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Facebook is gearing up to befriend investors. That, at least, is the chatter around Silicon Valley after the social networking darling booted its chief financial officer. But an IPO would be risky given Facebook’s business model is still unproven – unless it has a gun to its head.

Source: WSJ

Date: 4/02/2009

Keys: finance, management, investment, stock market, marketing

Link: http://money.cnn.com/2009/04/02/technology/facebook_ipo.breakingviews/index.htm?postversion=2009040214

Questions for discussion:

  • What reasons might explain Facebook’s current owners’ motivation to become a public company?
  • What similarities are there between Facebook today and Google just before it went public?
  • How can you explain the valuation stated for Facebook ownership, given its current financial condition?
  • Do you think Facebook would be as good a stock performer as Google has been since it went public?
  • Explain your thinking in terms of profits, market share, advertising revenues etc.

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Fortune’s Alex Taylor III says GM’s former CEO didn’t execute needed drastic changes.

Source: CNN – video report

Date: 3/31/2009

Keys: Management , leadership, decision-making, organizational re-structuring, government

Link:  http://money.cnn.com/video/news/2009/03/31/fortune.sl.taylor.gm.033109.fortune/index.html

Questions for discussion:

  • Do you agree with the Taylor’s analysis and explanation of GM’s failure?
  • Would you have kept Rick Wagoner as head decision-maker?
  • Does GM need a financial leader or a marketing leader more?
  • What would you do to rejuvenate GM?

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I.B.M.’s interest in acquiring the server computer maker Sun Microsystems for nearly $7 billion may seem at first to be a reversal of its recent efforts to move away from the hardware business. But analysts say there is more to Sun than servers, which are used in corporate data centers. They say its strengths in software, systems design and research make it an attractive target.

Source: NYTimes

Date: 3/18/2009

Keys: mergers and acquisitions, marketing, finance

Link: http://www.nytimes.com/2009/03/19/technology/companies/19sun.html

Questions for discussion:

  • Do you think the acquisition makes strategic sense for IBM? For Sun Microsystems?
  • What does each party gain by the merging of their resources into a larger market player?
  • Do you think that IBM  will be seen as a greater threat by competitors than before this merger?

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The food industry’s self-policing system failed to catch poor conditions at a peanut processing plant blamed for a nationwide salmonella outbreak, lawmakers said Thursday. The House Energy and Commerce investigations subcommittee released new documents and pictures Thursday that attested to long-standing sanitary problems at facilities owned by Lynchburg, Va.-based Peanut Corp. of America. The company is at the center of a nationwide outbreak that has sickened nearly 700 people and is being blamed for at least nine deaths.

Source: WSJ

Date: 3/19/2009

Keys: operations management, ethical and legal issues, government

Link: http://online.wsj.com/article/SB123746051155183071.html

Questions for discussion:

  • Do you think government agencies or the businesses in an industry should be responsible for the control of the nation’s food supply?
  • What would you suggest is a better approach than the current system?
  • Should the business people involved at Peanut Corp. be held legally accountable for damages caused by their business practices?

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How did the largest insurance company in the world fall apart? Who’s to blame? Watch Poppy Harlow’s attempt to explain the decisions being made by managers, investors and governments.

Source: CNN – video report

Date: 3/16/2009

Keys: Finance, stock markets, banking, insurance, government

Link:  http://money.cnn.com/video/news/2009/03/16/news.031609.maloney.cnnmoney/

Questions for discussion:

  • Should governments let the stock market sort out the financial problems at AIG?
  • How concerned should the general public be about the decisions being made today to support AIG and other failing institutions?