Title : Opportunities and Challenges that ABC Corporation is Facing

Executive Summary
Different strategies that key executives deliver to his/her sub-ordinates could make totally different cultures and business models of the company. ABC Corporation, a US listed chemical company is now under this transformation from a simple reporting hierarchy company to a matrix organization. Its aggressive vision till 2020 would amaze lots of the outsiders including shareholders and external analysts by boosting its double digit EBIT growth year over year.
Behind this fantastic financial performance, ABC Corporation is actually facing its own internal challenges which make ABC staff feeling heavy in workload and low morale in the office. However, I don’t believe that this phenomenon will last long as lots of statistics and comments are showing that, ABC Corporation is running out the blue.

Company Overview
ABC Corporation is a diversified chemical company serving agricultural, industrial, environmental, and consumer markets globally for more than a century with innovative solutions, applications and quality products. ABC Corporation was listed US Stock Exchange in 2000. In 2013, ABC had annual sales of approximately $3.9 billion. The company employs approximately 5,600 people throughout the world, and operates its businesses in three segments: ABC Agricultural Solutions, ABC Health and Nutrition, and ABC Minerals.
Company Strategy
“Feeding the world, protecting health, and providing the conveniences of life”. That is the mission and vision of ABC.
New Executive Leadership
There are few key personnel joined to ABC Corporation in the past few years as follow.
CEO, Pierre Brondeau joined ABC Corporation on January 1, 2010, as President and Chief Executive Officer. Over his 20-year career at chemical industry, Mr. Brondeau held numerous executive positions in Europe and the United States with global responsibilities for marketing, sales, research and development, engineering, technology and operations.
CFO, Paul Graves was named executive vice president and chief financial officer on October 1, 2012. He brings more than 19 years of international banking in Goldman Sachs and accounting experience in Ernst & Young, with a specialized focus on chemicals and agriculture. Also for Goldman Sachs he served as Global Head of Agricultural Investment Banking and Global Head of Chemical Investment Banking.
Vice President of Corporate Communications, Kenneth Gedaka joined ABC Corporation as in September 2011. He is responsible for the company’s public affairs, internal and external communications, executive communications, philanthropy, and corporate brand and reputation. Prior joining ABC, Mr. Gedaka spent 16 years in a variety of corporate and business communication roles of increasing responsibility, including community relations and philanthropy, mergers and acquisitions communications, technology/R&D communications, executive communications, and global business marketing communications.
What are the Challenges that ABC Corporation encountering?
During the past few years, ABC experienced a drastically change in management personnel, from top executive level to country level, aiming to twist the existing mindset of the leaders in which they tended to only focus on their country own business, to develop an international vision.
Say an example, I am working in HK Regional office of ABC Agricultural Solutions (AgS) division. The main product in AgS for selling is pesticides, including insecticides, herbicides and fungicides. In the past, Asian countries would only interest in their own country P&L performance, because the economic atmosphere was good, the weather condition & political environment were stable. All the extrinsic factors pushed the business to the peak which drove countries management stayed in their comfort zones. In the old times, there was only a simple and direct reporting hierarchy. Country managers (CM) reported to Regional Director, Regional Director reported to Corporate President. They had only one hat of responsibility.
However, after the new executive leaders were on board, the comfort zones in Asia regional office and countries became narrower and narrower. New executives brought in their previous organizational structure and culture into ABC. A time of “Matrix Organization” has come. Now, every leader entitled for 2 hats of responsibilities. For example, manufacturing plant manager in India has a solid reporting line to Regional Manufacturing Director, at the same time, with a dotted reporting line to Country Manager, India.
In the meantime, segment teams across Asia have formed. The segment team leaders are the CMs in Asia. Segment teams are including Rice team, Fruit and Vegetables team, Cereals team, Sugarcane team, etc., in which they are focusing on different crops to see any growth opportunities and explore any new potential markets in Asia. In simplicity, each country head also has 2 hats, one is as a Country Manager, and another one is segment team leader.
In my personal opinion, this organizational change to a matrix time is definitely a good start for the growth to both ABC and countries. As this would let the country heads to build up a macro view on Asia business instead of just focusing on their own country development. However, IT infrastructure and software system may not be in the same development pace to cope with the changes and needs for management. That’s why there are still lots of manual process and procedures for the staff to deal with, as a result, high workload low morale can be found in the company.
