Topic described in, order description section – The role of R and D for Syngenta. Essay
This paper seeks to examine and discuss the part that R&D plays in the new product development process for Syngenta. This discussion will focus on how this (R& D) can lead to the successful development of new, innovative, products, from their introduction stage to their ultimate decline stage. This paper is thus expected to provide advice to the company as to how the maturity stage can be extended by introducing new innovations at appropriate times and what suggestions could be made on how the company can compare the relative success or otherwise of its various product lines using appropriate portfolio analysis models.
In arriving at the conclusion, this paper will also attempt to apply theoretical constructs as put forward by Booz, Allen & Hamilton in the decay curve of new product ideas; the notion of the product life cycle and life cycle extension strategies and Rogers’ diffusion of innovations and portfolio analysis.How does R & D lead to the successful development of new, innovative, products, from their (Syngenta’s) introduction stage to their ultimate decline stage? By the application of science, R & D leads to successful development of new, innovative, products, from their introduction stage to their ultimate decline stage.In discussing the role of R&D for Syngenta, case facts acknowledge that as society develops, the corresponding change in consumer demands arises to reflect different needs. Thus from time to time the desire of customer to choose from a range of fresh, high quality products must be meet. Along with the changing need and wants of consumers may also include the increasing population which also requires increasing quantities of production.
There must be therefore a sustainable way to address these concerns and farmers must apply better technologies and solutions to balance environmental concerns with the need to produce food. Syngenta’s business is in providing research and development will therefore come into play. Syngenta claims to be a leading global agricultural business committed to sustainable agriculture through innovative research and technology whose customers are in the primary sector (Case facts). Being a provider of innovative solutions and brands to growers and the food and feed chain by its offers to customers of choice of chemistry, seeds and biotechnology products, Syngenta will need to respond also using research and development activities.In its research which is a systematic investigation to seek answers to agricultural problems, the company employs scientists such as biologists and chemists to develop technologies which may eventually lead to new products.
To illustrate, it has its chemists to investigate thousands of different compounds to see if they have the potential to be a new crop protection product. Upon the identification of a suitable compound, it is expected that development will take place. On the other hand, development involves turning or converting the research findings into a product. Syngenta through its R&D claims to develop new products and support existing products. Since production involves a process which can take 9 years in the case of Syngenta for its product to reach the market, the same could really involve a costly process (Case facts). And since the company can only achieve a return on its investment once new products reach the market, computing the cost benefit analysis of the product due for development could only be a regular part of its practice.
The company therefore will have to apply strategies to protect itself from the investment that it has made in R&D such as by patenting its new product but there is limit to this protection as to time. Thus, it would be consistent to reason to argue that the company would be better off concentrating on fully patentable products to ensure payback and profit and it cannot just introduce new innovations to existing products then there could good expectation for lower cost and higher bottom line figures.To understand the company’s R&D program, that same must be tied up with the company’s main goals for research and development which are: (1) to provide the most effective products for farmers and growers that are also safe for human health and the environment; (2) to develop the best new plant varieties to gain higher yields and quality in a range of soils and weather conditions, and (3) to maximize crop productivity whilst maintaining and improving farmland biodiversity (Case facts).After understanding the role of R&D, it is now appropriate the answer the question: How the maturity stage can be extended by introducing new innovations at appropriate times? To introduce innovations to extend maturity stage follows the same process as the R&D.
A wise product development analyst show knows when that product should mature and the timing of introduction of new innovations at appropriate times. There are good theories in research and development strategies that could used to address this concerned as will be discussed in the succeeding parts.Using also appropriate portfolio analysis models, this paper at this point attempts to know: What suggestions could be made as to how the company can compare the relative success or otherwise of its various product lines? Before responding to this query, it is best to understand the meaning of business portfolio. Tutor2u, (n.d.
) defined the terms as “the collection of businesses and products that make up the company.” It thus explained that “the best business portfolio is one that fits the company’s strengths and helps exploit the most attractive opportunities.’ This paper therefore expands the same definition by saying that a portfolio analysis must produce a combination of product and services that would be most beneficial to the company in meeting the corporate objectives. Supposedly therefore, Tutor2u, (n.d.) advises the company to analyze its current business portfolio and decide which businesses should receive more or less investment, and subsequently develop growth strategies for adding new products and businesses to the portfolio, whilst at the same time deciding when products and businesses should no longer be retained.
Given the two best-known portfolio planning methods which are the Boston Consulting Group Portfolio Matrix and the McKinsey/General Electric Matrix, this paper could suggest to the company how it can compare the relative success or otherwise of its various product lines. But first there is a need to understand the methods and processes involved. First it should be noted that in both methods, the first thing to do is to identify the various Strategic Business Units or the so called SBU’s in a company portfolio. The company’s SBU varies depending on how it was organized as it can consider an SBU to constitute a division, a product line or an individual brand.
Thus an SBU afford independent planning from other units and this therefore presupposes each SBU to have a separate mission and objective. Due therefore to the requirement to have SBU defined first, Syngenta may now be advised to categorize its existing products in terms of their individual mission or objectives for planning. After which since the SBU will be evaluated in terms of their bottom-line effects on profitability and other criteria, Sygenta would now be able to compare its products and put them in matrix for comparison. Tutor2 (n.d.
