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  • Subject area(s): Engineering
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  • Published on: 7th September 2019
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ABSTRACT

This report presents a reader with an investigation into an Engineering company called MICROSAIC SYSTEMS PLC. This research investigates the objectives and strategies of the company. Microsaic systems is public limited company (PLC) that specialises in developing and production of chip-based mass spectrometry instruments for analysis of matter. This research proposes and examines a conceptual framework for analysis and decision making concerning effectiveness of Microsaic system’s organisational structure. It discusses important determinants of effectiveness including sales, marketing and production performance. The report finally deals with the project management aspects of the research that has gone into understanding Microsaic Systems.

INTRODUCTION

The purpose of this paper is to outline the research done by the DELTA team (London South Bank University) on Microsaic, a high Tech company that was started in the labs of the famous Imperial College, London. This paper investigates the organisational structure, the financing and marketing of the company and the interrelationship between the stakeholders and the various parts of Microsaic. Microsaic, like many other high technology companies was started by individuals with an interest in their field who saw a potential to push the limits of their knowledge in the field and advance a particular niche of their field of expertise (in this case- mass spectrometry) [1]. The problem as with many other start-ups is the need for massive injections of cash that could only be generated by stakeholders from without the company. That is what Microsaic has tapped into. The sole purpose of most businesses is to generate returns on the investments that shareholders have put in them. Whatever the business, if it has taken money from investors; for example, through issuing of shares, it is then wholly or partly owned by the stakeholders. At the end of the day the conception ideas may not be relevant to the shareholders who are more likely than not interested in the returns on their investments. That having been said, it should be noted that investors usually evaluate the viability of a company’s vision and then decide whether it fits into their (investors’) financial and ethical realm of acceptability. The inclusion of foreign owners adds all manner of complexity to decision making and the supposed future direction of a company. Microsaic has through the years formed alliances with various companies to market its product. It is possible that with time there may be conflict of interests as to the marketing of the products and Microsaic may have to re-evaluate its relationships and goals. Mark Bonchek, in his article “Purpose is good. Shared purpose is better” states that the customer forms a very important part in how a successful product is built and finally released to the market.[6]   This paper will attempt to show the interlinks between the various entities of Microsaic based on a Business canvas model and how these parts affect each other.

This paper also includes a project management section involving the work done to accumulate information pertaining to Microsaic Systems.

MICROSAIC SYSTEM

As with most public limited companies. Microsaic Systems has developed a strategy of where the company is going. Strategic planning is the process of developing the strategy or direction and action plan to achieve the goals of an organisation. Key elements of any strategic planning process are:

 1. developing an understanding of vision, mission and values,

 2. a current-state assessment of the most salient internal and external factors affecting the organisation that will contribute to an informed selection from strategic alternatives.

The vision, mission and values of the organisation are foundational elements of the strategic planning process. Well-defined vision and mission statements provide direction and focus for the organisation. The values of an organisation provide the context for decisions (Essential tools for Management Accountants. 2013. CIMA, pp 32).

Mission Statement

According to the company website: Microsaic Systems plc is a high technology company developing and marketing next generation mass spectrometry (MS) instruments for the analysis of gaseous, liquid and solid samples.

Company Objectives

During the investigation the DELTA group discovered that Microsaic systems PLC just like any other profit driven company fulfilled the objectives as listed below;

Management: The company has a recognisable management and organisational structure. The company has good employee relations, career progression and a professional development programs. The company’s objectives and strategies are accomplished using available resources efficiently and effectively.

Market standings: It is the objective of the company to establish itself globally. This is being done by raising capital through the issue of market shares, ensuring positive customer satisfaction, and trying to increase the product range or the related products that Microsaic products can be integrated.

Public responsibility: The company also complies with social and ethical laws which is a requirement by government regulations. This is ensured through publically declaring financial statements that have to be audited by a qualified accountant, following proper company law when appointing board members and the company leadership.

Innovation: Although Microsaic Systems does not have a big range of products, it is investing in research to further miniaturise its available products which is one of the stated goals of the founders. The company is also pushing harder to increase the variety of products in which the Microsaic Systems product can be integrated. There are also on-going investments in the development of new software so that the products can be accommodated on many more platforms.

Profitability: The company’s annual reports prove that it is focused on improving its level of profitability and the rate of returns on investments. This is based on the amount of money the company invests in the commercialisation of its miniaturised products.

