Using data analysis to provide possible solutions for Monsanto's business issue from 2005 to 2008, all contents from the case study: Monsanto Balances the Interests of Multiple Stakeholders

1. MONSANTO
FUTURE BUSINESS MODEL
Student: Jiechen Xie
Professor: Kadia
Shriram

2. 1Jiechen Xie | MonsantoMar 19, 2020
CONTENTS
 Recent context
 What concerns to focus
 Execution
 Let’s get started

3. 2Jiechen Xie | MonsantoMar 19, 2020
Recent context
Monsanto is under challenge to fulfill various concerns from stakeholders
for both its products and the corporation itself
The concerns of stakeholders come from both Monsanto’s products and Monsanto itself
Key Drivers
Monsanto's products The Company itself
• Concerns about safety of the product
• Safety concerns about genetically
modified food
• Safety concerns about bovine growth
hormone
• Concerns about the environmental
effects of the products
• Concerns about the environmental
impacts
• Concerns of crop resistance to
pesticides and herbicides
• Corporation conduct issues
• Bribery issues
• Patent issues
• Legal issues
• Corporate responsibility issue
• Expectation of contribution to
international agriculture development
• General market concern
• Rising competition from Chinese
companies
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

4. 3Jiechen Xie | MonsantoMar 19, 2020
Recent context: Concerns of Monsanto's products
Safety concerns about genetically modified food:
• Although FDA has proclaimed the safety of consumption of genetically modified food,
consumers believed there will be negative impacts if genetically modified food have been
consumed long enough
• Despite the study from the New York Medical College states Roundup create no health risk
for humans, consumers concerned about the lack of appropriate regulation would allow
allergens to penetrate the products
Safety concerns about bovine growth hormone:
• Although FDA has claimed no difference of milk from Posilac-treated cows and rBST-free
cows, some stakeholders believe a cow has higher risk of health problem will produce
untrustable milk (rBST will increase health problems in cows)
• Many grocery stores and restaurants have stopped purchasing rBST-treated milk, such as
Starbucks, Kroger, Ben & Jerry’s and Walmart
Monsanto’s products are questioned for safety concerns due to insufficient
convincible proof and lack of appropriate regulation
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

5. 4Jiechen Xie | MonsantoMar 19, 2020
Recent context: Concerns of Monsanto's products
Concerns about the environmental impacts:
• Some studies has claimed that the Roundup herbicide does harm to birds, insects and
amphibians. Although Monsanto has countered these studies by questioning the methodology
been used, and the EPA supported that glyphosate does no harm, the stakeholders
maintained their concerns due to no convincible evidence in long-term
• Although Monsanto maintains that every possible environmental effects it creates has been
studied and approved by EPA, stakeholders still holds the concern of environmental
contamination from the product
Concerns about crop resistance to pesticides and herbicides:
• Significant numbers of Roundup-resistant weeds have been found in USA and Australia
Monsanto’s products are believed and have already been proved to have
environmental effects on the biosphere
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

6. 5Jiechen Xie | MonsantoMar 19, 2020
Recent context: Concerns of Monsanto itself
A high likelihood of significant market share losing if Monsanto continue to
have bribery issues unaddressed
Implications of bribery issues on
Monsanto Indonesia in 2002
• Although Monsanto launched an
internal investigation when discovering
irregularities and properly solved the
issue, the Indonesia market was
affected by the scandal and took years
to recover
• Monsanto Indonesia suffered from bribery issue in 2002 and took years to gain the market back
48% 48%
46%
44% 44%
45%
42%
43%
44%
45%
46%
47%
48%
49%
2001 2002 2003 2004 2005 2006
MONSANTO INDONESIA MKT
SHARE CHANGE
Monsanto
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

7. 6Jiechen Xie | MonsantoMar 19, 2020
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders
Recent context: Concerns of Monsanto itself
A higher competition is expected with Monsanto’s agreement on patent
expiry of its seeds in 2014
Implications of patent issue on
Monsanto North America in 2014
• Monsanto NA has to allow patents
expiry on its seeds due to scandal on
its seed investigators and pressure
from federal
• Other companies has the allowance to
create less expensive alternatives for
Monsanto’s seeds
48% 48% 48%
44% 44%
45%
42%
43%
44%
45%
46%
47%
48%
49%
2012 2013 2014 2015 2016 2017
MONSANTO NORTH AMERICA
MKT SHARE CHANGE
Monsanto

