Monsanto Company – SWOT Analysis considers Monsanto’s major business structure and processes, and gives summary analysis of its main income avenues and strategies. Thus in forecasting the internal environmental analysis of the company’s operations it’s essential to look at the SWOT analysis. The report provides a 3 year (2011, 2012 and 2013) forecast about the internal environmental analysis of the company. It emphasis on the strengths and weaknesses the company faces going forward.
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Monsanto Company is a U.S.-based producer and distributor of agricultural products. Monsanto together with its subsidiaries is a worldwide provider of chemical products to farmers and genetically modified crops. Monsanto is among the world’s biggest seed companies, distributing approximately 25 percent of the proprietary seed market.
It monopolize the seed supply for several strategic crops, including 90 percent of U.S. soybeans, 80 percent of both corn and cotton crops. With a market capitalization of $44 billion, sales grew by an annual rate of 18 percent over the past 5 years and it projects that.
The company is involved in production of seed brands such as oilseeds, cotton and corns in large scale, as well as small scale crops such as vegetables. “In addition, the company produces herbicides as well as producing ‘in the seeds’ quality technology. Although that the major market of Monsanto produce is the United States; it has extended its operations globally covering such regions like Asia, Australia Africa, and South and North America” (Langreth & Herper 2)
The company has achieved advancements in production of high quality hybrids which are the Genetically Modified crops which have been accepted and recommended by scientists due to their significant advantages, which include provision of solutions to farmers in production of food for consumption and animal feed.
The company for the last four years and has restructured its internal environment to be able to attain profitability and remain a successful company. In order to achieve this objective the company management embraced the SWOT analysis technique in the management and running of the company. “SWOT analysis focuses on the strength, weakness, opportunities and threats of the organization.”
By use of these four factors, the company has been able to analyze the resources, capabilities, fundamental competencies and the competitive advantage the company enjoys.
In its 2011-2013 forecasts Monsanto remains consistent in its objective that global population growth and climate change will need its innovations to meet the demand to feed the world. The company is aware that food security is a major concern and believes countering this concern would stop opposition against to genetically-modified crops. It also embraces the messaging tag of sustainability and plans to launch marketing campaigns under the slogan “Grow Yield Sustainably.”
In coming up with the forecasts several assumptions were made: As the global market recovers, consumer food prices around the globe are expected to shoot faster than general inflation in 2010 up to 2012. In the US retail food prices return to the longer term association of shooting less than the overall inflation rate. Another assumption made is that there are no internal or international upsets that could impact Monsanto’s industry.
The company potential and strength lies in applicability and usage of their products, despite the fact that no scientific product can be termed as having zero risk; usage of the Monsanto’s biotechnology globally has not shown any significant problem to either the environment or society. This shows that the risk is associated with ignoring biotechnology, not using this method’s benefits for society and environment as well as ignoring science as a good solution to problems such as malnutrition, hunger and unfavorable areas in farming.
“By using recognized and risk assessment standards which are globally accepted, the Monsanto Company has been able to produce GM crops and food which promise to continue doing well in the marketplace with no hazard to the surroundings than those produced through customary propagation techniques” (Langreth & Herper 2).
In response to this fact, the company has changed its internal production operations in order to match with the market demand of their products, thus they have adopted new technology and production techniques in order to ensure that the company continues to meet its obligations every time. In addition the organization has invested heavily and still continues to do so by having a human resource that can deliver its obligations under minimum supervision.
Also the company shall be carrying out refresher courses for the employees frequently to ensure that they area at par in their performance. These refresher courses shall make it possible for the innovation and reinvention in the operations and production of goods. This is due to the fact that the refresher courses will allow the employees to master the core competencies that are vital to the organizations operations
In addition due to the organizations determination to continuously embrace new technology, it will be able to counter any competition from related the organizations thereby having a higher competition advantage. This shall be achieved through the production of biotechnology-driven crops which meet the farmer’s approval due to its economic and environmental friendliness.
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The results of using the company’s Genetically Modified crops are higher farm level output. This is due to the company’s policy in using technology and production methods that are cheaper while at the same time doing away with issues that factors that unnecessarily increase their overheads for example redundant labor force.
