Business Management Foundations

Introduction to Organizations and Strategy | 2018-19

This Course sets the stage for learning about how business works. Beginning with an understanding of what an organization is and its basic purposes, topics will include vertical and horizontal integration, diversification, the managerial role, designing incentive plans, business strategy, the central importance of “value” in a business context, and the concept of industry attractiveness.


Prof. Ian Larkin

Prof. Ian Larkin


Ian Larkin is an Assistant Professor in the Strategy group at the UCLA Anderson School of Management. He researches the optimal use of formal rewards systems by companies, given the complex and often unanticipated effects these systems have on employee motivation and decision making. His research quantifying the cost incurred by a major enterprise software vendor due to salespeople deliberately gaming their sales commission system, published in The Journal of Labor Economics, is one of the most prominently cited empirical studies of incentive system gaming. It was the basis for a case study widely used in MBA classes on compensation and human resource management.

His recent research focuses on corporate awards and other programs companies use to formally recognize employee performance, and demonstrates that these programs often have unintended costs, such as the demotivation of some employee groups. A final stream of research investigates physician prescribing decisions in light of different sales tactics used by pharmaceutical sales representatives. His research has been discussed in a variety of media outlets including The Wall Street Journal, The New York Times, Forbes and National Public Radio.

Ian teaches the core Business Strategy course at Anderson. Before coming to Anderson, he was a member of the faculty at Harvard Business School, where he taught an elective MBA course on human resource management, as well as several executive education courses. He received a Ph.D. from the Haas School of Business at UC Berkeley, and a M.Sc. from the University of London, where he was a British Marshall Scholar. Ian worked as an Associate and Engagement Manager for McKinsey and Company, based in Hong Kong and Silicon Valley.

Ian’s hobbies include cooking, traveling and supporting the Green Bay Packers.

Prof. Phillip Leslie

Prof. Phillip Leslie


Phillip is a business economist with expertise in strategic management, the applied econometrics of data analytics, demand pricing and information disclosure. His work on pricing has examined how firms can implement practical strategies for consumer-specific pricing. Much of this work has been in the context of event ticketing, making Phillip a leading expert on ticket pricing.

Phillip has also written a series of papers on information disclosure as a policy tool. For example, in one study he shows that restaurant hygiene grade cards caused a 20% decrease in the number of people admitted to hospital with food-related illnesses. Another study shows that consumers at Starbucks reduced calorie purchases by 6% due to calorie posting on the menus.

In other research, Phillip has written about managerial incentives in private equity, consumer boycotts, inspection design and the behavior of inspectors, and the returns to education. His research is published in the American Economic Journal, American Economic Review, Journal of Labor Economics, Quantitative Marketing and Economics, Quarterly Journal of Economics and the RAND Journal of Economics.

Phillip is a Research Associate of the National Bureau of Economic Research. At Anderson he teaches strategic management and he is an experienced executive education teacher.


Ph.D. Economics, 1999, Yale University

M.Phil. Economics, 1996, Yale University

M.A. Economics, 1994, Yale University

  1. Comm. Economics, Honors 1993, University of Melbourne
  2. Comm. Economics, First Class Honors 1991, University of Melbourne

Course Learning Objectives:

By the end of this course, you will be able to:

  • Determine a company’s profit, using such key business concepts as input costs, transformation, total cost, price, willingness to pay, and value.
  • Make intelligent decisions about horizontal and vertical integration involving your business.
  • Use a comprehensive business strategy to intentionally create, capture, and deliver value to your company and your customers.


Introduction to Organizations, Part 1 Module Learning Objectives: As a result of participating in this module, you will be able to:

  • Explain the value of an organization in terms of how it manages resources and transforms inputs into more valuable outputs.
  • Evaluate a potential diversification opportunity that involves a key resource’s appropriability, control, durability, and inimitability.
  • Determine the best course of action for a company that is considering vertical/horizontal integration or geographic diversification.

Module Components:

  • Video Lecture 1: What Is an Organization?
  • Video Lecture 2: Organizational Scope and Horizontal Diversification
  • Video Lecture 3: Vertical and Horizontal Integration and Geographic Diversification
  • Reading 1: A Customer Value Creation Framework for Businesses That Generate Revenue with Open Source Software
  • Reading 2: Horizontal Integration
  • Reading 3: Vertical Integration
  • Assignment: Case Study on Drastic Publishing
  • Check for Understanding Assessment
Introduction to Organizations, Part 2 Module Learning Objectives: As a result of participating in this module, you will be able to:

  • Evaluate managerial applicants’ mindsets for the following qualities: communication skills, motivation, and ability to learn and adjust.
  • Determine appropriate coaching steps for employees who exhibit various levels of performance and potential.
  • Design an effective and appropriate disciplinary action plan that is timely, rule-based, and includes managerial action.

Module Components:

  • Video Lecture 1: The Role of the Manager
  • Video Lecture 2: Incentive Design, Part 1
  • Video Lecture 3: Incentive Design, Part 2
  • Reading 1: Mintzberg’s Management Roles
  • Reading 2: Motivation Is All About the Managers … Duh!
  • Reading 3: Misconduct & Discipline
  • Assignment: Case Study on Drastic Publishing, continued
  • Check for Understanding Assessment
Introduction to Strategy, Part 1 Module Learning Objectives: As a result of participating in this module, you will be able to:

  • Compose a draft strategy statement for a start-up company, stating how it will create, capture, and deliver value.
  • Based on research, create a value map comparing the relative strengths of two competitors that shows six to eight characteristics.
  • Adjust Total Cost, Price, and Firm Profit for a specific customer, focusing on capturing maximum value.

Module Components:

  • Video Lecture 1: What Is Strategy?
  • Video Lecture 2: Creating Value
  • Video Lecture 3: Capturing Value
  • Reading 1: Crafting Strategy that Measures Up
  • Reading 2: Porter’s Generic Strategies
  • Reading 3: Akbank in Brief
  • Reading 4: The Value Proposition
  • Assignment: Case Study on Drastic Publishing, continued
  • Check for Understanding Assessment
Introduction to Strategy, Part 2 Module Learning Objectives: As a result of participating in this module, you will be able to:

  • Use Five Forces Analysis to determine the attractiveness of a given industry.
  • Build on an existing draft to refine a strategy statement so that it expresses in detail how the company is unique in its approach to creating, capturing, and delivering value.
  • Propose at least one way to improve the situation so as to deliver more value, given circumstances describing how a company is failing to deliver maximum value to its customers.

Module Components:

  • Video Lecture 1: Industry Attractiveness
  • Video Lecture 2: Strategy Articulation
  • Video Lecture 3: Delivering Value
  • Reading 1: Rethinking Strategy for an Age of Digital Disruption: A Conversation with Philip Evans
  • Reading 2: Porter’s Five Forces Model
  • Assignments: Case Study on Drastic Publishing, continued
  • Check for Understanding Assessment


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