Ibm-Play It Safe

HBR.ORG

HBR Case study

JANUARY–FEBRUARY 2012

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Play It Safe at Home,

Or Take a Risk

Abroad?

by Michael Chu

Case Study

Michael Chu is a senior lecturer at Harvard Business

School and a managing director of the IGNIA Fund,

a venture capital firm based in Monterrey, Mexico.

A U.S. lease-to-own chain considers whether

to test its business in Mexico. by Michael Chu

play it Safe at

Home, or take

A risk Abroad?

S

HBR’s fictionalized case studies present

dilemmas faced by leaders in real

companies and offer solutions from experts. This

one is based on the HBS Case Study “Aaron’s:

Household Goods for the U.S. Base of the

Pyramid” (case no. 311047) by Michael Chu and

Charles Smithgall, which is available at hbr.org.

2 Harvard Business Review January–February 2012

tan Windham walked into the newest Coe’s store in South Tucson. As

CEO of the lease-to-own chain, he

was eager to see how his 1,000th location

was performing. Aubrey Merrin, the store

manager, met him at the door.

“Mr. Windham, so good to see you, sir.

The new employees are real excited to

meet you. And of course I want to update

you on how everything’s going,” Aubrey

said as he ushered Stan inside. “We’re doing great so far. Open for less than a month

and over 100 customers already. It’s a real

good start, sir, a real good start.”

“You don’t have to call me ‘sir,’ Aubrey,”

Stan said, realizing it was probably hopeless. “Congratulations. I’ve said it before,

but I’ll say it again: I appreciate your taking this on.”

Aubrey had transferred from the Coe’s

up in Flowing Wells, where he’d been the

store manager for 10 years. He was raising

three kids on his own, and although this

location meant a slightly longer commute,

he’d jumped at the opportunity.

“I’m honored, sir, to be opening a brandnew store,” he said. “And with the economy as it is, I’m just happy to be working

for a growing company.” He pointed

up at the celebratory banner that...