Business Strategy and Strategic Management of Yara International

This report focusses on business strategy and strategic management of Yara International. In this particular study, the concept of Created Shared Value and Corporate Social Responsibility has been explained. It has been observed that low rates of fertilizer use and limited agro-dealer capacity are the major challenges that has been faced by Yara International when they wanted to enter into the Sub-Saharan markets.

Running head: BUSINESS STRATEGY AND STRATEGIC MANAGEMENT
Business Strategy and Strategic Management
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BUSINESS STRATEGY AND STRATEGIC MANAGEMENT
Executive Summary
This report focusses on business strategy and strategic management of Yara International. In this
particular study, the concept of Created Shared Valueand Corporate Social Responsibility has
been explained. In addition to this, a comparison between Created Shared Value and Corporate
Social Responsibility has been explained. It has been observed that low rates of fertilizer use and
limited agro-dealer capacity are the major challenges that has been faced by Yara International
when they wanted to enter into the Sub-Saharan markets. In this particular study, how Yara
International Created Shared Value and its impact on business has been explained in a precise
manner. In this particular study, key reasons that has made Yara’ s Created Shared Value
Strategy a success has been described here. Besides, Created Shared Value Strategy of Abu
Dhabi Fertilizers Company WLLare explained in this specific study. Therefore, it can be
concluded that proper business strategy and effective strategic management can bring success to
any company including Yara International.

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Table of Contents
1. CSV and CSR..............................................................................................................................3
2. Challenges faced by Yara while entering Sub-Saharan markets.................................................4
3. Created Shared Value of Yara and its impact on business..........................................................4
4. Reasons that has made Yara’s created shared value a success.............................................5
5. Created Shared Value Strategy of Abu Dhabi Fertilizers Company WLL.................................5
References........................................................................................................................................6

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1. CSV and CSR
According to Schermerhorn et al., (2014) Created Shared Value means creating financial
value in such a manner that it creates its value for the society. Society’s needs as well as needs
are addressed in created shared value. It has been observed that created shared value is a
connection between comparative edge and corporate social responsibility (Wheelenet al., 2017).
On the other hand the, Rothaermel (2015) states that refers to the business approach
which causes sustainable development through delivering financial, social as well as
environmental benefits for each and every stakeholder of the company. The company that has
been chosen to write the assignment is Union Chemicals Co LLC. It is not considered as a profit
center. On the other hand, Carroll and Buchholtz, (2014) commented that created share value is
all about creating the values of Union Chemicals Co LLC. The company ensures that all the
products that they create are toxin free and also those they do not contain any harmful chemicals
that will cause harm to the environment in any way. This is why the company wants to opt for
created shared value as a strategy over CSR. CSV will help the company in maintain the position
in the market as well as perform its duties towards the responsibilities it has. The cost and
production of the company will benefits from this strategy as the profits of the company will be
used (Wheelenet al., 2017). In this context, it can be stated that this company wants to create
financial value in such a manner that it creates a value for the society. In accordance with the
opinion of Ginter, Duncan and Swayne (2018) , the company intends to earn more profitability
by selling high-quality fertilizers to its customers. This is the main reason why the respective
organization has chosen created shared value. The strategy is profitable for the company as the
profit of the company will be aligned with the profitability of the company.

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2. Challenges faced by Yara while entering Sub-Saharan markets
Yara had faced challenges regarding low rates of fertilizer use. In addition to this, this
company had faced challenges regarding limited agro dealer capacity. Majority of the farmers
staying at Corridor used the conventional, labor-intensive farming methods instead of using
chemical fertilizers. This takes away from the target market of the company thus imposing
barriers in the process of business operation.
Another challenge is lack of knowledge, the reason why the people in this area do not use
fertilizers is because they feel that fertilizers can damage the quality of soil and over-usage of
fertilizers also can contaminate the water bodies.
Scarcity of sufficient agro dealers’ capacity has restricted the company to expand their
business in entering the sub- Saharan markets. It is seen that over-usage of chemical fertilizers
often contributes to environmental pollution. These are the reasons why the company has faced
several challenges whenever they want to expand business in the Corridor. However, Yara has
created shared value for increasing the productivity of the agricultural land, which will create a
scope for them to earn more profitability from their business operations. By using fertilizers; it is
possible for the company to improve the quality of crops. As a result the company will earn more
revenue. This has triggered the management of Yara to create shared value. The company has
focused upon creating shared values strategies in order to overcome the challenges, the idea of
the company is to develop products which are not only environment friendly but also educate the
people regarding the usage of fertilizers.

