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CURRENT SITUATION

MONSANTO BALANCES WORLDWIDE STAKEHOLDER

INTRODUCTION
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World·s largest seed company - sales over $8.6 billion. It specializes in biotechnology, or the genetic manipulation of organisms. Today: 90% of the world·s genetically modified seeds - by Monsanto Monsanto also holds a 70% - 100% market share on certain crops.

THE ENVIRONMENT .A.

Monsanto owes approximately 60% of its revenue to its work in genetically modified seeds. lost $1. ´ ´ ´ . Monsanto owes its $8.STATE OF ECONOMY ´ 2003 .7 billion the previous year.6 billion in sales to biotechnology. down to $8 a share.the price of Monsanto·s stock had fallen almost 50%. After switching its emphasis from chemicals to food.

crops.S. doubling their income in one year. . cotton yield of Indian farmers rose by 50%. including most soybeans and 70% of corn are genetically modified.´ ´ More than half of U.

a highly toxic chemical. Fish from the creek were deformed. released toxic waste into a creek in Anniston. in open pit landfills.CURRENT TRENDS ´ The emergence of new Monsanto had been covering up decades of environment pollution. ´ ´ ´ ´ ´ ´ This animosity toward Monsanto·s products is generated by concerns about potential environmental effects. It had also disposed of polychlorinated biphenyls (PCBs). Monsanto leaders had known about the pollution since the 1960s but had not stopped production. (Current Trend) . and the population had elevated PCB levels that astounded environmental health experts. Alabama.

This animosity toward Monsanto·s products is generated by worries about the safety of genetically modified food. Inc. a leader in the fruit and vegetable seed industry. the company has recovered and is now prospering. (Global leader in the seed industry) ´ ´ .CURRENT TRENDS (2) ´ Grant focus on genetically modified foods.. Monsanto became so successful with its genetically modified seeds that it acquired Seminis.

farmers are supposed to vary herbicide use and practice crop rotation.CURRENT POLITICAL VALUES AND TRENDS ´ ´ ´ To combat ´super bugs. The theory is that this allows nonresistant bugs to mate with those that are resistant. To prevent resistance to the Roundup herbicide. preventing a new race of super bugs. .µ the government requires farmers using Monsanto·s products to create ´refugesµ in which they plant 20% of their fields with a non genetically modified crop.

the company agreed to offer rebates. however. . and Asia. The company is taking a proactive stance to show that it cares about preventing resistance. to farmers in 13 states who use combinations of herbicides on their crops. Africa. This is of particular concern in Latin America.´ ´ ´ ´ Many farmers do not take the time to take these preventative measures because Roundup is so easy to use particularly in conjunction with Roundup Ready seeds. In 2009. where farmers may not be as informed of the risks of herbicide and pesticide overuse. this does little to stem what many fear will become a global problem. up to $12/acre.

. .Monsanto·s seeds are protected under patent law and it not allowed to harvest seeds from the plants for use in upcoming seasons. Monsanto ensures it will secure a profit as well as maintain control over its intellectual property.LEGISLATION Patent Issues . .Critics argue that requiring farmers to suddenly purchase new seeds year after year puts an undue financial burden on them and gives Monsanto too much power.By issuing new seeds each year.

the farmer are often fined. investigators approach the farmers suspected of patent infringement and ask them questions. and farmers must abide by these laws. . According to Monsanto.´ ´ ´ ´ Therefore. When they are found guilty of using Monsanto seeds from previous seasons. The investigators must practice transparency with the farmers and tell them why they are there and who they represent. the law protects Monsanto·s right to have exclusive control over its creations.

.BRIBERY ISSUES ´ ´ ´ In 2002. Monsanto was facing opposition from farmers and activists in regard to the introduction of genetically modified cotton in Indonesia. 000 to a high level official in the country·s environment ministry. The company had paid off many officials between 1997 and 2002 because of bribery was not an isolated event. a senior manager at Monsanto instructed an Indonesia consulting firm to pay a bribe of $50.

Close monitoring of its activities by American authorities in 3 years. .´ ´ ´ ´ ´ The company launched an internal investigation and reported the bribery to the U. Monsanto agree to do :Accepted full responsibility for its employees· behavior Pay $1 million to the Department of Justice and $500.S. Department of Justice and the Securities and Exchange Commission (SEC).000 to the SEC.

.´ ´ Terminator seeds have several risks and spurred much controversy among the public. It includes a concern that these sterile seeds might somehow get transported to other plants. which could create sterile plants that would reduce genetic diversity.

Lower grain prices may convince farmers to switch from Monsanto to less expensive brands. The seed company Pioneer Hi-Bred International. The company needs to enforce its code of ethics effectively to avoid organizational misconduct in the future. (Bribery) It may be facing increased competition from other companies.lingering concerns over the safety and environmental impact of its products. Inc.. is using pricing strategies and seed sampling to attract price conscious customers.THE FUTURE OF MONSANTO ´ ´ ´ ´ ´ Threat . .

