Essay Electrochem, Inc.: Energy for a Clean Planet

1333 Words Mar 31st, 2011 6 Pages
Radha Jalan took over management of ElectroChem, a struggling company that researched and developed fuel cell technology, after the sudden death of her husband Vinod Jalan in 1992. She did so because she was intrigued by the possibility of participating in the early stages of a growth industry, and she looked forward to the intellectual stimulation and challenge. The biggest challenge she faced early on was funding, mostly because the company was not profitable and the government grants that had been keeping it afloat were quickly coming to an end. When looking at ElectroChem from a SWOT analysis perspective we would like to start when Jalan was first faced with the decision to sell the business or continue as its president. There …show more content…
One barrier to commercialization of fuel cells was the cost to produce them, the per-kilowatt cost for a fuel cell power plant was $3,000 - $4,000 and in order to be commercially viable the cost had to decrease to around $1,500. It is often outside influences that determine a businesses fate, so we have to look at the external opportunities and threats that existed. The main opportunity is obvious and has already been discussed, the product itself is revolutionary and as former executive director of the U.S. Fuel Cell Council Gregory Dolan stated, when speaking about fuel cells “they are not just the wave of the future; they are the tsunami of the future”. There is a tremendous growth potential in the fuel cell market, global demand was projected to be $46 billion in 2011 and could reach $2.6 trillion by 2021. When considering threats to the company one does not have to look far, because the biggest concern is cash flow. The company was in a state of financial crisis, in fact Jalan had to use her husband’s life insurance settlement to meet payroll expense in the beginning. Also government grants are limited and there were several companies, most larger than ElectroChem, trying to obtain them in order to continue operating.
After making the decision to take over control of the company, Jalan took many steps in an effort to turn it around financially. She did not let anybody get in her way,

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