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Noble Biomaterials, Inc. is a company that was actually originated from a company called Saquoit which was about a century old and it was located in the heart of New York State. Initially Saquoit was involved in the production of cotton in early 1873 and later the company started producing silk in the year 1880. It was named as Sauquoit Silk Company and it is one of the largest silk weavers which employed around 2000 employees. This is the first company to get license of DuPont to produce a new fiber called "Nylon" in the year 1947. Later on the company has undergone so many changes and it undergone a lot of technical and functional changes within the organization. One of the biggest transitions is the transition from silk to silver. This process later laid the foundation for the invention of a new technology and that is branded as X-STATIC. At present the X-STATIC fabrics are used in many consumer products and consumer brands such as apparels, uniforms, sportswear, defense, medical apparel etc. This X-STATIC fiber is also used in the manufacture of wound care bandages. Johnson and Johnson and some other companies have already started manufacturing it. The in house products of Noble Biomaterials are marketed in the name SilverSeal. For electronic circuitry noble biomaterials provide the technology named CircuiteX and for static control it provides ContaX. At present Noble Biomaterials is one of the top manufacturer and global leader in bacterial management solutions. This company develops new technology, sells and market the technology developed and the products manufactured in house which are mainly designed to manage bacterial contamination in any form. At present Noble Biomaterials holds around 200 licensees globally for various products in the medical, industrial, defense and consumer markets. (Noble Materials)
Management of the firm
Noble Biomaterial is not only into Textile processing, it has a lot of business unit's Precious metal mining and processing, industrial manufacturing, metals and mining. The number of employees of the firm is very much higher so the management functions like planning; organizing, leading and controlling will happen in a more pre-defined way. There are different modes of entry into different market zones across the globe. The firm selected has e-commerce support as well. The firm selected for this case study manufactures both in house products as well as X-STATIC where it is the global leader in bacterial management solution. As a corporate this organization has a very good culture. The core values of the organization are really good. Being a firm which performs R & D, and business that are wide spread in different areas the company values its employees well. The organization believes in employee self-management and this leads to a feeling of ownership and belonging. Employee involvement culture and academy culture will help the organization to improve a lot in our case because the nature of work being done is more into research and the company itself claiming as the global leader in bacterial management solution. Employee involvement and the number of experts within the organization will result in very quick innovation, so that it will be strategically easier for the organization to enter into a market. Brian Fee the vice President of the company in sale department is remarkably good in marketing. During his tenure in MI branch in the year 2003, the branch received "Branch of the Year" award for increase in sales and he made the revenue grow up to 102%. There are many forces that can change the relationship with the customers and suppliers. Since in our industry things are much into research and development, the environmental force such as technology, political and regulatory agencies and market forces are also involved. Once completing the research the manufacturing process should start immediately in order to go to the market first and launch a product, so technology plays a vital role here. Market forces given by the competitors also influence the relationship with the customer and supplier. The materials used in these kinds of fabric are new in the textile industry so there will always be a force which comes from political, regulatory agencies and laws. So we should always be in a position to implement these changes and the tactics to implement these changes should be studied well. As Lewin's three steps model of organizational change works only with a planned change we should go for some model which accepts dynamic change as changes faced here will be mostly dynamic and continuous. There are different tactics to handle these changes and this will work out only if there is employee involvement, top-management support and by continuous education provided to the employees. The top management should posses a very good decision making capability in order to aid the better growth of organization. There are many decision making techniques available that help stimulating the group creativity and involvement in groups. Brainstorming, story boarding, Delphi and Nominal group technique are the few popular techniques. SWOT analysis should be done for a proper strategic planning. To assess the strengths, weaknesses, opportunities and threats, SWOT analysis is a technique that is used in a business venture or even a project within an organization. All the internal and external factors that are favorable or not favorable to achieve a project objective will be identified after specifying the business objective of the organization. In the year 2006 Grubel was recruited as President for consumer division in Pennsylvania. The management is following a divisional model strategy. Divisional model strategy is the one which is identifying all the key areas of market and dividing it. Grubel removed the divisional model strategy and launched a new one which focuses on core business values and it increased the profit by 40 %. During his tenure the revenue has gone from $6MM to $45MM in outfit apparels. Noble biomaterial is very good in implementing IP management strategies. (Grant, 2005)
The culture of an organization is the shared values and norms that keep the employees united together. This is the reflection of employees minds about the way in which things are done in an organization. This influence, how an employee feel and act in an organization and also it impacts the employee retention in an organization. The visible culture of this organization seems to be good. There is a lot of employee who have the feel of ownership and belonging, and are feeling secured and a sense of continuity is there prevailing in the organization. The employees of the organization are self managing so that supervisor intervention will be minimal. The first thing among the three types of organization culture (i.e. visible culture, espoused values and core values) is really good which can be easily observed in the employee self-management and the stability. The organization seems to have a Base ball team culture or a club culture.
