MASCOMA CORPORATION

Introduction

A strategy is the art of coming up with a plan on how one is going to achieve their goals or dreams. The reason we have to set resolutions is because we have limited resources. We, therefore, need to organise what we have so that we can put it to optimal use for the benefit of achieving our targets. The management or leadership team is the one to strategise. A strategy can pop up as the organisation settles within a particular set up or field as it eventually becomes a routine. Global Strategy refers to a thought action by which a group focuses on in order to grow its company from a small local organisation into an international one. One of the primary considerations even as the leadership of an organisation comes to a consensus is on the product differentiation to fit different market segments.

The effects of running a global organisation lie on these three areas: International Strategy;the objectives mainly relate to the home market. However, a few others are developed to match the foreign activities. Multinational Strategy; the specified organisation has foreign clients/ markets besides the local market. Thus, it may need to have different actions plan for these markets because customer needs to feel the personal/ local touch in each country. Global strategy:-The organisation acts as one irrespective of the location and plans are developed at the headquarters with minimal product differentiation on the grounds.

Why is global strategy necessary?

The more the company expands internationally, so do the sales, resources, and profits. For other companies, it is because their performance locally is weak thus they seek to sail through by going abroad. Some clients like buying products with a global image or brand such as Gucci products. It also creates a platform for negotiations worldwide and may eventually lead the world to becoming a free market. Other companies are out to exploit the minority countries by taking up their resources.

Mascoma Corporation is a private company headquartered at Lebanon, New Hampshire in the United States of America. Its operations began in the year 2005. It has around 110 employees, and its CEO is Bill Brady. Robert Johnsen, Lee Lynd, and Charles Wyman are the founders. Mascoma is in the fuel industry and produces biofuel from wood, grasses, animals, organic components and plants. Biofuel can is used to as a source of light at homes, and it can be used for cooking, heating, in vehicles and trucks and planes as well. The truth is biofuel can be used as an alternative to any other human energy. The other benefit of biofuel is that it has nearly zero impact on the surrounding. In the United States, transport alone consumes around 30 % of the energy that has been generated within the country. Domestic and industrial consume 10 %. Analyses show globally Transport consumes 25 % of the energy. The statistics 62 % of the oil generated energy. To mean the remaining 75 % of the energy consumed worldwide cannot fully be derived from oil. Statistics also show that out of the oil used in vehicles, 12 % goes to moving it, and 2 % is the only one used to drive the cars. Therefore, 86 % of the oil put in cars is lost to friction, heat, inefficient combustion and moving other heavier vehicles. Another fact is that as we continually drill oil all across the world, we are slowly eliminating it from the face of the earth and so as time goes by, there is a high need to look for an alternative to oil. Manufacturing is the production of goods and services. Even as we discuss this topic, we cannot overlook the fact that in the twenty-first century, advancement in information, technology and biotechnology has led to a decline in the use of human capital to less than 10 % according to statistics whereas on the contrary, resulted to faster, better quality and more efficient outcomes. Since production mechanism has shifted, the 21st Century favours a company that has a high flexibility rate to customers ever changing demands. Therefore, as a company that is focusing on joining the global market or one that already has operations in the global market, a quick response, product quality, service, ease with which it can adjust to the changing demands of customers and a global focus are the primary considerations of a successful enterprise.

A manufacturing strategy document, therefore, refers to a set of coordinated objectives applied to production functions and aimed at securing a sustainable advantage over competitors.An essential component of the manufacturing strategy is the decision on whether products will continue to be manufactured at the primary site or if the cost analyses allow factories to be set up in other sites with lower cost. Companies have been managing their inventory very tightly to keep costs down. The ability to provide fast delivery has a higher value than the price of the commodity. Customisation, modifications and quick products improvement in response to market demands.Terry Hill model (developed by Terry Hill at London Business School) states that agreements on production processes should be a part of the way forward of a company. Key aspects of Hill’s model include stating the company objectives, establishing clients’ strategies, and assessing whether the company can handle the demands of their customers from both the marketing and operational dimension.

