Options_for_Implementing_a_Leadership_Change

Introduction In 1996 Gene One entered the biotechnology field and grew from the initial $2 million start-up investment into a $400 million business in eight years. Gene One is a biotech company that develops a genetic material that eliminates diseases on potatoes and tomatoes. As a result of Gene One’s technology, farmers no longer need to use pesticides when growing these plants and consumers are pleased to buy homegrown products untainted by chemicals. Gene One Chief Executive Officer (CEO), Don Ruiz and his Senior Leadership Team members believe that if the company is to continue its annual target growth of 40% each year, the company will need to go public with an Initial Public Offering (IPO) for development, marketing and advertisement. The company has established a target to meet within three years of starting the process and acquiring an IPO. Gene One CEO and his Senior Leadership Team members, along with the help of valuable members in the investment community, have developed a clear strategic plan. Implementation Plan Gene One is implementing a strategic plan to become a public company, and this will create an excellent opportunity for the company and give Gene One a competitive advantage in the biotechnology industry. For Gene One to employ the company's goals they first have to address the issues they have within the company. With Gene One possessing no experience implementing an IPO among its Senior Leadership Team or staff members, the CEO must decide on if to hire new members and let half of his original team go to ensure the strategic plan is a success. Specific rules and regulation from the Security Exchange Committee (SEC) and Wall Street need to be implied and all disclosure financial statements must be accurate. Dilemmas Gene One will need to regain the trust from its Senior Leadership Team, supervisors and employees. The company’s key issue is how to capitalize on their profit accordingly in which it would benefit everyone within the company. As Gene One moves forward with an IPO plan every government agency will be paying close attention to all documentation submitted by the company to ensure the company is following the appropriate rules and regulations. The government will ensure that every product produced by the company is safe for human consumption and safe for the environment. There may be some conflicts of interest if the product is not produced within a timely and effective manner and if the regulations are slowing down the production. This can cost Gene One revenues and delivery issues to its customer’s as well as lose customer’s because of too many rules and regulations. In addition, if Gene One does not follow the regulations in place they can produce dangerous products, which can reach the market and customers. Gene One customers are interested in receiving the most value for the dollar spent and to receive a comparable service to what other service providers give. Recommendations/Solutions Gene One has several solutions that are available to implement and bring the company closer to achieving its mission and goals. Some of Gene One’s current Senior Leaders do not have the necessary skills or knowledge to guide the company through an IPO launch and for the company to accomplish this task it would be necessary for them to replace some of its team leaders and hire a consulting firm to help with this process. In employing a consulting firm that is specialized in pre-IPO consulting, the firm will guide Gene One on every IPO related issue, which includes assisting and determining the size of the initial offering, preparing required documents, strategic development and team formalization. With Gene One having in place a consulting firm, this will enable the company to meet the requirement of an IPO within a specific timeline. In realigning its team leaders it would ensure they have the necessary people in place with the appropriate skills and knowledge in regard to the IPO and handling a public company. “In each decision-making structure, you have different ways of encouraging broad knowledge sharing. In loose hierarchies and democracies, one of your most important roles as a manager is often to provide the channels and incentives for sharing knowledge” (Malone, 2004). Gene One will need to decentralize its decision-making process for the benefit of the company. This would allow employees and management to contribute in the marketing strategic planning, and production ideas regarding other pertinent company decisions that will increase the achievement of the company's goals. Gene One may also take a look at decentralizing their leadership and allowing the employees to decide whether the company should go public or not. After educating everyone on the pros and cons of an IPO, the employees could make an educated decision. For example, SAS decentralized the decision of becoming a public company through utilization of a survey. Jim Goodnight, founder of SAS Institute supported the staff’s preference and declined the opportunity to go public (Maney, 2004). Gene One needs to show potential investors that they have the technology and leadership ability for the future, including the ability to meet the demanding requirements of the Sarbanes-Oxley Act. Gene One should commit itself to improving existing technology as well as developing major new technology that will entice investors. Risk Assessments Gene One has several risks that could potentially delay the launch of the IPO. Some of these risks can be the slowing of production; employee's morals are low; lack of trust toward management team and non-participation toward a smooth transition from private to public. Employees should have the necessary time allotted for training in the upcoming products distribution regarding knowing how to handle the company in the public arena. Whereas, in having problems raising the necessary capital and potential damage in taking the company public in a timely manner. Using a consulting firm has a few potential high risks. First can be the cost of which may not be adequately budgeted for any impact in improvement. Second there may be a skill shortage after the consulting firm is no longer in place due the completion of the IPO. Combining the use of the consulting firm with some changes in team leadership will allow for backfilling of the appropriate skills and knowledge needed for long-term, can be reduced. Describe End State and Goals In three years Gene One will have met the Sarbanes-Oxley Act and Security Exchange Committee requirements. Gene One CEO Don Ruiz will have the respect, excellent leadership skills that display a winning company. The company has been strengthened by Don Ruiz’ ability to use transformational leadership styles that has moved the company to record sales and an excellent reputation. Don Ruiz will have the respect of Gene One’s employees, key investors, stockholders, and the community. Gene One’s Research and Technology Department will have three new products in 36 months and Gene One has become a fortune 500 company with gaining markets in research and technology. Conclusion Gene One is at an important crossroad. The company can either continue with its current business model, which, although successful in the past, has certain problems associated with it, or Gene One can choose to change and set itself up for future success. It is apparent that Gene One is a highly ambitious company with a strong desire to succeed. By making a handful of specific changes to its management and team organization, and using the recommendations presented above, Gene One will be able to improve its corporate culture, grow, and ensure enough capital to become a bio-tech juggernaut well poised for the rigorous process of offering an IPO. The most important part of this entire proposal is that it is successful in meeting the end-state goals of Gene One. To evaluate the success, the proposal must be measured against these goals. These goals must be specific, measurable, attainable, realistic, and timely. It is harder to measure some goals than others. Once Gene One has clearly defined goals and values and has implemented the proposed changes, the company will be able to expect positive results and be positioned in becoming the leader in the industry of biotechnology. References Malone, T. (2004). Making the Decision to Decentralize. Working Knowledge for Business Leaders, Retrieved from http://hbswk.hbs.edu/archive/4020.html Maney, K. (2004, April 2). SAS Workers Won When Greed Lost. USA Today, Retrieved from http://www.usatoday.com/money/industries/technology/2004-04-21-sas-culture_x.htm Transformational Leadership- Integrated Training and Executive Management Retreats (2005). Transformational Leadership. Retrieved from http://www.transformational-leadership.us/