Harvard Case - Dilemma at Devil's Den
"Dilemma at Devil's Den" Harvard business case study is written by Kim Johnson, Allan Cohen. It deals with the challenges in the field of Social Enterprise. The case study is 3 page(s) long and it was first published on : Jan 1, 2000
At Fern Fort University, we recommend that Devil's Den adopt a hybrid organizational structure, incorporating elements of both a for-profit and a non-profit entity. This structure will allow the organization to leverage its unique strengths, including its strong community ties and its commitment to environmental sustainability, while maximizing its impact and financial stability.
2. Background
Devil's Den is a popular tourist attraction in the Ozark Mountains, facing a dilemma of balancing its economic viability with its environmental and social responsibilities. The organization, currently a non-profit, is struggling financially, leading to potential closure and job losses. However, the closure would negatively impact the local community and the environment, as Devil's Den is a vital economic and ecological resource.
The main protagonists of the case are:
- Mark Miller: The Executive Director of Devil's Den, grappling with the organization's financial challenges and seeking a sustainable solution.
- The Board of Directors: Responsible for overseeing the organization's operations and making strategic decisions.
- The Local Community: Reliant on Devil's Den for employment, economic activity, and environmental preservation.
3. Analysis of the Case Study
Strategic Framework: We will analyze the case using the Triple Bottom Line framework, considering the organization's social, environmental, and economic performance.
Social Impact: Devil's Den plays a crucial role in the local community, providing jobs, supporting local businesses, and preserving natural resources. Closure would have a significant negative impact on the community's well-being.
Environmental Sustainability: Devil's Den is a unique natural resource, home to diverse flora and fauna. Its closure would threaten the ecosystem and potentially lead to habitat loss.
Economic Viability: The organization is currently facing financial challenges, with declining visitor numbers and rising operating costs. This situation necessitates a strategic approach to ensure long-term sustainability.
Analysis:
- Limited Funding: Devil's Den's reliance on grants and donations is insufficient to cover its operational expenses.
- Competition: The tourism industry is competitive, and Devil's Den faces pressure from other attractions.
- Lack of Diversification: The organization's revenue stream is primarily dependent on visitor fees, making it vulnerable to economic fluctuations.
- Sustainability Concerns: Balancing visitor access with environmental protection is a constant challenge.
4. Recommendations
Hybrid Organizational Structure:
- For-Profit Division: Establish a for-profit division focusing on revenue generation through tourism activities, including expanded visitor experiences, merchandise sales, and partnerships with local businesses.
- Non-Profit Division: Maintain the existing non-profit division dedicated to environmental conservation, community outreach, and educational programs.
- Shared Resources: The two divisions will share resources, such as infrastructure, staff, and marketing efforts, to achieve operational efficiency and synergy.
Strategic Initiatives:
- Marketing and Branding: Develop a comprehensive marketing strategy to attract a wider audience, including families, adventure seekers, and nature enthusiasts.
- Innovation and Diversification: Introduce new visitor experiences, such as guided tours, educational workshops, and eco-friendly activities.
- Partnerships: Collaborate with local businesses, NGOs, and government agencies to create joint initiatives and leverage resources.
- Sustainability Practices: Implement sustainable practices across all operations, including waste reduction, energy efficiency, and responsible resource management.
- Social Impact Measurement: Develop metrics to track and measure the organization's social and environmental impact, demonstrating its value to stakeholders.
5. Basis of Recommendations
Core Competencies and Mission Consistency: The hybrid structure aligns with Devil's Den's core competencies in environmental conservation and tourism, while ensuring its financial sustainability.
External Customers and Internal Clients: The proposed initiatives cater to the needs of visitors, local businesses, and the broader community.
Competitors: The marketing and innovation strategies aim to differentiate Devil's Den from competitors and attract a wider audience.
Attractiveness: The hybrid structure and strategic initiatives are expected to generate increased revenue, improve financial stability, and enhance the organization's long-term viability.
Assumptions:
- The local community will support the hybrid model and its initiatives.
- The organization will successfully implement the proposed marketing and innovation strategies.
- Partnerships with other organizations will be mutually beneficial.
6. Conclusion
Adopting a hybrid organizational structure and implementing strategic initiatives will enable Devil's Den to achieve its social, environmental, and economic goals. This approach will ensure the organization's long-term sustainability while maximizing its impact on the local community and the environment.
7. Discussion
Alternatives:
- Complete Closure: This option would result in job losses, economic decline, and environmental damage.
- Remaining a Non-Profit: This option would require significant fundraising efforts and potentially limit the organization's ability to invest in growth and innovation.
Risks:
- Financial Risk: The hybrid model requires careful financial planning and management to ensure success.
- Operational Risk: Integrating the for-profit and non-profit divisions requires effective coordination and communication.
- Reputation Risk: The organization must carefully manage its brand image and ensure that its commercial activities align with its mission.
Key Assumptions:
- The local community will support the hybrid model.
- The organization will successfully implement the proposed initiatives.
- Partnerships with other organizations will be mutually beneficial.
8. Next Steps
- Develop a detailed business plan: Outline the financial projections, marketing strategy, and operational plan for the hybrid structure.
- Seek stakeholder input: Engage with the local community, board members, and other stakeholders to gather feedback and support.
- Secure funding: Explore funding options, including grants, investments, and partnerships.
- Implement the hybrid model: Phase in the new structure and initiatives, monitoring progress and making adjustments as needed.
Timeline:
- Months 1-3: Develop business plan, secure funding, and engage stakeholders.
- Months 4-6: Implement the hybrid model, including the for-profit division and strategic initiatives.
- Months 7-12: Monitor progress, make adjustments, and evaluate the impact of the hybrid structure.
By taking these steps, Devil's Den can overcome its current challenges and become a thriving and sustainable organization, contributing to the well-being of the local community and the preservation of the environment.
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Case Description
This case deals primarily with ethics and the individual's personal system and the way it affects his or her perceptions and actions. It also looks at rewards and punishments and their influence on behavior. Susan is a student employee at a campus snack bar who is caught between a wish to do what she thinks is right--take steps to stop food being taken off the premises that hasn't been paid for--and fear of negative consequences if she takes such action. She would also like to see students work harder, finish what is assigned to them on the night shift, and be punished for stealing from the cash register. Almost all students have faced peer pressure to do things that violate their value systems. The case helps students to understand why they feel so much ambivalence, sometimes going along and sometimes setting limits. Some issues are ethical; others involve criminal behavior. Issues include sexual permissiveness and experimentation, drug use and dealing, cheating, trespassing, and stealing. The case also raises questions of a company's ethics and responsibility for creating, or allowing, a climate that tolerates at best, and encourages at worst, illegal, criminal, or unethical behavior.
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