require different formats for case reports, but they should all have

roughly the same general content. For this course, the report should have the following

sections in this order:

1. Title page
2. Intro & Summary of Key Facts
3. Problem (Issue) statement – What is (are) the problem(s) that require attention?
4. Data analysis – discuss why these problems occurred.
5. Alternative Generation (a solution set)
6. Identify any key decision criteria. When several options exist –how are you going

to decide between different solutions?

7. Alternative analysis – often the use of a chart or matrix is a common element
here.

8. Recommendations
9. Action and Implementation Plan (not always needed – especically in short cases)
10. Exhibits (again – only if needed)

Notes on Written Reports:

Always remember that you will be judged by the quality of your work, which includes your

written work such as case study reports. Sloppy, dis-organized, poor quality work will say

more about you than you probably want said! To ensure the quality of your written work,

keep the following in mind when writing your report:

1. Proof-read your work! Not just on the screen while you write it, but the hard copy
after it is printed. Fix the errors before submitting.

2. Use spell checker to eliminate spelling errors
3. Use grammar checking to avoid common grammatical errors such as run on

sentences.

4. Note that restating all case info is not included in the format of the case report, nor is
it considered part of analysis. Anyone reading your report will be familiar with the

case/ You need only to mention facts that are relevant to (and support) your analysis

or recommendation as you need them.

5. If you are going to include exhibits (particularly numbers) in your report, you will
need to refer to them within the body of your report, not just tack them on at the end!

This reference should be in the form of supporting conclusions that you are making in

your analysis. The reader should not have to guess why particular exhibits have been

included, nor what they mean. If you do not plan to refer to them, then leave them out.

6. Write in a formal manner suitable for scholarly work, rather than a letter to a friend.
7. Common sense and logical thinking can do wonders for your evaluation!
8. You should expect that the computer lab’s printer will not be functioning in the

twelve hours prior to your deadline for submission. Plan for it!

9. Proof-read your work! Have someone else read it too! (particularly if english is not
your first language) This second pair of eyes will give you an objective opinion of

how well your report holds together.

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