) illustrated the application of using market attractiveness and competitive strength as criteria or category in applying the McKinsey/GE Matrix to the UK retailing market. It therefore listed factors that may affect market attractiveness of a product and the list include market size, market growth, market profitability, pricing trends , competitive intensity/rivalry, overall risk of returns in the industry, opportunity to differentiate products and services, segmentation, distribution structure (e.g. retail, direct, wholesale. To apply the principle to Syngenta, the company may now further it classification of its products by using market size, market growth, market profitability, pricing trends, and the rest of the factors in the said that may affect market attractiveness of its product and in this sense, the company can compare the relative success or otherwise of its various product lines.
In this paper’s effort to help Sygenta, this paper now attempts to answer this question: How to apply theoretical constructs as put forward by Booz, Allen & Hamilton in the decay curve of new product ideas for Syngentia? In response, it may be stated that Durham Associates Group Limited (n.d.) claimed that in the original research of Booz, Allen and Hamilton, the latter found that it took 58 new product ideas to produce one potentially successful product, but even during the ‘commercialization’ stage there was still a 50/50 chance that the product would not be successful. If this experience is applied for Syngenta, the company would really have to undergo a difficult process in its R&D efforts to innovate. Durham Associates Group Limited (n.
d.) also added that the latter research conducted by Booz, Allen and Hamilton implied that that it took considerably fewer new product ideas to produce a successful product. Again as far Syngenta is concerned, coming up with new products every now and then is becoming more difficult thus suggesting of rather improving on existing products. This must have a logical basis in reality since products could actually be repackaged and added some new features to be to sustain new life. The best example that could be used here is the case of Coca Cola Products. One could observed the contents of that famous soda Coke products has been there for a long time and even up to this the formula to manufacture the same was still the same.
But what the company did was to package the product under new marketing strategy so that it could be serving to satisfy other form of need and want.For further analysis, this paper wants to respond to the question: How to apply theoretical constructs on the notion of the product life cycle and life cycle extension strategies for Syngenta? Indigo Development (2005) explained that product-life extension is a strategy that could make very large reductions in materials and energy use needed to satisfy growing consumer needs. It is believed that the estimates from the use of the productivity could increase the productivity per unit of resource used ten times, thus promising improved resource productivity that could be translated to increased profitability and competitiveness. Given the reality of lesser chances of success for more new products using Booz, Allen & Hamilton theory on the decay curve of new product ideas and benefits of product life cycle and life cycle extension strategies as explained here, Syngenta is in very advantageous position to apply the principles in its research and development activities (Indigo Development, 2005).
Finally, this paper wants to respond to the question: How to apply theoretical constructs on Rogers’ diffusion of innovations? Rogers’ diffusion of innovations has its relation with the origins in diffusion theory, which is a set of generalizations regarding the typical spread of innovations within a social system (Orr, 2003). Under the theory there is claim that a tipping point makes it easy to spread change. Orr (2003) explained that diffusion is the process by which an innovation is communicated through certain channels over time among the members of a social system. The author realized that decisions under theory are not authoritative or collective and that each member of the social system faces his/her own innovation-decision that follows a 5-step process that includes knowledge, persuasion, decision, implementation and confirmation. Orr (2003) added that the most striking feature of diffusion theory is observation that the innovation-decision depends heavily on the innovation-decisions of the other members of the system, reaching a spread that follows an S-shaped curve (Leader Values, 2007). He noted that after about 10-25% of system members adopt an innovation, what comes next is a relatively speedy adoption by the remaining members and then a period in which the holdouts finally adopt.
The decision to innovate under the theory is also made through a cost-benefit analysis where the major obstacle is uncertainty and adoption of innovation comes after product or service utility is believed to be enhanced (Orr, 2003). This must be logical as innovators are economic agents who are rational beings (Terry, 1998; Huy, 2002).To conclude, Syngenta’s research and development activities were found to play important role in the company’s the new product development process. With the focus on how R& D lead to the successful development of new, innovative, products, from their introduction stage to their ultimate decline stage, this paper were confronted with application of models that could guide Syngenta in the attainment of its objectives.
This paper suggested ways on how and why the company extends the maturity stage by introducing new innovations at appropriate times. This paper found from Booz, Allen & Hamilton’s in-the-decay-curve-of-new-product ideas that there are more chances of success in improving on new products as way of introducing innovations that creating purely new products. Such observable fact is confirmed by experience that needs are normally permanent and that only wants changes. This finding was also consistent with product life cycle and life cycle extension strategies which promises greater benefits in implementation.
But the bottom line in making all these strategies for Syngenta should be the accomplishment of its corporate objectives (Bergen and Soper, 1995; Smith, 1996; Haedrich, 1993) which could be enhance by applying the principles of portfolio analysis. Along these lines, Syngenta is advised to define and classify its products in terms of SBU and apply the following different factors such as market growth, market share, and profitability to afford comparison of its products success in relation to the attainment of its corporate objectives.