Strategic Outlook & Business Model

Kataniís corporate strategic plan takes a holistic approach in the sisal industry. The companyís growth strategy encompasses issues ranging from sisal planting through to both primary and secondary sisal processing, waste management and environment, to broadening ownership and diversifying to increase the utility value of the plant. To achieve this, the company has created interrelated subsidiary companies, which, in their totality work to accomplish this. The company has embarked on a diversification programme, covering hydropower and biomass energy sector and production of building materials to start with.

The companyís subsidiary units are inter-related. The foundation of this relationship is the symbiotic relationship between the SISO scheme and the value addition entities as well as the head office. While not entirely a part of Katani Limited, this scheme has taken the land on which sisal is grown. This left the processing infrastructure, housing, offices, transportation and technical expertise to the leaf processing entities which are in the process of being registered as independent subsidiary companies of Katani Limited. The inter-dependence between these two is quite clear.

While the processing entities act primarily as a market outlet for the SISO scheme, the primary objective of KeS is to provide farm preparation services to the SISO, and for the servicing and repair of machinery and equipment for the leaf processing entities and the secondary processing company, TANCORD (1998) Limited. In the current outlook of the company, KeS is intended to diversify into providing road and dam construction services for the open market. As the SISO scheme expands and Most of the treatise on gas and petroleum developments in this section is taken from the EIA website at improves production, the requirements for services such as those offered to them now only by KeS will increase such that, it may suddenly find itself in open competition with other providers for this market.

TANCORD (1998) Limited, the producer of sisal manufactured products, is the primary market outlet for the fibre from the leaf processing entities and, by extension, the SISO scheme.

The leaf processing entities produce a lot of waste from the leaf which raises environmental concerns. MeS provides a solution for the environmental problem as well as a solution to cost and inconsistency of electricity supply to the leaf processing entities. The companyís power generation business has two components: a biogas power generation component and a hydropower component. For generation of power from biogas, MeS depends entirely on the leaf processing entities.

This business model was presented adequately in the previous plan by Figure 2. For continuity and consistence, it is deemed best to use the representation exactly as it was presented in the previous plan.

The overall aim of this strategic outlook is to turn around all the profit centres of Katani Limited into profitable businesses. The strategies, goals and objectives that will make this happen were outlined in detail in the previous strategic plan. This plan will realign the priority areas for the immediate period of 5 years based on experience gained in implementation of the previous plan.

Before presenting the objectives and goals for this period, we examine the extent to which the previous strategic plan has been implemented and highlight issues that have arisen from the experience gained in the one year of implementation.

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