Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget
This case concerns the bonus structure for a representative sales team. Pharma Talent, a contract sales company for pharmaceutical companies across Canada, promised its clients that its representatives would drive sales at a lower cost than what the client would incur if it had its own sales force. Historically, it had contracts with products that targeted physicians (e.g., prescription drugs or medical devices); however, a new contract in Ontario involved an over-the-counter (OTC) product. Pharma Talent currently had a pay-for-performance bonus structure that had already been revised three times. Nevertheless, due to the structure of the different territories in Ontario, many sales team members thought the bonus was unfair and very discouraging, while its pay-for-performance structure did not meet the clients' needs.
Swot Analysis of "Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget" written by Michael Taylor, Rocky Campana includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pharma Bonus facing as an external strategic factors. Some of the topics covered in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget case study are - Strategic Management Strategies, and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget casestudy better are - – increasing commodity prices, geopolitical disruptions, supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, increasing energy prices,
cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pharma Bonus, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pharma Bonus 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget can be done for the following purposes –
1. Strategic planning using facts provided in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget case study
2. Improving business portfolio management of Pharma Bonus
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 Pharma Bonus
Strengths Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pharma Bonus in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget Harvard Business Review case study are -
Ability to lead change in Sales & Marketing field
– Pharma Bonus is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Pharma Bonus in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Operational resilience
– The operational resilience strategy in the Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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.
Learning organization
- Pharma Bonus 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 Pharma Bonus is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Pharma Bonus is one of the leading recruiters in the industry. Managers in the Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Pharma Bonus 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 Michael Taylor, Rocky Campana 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.
Diverse revenue streams
– Pharma Bonus is present in almost all the verticals within the industry. This has provided firm in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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.
Highly skilled collaborators
– Pharma Bonus has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Pharma Bonus
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Pharma Bonus does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Sales & Marketing industry
– Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget firm has clearly differentiated products in the market place. This has enabled Pharma Bonus to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Pharma Bonus to invest into research and development (R&D) and innovation.
Innovation driven organization
– Pharma Bonus is one of the most innovative firm in sector. Manager in Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Pharma Bonus in the sector have low bargaining power. Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pharma Bonus to manage not only supply disruptions but also source products at highly competitive prices.
Successful track record of launching new products
– Pharma Bonus has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pharma Bonus 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.
Weaknesses Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget are -
Low market penetration in new markets
– Outside its home market of Pharma Bonus, firm in the HBR case study Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Workers concerns about automation
– As automation is fast increasing in the segment, Pharma Bonus 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 to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Pharma Bonus is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael Taylor, Rocky Campana suggests that, Pharma Bonus 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget, is just above the industry average. Pharma Bonus needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Interest costs
– Compare to the competition, Pharma Bonus has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Products dominated business model
– Even though Pharma Bonus has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget, it seems that the employees of Pharma Bonus 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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 Pharma Bonus 's lucrative customers.
Need for greater diversity
– Pharma Bonus has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
Aligning sales with marketing
– It come across in the case study Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget can leverage the sales team experience to cultivate customer relationships as Pharma Bonus is planning to shift buying processes online.
Opportunities Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget | 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Pharma Bonus can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
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 Pharma Bonus 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.
Buying journey improvements
– Pharma Bonus can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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.
Manufacturing automation
– Pharma Bonus 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.
Using analytics as competitive advantage
– Pharma Bonus 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pharma Bonus to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Learning at scale
– Online learning technologies has now opened space for Pharma Bonus to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Pharma Bonus can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Pharma Bonus can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Pharma Bonus 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.
Creating value in data economy
– The success of analytics program of Pharma Bonus has opened avenues for new revenue streams for the organization in the industry. This can help Pharma Bonus to build a more holistic ecosystem as suggested in the Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget case study. Pharma Bonus can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Sales & Marketing industry, but it has also influenced the consumer preferences. Pharma Bonus can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Pharma Bonus can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Pharma Bonus 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 Pharma Bonus to hire the very best people irrespective of their geographical location.
Threats Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget are -
Stagnating economy with rate increase
– Pharma Bonus 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.
Shortening product life cycle
– it is one of the major threat that Pharma Bonus 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 Pharma Bonus
– 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 Pharma Bonus.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Pharma Bonus 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget .
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. Pharma Bonus can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Pharma Bonus business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Pharma Bonus high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Environmental challenges
– Pharma Bonus needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Pharma Bonus can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Technology acceleration in Forth Industrial Revolution
– Pharma Bonus has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Pharma Bonus 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.
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 Pharma Bonus in the Sales & Marketing sector and impact the bottomline of the organization.
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 Pharma Bonus.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Pharma Bonus needs to understand the core reasons impacting the Sales & Marketing industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pharma Bonus with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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 Pharma Talent: Paying Sales Force Bonuses Within a Fixed Budget 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 Pharma Bonus needs to make to build a sustainable competitive advantage.