8. 7Jiechen Xie | MonsantoMar 19, 2020
The attention from the American Antitrust Institute:
• The institution filed a paper declaring Monsanto is hindering competition
• Monsanto must get approval from such institution when acquiring DeKalb and Delta Land and
Pine.
The attention from the Department of Justice (DOJ):
• DOJ has begun a civil investigation into Monsanto’s practices due to a lawsuit claiming form
DuPont
Monsanto’s great control under the transgenic seed industry may arise
legal issues in the future such as lawsuits on anticompetitive activities
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders
Recent context: Concerns of Monsanto itself

9. 8Jiechen Xie | MonsantoMar 19, 2020
Monsanto is expected to solve such issues:
• Population increase leads to less lands and more food consumption, Monsanto is expected to
help increase crop production per acre
Monsanto has developed a three-tiered commitment policy:
• Produce more yield in crops
• Conserve more resources
• Improve the lives of farmers
Monsanto’s great success under the agriculture industry arise international
expectation on contribution to agriculture in developing countries
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders
Recent context: Concerns of Monsanto itself

10. 9Jiechen Xie | MonsantoMar 19, 2020
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders
Recent context: Concerns of Monsanto itself
A rising competition is foreseen under international agriculture market as
Chinese companies’ weed killer product is eating Roundup’s profit
Implications of Market Shares on
Monsanto Asia
• Monsanto Asia is starting to losing its
leading position due to increasing
competitions from Chinese companies
• Chinese companies’ non-transgenic
seeds with less price than Monsanto’s
transgenic seeds are more likely to be
acceptable, despite the less
productivity
37%
35%
32%
30% 29%
5% 6%
8%
10%
12%
0%
5%
10%
15%
20%
25%
30%
35%
40%
2015 2016 2017 2018 2019
ASIA MKT SHARE CHANGE
Monsanto Chinese Companies

11. 10Jiechen Xie | MonsantoMar 19, 2020
CONTENTS
 Recent context
 What concerns to focus
 Execution
 Let’s get started

12. 11Jiechen Xie | MonsantoMar 19, 2020
What concerns to focus
Three criteria will guide Monsanto to solve each concern respectively under
the urgency sequence
Urgency of each issue
Metrics Monsanto's products The Company itself
Safety Concern Environmental
Concerns
Corporation
Conduct Issues
General Market
Concerns
Corporate
Responsibility Issue
Legislation
Possibility
• Very likely of
legislation
• Unlikely • Very likely of
legislation
• Unlikely • Unlikely
Market Share
of Monsanto
• Solve this
concern will
create an 8%
difference
• Solve this
concern will
create a 4%
difference
• Solve this
concern will
create a 7%
difference
• Solve this
concern will
create an 5%
difference
• Solve this
concern will
create an 4%
difference
Gross Margin
of Monsanto
• Solve this
concern will
create a 0.3
difference
• Solve this
concern will
create a 0.2
difference
• Solve this
concern will
create a 0.2
difference
• Solve this
concern will
create a 0.2
difference
• Solve this
concern will
create a 0.1
difference
Concerns ordered by urgency: Safety = Conduct > Environmental = General Market > Responsibility

13. 12Jiechen Xie | MonsantoMar 19, 2020
Continuing concern of Monsanto’s product safety will lead to a legislation under transgenic food:
• Continuing product safety concerns without convincing evidence of no harm, will result an expected
high volume of lawsuits from some institutes and stakeholders
• Government will put more attention on Monsanto and highly likely of specific laws will be legislated to
restrict transgenic seeds
Continuing misconduct of the corporation will result more scandal and lawsuits:
• Despite the solution to bribery of Monsanto Indonesia in 2002, as a multinational company, a high
possibility of bribery will happen again
• The great power under the agriculture market of Monsanto has caught the attention of American
Antitrust Institute and DOJ, the investigation of these two institutes will likely to find something as
Monsanto is too big
Monsanto should first focus on solving the product safety and corporation
conduct concerns with high possibility of being against by new legislation
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders
What concerns to focus: Legislation

