FIN
665: Final Project Guidelines and Grading Guide
The
final project for this course is the creation of an Individual
Case Analysis. The primary objective of this project is for
students to understand how to analyze the capital structure of a company.
Students will also improve their understanding of some basic forms of debt
financing and learn to formulate strategies in structuring debt financing. The
case will also expose students to the process of debt rating and its
importance. Because of its international setting, the case provides an
excellent opportunity for students to obtain an understanding of international
capital markets and offshore offerings. Students will apply the case method
described in this document. They will define the problem, build an analysis
separating the important facts from the peripheral data, develop alternative
courses of action citing advantages and disadvantages, and make final
recommendations on policies that will maximize value for the business.
Main
Elements
Case
Method
The case
method is an important tool in educating managers by allowing students to bring
to life conceptual material that is often difficult to understand without
application, and aiding in integrating tools and theories students have learned
by applying them to relevant management decisions.
The
cases used in this course are a record of issues and problems actually faced by
business executives, with supporting facts, opinions, and financial data that
decisions were based on. These real-life situations are summarized by case
writers who provide you with all of the relevant information that was available
to the decision makers involved. If the information presented seems incomplete,
remember that this only mirrors the business world reality of decision making
with limited information. Obtaining more information costs time and money,
resources that are scarce in most situations.
Each
case, like each management situation, is unique. Since there is no one best
procedure for solving problems or making decisions, there are no right or wrong
answers in case analysis. Each class member will approach the case in a
different manner. However, the following procedure can serve as a rough guide
to your analysis which can be fine-tuned to personal preferences.
Procedure
1.
Read the Case. The first step is to get acquainted with
the situation. Read through the case quickly, getting a general feel for what
is going on. Who are the main players? What types of information are available
to you? Go back and reread the case carefully, paying particular attention to
case facts, figures, and diagrams. Be careful to separate symptoms and
problems. Case writers will often flag important issues by italics, headings,
or questions at the end of the case.
1.
Define the Problem. Put yourself in the place of the decision
makers in the case (managers, investors, debt holders, banks, employees, etc.).
What are the critical issues? Does one problem stand out as primary, with other
problems secondary or contingent upon it? Establish a time dimension to the
problems; which problems demand immediate action, and which are long-term or
strategic in nature? What critical assumptions are being made by the decision
makers in the case, and how do these assumptions influence their chosen strategies?
Try to state the problems so as to identify (a) who must take action, (b) why
action must be taken, and (c) when should action be taken.
1.
Build your Analysis. Gather the important facts and concepts in
the case, and discard unimportant or fringe issues and data. Build a theme for
your analysis, and establish the importance of the problems you have
identified. Incorporate your knowledge of cultural impact on the situation,
financial analysis, accounting techniques, marketing methods, economics, and human
behavior into your analysis. Put theory to work in your paper, by using
concepts from the readings and module overviews to analyze the problems and
issues and explain why they require responses by management.
2.
Develop Alternatives.
Examine the alternative courses of action that are available to the firm. Make
a list of the advantages and disadvantages of each. Don’t use “straw-man”
alternatives (those that are patently unfeasible or undesirable). Develop a few
well-reasoned responses that could solve the problems, and critically evaluate
them.
1.
Make a Recommendation. Based on your analysis of alternative
courses of action, choose the best and recommend course of action. Be specific
in your statements. How will your recommendation be implemented? Circle back
through the case to identify possible points of inconsistency between your
recommendation and case facts. What potential problems might crop up? How will
internal constituencies (e.g., management, employees) and external
constituencies (e.g., competitors, stockholders) react, and how will you handle
their responses? What assumptions have you made in developing your
recommendation?
Please
review Writing
and Revising/ Editing the Case Analysis for additional information on structuring a
case analysis.
Deliverable:
Case Write-Up
The
write-up must include the following items:
·
Title page containing case name and date
·
Brief summary of the business situation in the case
·
Identification of problems or issues
·
Analysis of the problems or issues including the nature of the
problems, causes of the problems, constraints, and related theories (framework
for your analysis)
·
List of alternatives for solving problems, including pros and
cons of each alternative
·
Your recommended alternative and clear reasoning for you
decision
·
Supporting spreadsheets or charts
·
References
Read
this Example
of Case Analysis Writing for an
example of a case analysis report from Ashford University.
Since
most cases used in the class require a composite of careful thinking,
conceptualization, quantitative analysis, and some form of decision making,
your comments will be evaluated based on breadth and depth of your thought
process demonstrated in your discussion. While you should put the problem in a
context, you should not merely repeat case facts. You will get credit for only
meaningful and high quality analysis.
