Dr. Yet-Ming Chiang and Dr. Bart Riley

Dr. Yet-Ming Chiang and Dr. Bart Riley: Developing Next-Generation Batteries

Dr. Yet-Ming Chiang and Dr. Bart Riley are two scientists who are credited with developing next-generation batteries. A123, a firm founded in 2001, devised a novel method for developing high-powered, faster-charging lithium-ion battery systems using nanophosphate technology. The batteries were designed with the goal of producing high-capacity batteries that were lightweight. Throughout time, commercially available batteries took longer to charge and were heavier. The company has took the initiative to collaborate with General Electric and Ballard Power Services to improve the performance of commercial bus batteries. The company has been operational on a commercial aspect since the years 2007 when they partnered with General motors and Ballard Power Services. The company has however faced various challenges chief among them being competition. The clean energy sector in transportation has been growing over the years. Companies such as Samsung and other multinationals have entered the market. It is for this reason that, A123 has been finding it difficult to dominate the industry. The company has had to patent each and every step of development undertaken which is expensive.

Challenges Faced by A123

The other challenge that A123 has been facing over the years is high operations cost. The development of the batteries means that company has to invest a lot of resources in developing a single battery. The difference however arises based on the selling price that the company offers consumers (Wheelen, et al, 56). The firm has been able to stay afloat as a result of partnerships with huge transportation companies. The company in this case has faced a challenge of making profits which is a major problem.

Recommendations

The organization has been able to grow over the years and has learnt valuable lessons in the field. It is however important for other companies seeking to enter a given market to put various factors into consideration. Competition is an issue that exist in all sectors of the economy especially to new businesses. It is hence important for a company to research on potential competitors in a given market before making conclusions. Identifying strong points of a company over competitor’s means will go a long way in saving a company. The other factor is identifying the weak points of competitors.

The operation cost of a company in any industry is one of the greatest challenges that new company is likely to face. In most instances the operations cost is likely to exceed the profits margins of a company. In the event that a firm has external financers it becomes impossible to explain such scenarios. In the case of a new company, it is important for a company to seek better ways of reducing operations cost. Operations cost involves amount paid to employees, technology in use and the cost of raw materials (Wheelen, et al, 49). It is important to put this factors into consideration before starting a new company.

The starting point of A123 as a company is common to many startups in various industries. A new company is however likely to face various challenges such as competition in a new industry. The existence of strong competitors poses the greatest challenge to a company as it has to seek better ways of competing. The other challenge is high operations cost which is likely to raise debt levels. It is hence important for a company to seek better ways of dealing with high operations cost.

Works cited

Wheelen, Thomas., Hunger, David., Hoffman, Alan., & Bamford, Charles. Strategic Management And Business Policy. London: Pearson.2015 Print.