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Gene One: Problem Solution and Defense
Gene One is a privately owned biotechnology company who is attempting an initial public offering (IPO). During this transition, opportunities within Gene One‘s organizational structure have been made more eminent. This paper uses the Problem Based Learning model the concepts of transformational leadership and organizational culture will be applied to the current internal issues faced by Gene One in the areas of team dynamics, knowledge and leadership style. Gene One is lead by Don Ruiz who has surpassed expectations during its 8-year growth. Don is an intrinsic part of a 5-member team who built the Gene One out of a 2 million-dollar investment. Don’s goal is to position Gene One as an industry leader. In order to acquire large amounts of capital for advanced research and superior product development to meet consumer demand and a grow by 40% per year, Gene One board of directors have decided on an initial public offering (IPO) within a 36 month deadline.
Describe the Situation
Issue and Opportunity Identification
Gene One has several opportunities within the organizations. These opportunities are organizational culture, teamwork, and leadership. A company’s organizational culture is “the basic pattern of shared assumption, values, and beliefs governing the way employees within an organization think about and act on problems and opportunities,” (McShane and Von Glinow, 2005). Gene One must understand how employees' attitudes, feeling, and emotions affect job satisfaction and productivity. By understanding their employees Gene One can mitigate the affects of change. Through the IPO transition Gene One’s organizational culture is lacking employee loyalty. The lack of employee loyalty is demonstrated in a conversation with John Kirby and the members of the senior leadership team. Kirby had suggested that the team should fire Charles Jones and replace him with one of his friends, Lucas Antonio. When the team questioned Kirby about Antonio’s, credibility, Kirby said, “That Antonio could be fired after the successful launch of the IPO” (Gene One Scenario, 2008).
The second opportunity is teamwork. “Katzenbach and Smith define a team as a small number of people with complementary skills who are committed to a common purpose, performance goals, and approach for which they hold themselves mutually accountable. The essence of a team is common commitment. Without it, groups perform as individuals; with it, they become a powerful unit of collective performance (Kinicki and Kreitner, 2004). Gene One’s management has to ensure that they work as a team therefore, their employees can be fully engaged to the mission. The board members want, Don to dump half of the team. Additional, during several team meetings, key players of the management staff have alluded to the company going in a different direction. For example, Michelle Houghton suggested going into cancer research after Teri Robertson who won the CTO Award. In addition, Michelle said, “Don, I have some concerns about the timing of our proposal. There was an article on the front page of this morning’s Money section that said investors are going to be much more cautious about biotech investments because of the human genome sequencing scandal” (Gene One Scenario, 2008). However, Don Ruiz does understand the importance of team and teamwork however, Don is also a realist. Don said, “We are who we are because of this team. This team has risen to the occasion before and I know it can again. I can’t replace people willy-nilly and expect to run a business. I just have to figure out how to get them on board. Individually, each of you has made major contributions to this company, contributions that have made Gene One the successful company it is today. But I think if you worked as a team, you could realize even more success. I need your support and commitment if we are to realize our strategy and make this IPO happen. But if it’s not what you want, and if your not wanting it is going to create resistance to our efforts, I will respect that, and support you in your resignation” (Gene One Scenario, 2008).
The last opportunity identified is the lack of a skilled leadership team for a successful IPO because the IPO has requirement changes that need to be carefully understood particularly in areas of financial reporting, publicity and legal compliance and Board requirements (Gene One Scenario, 2008). John Kirby expressed his concern with the leadership team when he said, “I’m not afraid to tell you, Don, that I’m concerned about a few members of your senior leadership team and their ability to lead an IPO transformation process. I know we’re all part of what has always been a successful Gene One family, but this is a totally new game. Do you think your top leaders have what it takes?” Greg Thoman also expressed concern when he said, “I also think we need to examine our top 50 executives to make sure we have the right leadership at our level and at the level below us. Wall Street and the SEC look long and hard at leadership” (Gene One Scenario, 2008). In addition, Gene One does not have the management in place to fulfill the requirements for Sarbanes-Oxley Act (SOA). Gene One does not have a member of the board with financial, auditing, compensation, and auditing experience.
Stakeholder Perspective and Ethical Dilemma
Many stakeholders that are affected by Gene One IPO vision. These stakeholders are customers, shareholders and employees. The only way the company is going to remain profitable in the market is by becoming a publicly traded company. Therefore, increasing profitable for shareholders.
Implementing an IPO would create funding therefore, Gene One can continue to create groundbreaking technologies that would help society. These technologies create advancement in biotechnology for their customers, society and the environment. In addition, the shareholders would receive a greater return on their investment especially because Gene One plans to grow by 40% over the next 3 years (Gene One Scenario, 2008).
