1. The World Wrestling Federation: Vince McMahon vs.

Bret 'the Hitman' Hart

Note: INSEAD used to offer free evaluation copies of their cases. They no longer do... Professional wrestling has been popular in North American for over a century, though mostly limited to small arenas and controlled by local promoters. It was Vince McMahon, head of an East Coast operation, the World Wrestling Federation (WWF), who made the sport a national enthusiasm in the 1980s. This was all to change in 1988, when Ted Turner and World Championship Wrestling (WCW) arrived on the scene. Thomas Mannarelli, Professor of Organizational Behavior, and Research Associate Christopher Baty, both of INSEAD, examine the changes in wrestling over the past twenty years, with a view towards understanding the ethical and managerial dilemmas faced by wrestling executives. This three-part case focuses on the WWF-WCW rivalry and explains why the appearance of the WCW brought McMahon into conflict with his top wrestler, Bret Hart. Part one traces the history of wrestling in North America, and discusses the phenomenal rise to success of the WWF in the 1970s and 1980s, as well as the ever-increasing challenge posed by Ted Turner's nascent WCW. Part two narrates the longstanding tensions between Hart and McMahon, and discloses the astonishing outcome of the 1997 Montreal match between Hart and Shawn Michaels, and its surprising impact on the WWF as whole. Finally, part three looks at what happened next, examining how McMahon manipulated the aftermath of the Hart-Michaels fight and Hart's subsequent departure from the WWF to boost ratings. It also explores Hart's brief career at WCW and the final conclusion of the decade-long WWF and WCW rivalry. The authors ask you to consider the factors of charismatic and transformational leadership as well as management ethics and integrity. The cases also outline the importance of innovation in entrepreneurship, the role of motivation in privately owned family business, and the debate over whether it is management or talent that drives a company's success.

WWF Case Study

1. Briefly describe the situation described in the case: a. The case basically describes the initial start-up and growth of the wrestling industry. At the beginning the McMahons had a perceived monopoly within the wrestling industry. Vince McMahon took the WWF, which his father began, and expanded it beyond any expectation. He created story lines and merchandise demand that help propel the WWF into the wrestling entertainment leader. Ted Turner worked with the WWF to broadcast the shows and he saw the demand and wanted a piece of the action. When Ted Turner approached McMahon to purchase some shares, Vince McMahon declined the offer. Ted Turner, known for going after what he wants, decided to go after the market created by the WWF and purchased the smaller operation that was sold by McMahon previously in Atlanta, Georgia. Turner hired Eric Bischoff and they both became extremely aggressive and tried to gain their own support for fans over the WWF. Bischoff created a different format that attracted more fans and negations took place that tried to lure old WWF wrestlers over to the new WCW create by Turner. Turner and Bischoff were also able to use the vast amount and levels of entertainment avenues that Ted Turner owned and had control over. The WCW expanded their time slot and became aggressive for the timing of the programming versus the WWF. Both programs tried to create their own characters and maintain the story lines to attract and maintain fans. The case study describes the process in the negotiations for Bret Harthis heart tells him to stay with the WWF, but they can no

