Executive Summary; Pachamama Coffee)
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Provide a 2 page Executive Summary for the uploaded paper (Pachamama Coffee) included with this order. Provide a minimum of 2 APA references and you could use the
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Pachamama Coffee
Relationships between the Different Systems
Multiple-scenario analysis helps depict the present and the future state of an organization’s operating environment and often considers the dynamic progression of all
the interrelated conditions, changes and events that are critical to attain the desired state (Bood & Postma, n.d.). Projections into the future are best attained
through the difference events analysis technique despite the fact that it only involves forecasting and hence, may not give the exact picture of all interconnected
systems. However, the method helps realize several options that are applicable for future developments thus curving a path suitable to bring about development,
desired outcomes, and techniques needed for the planning exercise.
The success of Pachamama Coffee depends on the interactions of different systems. According to Meadows (2007), systems are interconnected elements that work
coherently so as to achieve a defined purpose or function. The success of Pachamana Coffee depends on such well-interconnected systems. First, there are small scale
coffee producers who control and own the cooperative. The coffee producers demonstrate total control of the cooperative’s production thus influencing the profits that
are realized as well as the impacting the relationship that exists with coffee consumers, wholesalers and retailers. Another robust system consists of the Pachamama
Coffee management team responsible for marketing the end product. The team ensures that what the farmers produce reaches the consumers and that the market enjoys
quality coffee. Additionally, there is the Board of Directors constituted from cooperative countries including Peru, Nicaragua, Guatemala, Mexico and Ethiopia. To
fully foster the relationship between the consumers and the producers of Pachamama coffee, the management has established, in various locations, different retail
outlets that ensure that what producers are providing reaches the users appropriately. These systems demonstrate innate cultures, traditions, systems, principles and
beliefs that make the entire system function as one. Together, the systems work hand in hand as they attempt to predict the future, anticipate any likely events that
may influence business as well as managing risks that the entire system faces.
Different Systems Connection and Loops
The various systems work hand-in-hand in attempts to realize the organizational goals and objectives with an aim of realizing sustainable growth.
Therefore, various systems connect where they are required to offer recipes for growth and maintaining a balance that leads to realization of organization goals.
The various systems are united through common goals set by the management of Pachamama Coffee. This means that the management, farmers, consumers and all
shareholders will be united by these goals and will dedicate themselves to long term goals which are beyond just realizing profits. This way, the stakeholders will be
assigned to specific goals which will lead to increased output of the whole system. For instance, the farmers should be assigned an expected tonnage per month, while
finance department should concentrate on increasing profit margins. The quality analysis department should focus on the high quality organic coffee that meets
required specifications and so on.
The systems can reinforce each other through proper training and education. Since production of coffee is research and labor intensive, continued learning
and mechanization is vital to keep the members up to date on the heavy and sophisticated farm equipment and on all technological advances necessary to realize success.
Consequently, the organization must adapt the culture of a learning organization aimed at educating and training its farmers, and the entire staff on ways to attain
success.
Identification of Systems that Complement as well as Conflict Each Other
Pachamama coffee cooperative brings together small scale coffee producers into a unique cooperative, owned and controlled by the coffee farmers themselves. With this
kind of arrangement, farmers exhibit total control on their productions and profits, direct interrelationship with wholesalers, retailers and consumers.
The Pachamama coffee management are targeting a more robust market, and this market needs specialized quality of coffee; organic and fair-trade coffee. The board of
directors of Pachamama is from cooperative countries: Peru, Nicaragua, Guatemala, Ethiopia and Mexico.
The management of Parachamama has begun to establish retail locations to foster the relationship between consumers and farmers.
The application of scenario analysis will achieve three significant purposes:
• Looking into the future
• Anticipation of likely events
• Then taking the likely risks into consideration
Effective events analysis of Pachamama coffee market will give the cooperation an edge over its competitors. Market is a social creation and not automatic or natural
mechanism (Valeriu, 2014). This implies that market strategies could be planned base on the relationship and interactions among the above identified systems.
Pachamama should employ the concept of multiple scenarios to create its own future market with keen consideration of the future uncertainties which more often depend
on the beliefs, principles, traditions, cultures, etc. (Senge, 2006). These parameters are never static, but keep evolving with time as such making future planning,
prediction, and even forecasting very difficult. According to Shell, “people hold beliefs and make choices that can lead down different paths. They reveal different
possible futures that are plausible and challenging. Our latest energy scenarios look at the world in the next half century, linking the uncertainties we hold about
the future to the decisions we must make today” (Shell Oil Company, 2009).
