Case Study Description of Vistakon: 1 Day Acuvue Disposable Contact Lenses
Vistakon, an independent and entrepreneurial subsidiary of Johnson & Johnson, pioneered the production and marketing of disposable contact lenses with the 1987 launch of Acuvue, the first disposable extended-wear lens--a soft contact lens that patients wear for a period of less than two weeks and then abandon. By 1993, Acuvue was the leading brand of soft contact lens in the United States. In March 1994, Gary Kunkle, president of Vistakon, was presented with the test market results for an addition to the firm's product line, 1 Day Acuvue, the world's first daily disposable contact lens. The test market results raised a number of strategic issues relating to: 1) the positioning and pricing of the new daily wear disposable product; 2) cannibalization of the firm's existing extended-wear disposable lens; and 3) the mix of push and pull components required for the introductory marketing campaign to be effective in generating and coordinating demand from both eye-care professionals and consumers. In deciding how to proceed, Kunkle must evalute the risks associated with commencing an immediate launch with an unproven strategy as opposed to extending the test market.
Authors :: Alvin J. Silk, Bruce Isaacson, Marie Bell
Swot Analysis of "Vistakon: 1 Day Acuvue Disposable Contact Lenses" written by Alvin J. Silk, Bruce Isaacson, Marie Bell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Disposable Acuvue facing as an external strategic factors. Some of the topics covered in Vistakon: 1 Day Acuvue Disposable Contact Lenses case study are - Strategic Management Strategies, Market research and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Vistakon: 1 Day Acuvue Disposable Contact Lenses casestudy better are - – there is increasing trade war between United States & China, geopolitical disruptions, customer relationship management is fast transforming because of increasing concerns over data privacy, talent flight as more people leaving formal jobs, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing transportation and logistics costs,
supply chains are disrupted by pandemic , technology disruption, etc
Introduction to SWOT Analysis of Vistakon: 1 Day Acuvue Disposable Contact Lenses
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Vistakon: 1 Day Acuvue Disposable Contact Lenses case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Disposable Acuvue, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Disposable Acuvue operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Vistakon: 1 Day Acuvue Disposable Contact Lenses can be done for the following purposes –
1. Strategic planning using facts provided in Vistakon: 1 Day Acuvue Disposable Contact Lenses case study
2. Improving business portfolio management of Disposable Acuvue
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Disposable Acuvue
Strengths Vistakon: 1 Day Acuvue Disposable Contact Lenses | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Disposable Acuvue in Vistakon: 1 Day Acuvue Disposable Contact Lenses Harvard Business Review case study are -
High brand equity
– Disposable Acuvue has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Disposable Acuvue to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Disposable Acuvue is one of the most innovative firm in sector. Manager in Vistakon: 1 Day Acuvue Disposable Contact Lenses Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Disposable Acuvue digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Disposable Acuvue has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Low bargaining power of suppliers
– Suppliers of Disposable Acuvue in the sector have low bargaining power. Vistakon: 1 Day Acuvue Disposable Contact Lenses has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Disposable Acuvue to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Vistakon: 1 Day Acuvue Disposable Contact Lenses Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Successful track record of launching new products
– Disposable Acuvue has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Disposable Acuvue has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Sustainable margins compare to other players in Sales & Marketing industry
– Vistakon: 1 Day Acuvue Disposable Contact Lenses firm has clearly differentiated products in the market place. This has enabled Disposable Acuvue to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Disposable Acuvue to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Disposable Acuvue is one of the leading recruiters in the industry. Managers in the Vistakon: 1 Day Acuvue Disposable Contact Lenses are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Diverse revenue streams
– Disposable Acuvue is present in almost all the verticals within the industry. This has provided firm in Vistakon: 1 Day Acuvue Disposable Contact Lenses case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Training and development
– Disposable Acuvue has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Vistakon: 1 Day Acuvue Disposable Contact Lenses Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Learning organization
- Disposable Acuvue is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Disposable Acuvue is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Vistakon: 1 Day Acuvue Disposable Contact Lenses Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Disposable Acuvue is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Alvin J. Silk, Bruce Isaacson, Marie Bell can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Weaknesses Vistakon: 1 Day Acuvue Disposable Contact Lenses | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Vistakon: 1 Day Acuvue Disposable Contact Lenses are -
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Disposable Acuvue supply chain. Even after few cautionary changes mentioned in the HBR case study - Vistakon: 1 Day Acuvue Disposable Contact Lenses, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Disposable Acuvue vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Disposable Acuvue needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow decision making process
