Hasbro Interactive

Presented by: Emmanuel Ofobeze

Supervisor: Prof. Dr. Claire Purvis Controllership and Decision-making Systems University of Applied Sciences Fulda

24th May 2011

AGENDA
Companys History & Profile The Strategies of Hasbro Interactive Analysis of Hasbros MCS Hasbro Interactives Problems Recommendations

AGENDA
Companys History & Profile The Strategies of Hasbro Interactive Analysis of Hasbro Interactives MCS Hasbro Interactives Problems Recommendations

Companys History & Profile

Hasbro: American producer of toys in Rhode Island since 1923 Hasbro Interactive as wholly-owned subsidiary (1995) supplied video games short product life cycles strict dead lines to develop new products

AGENDA
Companys History & Profile The Strategies of Hasbro Interactive Analysis of Hasbro Interactives MCS Hasbro Interactives Problems Recommendations

The Strategies of Hasbro Interactive

1) Product Safety Concerns to toys of parent company Hasbro Nothing is more important than the safety and well-being of the children who enjoy our products. CEO Brian Goldner, company homepage Tests and investigations to protect children

The Strategies of Hasbro Interactive

2) Marketing Strategies Strict regulations concerning permitted time of advertising in children's TV Cartoon series produced to merchandise toys and games long-term business strategy: constant reinventing and reviving of the brand portfolio

The Strategies of Hasbro Interactive

3) Acquisition/Investing Strategies Takeover of competitors and licences Examples: Milton Bradley (1984), Tiger Electronics (1998), Atari's licences (1998) Result: expansion and enlarging of market shares in toys as well as video game sector

The Strategies of Hasbro Interactive

4) Social Engagement responsibility to the people that develop, manufacture and sell our products, the children and families that use our products, and the communities and environment
CEO Brian Goldner, company homepage

Example: name for the Hasbro Children's Hospital in Providence

AGENDA
Companys History & Profile The Strategies of Hasbro Interactive Analysis of Hasbro Interactives MCS Hasbro Interactives Problems Recommendations

Analysis of Hasbro Interactives Management Control Systems

Hasbro Interactivess MCS Result Control: performance target of reaching a total revenue of $ 200 million by the end of 1998 and $ 1 billion in the next 3 years + Bonuses Action Control Action Accountability: Mr. Baum held meetings on monthly basis with the head of business units to define and communicate to them which actions are acceptable or unacceptable Preaction Preview: all business units were made to report standard metrics known as value drives Tight Action Control: tighter supervision of Hasbro Interactive by Mr. Baum by hiring Charlie McCarty, a past colleague, to serve as Mr. Dusenberrys COO & Jackie Daya to monitor the financial systems

Result 1 Control

Action 2 Control

Tight Action Control 3

AGENDA
Companys History & Profile The Strategies of Hasbro Interactive Analysis of Hasbro Interactives MCS Hasbro Interactives Problems Recommendations

Hasbro Interactives Problems

Problems of Hasbro Interactive

Pressures from Wall street &1 corporate offices of Hasbro Inc.

Which risks are acceptable in2 reaching the $1 billion target

Operating with ambition, but 3 without a multiyear plan

4 Inefficient tight action control

AGENDA
Companys History & Profile The Strategies of Hasbro Interactive Analysis of Hasbro Interactives MCS Hasbro Interactives Problems Recommendations

Recommendations
Recommendations

Careful Selection of Managers: efficient and careful selection of management of Hasbro Interactive. Mr Dussenberry & another manager with expeience in finance & 1 strategic planing.

Autonomy in Decision making: have autonomy in setting of the standards & the result control because they understand the growth pace and the dynamics of the interactive 2 industry better than its corporate executives.

Budget Slack: there was clear information asymmetry between the Hasbro Interactive 3 and its management on which revenue target was plausible.

Conclusions
As conclusion: the benefit of having an independent management outweigh its cost.

Corporations should grant the managers of its subsidiaries great autonomy in discharging its managerial duties in order to promote flexibility & creativity

Thank you for your attention! I welcome your questions, suggestions, & comments!