As per recent Interview of Zalkin appearing in the NAUMD Official Guide, "Belief is that the Innovation Committee and its center will turn out to be a driver of the future of
NAUMD. Innovation in the sense like progress, advances society and consequences into efficiencies. Ultimately - Innovation that leads to support the business and assists us in reaching the profits we generally look for. Technologies that gave us new fabric enhancements, , performance and design advancements, new ways to provide originality have made the employees across the world safer and more comfortable in doing their job tasks. It is NAUMD the decisive goal to help our membership take the full advantage of all these innovations so that they may enhance their service to the customers!". (Brian Fee New Chairman of NAUMD Innovation Committee, 2010)
The annual revenue per employee working in Noble Biomaterials is about $ 600,000 which is not possible for any organization without a good core and espoused values. Brian Fee addressed to media saying they are very much engaged in improving the organization culture by creating a feeling of togetherness. A better human to human, cross culturing bond is built among the employees. They also conduct many training programs and events to bring in this cross culture efficiency.
The employees' salaries are relative better that makes the employees feel better. Many employees of Noble Biomaterials are Bpeace team member and Noble Biomaterials also encourages many extra-curricular and co-curricular activities like this. Thus the core and espoused values of the company as well employees seems to be good.
Porter's Five Forces analysis
Here the present scenario of this x-static and e-textile manufacturing company the market seems to be of more monopolistic. The competition in this industry at present is not much as there are only few companies which manufacture these kinds of products. Few advantages of monopolistic market are as follows
Price: The manufacturers have more flexibility to fix the price here, as there are little competitors in the market.
Advertising: The amount or the volume of money spent in advertisement will be less
Can offer mediocre services
Lesser number of competitors
Rivalry: In a market where the competition is high the profit will be lesser, where there is more competition the profit will be very lesser i.e. where the profit and the no of competitors sum
Always be inversely proportional. With the help of the industry concentration and other factors economists will measure the rivalry. If the concentration ratio is higher it means that only few large firms hold the majority market shares. The competition landscape will be less competitive if the market share if hold by very few firms. The industry will be monopolistic or close to a monopoly if the concentration ratio is high. So in our case also there is a high concentration ratio. The rivalry factor is less in our case. The factors that add an advantage for the firm's rivalry factors are smaller number of firms for competition, lesser switching option, high levels of product differentiation etc.
Threat of substitute products:
Since the e-fabric and the x-static products are in inventory stage there are no potential substitutes identified. So the threat of substitute product is also very lesser. Since the threat of potential substitute is very less as the price factor can be more influenced by the manufacturer.
There are a variety of uses as demonstrated by the product manufacturers. It is used in cinemas, and by Military and army persons, sports men. For these groups of people the price influence to use the product will be less. It can also be targeted in commercial market as it has many advantages of anti-bacterial action and many other uses. Here in our case the market is not monopsony, where in a monopsony market there will be a number of suppliers and one buyer. Under such conditions the buyer will usually decide the price.
The raw material used and the labor availability is an added advantage for this firm. The suppliers can influence the operation in production industries, like selling the raw material at higher cost and capture some of the industry products. The raw material used by the industry in this study is commonly available and there is a switching option for the manufacturer to switch its supplier if the supplier is demanding more.
Barriers to entry / Threat of entry
At present most of the giants in fabric manufacturing is not much into the manufacturing of this kind of fabric. There is a potential threat that or an expectation that new competitors can enter into the market to take advantage of the higher level profits. But if the prices are kept low by the firms individually and keep the prices and the profit artificially low, as a strategy to prevent the potential entrants from entering the market than this will act as a barrier for the new potential entrants into the market (entry-deterring pricing)
Latest and worth noting about the company
In November, 2010 the Ben Franklin Technology partners of Northeastern Pennsylvania announced an investment plan in Noble Materials, Inc. The investment is around $13,650 to conduct a min pool geothermal feasibility. An additional $24,000 is also allocated to conduct a study.