In 2009. . This corn could be a major boon to farmers in areas where drought is prevalent. Monsanto is also working with the African Agriculture Technology Foundation to bring drought resistant technology to Africa (without having them pay royalties). the company announced that it had finished regulatory submissions for the planet·s first biotech droughttolerant corn.OPPORTUNITIES ´ ´ ´ ´ It under a new innovations that could increased competitive edge as well as provide enormous benefits to farmers worldwide.

. Monsanto will need to continue working with stakeholders to promote its technological innovations and to eliminate fears concerning its industry.´ ´ With the increasing popularity of organic food and staunch criticism from opponents.

and distribution of farm commodities. .B. and the processing. INDUSTRY ANALYSIS ´ Agribusiness .an industry engaged in the producing operations of a farm.Syngenta and Bayer CropScience. the manufacture and distribution of farm equipment and supplies. storage. ´ Major competitor .

Threat of new entrants Barriers to entry are medium & increasing. Rivalry among existing competitors few competitors involved in this industry. .Porter¶s five forces Bargaining power of buyer Customer. Could not make the product by themselves. High level of innovation & potential for new technologies in the industry.  The ability of small firms to compete successfully with major players. Stable market growth. Low exist barrier.farmer High switching cost. Threat of substitute product Low. High value intellectual property making substitute products difficult to produce. Bargaining power of supplier A number of supplier chemical manufacturers & medical instruments High switching cost.

THREATS LEGAL ACTIONS COMPETITORS SOCIAL AND PHYSICAL ENVIRONMENT . ORGANIZATION STRENGTHS R&D LICENSING PARTNERSHIPS INTELLECTUAL PROPERTY PROTECTION STANDARDS WEAKNESSES PUBLIC CONTROVERSY LIMITED PRODUCT PORTFOLIO OPPORTUNITIES THE BIOTECHNOLOGY INDUSTRY IS AN EXTREMELY YOUNG INDSTRY AND THE POTENTIAL FOR GENETIC ENGINEERING APPLICATIONS IS HUGE.C.

THE MARKETING STRATEGY ´ OBJECTIVE : CONTINUE TO GAIN MARKET SHARE GLOBALLY IN THE AGRICULTURE BIOTECH INDUSTRY TARGET MARKET : FARMERS COMPETITIVE ADVANTAGE : INSERTION OF TRAITS INTO CROP PLANT GENOMES ´ ´ .D.

FERTILIZERS AND AGRICULTURAL CHEMICALS.PREMIUM PRICING ´ ´ ´ .4 P¶S ´ PRODUCT .CORN FARMING. PHOSPHATE AND OTHER MINERAL MINING AND PESTICIDE MANUFACTURING PROMOTION .PUBLIC RELATIONS AND INTERNET MARKETING PLACE ² LICENSING PRICE .

PROBLEMS & THEIR CORE ELEMENTS .2.

PROBLEMS Lingering concerns over the safety and environmental impact of Monsanto Products. ´ Organizational Misconduct ´ Facing increased competition ´ .

CONCERNS OVER THE SAFETY AND ENVIRONMENTAL IMPACT ´ Genetically Modified products could result in negative health consequences « bring harms to the environments. . « Bovine Growth Hormone ² It may cause health problems in cows and in the human who drink their milk.

 It cause Monsanto to compensate $1.  . the bribe pay in order to destroyed the evidence that showed Monsanto was facing opposition from the farmer and people.ORGANIZATIONAL MISCONDUCT ´ Bribery Issues In the case of the Indonesia.5millions to the relevant department of the government of U.S.

Inc. ´ .FACING INCREASED COMPETITION Competition among rBST-treat milk and rBSTfree milk. that offer lower prices on the seeds. ´ Compete with Pioneer Hi-Bred International.

EVALUATION & ALTERNATIVE .3.

Lingering concerns over the safety and environmental impact of its products Objective: Reduce or even eliminate the worry of consumer about the safety and environmental impact of its product. Monitoring And Quality control Product Development Public Relation .

Organizational Misconduct O j ctiv : duc or v n liminat t misconduct it in t organization sta lis Organizationa l ultur ards and anctions Monitoring .

Objective: Win the competition from competitors Increased competition from other companies Pricing competition Differentiation Benchmark .

CHOSEN ALTERNATIVE & IMPLEMENTATION DETAILS .4.

2. Proactive action towards preventing ³super weed & super bugs´ ± . More CSR 3. Study from New York Medical College Roundup doesn¶t create health risk for human. Certification by FDA . .milk from Posilac-treated cows same in terms of safety with normal cows.the genetically modified food is safe to consumer. Create positive image 1. 2. Stress on What Bio product can achieved.PUBLIC RELATION Educate the public (stakeholder) 1.

..let employees learn & monitor between employees .Clearly define corporate policy & code of conduct. .reconstruct corporate image in employees mind by eliminating the bribery habits..ESTABLISH ORGANIZATIONAL CULTURE Employees ..

Fully utilize the resources & knowledge of the company ± to create more competitive advantage in future. . Drought-resistant technology ± eg: Corn 2.DIFFERENTIATION Innovation of product (technology advancement) 1. Create value-added properties ± eg: better service & quality product. 3.

THE END«« .

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