Analyzing various scenarios helps an organization avoid surprises and prepare for change so that it can sustain itself; the concept of scenarios analysis assist in
exploring the future (Shell Oil, 2009). In Pachamama coffee organization, one of their strategies is to bring small scale coffee producers into cooperative and make
the farmers to co-own the organization, this is a perfect strategy, but care must be taken in planning future operations and management of the organization, in terms
of equity share, profits sharing, capital base, employment opportunity, so that it will not “rock the boat” in the future. With common goal and objective, the
organization stands a chance of growing from strength to strength, pole to pole, and bound to bound. This is because of their interdependency on each other knowledge,
expertise, techniques, technology, resources, etc.; from the five members’ countries. Their vision of capturing of the market with quality coffee of organic and
fair-trade standard could be achieved, particularly, with their latest retailers’ coffee shops scattering all over the United States of America, it is a dream come
true for Pachamama coffee organization.
Strategies for Balancing and Reinforcing Loops
There are two types of feedback processes: balancing and reinforcing. Balancing feedback operates whenever there is a goal-oriented behavior, while reinforcing
feedback processes are the engines of growth (Senge, 2006). Strategies are required in managing and exerting control by the management; strategies are needed in order
to continue the growth of the entire systems (the organization).
Strategies for Stabilizing the System
There are necessary strategies that the management of Pachamama will need to employ in running the administration of the coop, having in mind the diversities in the
corporation.
• Set clear outcome goals: top management, farmers, managers, shareholders, etc. should know the organizational goals beyond profitability. For instance, the
marketing team must understand the goal of the sales department. The farmers must know the species of high quality coffee as it will influence the pricing. The
organization should set both short-term and long-term goals.
• Create and set performance goals: individual performance numeric goals with deadlines will increase output. Farmers should be assigned an expected tonnage per
month, or should declare an expected tonnage. Finance should be tasked on increasing profit margins by reducing overheads cost, quality analysis department will be
tasked on the high quality organic coffee that meet specifications.
• Set personnel policies: expectations should be set for exerting discipline to guard individuals’ behavioral pattern in the organization. The organization
should create a company handbook that will set behavioral parameters for all categories of staffers, farmers, distributors, whole sellers and retailers. The policies
should include dress code, attendance, break hour, documentations, procedures in office, grievances, etc.
• Education and training: coffee production requires intensive research and development, including mechanized farming which requires heavy farm equipment,
sophisticated tools, technology, etc. Therefore, the organization must imbibe the culture of a learning organization. The organization should educate and train its
farmers, and the entire staff and stay abreast of new technologies that can better the organization.
Strategies for Amplifying the System
This means the strategies to necessitate growth in the Pachamama coffee cooperation. Pachamama should adopt the following seven techniques to enhance its growth
(Valeriu, 2014).
• Analyze the environment in which the company operates;
• Analyze market and competition;
• The diagnostic analysis of Pachamama organization;
• Development of scenarios;
• Estimating the determined factors for each scenario;
• Scenario matrix;
• Choosing the most likely scenario.
Potential Archetypes to Guard Against
The potential archetype that Pachamama Coffee will need to guard against is the Policy Resistance trap. This is when various people have different visions and
goals and all are pulling the company to a different direction. This would only pull the company farther away from the original goal and create more resistance, with
everyone putting in more effort but without the wanted affects.
The best way to guard the company from this is to realize all goals and redefine them if needed. They should then try to work towards them together in a way
where everyone will be able to see the changes but without resisting each other, or wasting the time or energy in order to reach the final goals (Meadows, 2008).
Key Stakeholders Commitment Plan
In order for a company to be successful it needs to depend on its stakeholders. These stakeholders come in a variety of types and interests, and each offers a
different prospective to the company. Pachamama Coffee depends on a specific system of small-scale coffee producers, management that is responsible for marketing the
coffee, and the Board of Directors constituted from the cooperating countries. Stakeholders will need to be a team of people that would help this company in realizing
its organizational goals.
The first step is to identify who the stakeholders are. These stakeholders need to be people who have the ability to put ideas on the table, and include
various perspectives from all sectors and elements of the community and affected market. This is an important factor because this company depends on the farmers that
grow the coffee and it also depends on the management team that is responsible for the marketing and end product. So any stakeholder will need to understand that they
are dealing with, not only what is happening on the farms but also what is happening between the different countries and in the market. They also need to meet the
requirements to be able to strengthen their position in the market, and create a web of acquaintances in the community and in the business. Finally a stakeholder
would need to increase the credibility of the organization in world market and increase the chances for the success of everyone’s effort.
Second is developing a plan to find the best stakeholders. The company would need to brainstorm, collect categories and names from different organizations and
social communities. Then they would need to consult with different organizations, of which are good enough to be stakeholders with this company. A company should
always try to find someone that has the company’s best interest in mind. Sometimes, stakeholders should introduce other names. Finally, if it is appropriate,
advertise the need for stakeholders. This would be done through social media, newsletters, community meetings, and through word of mouth.
Finally, stakeholder mapping is a very important step. The company would need to understand where their interests and concerns exist. Mapping is a way to
find out if a certain stakeholder can have the most positive or negative influence on an effort, which parties are most likely to be affected by the effort, and how
you should work with the stakeholders with different levels of interest and influence.
