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Monsato analysis


									1) Critically discuss the company's dramatic restructuring during 1996 and 1997.

Monsanto start up with product saccharin a few year later take over another company for produce
Phenol and Cresol. These obviously see the company business involve with chemical thoroughly
until 1972, when John Henry promote to CEO, he have an idea to make the produce involve with
biology and genetic. After that, Henry decided Monsanto would need a pharmaceutical presence.
That is beginning point where Monsanto start into life science businees.

Before the transformation in 1992, Monsanto operation consisted of decentralized operating unit;
i)agriculture product ii)performance material iii)Pharmaceutical iv)food product v)industrial process
control instrument and equipment. Therefore, in the 1990s have a lot of change in technology and
competition then the restructed of the organized occur. With the new leadership, CEO Robert
Shapiro, in 1995. by two strategic.

    Redesign itself to be a leader in life science which regards agriculture biotechnology, human
       health product and food ingredient
    Expand the market to global strategy instead of dominated in United States only

Shapiro have the vision that the firm must to adjust itself if still be rigid then the company will
behind another competitor because the technology in this field grow up very fast. Some product that
Monsanto already exist such as performance material petrochemical businees. It can not have much
development and to compare with the main three businees that will to archieve. Those are the new
technology can significantly grow up and beneficial to everybody. Even the past the company
involve with poisonous substance. Furthermore, in the field of alter genetic is the world expectation.
These bring about to the second strategy, to expand to global market.

In the transform, company redefine product itself for three field:
   1) Agriculture product: Decreasing the use of chemical fertilizer and insecticide which is
       propoties including into the new seed.
   2) Pharmaceutical: In the pharmaceutical field, ethical drugs receive protection for seventeen
       years and half of this period need to examine to reach the health authority before sell. This
       why Monsanto have to research and develop the new product in this field all the time.
   3) Food ingredients: In the past, this field never have any new technology to develop the new
       product then the company is willing to use biotechnology to assist the research and
       development of the new product
All three main field using the new technologu, biotechnology and genetic, to increase the variety of
product and its efficiency to perform in chemical business. These include the ability to expand the
market to be global as now the porpotion for the global only one third.

2) What are the broad conceptual bases for the company's new strategy?

Monsanto set the new strategy by;
     Redesign itself to be a leader in life science which regards agriculture biotechnology, human
         health product and food ingredient
     Expand the market to global strategy instead of dominated in United States only
To archiving this two strategy, The company devide into three step.

Step 1. Define itself what new Monsanto will do and aim to. These gives the direction how the
company go for the future.
Step 2. New arrangement of the company for example combine 3 sector to be a new product sector
that the industry segment of presticide and fungicide, along with the sector of crop protection.
Step3. Announcement and growth.

Then, the concept of new monsanto is research and development the new product product and by
using a genetic and biotechnology to make new product for creature. Finally, bring the company to
the world market.

3) Who are the emerging relevant competitors for the 'new' Monsanto?

The main competitor of Monsanto in agriculture chemicals are Novartis and American Home
Product because in 1990s these three company adapt their businees and merge biotechnology to the
product by take over another company in this field. To compare between Novartis and American
Home Product, Novartis is the biggest competitor of Monsanto because in 1996, after merged with
Genetic Therapy and SyStemix over $2.1 billion were spend for the research and development.

For the pharmaceutical or the human health, the main competitor in this field is Navartis, American
Home Product and Pfizer. All of them try to have the new development of gene therapies for
incurable disease by signed an agreement or acquisition another company for fast growth in this
For the food ingredient, International Flavors & Frangrances (IFF) is the main competitor. In that
time, still not have new product using genetic technique to develop the new product. IFF was a
major producer of synthetic tastes without any genetic apply to their product. This is a good
opportunity for Monsanto to apply genetic to the food ingredient because do not have have
competitor exist.

4) Is the concept of 'transformational management' relevant in this case? Why?

Trasformational changes is the change for survival or revolutionary and continue transforming for
the sustainable. The changes of Monsanto changes as a dramatically change in the world
globalization, Monsanto need to restructed its organization to reach the new technolgy that growth
rapidly then Shapiro redefined their strategy and organisation to reach. And these changes is
according to the transformational management.

5) How does this restructuring impact upon raising 'shareholder value'?

One of Monsanto goal was to deliver shareholder value from business growth and value creation by
three ways
    Operational Excellence of Monsanto Business Unit
    Via growth sources (Business Unit project and investments)
    Portfolio restructuring (merger, acquisitions, divestitures, and swaps)

Operational Excellence of Monsanto Business Unit is team co-operate for continuous improvement
to archive customer need. This is the root base of the growth for sustainable in the future. To ensure
that restructuring of the core strategies achieve the desired result under the strategic direction.

For portfolio restructuring is for growth in leaps and bounds, fast develop, reduce business risk and
reduce the competitor to increase the market in that field. These improve strength of company
finace. Moreover, The company will gain the benefit for any patents or intellectual properties that
hold. The important of portfolio restructuring is the that merge or acquisition should in the same
field because the development in a transition period to not break off.

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