The Global Farmer and the Future of Soybean Production: The Halderman Companies - Case Study Example

? The Global Farmer and the Future of Soybean Production: The Halderman Companies Task Why this company has been successful, when the industry and the agribusiness sector have been characterized for the dominance of one of the “big sisters” (Cargill, Bunge, Louis Dreyfuss, ADM) downstream and have been highly fragmented and heterogeneous upstream (close to the farmers)? The Halderman Company has been successful despite the dominance of Cargill, Bunge, Louis Dreyfuss, and ADM and highly fragmented and heterogeneous upstream in the industry and the agribusiness sector because of the following reasons. Firstly, Halderman’s management of ensuring that tenants work professionally with land owners and endorsement of long-term productivity of the farm makes the company be successful. He ensures that soil is handled properly and farm infrastructures are improved, restructured and modernized. The soil has been in favorable condition to ensure that it produces quality crops. Halderman ensures that fertilizers used are obtainable and sufficient to make the farm productive leading to affluent harvest season. The infrastructures are always in superb condition that has created a comfy working milieu. Furthermore, he ensures that infrastructure such as buildings and roads are rationalized and have necessary facilities that make operation uncomplicated. The roads are always accessible and restructured to meet standards required to make transport and contact a simple task (Ray, 2004). Secondly, Halderman’s guidance to clients in an apt way of choosing cost effective farm inputs, makes them save money by buying high-volume discounts of farm supplies. Halderman makes sure that his clients enjoy discounts provided by other departments so that he creates an intimate relationship with them. Halderman Company has been successful despite the highly fragmented and heterogeneous upstream since the principle he uses is to satisfy clients of the company (Ray, 2004). Moreover, he assists in companies’ sectors such as filling forms and choosing correct means of conducting a business aiming at getting profits. The uncertainty existing in the company is eliminated by the relationship that exists between the company and the reputable contractors. The tricky government forms are always analyzed to assist customers in comprehending how to fill them by Halderman. Lastly, the Halderman’s efforts in providing lesson to clients on ways of managing risk make the company be successful. He does this by helping customers with legacy and estate planning strategies. All the efforts of Halderman are successful since he impresses customers who maintain their loyalty and call other members to join the firm and conduct business. Halderman also bargains and assists clients using share and custom hire lease to capitalize on their returns. Halderman Company has been successful despite the dominance of Cargill, Bunge, Louis Dreyfuss, and ADM since he advises the customers on the proper choices making when faced with difficulty in making strategic lesson. For this reason, the company has managed to have a broad client’s base that comprises of the following individuals: profit-driven investors and older farmers. Halderman belief is that a small increase in price per bushel of soybeans results to an extra profit making. This strategy has made the company successful despite the dominance of Cargill and Bunge (Shurtleff & Aoyagi, 2010). What distinctive core competences did this company develop? How this competence has helped to build – up competitive advantages? Firstly, the distinctive core competence the company developed is an apt form of leases arrangement depending on the targets and attitude towards getting a risk. It launched cash rent leases that played a core role in ensuring that tenants received their salary promptly (Warner, 2011). The owners’ of the lease were required to pay taxes of real estate, insurance, money enhancement and management for each acre only. Tenants were required to pay for a fixed annual fee in order to lease the land from the owners. The operator tenant received 100 % of the yield crop during the harvesting period. Share lease required firm’s cost to be split amid the owner and the tenant. Tenant and the owner had to share both the risk that could occur and the price that needed at a meticulous time (Warner, 2011). In simple terms, the share lease required a 50-50 share and needed the active involvers of the deal to participate wholly. Clients of Halderman were assisted to choose suitable share lease that would go well with their property and personal preferences by Halderman. Lastly, it implemented the custom hire lease. The owner was responsible to pay all the input fee and costs and was credited to get 100% of the harvested crop (Warner, 2011). Halderman benefitted deeply, since owners were required to pay the company a management fee for services such as consultation and buying discounts. Halderman responsibility was to perform all the operational coordination and market operations. It monitored the production operations guaranteeing that all projects were attained. Secondly, the distinctive core competence the company developed involved the fields representative of the Halderman Companies who were well-informed individuals holding a bachelor’s degrees and master degrees in Agricultural courses such as Agricultural economics. This competence helped to build–up competitive advantages since the representatives produced quality work. They had the necessary skills required for outstanding work and results. Thirdly, the company explored South American countries such as Brazil and Argentina. Halderman suspected that South America was affecting the soya bean business negatively. As an inimitable leader, he visited the countries and was able to witness the magnitude of the problem. This competence helped to build–up competitive advantages since he saw the condition as a challenge and an opportunity for Halderman Companies such as Halderman Farm Management, Inc HFMS, and Halderman Real Estate Services, Inc, HRES. Which are this firm’s competitive advantages? Are they sustainable or not? Why? Support your statement. The firm’s competitive advantages include the 600 farms in Argentina and Brazil, and assets that amount to 460 million dollars. It is sustainable since this fact makes them financially stable; hence can come up with projects that improve the standard of the company. Being financial stable makes the company competent in business, since it can solve its problems when it requires money to perform and initiate a task. Having 600 farms is potentially necessary in making the firm perform diverse business that are productive and profit oriented. Secondly, the firm’s competitive advantages are infrastructures such as railways and water transport that have assisted the company appreciably. They are sustainable since they are capable to make effective business through the transportation of soybeans and other commodities such as fertilizers. The availability of such commodities is essential for successful running of business (Shurtleff & Aoyagi, 2010). Thirdly, the firm’s competitive advantage is because of America’s useful financial markets that have macroeconomic stability. It is sustainable since it makes Halderman Company operate and manage their business in a favorable environment. The stable agricultural support system allows making the company face competitiveness from other industries hence forced to improve services to the populace. Furthermore, the ability of the company to have quality yields positions of the company at a lively competition level. The technological advancement has made Halderman Company make high profits at a fast rate, because the technology increases the working rate since it entails diminutive energy (Ray, 2004). What recommendations can you make to the CEO of this company in terms of how to manage future growth and the firm’s international strategy? I recommend the CEO to create and maintain an intimate relationship with clients since they are the core cause of firm’s existence. Making customers satisfied should be the foremost priority for tenants and the management team of the company. Customers are significant aspects for the existence of a company. Thus, the leader should create a good milieu that makes them comfortable in conducting a business. This can be achieved if the CEO ensures that farm operators uphold a lengthy term relationship with land owners and other significant personnel in coming up with leases. The CEO should set goals to be accomplished within a specific time, and ensure that apt strategies are implemented and written down. All the stakeholders should participate in the process of making targets and suggest appropriate methods of attaining them. Examples of some of the goals include replicating the profits got within a specific time. The CEO should ensure the other sectors are working accordingly. I recommend the CEO to ensure that there are enough and effective fertilizers to enhance the growth of soybeans. Moreover, infrastructure should be modernized and maintained to allow mobility of materials in a good condition. Another factor focusing on advising the company and services it provides to the society. Through advertisement, the company gets serious and prospective clientele who are ready to work with the company. References Ray A. G. (2004). The Global Farmer and the Future of Soybean Production. Harvard business school. Retrieved on 14 April 2012 from < http://www.academia-research.com/filecache/instr/c/a/665694_casoharvardsoja-rayagoldberg.pdf> Shurtleff, W., & Aoyagi, A. (2010). History of soybeans and soyfoods in Canada (1831-2010): Extensively annotated bibliography and sourcebook. Lafayette, CA: Soyinfo Center. Warner, R. E. (2011). Leases and rental agreements. Berkeley: Nolo. Read More