SBU, which in business stands for strategic business Unit, is a portion of a company that acts on its own, thus even its financial operations including profits is treated separately and looks at what is it that we are producing and who are we targeting. A business strategy shows how an organisation’s goals will be reached while corporate objectives and strategy are the business aims and targets.Mascoma Corporation vision had been in the line of producing an alternative fuel named biofuel. However, in the quest to accomplish this, challenges like the oil price decline and a rise in the price of agricultural products across the world such as better prices for the farmers implied that Mascoma had to pay a little more for the corn they use for biofuel generation. With the unexpected shift in the market, for Mascoma Corporation to remain operational relevant, they had to be flexible as well and in line with that they decided to sell their precious asset, the resource they have been using to convert yeast to ethanol.

Some of the strategies that Mascoma Corporation should take into consideration are on the side of raw materials. As an organisation, identifying a raw material that is cost effective will ensure, the company uses the least cost on production. They should also be able to identify alternatives, and, in this case, the raw materials of biofuel being plants, animals, and organic matter, it is also good to try production using the organic matter or animals. The benefit depicts that raw materials for biofuel are easy to source.

Mascoma Corporation should also be willing to disseminate information with facts to the public. That is by sharing the idea they have and letting the public know that the use of biofuel like diesel in cars cuts on environmental degradation since the product is cleaner thus the car can consume the whole of it without wastage. That implies that the diesel used by the car to cover a particular distance is less than when using diesel from oil energy. Also allowing clients information that they can use biofuel even for other domestic purposes could give the product an edge. Biofuel is a fit for the latest engine structures and does well under nearly all weather. Thus helps in engine maintenance since it is a fit, and so the engine rarely needs replacement.

Mascoma Corporation would also take advantage of countries that do not have oil reservoirs. This is because, expanding to such and allowing the public and the government to have enough information on the same would actually boost their sales and in turn revenue whereas helping the country cut on costs used on oil.

Mascoma Corporation could also look into the aspect of developing a strategic business unit. This would be made possible if they were able to identify a particular good that can work alongside biofuel yet helping them boost revenue. A good example could be deciding to also focus on building domestic energies as a part of the organisation’s goals and selling them to individuals and companies that are in need just like they did sell to the Canadian company. These could also work alongside biofuel production as we wait for more people and companies to embrace the commodity.It is of the essence for every corporation to consider the chain of steps that one will follow as they develop their product. Thus, selection of the levels to be involved is a dangerous strategy. Being in the production of biofuel, it is important to know exactly what is needed to convert the product from a plant to ethanol. The first step is filtration where waste plants are distilled to remove particles. The other step is eliminating water from the substance. It could even be through heating. The next step is titration. It also involves adding some lye into the process. It is an essential stage. Then getting sodium methoxide ready is the other stage by mixing methanol with sodium hydroxide. The next stage is heating and mixing sodium methoxide to ensure the substance is well mixed. Lastly, allow the material to cool and settle, then separate the two products by eliminating glycerin. Then one is left with the biofuel. Understanding this process is fundamental in that it can quickly help us identify cheaper and faster ways to work out each process.

The other critical decision is about stock. Since the main raw material for biofuel is corn, the company can consider buying it in large scale during the low seasons and then storing some up to be used during its high-cost period. A Decision on this would include warehousing cost. Does getting a warehouse for the plant more expensive than buying plants during high-cost period or is it vice versa?. From comparing the cost of buying and of a warehouse, the company will be in a better position to decide which is the most cost effective.

Another essential element to consider is whether to make the raw materials or to buy them. For raw materials such as corn, Mascoma Corporation has a ball on its side to evaluate which one is more viable. A decision to produce means getting a farm and then planting the corn for their use. This may involve a lot of dedication especially at the initial stages but could end up being more cost effective in the long run especially if that can produce large scale and also throughout the year. The only challenge for the “make” decision is that corn will need a lot of water to grow and therefore looking for alternatives to getting this water such as drilling could eliminate the possibility of creating water shortages across the States. It is also important to weigh the long term cost and the pros and cons between both make or buy before settling for any.