Productivity: It is also the company’s objective to optimise its use of resources and focus on its value proposition. The company has signed long-term contracts with mining companies to ensure continuous raw material supplies.

Financial resources: Although acquisition of fixed assets is primarily to ensure that the company cuts down on its rental costs, ultimately these same assets can be conveniently used as collateral to get loans or they could be partly rented out to other companies.

Governance

Microsaic systems is just like any other structured business organisation. They have a hierarchal structure (as shown above) through which discipline, respect and the company’s value proposition are delivered

Microsaic systems motivates its employees by rewarding them in various ways. Its employees benefit from competitive salaries, bonuses annual performance and pension contributions.  The team members also benefit from share options. [2]

Sales and Marketing

The company signed a supply agreement with GE Healthcare this year, for the sale of its 4000 MiD unit in combination with GE Healthcare’s instruments. GE Healthcare is one of the front players in the global market for scientific instrumentation. The agreement is centred on the development and commercialisation of new instrument for use by research and healthcare professionals. This relationship is aimed at helping both companies work hand in hand towards the launching of the integrated product that is expected to be completed in 2016 [4] .

Product development

Microsaic Systems is constantly developing its products and making them compatible with other secondary products. For example, in September 2015 the company released a statement on its main website saying that “its product range is now compatible with Clarity Chromatography Software, the advanced Chromatography Data Station developed by Data Apex”. [3] This is one way of how the company is upgrading its products without the requirement of them being altered and this also provides the customers with the ability to deploy their purchases on different software platforms.

The Clarity software interface used for acquisition of data, processing and operation for gas and liquid chromatography platforms. This software provides a control solution that enables users to increase workflow efficiency by deploying simple to use mass detection for Microsaic’s 4000 MiD miniaturised mass detector and MiDas compact interface module.

The software also provides a variety of tools supporting the Good Importer Practice (GIP) regulations and complies with the requirements of the Food and Drug Administration (FDA) regulations. [3] This is another confirmation that the company complies with law and it is also an assurance to its customers that they are purchasing legitimate products built for purpose.

The company has also proved that they are focused on product development being part of the agreement signed this year with GE healthcare as mentioned under the “sales and marketing” section above.

Market Research

Microsaic systems boasts a large customer target niche in pharmaceuticals, diagnostics and healthcare, government security and defence, energy, food and drink, environmental, and utilities.

Since keeping an eye on the market is one of the company’s strategies, its market research department which comprises of Numis securities Limited works with the London Stock Exchange’s AIM to ensure that the company’s annual reports, forecasts and news are delivered on time and comply with government regulations and law. Numis Securities Limited is the company’s financial and broker adviser to the company in relation to the placing and admission of share prices. Numis Securities’ roles also comply with regulations of the Financial Conduct Authority (FCA) in the United Kingdom.

FINANCIALS

The finance department is responsible for the company’s funds allocation and its book keeping requirements. The book keeping entries are as shown in tables 1 to 8.

The most recent annual report released by Microsaic systems on 31/12/2014 indicates that the company has an annual turnover of just over £1.2 million Great British Pounds. This as shown by the blue line on Graph 1 of key financials and the profit and loss account (Table 2) of the company in appendices A and B respectively. The profit and loss account also shows that the turnover values increase year by year between 2010 and 2014. This attracts potential investors and stakeholders and also assures those who already have shares that they have invested their funds in the right business without any doubt.

Table 4 indicates that the company would hardly experience funding crisis since they have more than one financial reserve and this has also increased on a yearly basis.

In 2014, the company entered into a conditional placing agreement with Numis Securities Limited as the company’s agent to which it was agreed to use a reasonable promotional offer to attract potential shareholders for the placing of shares at the placing price. The placing price represents a discount of approximately 6.7 per cent to the closing market price of 45 pence on 6 October 2014. This is one of the revenue streams of the company.

The major aim of placing conditional shares was to use the net proceeds as an additional working capital and capital resources to execute its revenue growth plans as mentioned below;

(a) It was aimed at generating volume sales of its miniaturised mass spectrometry system by establishing the company as an Original Equipment Manufacturer (OEM) partner to highly recognised companies specialising  in scientific instruments like GE and developing its own sales channels to customers. This aim was accomplished as mentioned under the “sales and marketing’’ section.

(b) The resulting proceeds were also aimed at accelerating the commercialisation of its products and technologies, customer contracts and further product development, and also to provide a strong financial position from which to support commercial negotiations.  

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