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3. Created Shared Value of Yara and its impact on business
It has been noticed that Yara has formed partnership with the Norwegian government.
The government has supported the company in order to produce and live up to the values that has
been created. The CSV has helped the company to employ their ideas and values without having
them pay from the profit, the objectives of the company is created in such a way that the
company can both create values and profit at the same time. In this context, it can be stated that
formation of executive committee had taken place which is co-chaired by Unilever as well as
Tanzanian Ministry of Agriculture. The main aim is to attain commercial success by selling the
fertilizers. this is how Yara has created shared value for expanding its business operations. After
creating the shared values, it has been observed that Yara has achieved success in making high-
quality fertilizers easily accessible for the farmers. It has been bserved that by creating shared
values, it is seen that the respective company has initiated establishment of modern terminal as
well as handling facility in the port of Dar es Salaam. It has also constructed in-market storage
facility at Njombe. This is how created shared value has created an impact on the business of
Yara.
The company has achieved with the help of the CSV strategy four sources of competitive
edge: valuable knowledge regarding ecological fertilizers and eco-use of fertilizers, economies of
scale and global optimization, competitive raw material cost and experience in the operational
area. The strategy of CSV has leaded the company to extend the value chain beyond the farmers
to building partnerships with food industry in response to consumer trends. The value we create
through this integrated business model sustains our global presence and differentiation, and
strengthens our competitive edge.

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4. Reasons that has made Yara’s created shared value a success
The company has focused its resources in achieving the objectives that are CSV based
this is the major reason why the company has received success. Yara is an organisation that has
embedded the CSV strategies as the value of the company and focuses on building the success of
the organisation encompassing these values. This company has provided sufficient training to
local agro-dealers who are not dependent on anyone. It is seen that this organization has
emphasized on expert agronomists who would guide the farmers regarding the ways of using the
fertilizers. In addition to this, companies like Yara are focusing on developing new distribution
systems. This new distribution system would be formed in collaboration with companies like
SeedCo, Syngenta, NMB and Bayer CropScience. Besides, they had established agro-dealers.
These are the reasons why Yara has achieved success in gaining commercial success by sharing
created values.
5. Created Shared Value Strategy of Abu Dhabi Fertilizers Company WLL
Abu Dhabi Fertilizers Industries Company WLL (ADFERT) has implemented Shared
Value Initiative in its working practices.Abu Dhabi Fertilizer Industries Company WLL wants to
provide high-quality chemical fertilizers to its existing customer base in UAE. The vision of the
organisation is to be the regional leader in the field of Specialty Plant Nutrition (Adfert.com,
2018). The primary objective of the company is to maintain sustainability in their business
operations by offering premium-quality fertilizers to its existing base in UAE. We aim to
constantly implement technological developments and best practices in the field to provide our
customers with high standard fertilizers at reasonable pricing (Adfert.com, 2018). They want to
maintain social responsibility through its business practices. The management of Abu Dhabi
Fertilzer Industries Company WLL wants to main economic sustainability through its business

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operations. It is seen that the company’s quality control laboratory is facilitated with analytical
instruments, which assesses the quality of the raw materials as well as finished goods. The
management wants to maintain environmental sustainability through its business activities. It is
seen that this company provides substantial training to individuals which are within and who are
outside of this company (Adfert.com, 2018). The company ensures that the process of business
operations is aligned with the Created Shared Value strategy so that the company can maintain
their competitive advantage as well.

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References
Adfert.com. (2018). :: Welcome to ADFERT :: Quality Controller. [online] Available at:
http://www.adfert.com/quality/index.html [Accessed 18 Jun. 2018].
Carroll, A., &Buchholtz, A. (2014). Business and society: Ethics, sustainability, and stakeholder
management. Canada: Nelson Education.
Ginter, P. M., Duncan, W. J., & Swayne, L. E. (2018). The strategic management of health care
organizations. New Jersey: John Wiley & Sons.
Rothaermel, F. T. (2015). Strategic management. USA: McGraw-Hill Education.
Schermerhorn, J., Davidson, P., Poole, D., Woods, P., Simon, A., &McBarron, E. (2014).
Management: Foundations and Applications (2nd Asia-Pacific Edition).
New Jersey: John Wiley & Sons.
Wheelen, T.L., Hunger, J.D., Hoffman, A.N. and Bamford, C.E., 2017. Strategic management
and business policy. London: pearson.