Problem Solution Paper

Abstract

The use of biotechnology is necessary to aid in growing chemical-free produce. This pesticide-free product is in high demand for consumers and production of pesticide-free crops has become a major cost saving to farmers. The sharply rising value of stocks in the biotechnical field is clear evidence of the increase of the supply and demand for this technology. Gene One, an eight year-old company with an initial start up of $2 million and a current net worth of $400 million, will present itself to the public market in three years. As a contender, Gene One plans to show an overall annual increase of 40% in order to improve its status from private to public entity.

INTRODUCTION

Don Ruiz, a 37 year-old Chief Executive officer of Gene One became an entrepreneur when he assembled four colleagues to develop what he calls the brainchild. In eight years this homegrown company went from a $2 million dollar start up to a $400 million company. Teri Robertson, 37 year old niece of Ruiz, is Chief Technology Officer [CTO]. Due to her doctoral research, Gene One entered the biotech industry with groundbreaking technology that allows farmers to produce disease free tomatoes and potatoes without using pesticides. Furthermore, consumers are able to purchase chemical-free produce from their local supermarkets as if it were homegrown. This win-win situation led to an increase in supply and demand which reflects in the rising stock influence on Wall Street. With this increase, the biotech industry is inviting for newcomers to the field and Ruiz is aware of the opportunity that his company is facing and intends to react quickly to keep up with the demand in order to accomplish conservative annual growth targets of 40% within the respected time frame. Ruiz has characteristics of being a transformational leader. According to McShane (2005), transformational leadership is about leading -changing the organization's strategies and culture so that they have a better fit with the surrounding environment. Ruiz wants to move Gene One from its private status to the public market. With this challenge at hand there will be several issues and opportunities that Ruiz and his team will have to face and overcome.

ISSUES

As other companies observe the stock market in search of options and investments, the increase in stock for the biotech industry will be enticing for investors. The Gene One team will have issues to overcome including the fact that in 1996 Gene One entered the biotech industry with ground breaking technology that eliminate diseases from tomato and potato plants and are the current industry leader. Due to increasing demand of technology, remaining the leader in the biotech industry will be a concern. The demand has also been increased due to supply (farmers) and demand (consumers) for chemical-free produce.

Ruiz will also have to combat possible negative publicity due to the human genome sequencing scandal in the biotechnology industry. To meet the needs of the supply and demand, Gene One has an issue of going public or staying a private company and lose its position in the forefront of the biotech industry. In going public, Gene One will have to generate more research and increase technology in order to stay afloat in the public domain. Gene One is a relatively young company and going public in 36-months is a risky decision. Ruiz must battle hesitation by investors due to scandals and concerns from board members regarding the transformation. There is even doubt from other team members questioning Ruiz's leadership ability to offer an Initial Public Offering [IPO] in 36 months.

OPPORTUNITIES

Ruiz's team has many opportunities, some of which have been present and includes the opportunity to maintain Gene One's current status as leader in the biotech industry and be nationally recognized as a public entity. The board's approval to proceed with the IPO, three-year timetable, the 40% annual conservative growth target, and the need to raise capital and develop new products is retrospective of the confidence they have in the company and Ruiz as leader. Teri Robertson's recognition as the Chief Technology Officer of the Year due to her breakthrough research technology and imminent breakthrough in flavor technology will have a significant impact on the company's public standing. Gene One has already secured its position in the biotechnology industry with the introduction of Perfect Potatoes and Tender Tomatoes and will present an opportunity to not only help the company but the economy: according to the Money Section's, What's the word? Column Gene One's IPO would certainly be a shot in the arm for the economy, creating jobs for hundreds of displaced workers.

Ruiz is also aware of the opportunity that publicizing Gene One will give the company better economic standing and credibility. His leadership abilities will be challenged as he leads the company in its transitions. The three year time frame is also an opportunity to address various issues deemed critical to successful IPO implementation of the company's business strategy.

Ruiz also has the opportunity to properly consider and compose his team members in order to successfully implement the IPO. According to McShane (2005), transformational leaders build commitment by involving employees in the process of shaping the organization's vision. Encouragement, support, and commitment of these current team players are also a priceless opportunity with an end-state goal of being a publicly traded company.

STAKEHOLDERS

Ruiz is the CEO for Gene One and the business strategy is driven through his perspective with a push from the senior leadership. The company is his brainchild and his strategy has made him a great entrepreneur. A significant amount of the initial $2 million start-up was his own contribution and Ruiz is thrilled about the new opportunities that his organization is facing including the IPO. Michelle Houghton, Chief Financial Officer, is passionate, has a strong sense of ownership and emotional attachment to the company. She has a great history with the company and has been successful securing funding from government and private investors. Her ability to secure finding will be valuable during the IPO transformation with Houghton's ability to find investors, investment firms, and secure a solid, certified financial statement to the Securities and Exchange Commission [SEC] in agreement with Sarbanes-Oxley Act [SOA] requirements. Houghton shares a solid working relationship and friendship with Ruiz and she has also earned a credible reputation with the leadership team, the Board, the Federal Drug Administration [FDA] leadership