Brian Fee who is the vice president of sales in Noble Biomaterial became the chairman of NAUMD committee which will increase the revenue further.
Hospitals are now using X-STATIC for privacy curtains which will reduce the bacteria on the curtains. Hospitals in Midwestern United States have already initiated the process.
Noble Biomaterials has got a credit of 1.5 million dollars from Silicon Valley Bank of Santa Clara, CA. This fund will be used to improvise the products in health care industries.
In the year 2009 Noble Biomaterials Inc, closed a convertible loan worth 2.5 million dollars with TL ventures of Wayne, PA.
Noble Bio-Materials has about 200 licensees now globally for different products in the medical, consumer products, health care, hospitality and industry. This also includes J&J (Johnson and Johnson) and other global giants.
Giro, a famous helmet maker has signed a deal with Noble Bio material for manufacturing helmet's with anti-bacterial capability using X-STATIC fibres.
Noble Biomaterials Inc is an ISO 9001 : 2008 certified organization
Karin Recchione has joined the Organization as Director of marketing with 7 + years of experience which includes companies like Johnson and Johnson and others. Allyson Wall joined the organization as Accounts manager where her experience includes Johnson and Johnson, Systagenix Wound Management and Abbott Laboratories.
US military service is about to have deal with this bacterial management giant, in making defense apparels for US soldiers which will increase the revenue about 300 million dollars.
As an entrepreneur I will think of bringing either lower-tech fabric or an e-textile to market or both. But the decision making in this regard will not be so easy and simple. The points that favors lower-tech fabric are listed below
Time and money to spend on research and development will be less when compared to e-textiles. This is because x-static fibers and inclusion of micro fabric is already available in the market. Getting a resource who knows the technology to manufacture is really cheaper when compared to doing a research and coming out of the own product.
Since there is lesser number of potential competitors it will be easy to take advantage of the market share.
The potential buyers are huge as there is a variety of buyer market from defense, sports, entertainment and goes till the commercial buyers.
Since it is an emerging market building up a brand and reorganization for our brand will be much easier.
Considering all these advantages I will choose to bring lower-tech fabrics into the market. E-textiles involve lot of investment in research and development and the certainty to go first in the market is very less.
"An important distinction is normally made between invention and innovation. Invention is the first occurrence of an idea for a new product or process while innovation is the first attempt to carry it out into practice." Says Dr. Ogan Gurel
Both the lower-tech as well as e-textile fabric is really a very good innovation. It actually suffices the requirement of many people. I consider these things as Innovations not inventions. There are the new innovative ideas from existing technologies in order to meet few requirements of the end customers like anti-odour, anti-bacterial and anti-radiant costumes. The materials used for the anti-bacterial anti-radiant and temperature control are already there; here we are using those inventions in the fabric industry to meet specific requirements. So I think these are innovations not inventions. E-textiles will fall into inventions because the technology is new; the control to drive the technology is also new.
Now the e-textile industry is under the invention phase because of the involvement of electronics. The electronic equipment to use, the fiber properties and the micro capsule or the micro chip development are still in progress. These things are not generalized. For few products which are already released the microchips that are already made is not yet generalized they are product specific. In order to make these things to become more innovative than inventions more research and development should be done. The requirement and the specification should be made and the products should be made more generic so that it can be reused. Companies should go for patents and release their innovation so that further development can be done by some other companies which are into same market.
The commercial needs can be like the one which produces anti odour capability. Some sports men will require some specific functionality like calories burnt by him, the heart rate and other factors. So manufacturers can take a detailed survey of those requirements and come out with a product which satisfies those requirements. Sometimes kids will be interested in e-textiles if the image or the picture in a fabric changes as per the surroundings like temperature, and other environmental factors or some option selected by the user. These kinds of products should be available at a relatively lower cost. A survey needs to be taken from various potential buyers of market which details the requirement of the end customers.
In this case I have learned about a new emerging market and business. By answering the questions in the discussion section I understood the importance of survey that needs to be conducted before starting a new project so that we can meet the end customer's requirements. I have understood the importance of knowing the market and reading the end consumers mind before starting a new organization or a new project, and how well the product meets the customer's requirement. More than inventing a new product that is technically good and complex; a proper analysis should be made on whether my new product will meet the customer's requirement. Also by going through the complexity in planning, organizing, executing and how to make proper decision I have understood the various aspects involved in making an organization successful. I also understood clearly about the importance of organization work culture and people management and how people at the top management level makes difference that will increase the revenue rapidly.