Hutchison
Whampoa Limited: The Capital Structure Decision
Obtain
the Hutchison Whampoa Case from Harvard Business Publishing Coursepack. After
reading the case, you are expected to submit a preliminary case analysis report
(progress report) at the end of Module Five and a final case analysis report at
the end of Module Ten. You are highly encouraged to utilize the Individual Case
Analysis Questions forum to help you with this task. To help you with the
analysis of this case, below are suggested questions for you to discuss on when
analyzing it. Note that while these questions are helpful, your reports should
not be written to answer these questions but to provide a full analysis of the
case.
Suggested
Questions
1.
What kind of capital structure would you propose to Hutchison
Whampoa in light of its future needs and why?
2.
What bond rating do you think Hutchison Whampoa will be able to
obtain from Standard and Poor’s?
3.
What are the debt financing options? Why you are for/against the
Yankee bond option?
4.
Assume Hutchison Whampoa will require $1 million USD of
financing in 1996. Assume that new equity can be raised at $48.8 a share and
that a long-term debt issue will carry an interest cost of HIBOR plus 70 basis
points (bps). How would an equity or debt issue impact Hutchison’s financial
position and performance?
Format
In 8-4
Final Project: Milestone Two: you will submit a rough draft. The draft
should contain the work from the progress report, reflecting the incorporation
of the previous feedback. In addition, the identification and the evaluation of
alternatives for solving problems as well as the recommended courses of action
should be included in this rough draft. Be sure to provide convincing
arguments, supporting information, and spreadsheet analysis to support your
views and recommendations. The draft should be 8–10 pages, not including
tables, charts, and references.
Final
Project Rubric
Requirements
of submission: Written
components of projects must follow these formatting guidelines when applicable:
double spacing, 12-point Times New Roman font, one-inch margins, and APA-style
citations.Your case
write-ups should be approximately 8-10 pages long including charts and figures.
Instructor
Feedback: Students can find their feedback in the grade book as an
attachment.
|
Critical Elements
|
Exemplary
|
Proficient
|
Needs Improvement
|
Not Evident
|
Value
|
|
Identification of
the
Main Issues/ Problems
|
Demonstrates a clear and deep
understanding of main issues/problems in the case study
(18-20)
|
Demonstrates deep
understanding of main issues/problems in the case study
(16-17)
|
Demonstrates limited
understanding of main issues/problems in the case study
(14-15)
|
Demonstrates superficial
understanding of main issues/problems in the case study
(0-13)
|
20
|
|
Analysis of the
Issues/Problems
|
Makes appropriate,
insightful, and powerful connections between the issues/problems and the
theory. Relevant financial analysis is applied properly
(18-20)
|
Makes appropriate and
insightful connections between the issues/problems and the theory. Relevant
financial analysis is applied
(16-17)
|
Makes appropriate but somewhat
vague connections between the issues/problems and the theory. Inadequate
financial analysis is applied
(14-15)
|
Makes little or no connection
between the issues/problems and the theory. No relevant financial analysis is
applied
(0-13)
|
20
|
|
Identification and Evaluation
of Alternatives
|
Identifies a comprehensive
set of thoughtful alternatives. Pros and cons for alternatives are provided.
Arguments are convincing, supported, and comprehensive
(18-20)
|
Identifies majority of alternatives.
Pros and cons for alternatives are provided. Most of the arguments are
convincing and supported.
May be
missing a few pros and/or cons
(16-17)
|
Identifies few alternatives.
Pros and cons for alternatives are provided. Arguments, however, are
insufficiently convincing and supported
(14-15)
|
Identifies few, if any,
alternatives. Missing
significant
discussion of
alternative
pros or cons
(0-13)
|
20
|
|
Recommendations
|
Makes realistic, appropriate,
and insightful recommendations clearly supported by the information presented
and the theory from the chapter
(18-20)
|
Makes realistic and
appropriate recommendations clearly supported by the information presented
and the theory from the chapter
(16-17)
|
Makes realistic or
appropriate recommendations supported by the information presented and the
theory from the chapter
(14-15)
|
Makes realistic or
appropriate recommendations with limited support from the information
presented and the theory from the chapter
(0-13)
|
20
|
|
Writing
(Mechanics/Citations)
|
Writing demonstrates
sophisticated clarity, conciseness, and correctness; includes thorough
details and relevant data and information; extremely well-organized. Uses APA
guidelines accurately and consistently to cite sources
(18-20)
|
Writing is accomplished in
terms of clarity and conciseness and contains only a few errors; includes
sufficient details and relevant data and information; well-organized. Uses
APA guidelines with minor violations to cite sources
(16-17)
|
Writing lacks clarity or
conciseness and contains numerous errors; gives insufficient detail and
relevant data and information; lacks organization. Reflects incomplete
knowledge of APA guidelines
(14-15)
|
Writing is unfocused,
rambling, or contains serious errors; lacks detail and relevant data and
information; poorly organized. Does not use APA guidelines
(0-13)
|
20
|
|
Total:
Comments:
|
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