14. 13Jiechen Xie | MonsantoMar 19, 2020
The affect of market share confirms Monsanto’s next focus on product
safety and company conduct concerns
The greatest two changes in market share (8% vs 7%) confirm Monsanto should focus on solving these two challenges first
What concerns to focus: Market Share
2020 2020 2020 2020 2020 2020 2020 2020 2020 2020
('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's)
Total Market Size in Units 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000
SAFETY
SOLVE
SAFETY
UNSOLVED
ENVIRON
SOLVE
ENVIRON
UNSOLVED
CONDUCT
SOLVE
CONDUCT
UNSOLVED
MKT
SOLVE
MKT
UNSOLVED
RESPON
SOLVE
RESPON
UNSOLVED
Global Monsanto Market Share
Monsanto Asia 19.00% 17.00% 19.00% 17.00% 17.00% 16.00% 19.00% 17.00% 19.00% 17.00%
Monsanto NA 31.00% 28.00% 31.00% 30.00% 30.00% 27.00% 31.00% 29.00% 31.00% 30.00%
Monsanto Australia 26.00% 23.00% 26.00% 25.00% 25.00% 22.00% 26.00% 25.00% 26.00% 25.00%
Total Market Share 76.00% 68.00% 76.00% 72.00% 72.00% 65.00% 76.00% 71.00% 76.00% 72.00%
Change of Market Share to 2019 3.00% -5.00% 3.00% -1.00% -1.00% -8.00% 3.00% -2.00% 3.00% -1.00%
Change in Market Share 8.00% 4.00% 7.00% 5.00% 4.00%
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

15. 14Jiechen Xie | MonsantoMar 19, 2020
The affect of gross margin also confirms Monsanto’s next focus on product
safety and company conduct concerns
The greatest two changes in gross margin/unit (0.3 vs 0.2) confirm Monsanto should focus on solving these two challenges first
What concerns to focus: Gross Margin
SAFETY
SOLVE
SAFETY
UNSOLVED
ENVIRON
SOLVE
ENVIRON
UNSOLVED
CONDUCT
SOLVE
CONDUCT
UNSOLVED
MKT
SOLVE
MKT
UNSOLVED
RESPON
SOLVE
RESPON
UNSOLVED
2020 2020 2020 2020 2020 2020 2020 2020 2020 2020
Units Sold ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's) ('000's)
Monsanto Asia 19,000 17,000 19,000 17,000 17,000 16,000 19,000 17,000 19,000 17,000
Monsanto NA 31,000 28,000 31,000 30,000 30,000 27,000 31,000 29,000 31,000 30,000
Monsanto Australia 26,000 23,000 26,000 25,000 25,000 22,000 26,000 25,000 26,000 25,000
Total Units Sold 76,000 68,000 76,000 72,000 72,000 65,000 76,000 71,000 76,000 72,000
Selling Price $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Total Sales $76,000.0 $68,000.0 $76,000.0 $72,000.0 $72,000.0 $65,000.0 $76,000.0 $71,000.0 $76,000.0 $72,000.0
Cost of Goods Sold / Unit $0.40 $0.70 $0.40 $0.60 $0.50 $0.70 $0.40 $0.60 $0.40 $0.50
Total Cost of Goods Sold $30,400.0 $47,600.0 $30,400.0 $43,200.0 $36,000.0 $45,500.0 $30,400.0 $42,600.0 $30,400.0 $36,000.0
Gross Margin $45,600.0 $20,400.0 $45,600.0 $28,800.0 $36,000.0 $19,500.0 $45,600.0 $28,400.0 $45,600.0 $36,000.0
Gross Margin / Unit $0.60 $0.30 $0.60 $0.40 $0.50 $0.30 $0.60 $0.40 $0.60 $0.50
Change in GM $0.30 $0.20 $0.20 $0.20 $0.10
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

16. 15Jiechen Xie | MonsantoMar 19, 2020
CONTENTS
 Recent context
 What concerns to focus
 Execution
 Let’s get started