Capacity is another area of focus. The quantity produced, and timing and location are also of utmost important. Since the company has not been in operation for long and has not yet fully penetrated the market, to mean biofuel only contribute to about 10 % of the energy currently being used, it is important to put this fact into consideration and only move at the rate of the consumers even as they create awareness of the product and its benefits. Besides this consideration, it is also important to consider Terry Hill’s point of view that even the operation side of it is important. Thus, questions like can the current biotechnologies we are using be able to accommodate a higher production? How can we put them to optimal use so that we can leap the most? Which country has a more promising market among the one our products are available? Does our current financial standing allow us to expand into other parts or buy more modernised and faster equipment? Are there people or other companies out there who would believe in us and invest some more with us? That is especially important for Mascoma given that they have been in the market for the last three years and have not enough made a significant breakthrough. Thus, this has left many investors disillusioned and one of their major investors left. If we have to convince more customers, it means we have to have a new scheme and at list something at hand to show.

Infrastructure in an organisation serves the company’s needs and ties its various parts by integrating them to correlate and bear results. Technology pertains to the equipment, hardware, software, procedures and technical knowledge brought to bear in the firm’s transformation of inputs into outputs.Function support is part of the team that holds and loyally supports an organisation through its incubation process until the company finally breaks through. For Mascoma Corporation, seeking the support of the state government or and the national government for the period until the eventual breakthrough would be one of the primary pursuits to recommend. This is because biofuel production will not only benefit its stakeholders but the state governments as well. And since it is a noble project that if supported would help everyone, the government should be made aware so that they can give their support whether financially, morally or by becoming one of their major clients through promoting the use of biofuel in state energies. They would also help them by encouraging their citizens to embrace the product. This would boost their revenue.

Another essential functional support team is the employees. A recent survey shows that employees value open communication more than they do appreciate the other benefits that companies are likely to offer. Thus letting them know why we are doing what we are doing is of utmost importance and also embracing them and making them feel like it’s also their project and their views are appreciated, will give them the required motivation to pull through and give their best thus improving efficiency.Having meetings with the current shareholders and updating them on your way forward and what you have achieved so far would be important. Also reminding them the reason they chose to invest in Mascoma Corporation and assuring them that even though we have not attained our target per se, our eyes are still fixed on the goal. The founders who had carried the vision are also important to keep around and even welcome them to be part of the leadership so that as an organisation we continuously tap into their wealth of wisdom and expertise. It is also important to relate to other business acumen and private enterprises because from them we can also learn a number of principles.

The manufacturing, planning, and control system deals with organising and managing all activities involved in the product development such as managing materials, scheduling machines and people, coordinating suppliers and key customers. The manufacturing, planning, and control system of any organisation needs to be dynamic to handle the changing surrounding, strategy, clients’ demands, particular challenges, and distribution opportunities.

Quality assurance and control is the act of assessing and managing the process and checking how effective it is. It is important to determine the process of production and distribution of biofuel from the raw materials to the process of filtration, titration and eventually cooling and the distribution process. It is also important to eliminate middlemen in the supply chain process that may otherwise contribute to the price increase. The continuous assessment of the processes will help us to improve continually it until we attain optimally. As we review the process, it is also important to examine the equipment since we have not yet gotten the most modern and most efficient technology.

Manufacturing system engineering deals with various production processes such as research, design and building systems, processes, machines, tools, and equipment. The engineer looks at ways to develop the raw materials or the product into the most viable and efficient means. It could also mean the joining of the different processes involved for a quality product. Mascoma Corporation would need to invest in a number of engineers who have a wide range of understanding in the energy, nuclear, biotechnology and engineering fields who would solely work towards coming up with a better equipment that would produce a good quality and also assessing the production process and looking at how to improve it for optimal results. It is also important to test or to research on different raw materials to see the most available and cost-effective one.

Clerical procedures involve a lot of organising, handling equipment, communication and administrative support functions. Mascoma would need a support team who also has an understanding of technology, cost accounting and management for optimal supervision and a drive to achieve the set targets.It is important to engage workers in contracts by entering into Sales and Wage agreements based on someone’s expertise, skills. Whereas considering the ability of the business to handle the costs associated with such. However, it is important to discuss with the employees about their salaries prior to them joining and letting them know the much you can afford to pay for such a position given the current standing of the corporation.

