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HEART TO HEART ON ABP

Kolade Adetoro Written by Kolade Adetoro · 2 min read >

The highlight for this week for any MBA’21 student must have been Analysis of business problems (ABP). Not just because we had the course about five times this week but also because of the rigorous case assignments we had to analyze within a short time frame for submission. Some of the top cases were Micodern and Mountain Man Brewing Company (MMBC). We also had a course feedback to gauge our understanding of the course with the facilitator.

Micodern was a case about a company called Lidern in Spain who had a product called Micodern which was on a price regulating scheme of the government (SRSS) had started making losses due to some increase in maufacturing cost. The drugs on the price regulating scheme of the government (SRSS) were treatment drugs used in public health centers  were administered to patients by prescription only and was heavily discounted between 60%-100%. The working-class citizens got 60% off the price drugs in public health centers while the elderly or retired citizens got it free. Hence, this made the government set the stipulated price the manufacturers will sell after reviewing the manufacturing cost.  In this case, the last price review attempted by the company to increase the selling price to the government had failed. So the company had to decide if to remain their position on the regulating scheme of the government (this was were most of their sales came from), apply for a price review a second time ( this could either be positive i.e the price is increased or denied again and have their position on the scheme reviewed) and lastly maintain status quo till the company can no longer bear the losses. This was a big decision because this would affect the revenue of the drug. It either gets better or drastically worse. After careful analysis of the alternatives based on the data in the case, we reached a decision the company should approach the government a second time for a price review as this was the only positive step to solving the problem while still increasing revenue.

Case 2 was about a beer brewing company located in west Virginia In America called Mountain Man. The company was a family-owned business that had been in existence for over 50 years. Due to its distinct bitter taste and higher alcohol content, Mountain Man Lager was the top beer in the territory they were based and this had been sustained for the lifetime of operation of the company. The main drinkers of Mountain Man Lager were blue collar job men within the ages of 35-55 years. In recent times, the company started recording some losses in the sales of their product due to a change in customer preference. Chris Prangel, the son of Oscar Prangel the owner of MMBC has proposed the company launched Mountain Man Light a light beer which was fast gaining grounds at the time while regular beer was experiencing an overall down time in the brewing industry. He had to prove to the board and father especially who was reluctant to introducing a new product due to the fact that it would have a great effect on the brands image which it had preserved for decades. After careful analysis of factors affecting the product launch and the data in the case. It was best to go for launch as light beer was the future in the brewing industry and this was certain to keep the company afloat in years to come. 

The summary provided on these cases might make it seem easy and straight to the point but this was far from the realty. The class was not able to completely solve any of these cases most especially the financial analysis aspect and we had to wait for the facilitator to review the cases in class. This then prompted class feedback on our understanding of the course and about 80% of the class population admitted to struggling with analyzing the financial data in cases. The facilitator than encouraged us on how to go about it and mentioned we kept on practicing as this will help us a great deal. 

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Written by Kolade Adetoro
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