Business Model and Strategic Plan Part I:
Conceptualizing a New Product or Service Division of an Existing Business

Karon Kanadjian
Bus/475
June 24, 2014
Kathleen Kemmer

Business Model and Strategic Plan Part I:

Conceptualizing a New Product or Service Division of an Existing Business

This paper will explain the strategic plan for Newmont Mining Corporation’s newest venture, while defining the vision, mission, and goals of this Corporation and how it will interlink. It will state the company’s values and will offer strategic direction while considering the culture, social responsibility, and ethics. It will show how the mission statement along with the vision and values will help the company to achieve success in its new venture of promoting gold in a new format, and how it will guide the strategic direction of the company. It will address the needs of the public and global economies and how the company will offer a competitive advantage over all other companies in this industry.
Company History
Newmont Mining Corporation is an exploration, refining, and marketing company of gold and copper. They operate in the US, Australia, Peru, Indonesia, Ghana, New Zealand, and Mexico. As of December 31, 2013 , Newmont employed 15,085 people with its headquarters in Denver, Colorado. For the year ended in December 2013, they recorded revenues of $8,322 million. They are considered to be one of the largest producers of gold in the world (“Newmont”, 2014).
Vision
They consider their mission, vision , and values are what has helped to successfully grow their business. Their Vision is to be the most valued and respected mining company through industry leading performance. Their sustainability as a business depends solely on their ability to open, operate, develop, and close mines that allows value to be shared collectively with the company and the communities (“Newmont”, 2014). With Newmont’s new strategy of opening up centers to purchase gold coins, this will take the company a step forward in being respected in the mining company and will continue to propel them into the leading edge of the industry. Mission
Newmont’s mission is “We will build a sustainable mining business that delivers top quartile shareholder returns while leading in safety, environmental stewardship and social responsibility” (“Newmont”, 2014).
In a statement made by Richard O’Brien, president and CEO declares “ Part of our mission is to eliminate fatalities and serious injuries for our business, and we must be relentless in pursuing this goal. I know we can do it. We have plenty of days – and weeks- where no one gets hurt. If we can do it for a day or a week, we can do it every day.” (“Newmont”, 2014).
This new strategy will not have the hazardous conditions that cause accidents thus causing their percentages to overall drop due to the number of new employees that will be needed to move these new centers into the market place Newmont is recognized as a leader in the mining industry in safety and they take that seriously as risks are presented daily on-the-job tasks and with these new products will not have any of these safety issues. The centers will continue to allow Newmont to be a sustainable business as these new coins will be sold all over the world and more individuals than ever will know and recognize the name Newmont. This avenue will go a long way towards social responsibility as the economy struggles with the day to day survival and most individuals struggle with savings, this will allow a consumer to purchase a real gold item that could potentially be used in the future as trade. With the constant bombarding of news and forecasting a possibility of the dollar going away, this strategy would benefit every single citizens here in the U.S. to have a viable method of trade if that should ever come about like it did in the days of Germany’s struggle where a wheel barrel full of money was used to buy a loaf of bread. These coins will only continue to be valuable and a great source of trade since the U.S. no longer goes by the gold standard.
Gold
According to Gene Pantuso (n.d.), “Gold. Man’s fascination and pursuit of this rare, naturally occurring precious metal are legendary. It has become a universal symbol of wealth, success and quality. Gold is a centuries-old siren’s song which has never lost its allure. Men have died for it. Cities have been built in search of it. Careers have been built on it. And lives have been changed forever because of it” (para. 1).
Newmont was propelled into one of the leading producers of gold globally when they developed an airborne electromagnetic (EM) system designed for gold exploration. Their system, called NEWTEM is able to not only explore for gold and copper, but it is able to handle a multitude of problems that extend into the mining exploration commerce. NEWTEM I and NEWTEM II its successor were developed by Newmont for the exploration of mineral deposits, chiefly gold. It provides for general geologic mapping information all over the world, many places that are extremely challenging or costly to explore.