Gene One has an ethical dilemma with providing research that can help society, which is their existing culture, and the culture that Gene One is embarking. This dilemma was raised when Angela Thomas resigned. Angela said, “Last week’s Money item really made me think about what the IPO is about. My passion centers on doing pure and applied research, not pleasing Wall Street. I just don’t have the energy or desire to push myself to deliver new technologies on a schedule; that’s not the way breakthrough technologies happen” (Gene One Scenario, 2008). In addition, from a HR perspective, a couple of things to consider, too. For starters, we need to make sure our executive and Board compensation strategies are squeaky clean. If you read the Money section regularly, I’m sure you’ve read a few stories about compensation issues. Compensation for Board members is shifting from equity to cash, mainly because of new rules and high risk associated with the SOA (Gene One Scenario, 2008).
Many employees are in fear about their jobs due to the IPO. This could lead to employees seeking other employment opportunities. Employee retention is an opportunity for Gene One’s management team. One of Gene One’s key players resigned. In addition, Greg said, I haven’t even mentioned the internal problems that could arise. We need a plan for sharing this news with employees. Staffing will be a nightmare if people panic and start leaving the company because he or she have doubts that we can pull this off, or because they do not want to be part of a publicly traded company” (Gene One, Scenario, 2008).
Frame the Right Problem
Gene One can realize the vision of an initial pubic offering by having a leadership team with the skills, education, and tools needed to carry the vision into realization.
End-State Vision
“Accordingly, sharply rising stock indices on Wall Street indicate a growing interest in biotechnology. And leadership changes at the Food and Drug Administration are further enhancing investor confidence in the industry. At Gene One, the CEO and his Board believe that in order to keep pace with demand and realize conservative annual growth targets of 40 percent, Gene One is going to have to go public within the next three years. The time seems right, but the company needs IPO capital for new development, advertisement, and marketing if it is to remain successful. Working toward a 36 months maximum deadline, the CEO and his Board have devised a clear strategy with the help of key members in the investment community. It is their hope that implementing it will help Gene One realize its growth targets, establish the company as a strong competitor and show Wall Street that Gene One has the leadership and organizational capabilities to succeed as a public entity” (Gene One Scenario, 2008). Over the next 90 days Don, the board and HR has to ensure that Gene One has a members on the board who fulfill SOA requirements. In addition, developing two new technology breakthroughs within the next 3 years and developing 6 new and innovative products based on current technology. Additionally, building brand image, increasing customer base and implement marketing infrastructure (Gene One Scenario, 2008).
Gene One would also have to address several key issues over the next 6 months. These issues are meeting SEC Requirements, identifying state in which to incorporate as a public company, identifying investors to focus on, identifying multiple investment firms, meeting new management and board requirements, developing public-company infrastructure, providing consistent IPO “story,” and addressing post-IPO requirements. Additionally, developing a certified financial statement to the Securities and Exchange Commission to be signed of on by CFO and CEO. Gene One has to identify senior leadership and Board positions to be upgrade to realize strategy and comply with SEC requirements (Gene One Scenario, 2008).
Alternative Solutions, Benchmarking Validation and Evaluation of Alternative
The first alternative would be for Gene One to change the vision. Therefore, Gene One would not go forward with the IPO. If Gene One decided not to go forward with transition then they would not be able to see a minimum of 40% revenue growth over the next 3 years needed to develop new products. Without revenue growth Gene One might not be able to introduce to new biotechnology advancement.
However, Gene One can continue to invest in technologies that are thoroughly safe and beneficial to society. Technologies that are pure and applied research. For example, Teri’s Robertson’s newest research project seeks to develop five different, genetically modified varieties of tomatoes, potatoes, broccoli, cabbage and spinach that will reach maturity twice as fast as unaltered crops, even in a broader range of soil and weather. This will lead to a nearly 35% increase in yield, impacting food volumes worldwide and significantly reducing growth costs. In addition, too cancer researches, which is an area with growth opportunity. (Gene One Scenario, 2008).
Gene One can benchmark Shiva’s five-step process as a model to implement change for a smooth transition into the IPO. The five-step process includes recognizing the critical impact of culture, discovering what is going on, designing the culture, defining an action plan, and getting results. Companies must recognize the critical impact of culture on profitability, business growth and on the company's capacity for competitive leadership (Catlin and Cookman, 2008).
Gene One can benchmark from Google’s philosophy on team and organizational culture. Google has a Chief Culture Officer named Stacey Sullivan. Sullivan’s mission is to retain the company's unique culture and keep the Googlers happy. She works with employees around the world to figure out ways to maintain, enhance, and develop their culture. In addition, Google wants their employees to play a part in being involved in keeping their culture the same today but also growing and developing it. Therefore, Sullivan comes up with different programs or processes, and just being there to talk with people when they have issues, setting up Web sites where people can report bugs in their culture and ideas on how to improve it (Mills, 2007).
Risk Assessment and Mitigation Technique
When transitioning to an IPO, there would be several risk factors that Gene One would have to consider. Having risk management tools in place will reduce the risk or threat caused by employees, technology, internal and external environment. The SBA and SEC requirements will also assist Gene One with managing events related to threats. In addition, the IPO has several financial risk associated with becoming a public traded company. Especially changing from equity based compensation system to a cash compensation system.