Mascoma should set the conducive environment for its employees both by developing an excellent relationship between the senior management and the junior staff. THIS will make them feel valued thus in turn portraying the same on their jobs. Organisation structure means there should also be a well-laid plan on how the jobs should be done and the role of each staff in the production and development process.

Comparison between the existing strategy and the proposed strategyThe suggested strategy would focus more on creating product awareness through advertising, promotions, publicity, social media and media houses among other-awareness generating means as one of their means to ruling clients to reconsider buying the product. Part of this would also include the benefits that the product has over the other energy products, an area that has not been prioritised in the existing strategy.

Sale of an existing biotechnology plant used for producing yeast and bacteria to the Canadian company named Lallemand which was neither a good nor a bad move, but the proposed strategy shows that the focus should remain in biofuel production. However, a strategy business unit that builds on and develops domestic appliances like cooking gas and power would be developed as part of the ways to raise revenue. Also, since Mascoma has enjoyed a number of donations from the government, some universities and a few more others, it would be a good move to optimise on this relationships and build products that are first tested through these donors, so that they can also send word out there of the products thus also acting as one of our marketing strategy.

Creating transparency in the management, the leadership, the employees, the shareholders, investors, the government and the public at large would also be one of the schemes they should use to create confidence to the stakeholders with the company, since they are aware of the decisions and happenings of the corporation, thus making them feel like they belong which would work so much for the company as opposed to the existing strategy where the management just wakes up one day and decides to shift focus as the sale of the biotechnology to Lallemand without the knowledge of the other stakeholders. This will ensure they are on the know-how thus ensuring they are a little bit more secure.

The proposed strategy would focus more on mass production. Evaluating the most efficient machinery and technology to use, in the long run, to ensure faster, efficient and customised product for the particular market is of utmost urgency. This would also ensure that the company is not only selling outside yet internally it cannot meet the demands, but should also focus on building the internal system and infrastructure to embrace the global production. This is not something that the existing strategy is looking into because if it was, then selling some of its most precious assets is a short-term goal that would not be relied upon in the long run.

Since the world is becoming a global place, it is also important to take advantage of that and diversify the target market. Create a product that is not only sold to the state, but also one that cuts across the continent to other continents. United Kingdom is one of the countries that have already embraced the use of biofuel, and it would act as one that can easily be targeted to take up the product. Other countries that do not have oil reservoirs would also be a good target. This is something that the existing strategy allowed a major blow on when the oil prices went down and interestingly the price of corn went up. So they slowed down and eventually started shifting their focus, yet if they push a little bit more and tighten both the external marketing strategies and the internal systems and infrastructure, they would eventually pull through and remain relevant as the other alternative to oil and electricity.

Recognition of and ensuring the strategy remains current in a changing marketFor the proposed approach above to remain present, Mascoma Corporation would have to develop relationships with their clientele, so that customers’ have a personal touch and loyalty to the product based on their relationship with the company and the benefits. Also, if the company created an excellent communication channel where the customer comments and issues are put into consideration, then it would be easy for the customers to drop hits of currently preferred preferences.It is also important for the company to keep up to date with the happenings in the market and internationally as well so that they are aware of any information that would affect their product. Example, they are aware of any war that may erupt anywhere in the world that would eventually lead to a decline in consumption of the product in that particular region.

Ensuring that the internal systems and infrastructure are not rigid but can adjust to the changing demands is also of priority. It is also important to have an active research department, that keeps updating us on the best practices and technology we can adopt for optimal benefits.It is also important to develop good relationships with the stakeholders and the public at large. This will create a good reputation for the company and in case the company was in need of more financing, it would be very easy for the stakeholders and the investors to chip in because they already have confidence with both the product and the leadership and management of Mascoma Corporation.Mascoma Corporation is an excellent organisation that was born out of research from two professors at a University environment. If the idea were nurtured irrespective of the challenges on the ground, the long term benefit that the company would leap would be overwhelming, both for the stakeholders and the public in general.

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