This system has proven to not only be cost effective with regard to operation, spatial resolution with the capability to map at the ends of the resistivity scale, but to be valuable in terms of safety which is one of Newmont’s primary concerns. This system that provides data lines up with Newmont’s goals of their gold- concentrated exploration and programs. They are able to continue quickly to carry out surveys with a local helicopter, and meet their exploration dictates on schedule for their specific company’s needs. According to Eaton et al. (2013), NEWTEM studies have been able to recognize conductive and resistive targets and to gain a better understanding and knowledge of the area’s capabilities in regards to host mineralization. These centers, placed in heavy trafficked area, will allow a debit or credit card to be used in the machine to pull out gold coins stamped with the Newmont mark indicating its authenticity. Gold will be a viable way to save money in the new tough economic times, and currently with banks, and other institutions charging high fees, or closing altogether. Newmont’s coins are the perfect way to save and not share in any risks. This will align with Newmont’s Vision statement of being the most valued and respected mining company through industry leading performance. It also meets the standard of its Mission statement of building a sustainable mining business while leading in safety, stewardship and social responsibility (Newmont 2014). This will be add to their value statements of acting with integrity, trust and respect, and promoting positive change through the encouragement of innovation.
With the current trends and scarcity of gold, making it the desired metal of choice, the value of these gold coins and allowing them to be widely available in common everyday places just like the ATM’s , will gain wide public acceptance. It will not only be innovative but will promote positive changes in everyday citizens allowing them to easily with minimum amounts of monies, buy gold coins that will be easy to trade or save. With Newmont’s economies of scale, and its opulent gold reserves, it places the company in a very solid position to have an advantage in this new gold market. According to Gold Bars Worldwide (2014), “ Approximately 250 coins (3,500 tonnes of fine gold) have been issued around the world since 1970” and “from 1970 – 1979 a period of nine years the Krugerrand was the only ounce-denominated gold bullion available to the International market” (p. 2,3). Gold coins can be issued at the time of purchase on the prevailing value, which will enable the coins to be traded at prices that reflect the standard international gold prices. With Newmont’s ability to mass-produce them in large quantities, it generally will ensure that the value will be relatively stable (“Gold Bars Worldwide”, 2014). The gold coins just like all countries have national Acts and regulations that they will need to adhere to, however, having a responsible outside company that has been minting for companies will allow Newmont to not have to gather more information and go through the normal process and red tape to start. Once the coins are minting and ready for distribution, Newmont will then get involved with the marketing and distribution of the produce. They will have an striking decorative design on their back side and will be changed each year to allow for a collectable dimension, an example would be the Australian Kangaroo. Newmont will be highly capable of creating long-term sustainable prospects for the economy as well as the company through their honest and transparent communication practices and their high regards in safeguarding the human rights and health of their employees as well as communities (“Newmont, 2014).
Newmont has a positive effect on many Non-Government Organizations (NGOs) in the country in aiding the disadvantaged society. Through their continued support, furniture, curtains, kitchenware, appliances and other bathroom wares are donated to four beneficiaries which distribute the goods through their organizations. Each new innovation and produce or service will help to continue support to the global community at large.
The gold machines such as the pictures below of one currently located in Los Vegas left, or right the Gold to Go machine, will be distributed in high traffic areas starting in prominent areas first, shopping centers, airports and areas with high security. The machines will be fitted just like an armored vehicle and tested against explosives to prevent theft. It will be surrounded with surveillance cameras that will record all consumers transactions. These gold ATMs will be designed to offer ordinary people the chance to feel comfortable with investing in gold and the opportunity at convenient every day places to purchase them. These machines will update their prices to the current market value every 10 minutes via the internet so the chance of being overcharged like some companies currently offering to sell gold at premium prices, would be eliminated. Users will be required to scan their identification for any purchases that exceed $100 and access to the system will be limited to three times per day to avoid any possible money laundering. The machines will dispense in quantities of 1, 5, and 10 grams of 24-carat gold coins or bars. They will be sealed in plastic with an anti-counterfeit hologram label just like the Gold to Go bars, describing its purity and price per gram. Newmont will purchase Franchise licensees and pay TG-Gold to service the machines (“Gold Bars Worldwide”, 2014). n conclusion, Newmont is in the perfect position financially, to move ahead of the game and to launch its new innovation to the global communities while being supported by the same communities in which they work, and serve. We will show a positive outlook for the company and positive revenues that will continue to grow throughout the coming years, and they will keep their vision to be most valued and respected in the industry through their performance of perfection, safety, with a commitment to action.

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References
DATAMONITOR: Newmont Mining Corporation. (2010). Newmont Mining Corporation SWOT Analysis, 1-9.
Eaton, P., Anderson, B., Queen, S.V., Nilsson, B.Y., Lauritsen, E., Barnett, C.T., Olm,M…Mitchell,S. (2004) NEWTEM — Adventures in thin air. SEG Technical Program Expanded Abstracts 2004: pp. 1213-1216.doi: 10.1190/1.1839660
Gold Bars Worldwide. (2014). Retrieved from http://www.goldbarsworldwide.com/PDF/RT_8_Gold_Vending_Machines.pdf
Newmont. (2014). Retrieved from http://www.newmont.com/about/company-glance
Pantuso, G. (n.d.). Beverly Hills Beauty Institute. Fulfilling The Golden Promise, ().
Society of Exploration Geophysicists. Retrieved from: http://librariy.seg.org/doi/abs/10.1190/1.1839660

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