longer afford him or write him into the story line. The WCW is willing to pay him what he desires, but Hart is more interested in the overall wrestling morale than a paycheck. 2. Review the latest news regarding the WWE: The World Wrestling Entertainment group has expanded and from the looks of their website, they have continued to utilize the model that was created by Vince McMahon. They continue to update fans on new storylines and characters and have voting polls on the website that let fans weigh-in on how they feel that things will shake out. Fans are able to buy tickets to tour appearancesthe WWE has created a tour that travels around the United States and fans can purchase tickets and see the wrestling tournaments live. At the event, fans are able to purchase all the memorabilia for their favorite WWE wrestler. The WWE has expanded their scope to bring the wrestling to the fans. They are also promoting with some more sexier ads by bringing in female wrestlers and characters, which help make the storylines more appealing to both sexes while creating an almost romantic twist with all the ups and downs with a love-triangle. 3. Evaluate the WWEs financial situation: The WWEs financial situation is performing well, as stated on their investor relations portion of their website. website. They are maintaining their portion of the ratings as well as bringing in the required money through merchandise that helps them regain their fan base and attract more consumers. They are looking to expand by adding a WWE cable network that will show wrestling all the time and will allow them to dictate how they want the story lines to progress and what they would like to show in regards to profanity and adult situations. 4. Evaluate the WWEs market situation: I have to say that I am a little confused about the market situation. I take it that the WWE is the old WWF since I saw that Steve Austin is with the WWE and he was with the WWF in the case study. I know that on the website the WWE had the big names, such as Steve Austin, The Rock, etc. I am not a wrestling fan, nor am I going to pretend like I can rattle off the names, but it looks as if they run the show for the wrestling entertainment. They have been able to take the acts on tour and they are able to maintain some expansion projects, such as having some of the wrestlers act in movies, on Saturday Night Live, etc. This helps reach out to fans who may not realize that they are fansthey may like the work that the wrestler is doing elsewhere and may be more willing to follow them in the wrestling career. Most people live for Monday night wrestling..However, there are many cable and TV outlets that now provide wrestling almost every night. This may be why the WWE is looking to create their own networkthe only problem with expanding is sometimes more is not always better. Fans may not enjoy the events as much because they are too accessible. 5. Do a SWOT analysis on the WWE: Strength: The WWE has a strong fan base and the fans are loyal to their particular favorite wrestler. The WWE has created some solid characters and the characters are able to withstand the storylines to maintain their fan base. The cable outlets also realize the importance and the money and access that wrestling can bring them. Cable outlets realize that the amount of people that are brought in to watch the wrestling can pay off big time for themespecially with advertisers. Weakness: The WWE may have some outside competition from some smaller operations. You can always find a wrestling match on some station when flipping through the stations during the evening.

The market may be over saturation and creating an abundance of wrestling activities. The WWE looks as if it has surpassed the WCW and some of the wrestlers that went to the WCW seem to be forgotten. Opportunities: The WWE may have a tremendous opportunity in regards to beginning a wrestling network. The WCW had the success because Ted Turner is a media-mogul and has access to many avenues in which the matches could could be broadcast. The WWE could expand their scope and allow for an entire network that could help them provide access for fans and potential fans. I also feel that there should be a match between the WCW and the WWE and they could almost create matches against one another and stage the promotions and almost team up to create such an outpouring of fan support and I am sure that the revenues would be increased and the advertising opportunities would be increased as well. Threats: The WWE may need to target a younger audience and interest may vary with age groups as well as over time. It is important to stay in tune with what is pop culture and also to maintain the visibility of the wrestlers outside the ringonce that ends, it may be hard to create momentum for outside fans. The opportunity of a wrestling network may also diminish demand and may hurt advertisements and merchandise purchases. 6. What are the major issues: The major issues that are facing the WWE within the case are whether or not to keep Bret Hart. They must weigh their decision by analyzing whether keeping him will hurt or help them. Bret Harts popularity was somewhat diminished because of the onset of newer characters with Steve Austin. It was becoming more work to write Bret Hart into the scripts than it was to leave him out. Vince McMahon is offering Bret Hart the opportunity to go to the WCW to sign because they can no longer support him financially and there is no longer a demand for his character. Bret Hart has more than financial ties with the WWE and feels a sense of loyalty to McMahon and to his WWF fans. McMahon also realizes that by keeping Bret Hart it has not helped his ratings for the WWE. He must decide on how to direct Hart without offending him since he has been loyal to the WWE and helped bring it to the level it is today. 7. Recommendations for the issues: I feel that the WWE should evaluate the fans that remain for Bret Hart and see how having them leave will impact their overall fan base. I also think that they should not just let him go because there is a new kid on the block and there is more interest in the newer characters. People like routine and they like to support that they feel they know the best. Sometimes turning their backs on an old character may not work to their advantage. I feel that the WWE should keep Bret Hart and have him be an announcer or have him work alongside with one of the newer charactershe should stay with the WWE and the loyal fans will remain as well.