Optimal Solution
The optimal solution would be for Gene One to implement the IPO. In addition, too implementing several organizational structure, leadership, and team changes. The management team has to ensure the culture has assumptions, beliefs, and values that represent the new vision that Don has for the company. The assumptions will represent the unconscious attitudes of Gene One employees. The beliefs will represent each employee’s individual perception of the reality of the IPO. The value will represent what is particularly important to Gene One. “The basic pattern of shared assumptions, values, and beliefs governing the way employees within an organization think about and act on problems and opportunities” (McShane and Von Glinow, 2005).
The leadership has to have the skills and tools necessary to manage their employees so Gene One can move forward with the IPO. Therefore, the management team has to know and evaluate Gene One’s current employees’ skill set. In addition, to meeting with the team to keep them updated with the progress of the IPO. Additionally, to educating and inspiring the team to meet Gene One’s objective.
Gene One has to create high performance team to ensure successful completion of the IPO. A team goes through several stages of performance, these stages are forming, storming, norming, performing and adjourning (Kinicki and Kreitner, 2004). The leadership team that has been put together for Gene One includes special skills that the board members are unfamiliar with. These skills include finance, auditing, compensation, and nominating. Each team member has a responsibility for a part of the proposal and does his or hers own thing for task (Gene One Scenario, 2008). Therefore, Gene has to put together a special self-managed team whose administrative task is to move forward with the IPO. “Self-managed teams are defined as groups of workers who are given administrative oversight for their task domains. Administrative oversight involves delegated activities such as planning, scheduling, monitoring, and staffing. These are chores normally performed by managers” (Kinicki and Kreitner, 2004).
Additionally, Gene One has to consider the corporate responsibility associated with the IPO to ensure that the Company is still committed to biotechnology that are safe for society. “As part of corporate social responsibility, many companies have adopted the triple bottom line philosophy. This means that they try to support or earn positive returns in the economic, social, and environmental spheres of sustainability. Firms that adopt the triple bottom line aim to survive and be profitable in the marketplace (economic), but they also intend to maintain or improve conditions for society (McShane and Von Glinow, 2005).
Implementation Plan
“Successful implementation requires both technical and social skills” (Gray & Larson, 2006). The first thing Gene One has to do is create a team that fulfills IPO standards. Therefore, Gene One would need to benchmark from other companies to research effective systems that would fit their IPO needs. Gene One would have 30 days to research, present, and train management. In addition, to developing a work breakdown structure and critical paths to help determine the resource requirements and timeline. Gene One should also have “periodic priority review and changes need to keep current with the changing environment and keep a unified vision of organization focus" (Gray & Larson, 2006). In addition, Gene One should identify the resources, “typically represent funds, people, management talents, technological skills, and equipment” (Gray & Larson, 2006), required to do every single tasks on the IPO as well as the timeline from start to end including dependencies of each task.
Evaluate Results
When a company makes any changes within the organization, they must evaluate the success of the changes. This will give Gene One the tools necessary to determine whether or not the changes were successful. The solution implementation can be tracked by milestone. It would enable Gene One to correct quickly any obstacles or opportunities. Additionally, a project tracking system will provide a timeline for all parties involved.
The key to success lies in effective project risk management. Without this organizations are effectively walking blindfolded into the unknown, with no clear idea of what might go wrong, no preventative measures in place and no plan of how to respond when a crisis occurs (Honour, 2005). Gene One has some opportunities with their strategic plan. Implementing the IPO is an important mission for Gene One because it would give them the resources availability to develop new biotechnology. By implementing some of these benchmarked alternatives, Gene One might be able to terminate their current issues and move forward with launching the IPO. Gene One has to ensure that their customers, management, and employees are all involved in the process. Once a strategic plan has been set in place, Gene One can then move forward towards success.


Catlin and Cookman, 2008. Getting Your Culture Back on Track. Retrieved on November 15,
2008 from
Google, 2008. Google Corporate Information. Retrieved on November 15, 2008 from Gray, C.F and Larson, E.W. (2006). Project Management: The Managerial Process. New
York: The McGraw-Hill Companies.

Honour D. (2005). Ensuring Successful Project Completion. United Kingdom: Portal Publishing

Kinicki, A and Kreitner, R. (2004). Organizational behavior (6th ed.). New York: McGraw-Hill
McShane, S and Von Glinow, M. (2005). Organizational behavior (3rd ed.). New York:
Mills, E. (2007). Meet Google’s culture czar. Retrieved on November 15, 2008 from University of Phoenix. (2008). Week One Supplement: Gene One Scenario. Retrieved
November 15, 2008, from University of Phoenix Week One. MBA/520 –
Transformational Leadership Course Web site.…...

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