Best Practices for Improvement Initiative
Pachamama Coffee has already established many best practices that will support their improvement initiatives. Through their continued emphasis on organic growing and
free-trade product handling, they are significantly ahead of many other coffee companies and suppliers. As Pachamama continues to grow, they should continue to
maintain these standards as they bring new family farmers into the cooperative, or add more countries or other cooperatives into the company. Additionally, Pachamama
should continue to demonstrate their commitment to not only top quality organic coffee, but to their farmers. This close connection between farmer and consumer is
unique in the coffee industry, and Pachamama will do well to encourage and highlight this connection. This company is not just about the coffee. These farmers are
the heart and soul of Pachamama, and the central focus of why Pachamama is in business today. By supporting these farmers, and by keeping the company’s marketing
focused on this central point, Pachamama will continue to grow and stand out among the many other coffee companies today.
Opportunities to Encourage Local Interest
Pachamama’s current primary distribution is via internet orders and home deliveries. To date, Pachamama only has one outlet and office, and is in the process of
opening one store, both of which are located in California. They have also begun to sell through other distributors. There are many ways that Pachamama can encourage
local interest. It would be prudent for them to target and sell through major organic grocers, such as Trader Joe’s or Whole Foods. They can also look to begin
partnerships through other distribution means, such as book stores, or other fair-trade clothing outlets or boutiques. Most significantly, Pachamama could roll out an
education program and fund raising initiative. By opening up the sales market to individuals through door-to-door marketing, they can provide fundraising
opportunities for schools, churches, and other organizations, and also spread educational awareness of their company, products, and programs to those who might not
otherwise learn about Pachamama through other means. Many organizations provide fundraising opportunities, such as Krispy Kreme Doughnuts, and provide easy,
successful, and profitable fundraising opportunities. A product development team would do well to investigate additional ways to use coffee and coffee byproducts
(e.g., stalks, leaves, and shells). Much research has already gone into the many different functional properties of the coffee plant and its by-products.
ScienceDirect.com featured an excellent article on such research (Esquivel & Jimenez, 2012). Such by-products may be used to produce clothing (coffee stained shirts
for example), recycled paper, bath products, or any number of other items. EcoPaper.com, for example, produces a wide variety of tree free agricultural bio-products
from 100% post-consumer materials, which includes coffee paper (2014). Even if Pachamama chose not to produce all of these products themselves, they could make
valuable connections with other companies that are already creating these kinds of products, and provide them with much of their post-consumer or post-processed
byproducts for recycling and alternative use, and then sell these products in their outlet stores.
Pachamama has already created a solid foundation and has limitless options for potential growth. There are many different ways that they may consider adding to their
distribution to both boost sales and spread awareness about their cause.
Relevant Stakeholders
As part of the continued success of Pachamama Cooperative, key stakeholders have been instrumental. While key participants are readily identifiable such as the
farmers, roaster and food co-ops, others stakeholders are not as obvious. These stakeholders have been identified by following the process forward and backwards as
well as to each side in order to avoid missing a valuable component. This brings into the picture others such as the coffee bag producer, the web site provider and
the mail order customers. Less obvious are competitors and suppliers who may affect relationships with potential future stakeholders.
In assessing whether a critical group have been overlooked, the actions needed to assure not missing someone is much like a golfer about to putt who looks at
the putt from more than one angle before stepping up to strike the ball. While looking from the multiple angles will likely find new opportunities or hidden traps,
there is no complete assurance that a necessary stakeholder is not overlooked. That is where adding to the knowledge base is critical. Besides the executive team,
groups such as key suppliers and those who may be a stakeholder in the future, useful outsiders add another layer of feedback and experiences. These can include a
board of advisors as well as inviting a venture capitalist to do a strategic review of the company.
There are many costs, benefits, opportunities and risks involved in developing collaborative support for the growth and expansion of Pachamama Coop. These are
components that can affect the whole organization or individual components. Among the costs for the growth and expansion are investments in additional coffee capacity
and roasting capacity. In addition, the needs will create additional warehousing and shipping costs. Depending on the path chosen, costs may be incurred for
additional retail locations. If franchising is the direction, the costs will be in acquiring the franchisees while coop-owned stores will require capital for real
estate and start-up costs.
The benefits of the expansion can benefits the existing farmers if they have the capacity to meet the needs. Otherwise, new farmers and coops will create
opportunities for more new members to build wealth. It may also allow new countries to join the coop, expanding the reach and influence of the organization. Finally,
the larger that Pachamama grows, the more name recognition.
The expansion brings more opportunity to the main stakeholders involved including wealth creation and, for others, the fulfillment of the bigger vision and the
satisfaction of those helped. However, these benefits and opportunities create risks. This segment of the coffee market has already attracted many big players such
as Starbucks and their much larger resources. As this segment grows, the commoditization of the straight from the grower’s selling points may become mute and lower
the selling price of the coffee. In addition, the larger needs of the growing organization may lower the standards that the smaller coop could better control. In
addition, all the preparation for expansion could come at the cost of overcapacity, hurting many of the stakeholders with additional investments for the vision.
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