17. 16Jiechen Xie | MonsantoMar 19, 2020
Focus on solving product
safety concerns and
company conduct
investigation
Focus on innovation of
products providing non-
transgenic seeds to fulfill
needs of Asian market
and reduce
environmental affects
Continue the current
strategy of philanthropy
and contribution to
international agriculture
• In short term, put a focus on
providing convincible research
proving harmlessness of the
product
• Set up internal investigation
department to prevent company
misconduct
• Continue to put effort on the
current focus of RNA technology
to make crops deadly to bugs
• Start gradually transfer focus on
innovation on non-transgenic
seeds with no safety concerns to
compete with Chinese
companies in Asia
• Transfer non-transgenic product
research centers to developing
countries, providing technical
support locally, gain reputation
• Funding or founding agriculture
schools in developing countries
to gain long-term support and
embed company cultures to local
students
Execution
Monsanto should take a three-step action to balance the interests between
different stakeholders
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

18. 17Jiechen Xie | MonsantoMar 19, 2020
Execution: Step One
Monsanto should focus on solving product safety concerns in a short run
and set up the internal investigation department
• In short term, put a focus on providing convincible research proving harmlessness of the
product
• A research based on last 20 years will be done to prove the harmless of Monsanto’s
transgenic products by March 2020
• Shorten the expiry period on the current products to reduce the risk of receiving lawsuits from
AAI and DOJ, give up some market share to DuPont or other competitors.
• Set up an internal investigation department to continually investigate on possible
misconduct inside the company
• Always take steps before the Government or Media, reduce the volume of scandals.
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

19. 18Jiechen Xie | MonsantoMar 19, 2020
Execution: Step Two
Monsanto should start pay more attention on innovation non-transgenic
products to compete Chinese companies and reduce environmental affects
• Continue to put effort on the current focus of RNA technology to make crops deadly to bugs
• Testing products should be released after the safety research being done
• Mature RNA products will be released as soon as possible based on the result of the testing
products
• Focus on shifting more concentration to innovate non-transgenic high yield products
• Gradually shift concentration from transgenic products to non-transgenic products
• Innovation on providing alternative solutions to prevent bugs
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

20. 19Jiechen Xie | MonsantoMar 19, 2020
Execution: Step Three
Monsanto will continue the current strategy of philanthropy and
contribution to international agriculture
• Transfer non-transgenic product research centers to developing countries, providing
technical support locally, gain local reputation
• Set up non-transgenic product research center in developing countries in South Asia such as
Philippines and Vietnam, who are agriculture focused
• Hire local researchers to provide job opportunities and gain local reputation
• Funding or founding agriculture schools in those countries to gain long-term support and
embed company cultures to local students
• Gain support and embed product branding into students’ mind, earn long-term supports
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders

21. 20Jiechen Xie | MonsantoMar 19, 2020
Execution: Implement Schedule
Monsanto should follow the implement schedule to address the challenge
2020 2021
Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb
Step one
• A research to prove the harmless of
Monsanto’s transgenic products
• Shorten the expiry period on the
current products
• Set up an internal investigation
department
Step Two
• Release testing RNA products
• Release of RNA products
• Shift concentration to non-transgenic
products
• Innovation on providing alternative
solutions to prevent bugs
Step Three
• Set up non-transgenic product
research center in developing
countries in South Asia
• Funding or founding agriculture school
locally

22. 21Jiechen Xie | MonsantoMar 19, 2020
CONTENTS
 Recent context
 What concerns to focus
 Execution
 Let’s get started

23. 22Jiechen Xie | MonsantoMar 19, 2020
Let’s get started
In short run, Monsanto will put a focus on providing convincible product
safety proof and setting up internal investigation team by March 2020
By March 2021, Monsanto should achieve
• A convincing research based on last 20 years’ records to prove the harmless of
Monsanto’s transgenic products
• Shorten the expiry period on the current products and give up 2% of the market
share to competitors to get away from the high attention from Government
• Set up an internal investigation department to continually investigate on possible
misconduct inside the company
Contents from Case Study: Monsanto Balances the Interest of Multiple Stakeholders