Still tops in its niche, Best Buy is struggling to stay ahead of discount and online rivals. Who better to come up with creative business solutions than Skidmore students?
Can Skidmore save Best Buy?
“That’s your company,” business professor Caroline D’Abate ’93 told this spring’s teams and coaches in the MB 107 course. “Take a look at that stock value,” she said, pointing to a down-sloping line. “Yikes!” Then she asked, “Anyone want to guess what company that is?”
Turns out it’s Best Buy, the world’s largest consumer electronics chain, which had better-than-expected holiday-season sales but still faces an uphill battle to fend off discount and online rivals. Certainly, Best Buy isn’t sitting still. Maybe you saw its Super Bowl ad, starring actress Amy Poehler as a retail employee’s nightmare. Or heard that the company will match online prices beginning in March.
“Your job,” she informed the 120 students, “is to add 10% to Best Buy’s operating profits by year-end 2016. Coordinator of the introductory, case-study-based business course, now in its 31st year, D’Abate said, “We’ll have a dry run in mid-March. Then on April 26 at the Courtyard Marriott, you’ll be presenting your business plans to executives.”
At these presentations, the mostly first-year students get immediate feedback, including a grade, from real-life business execs like Christopher Graves, global CEO of Ogilvy PR; Deborah Monosson, president and CEO of Boston Financial & Equity; and David Marks, chief investment officer of Cuna Mutual Group. It’s intimidating and invigorating, and it’s a great introduction to the business world. “The relevance of this experience for our students is huge,” says D’Abate. “Whether from current students or alumni, I often get the same response: ‘I’m so glad I took that course.’”
Watch this video for an in-depth look at MB 107.
D’Abate’s faculty colleague Catherine Hamilton recommended that students use the “strategy diamond” of markets, customers, and geography. “Based on these three variables,” she said, “how do you differentiate a Sony TV at Best Buy from one on Amazon or at Walmart? That’s your challenge, and it’s a big one. Best Buy reminds me of Borders, and as you know it’s not in town anymore.”
“What’s the fundamental goal of every business and organization?” asked professor Mark Youndt. “To create value in the market place—the difference between willingness to pay and cost. One way or another, your team has to figure out how to increase the willingness to pay or create value.”
Rebecca McCourt ’14, one of the two student coordinators, along with Tyler Orfao ’13, had some more basic advice. “Put in the hard work now so you can get the most out of your dry run,” said the business major and computer science minor. “It’s easy to put off the work because the executive presentations seem so far away. But if you treat the dry run as the real thing, you’ll just have some minor tweaks, and you’ll have a great presentation.”