Any Opportunities does ABC possess?
Branding is one of the key focuses since the new executives joined ABC. Both external and internal communication channels have been strengthened.
For external communication, the formation of Communication and Public Relation department is an example, which keeps releasing difference notices and reports to the public to “promote” ABC performance. Ken, VP of Corporate Communications, would share his viewpoint and rational on the change of name of division from “Agricultural Products (AP)” to “Agricultural Solutions (AgS)” to enhance the awareness of the public that, ABC is not just simply selling the pesticides, but also providing professional solutions to improve the quality of life to the public; For Finance team, Paul, executive VP and Chief Financial Officer, would hold regular meetings with investors and external fund house analysts; the annual general meetings with shareholders to report for the annual performance and share the perspective outlook for the coming 5 to 10 years about ABC’s leading role in the chemical industry; disclose the meeting minutes with banks about the risks analysis, etc.
Besides, CSR activities were held in different countries to promote for a “green environment” is also feasible for a chemical company. Activities are including plantation in country side; community day with educational booths for children to participate to learn how green chemistry links with our daily lives.
For internal communication, weekly or monthly newsletter from various departments would be sent to all employees in ABC, to ensure everybody is on the same page of company’s activities and development directions. Such as, Operation department send out the weekly newsletter to record the number of injury cases; environmental protective actions from the perspective of a chemical company to save our planet; and any hidden hazard news and statistics to raise the awareness of our employees about the importance of “Safety First”.
Finance department would hold quarterly town hall meetings over video conferences and presentations with the global finance folks about the quarterly financial performance, the outlook for the rest of the year, also update the progress and discuss some of our Finance specific activities, to let us align with what directions and attitudes to go for the company goals.
Another new initiative to drive the company move forward is a finance project called “One Finance”. As there are 3 divisions in ABC, Agricultural Solutions (AgS), Health and Nutrition (HN), and Minerals (Min), Corporate aims to streamline and consolidate all the finance functions among ABC. As a result, the authorized finance people can see how the financial performance would be when they just clicking one button.
This combination of finance team can allocate the appropriate resources to the right people to the right assignments, in which they would definitely enjoy the improvement behind the project. Taking myself as an example, I was promoted to Senior Regional Financial Analyst in AgS as I can learn the new business models and operational flows from different angles in the other 2 divisions, which trigger my intrinsic motivation to think about how to analyze the current company performance and position from a new perspective to suit into management’s need to present to the outsiders and investors. Also, this consolidation of finance team would be a good chance to share the knowledge and inspire for new ideas among other teams colleagues. In addition, this move could give me freedom and direction to achieve the company’s goal.
Last but not least, in order to achieve the above new drives, Human Resources department put lots of effort on those areas. For instance, a number of new work forces from different expertise areas joined ABC in the past 2 to 3 years. Also, a new scheme launched in ABC to retain the capable staff called “Talent Management”, in which those talent would be the focal points to be trained up in ABC in the coming few years. They can enjoy the study allowance which equips them for the career development; also they could be switched to other departments or relocate to other offices to understand how ABC is operating to gain the competitive advantages in the market. Under this program, these staff can be trained up to see something old in a new way. Under this scheme, the knowledge gained by the staff can be strengthened; also the morale and loyalty would be enhanced.
Conclusions
In my opinion, for ABC Corporation, the current hardware and software have already existed to face the future challenges. That means, both process and context have already been developed by new executive leaders in the past few years to gain the market shares to be the top 5 chemical players from the current position of top 10.
From the “Process” perspective, the lack of macro view concepts of the local managers has been indentified, in which the Corporate executives has introduced the strategies and directions for the countries to further develop based on their country situations.
From the “Context” perspective, after the development of the matrix organization with the new joined experts with different background, a new hierarchy structure and culture have been formed.
But why the market position of ABC still not yet reached to what they want? I believe that ABC is improving its roles in the market, which could be reflected in its share price, amazing EBIT growth % compared with other competitors in the chemical industry, also the comments from various analysts in different research houses and fund houses. Now the matter is just, ABC is still in its transitional period to compromise all the hardware and software to function well with each other to deliver its desired market position.