This has been done with the aim of enabling the company policy of being the center stage and monopoly of the seed stock products worldwide. There have been able to achieve this through continuous innovation of their products by embracing new ideas in the operations and later patenting their products to avoid unnecessary completion from other related organizations.
In addition the management is continuously working to reduce all bottlenecks in the sales department that affect the delivery of the products to their global customers, they have done that by getting into agreements with reliable courier services and also having a department that tracks and ensures that the goods are delivered on time and in good conditions.
Another strength that the company enjoys is the healthy relationship it has with the government and regulatory bodies. To achieve and maintain this leverage, the company has always worked to ensure that the company meets all the regulations in its operations.
Therefore all the staff members in the company are accorded respect and dignity as they go by their day to day business; hence despite the fact that the company is a profit oriented, it has ensured that that is achieved in the most human way. In addition the company has ensured that it does not violate the environment and all toxic waste is properly disposed without exposing the environment or the employees to risk. Also the company’s’ management is in a process of implementing a systems resource approach.
This is a system that will focus on the input of the company and ways and means it can acquire resources. Thus it shall focus on getting the best, dynamic and highly trained labor force from the diverse labor market while at the same time offering a high remunerations and rewards schemes to them. By doing so, the morale and productivity of the company shall be increased ( Langreth, & Herper 6)
In addition the company is working hard to ensure that the relationship it enjoys with its labor force will continue to increase overtime. This will be achieved through changing and adopting new policies in the human resource department while at the same time ensuring safety and good working ethics for the staff members. Monsanto will therefore carry out decontamination of the company buildings frequently to get rid of toxic substances while at the same time taking into consideration the views and concerns raised by the employees.
As a result of introducing changes in the organizations human resource through introduction of processes and guidelines, policies and conduction of progressive protection, environmental and market impact assessment it will enhance its products steward through the life cycle production. This will involve observation of the company’s core values and operations stewardship and post – production stewardship.
The former entails reviewing of the technology and project plan, standard operation procedure, best practices and quality control reviews, factors that enhance high quality and safety of the feed, food and environmental products. On the other hand, the later factor involves dealing with issues such as dealing with any concern arising from product launch and termination, licensing the management, fulfilling the settings of registration or the approval of regulatory, and monitoring current research and product centers.
Monsanto is faced by various environmental weaknesses in achieving its objectives and its equally essential to look into the company’s weaknesses in coming up with the forecasts for the future. First, Monsanto has a weakness in timing and planning for product development.
In many cases it is caught unawares by unexpected growth of foreign market making it hard for the company to effectively run its operations normally. In the 2011 fiscal year, the management plans to invest more resources to research not only on the product development but also on market research to ascertain market developments, especially now that its products are gaining popularity.
Second weakness is tin-ear to consumer concerns. Monsanto has been accused of been unwilling to engage significantly on consumer concerns against of bio-tech foods. The company intends to distance the “New” from the “Old” Monsanto as a means to counter past misconceptions. “Agent Orange, DDT, Aspartame, and rBGH all have substantial evidence showing biotechnology’s adverse affects on humans and the environment.” Monsanto plans to embark on rebranding of its core products under a single brand platform.
Thirdly, poor early messaging; This involves ineffectiveness in showing bio-tech produce net benefits to the consumers, opposition to labeling transparency, western commodity foods were entirely inappropriate for developing nations. In the current fiscal year (2010-2011) and in consequent years, the company plans to invest more than $980M, that is, approximately 9% to 10% of sales annually towards research on new instruments for agriculturalists based on market segmentation.
The company in the next three years it plans to concentrate more on research-and-development on “new biotech traits, elite germ plasm, breeding, new variety and hybrid development, and genomics research.”
Fourthly, Monsanto has an alienated consumer base. It is claimed that the company’s marketing strategies alienated farmers, litigating farmers and unpopular seed brands. In countering this, the company in the three year projects has embarked on a mega-marketing campaign aimed at reclaiming its brands goodwill and recognition.
Langreth, Richard & Herper, Martin. The Planet Versus Monsanto. Forbes, 28 April 2010. Web.