– As mentioned earlier in the report, Disposable Acuvue has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Disposable Acuvue even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High bargaining power of channel partners
– Because of the regulatory requirements, Alvin J. Silk, Bruce Isaacson, Marie Bell suggests that, Disposable Acuvue is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Vistakon: 1 Day Acuvue Disposable Contact Lenses, it seems that the employees of Disposable Acuvue don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High operating costs
– Compare to the competitors, firm in the HBR case study Vistakon: 1 Day Acuvue Disposable Contact Lenses has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Disposable Acuvue 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Vistakon: 1 Day Acuvue Disposable Contact Lenses, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Increasing silos among functional specialists
– The organizational structure of Disposable Acuvue is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Disposable Acuvue needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Disposable Acuvue to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Disposable Acuvue products
– To increase the profitability and margins on the products, Disposable Acuvue needs to provide more differentiated products than what it is currently offering in the marketplace.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Vistakon: 1 Day Acuvue Disposable Contact Lenses HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Disposable Acuvue has relatively successful track record of launching new products.
High cash cycle compare to competitors
Disposable Acuvue has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Opportunities Vistakon: 1 Day Acuvue Disposable Contact Lenses | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Vistakon: 1 Day Acuvue Disposable Contact Lenses are -
Buying journey improvements
– Disposable Acuvue can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Vistakon: 1 Day Acuvue Disposable Contact Lenses suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Leveraging digital technologies
– Disposable Acuvue can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Using analytics as competitive advantage
– Disposable Acuvue has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Vistakon: 1 Day Acuvue Disposable Contact Lenses - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Disposable Acuvue to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Disposable Acuvue to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Better consumer reach
– The expansion of the 5G network will help Disposable Acuvue to increase its market reach. Disposable Acuvue will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Manufacturing automation
– Disposable Acuvue can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Creating value in data economy
– The success of analytics program of Disposable Acuvue has opened avenues for new revenue streams for the organization in the industry. This can help Disposable Acuvue to build a more holistic ecosystem as suggested in the Vistakon: 1 Day Acuvue Disposable Contact Lenses case study. Disposable Acuvue can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Disposable Acuvue can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Developing new processes and practices
– Disposable Acuvue can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Disposable Acuvue to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Disposable Acuvue to hire the very best people irrespective of their geographical location.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Sales & Marketing industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Disposable Acuvue can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Disposable Acuvue can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Disposable Acuvue in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Disposable Acuvue can use these opportunities to build new business models that can help the communities that Disposable Acuvue operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Threats Vistakon: 1 Day Acuvue Disposable Contact Lenses External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Vistakon: 1 Day Acuvue Disposable Contact Lenses are -
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Disposable Acuvue.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Disposable Acuvue can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Disposable Acuvue with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Disposable Acuvue can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Technology acceleration in Forth Industrial Revolution
– Disposable Acuvue has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Disposable Acuvue needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Disposable Acuvue can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Vistakon: 1 Day Acuvue Disposable Contact Lenses .
Consumer confidence and its impact on Disposable Acuvue demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Disposable Acuvue in the Sales & Marketing industry. The Sales & Marketing industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Shortening product life cycle
– it is one of the major threat that Disposable Acuvue is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing wage structure of Disposable Acuvue
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Disposable Acuvue.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Disposable Acuvue business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Disposable Acuvue in the Sales & Marketing sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Vistakon: 1 Day Acuvue Disposable Contact Lenses Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Vistakon: 1 Day Acuvue Disposable Contact Lenses needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Vistakon: 1 Day Acuvue Disposable Contact Lenses is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Vistakon: 1 Day Acuvue Disposable Contact Lenses is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Vistakon: 1 Day Acuvue Disposable Contact Lenses is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Disposable Acuvue needs to make to build a sustainable competitive advantage.
