Johnson & Johnson: The Promotion of Wellness SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Sales & Marketing
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Johnson & Johnson: The Promotion of Wellness
To create the world's healthiest workforce, diversified health care giant Johnson & Johnson (J&J) mandated participation in its "Culture of Health" program globally, customized by location, culture, and specific health needs to offer prevention-focused education, rewards for healthy behavior, and workplace environments that encouraged healthy employee behavior. By 2015, 90% of J&J's 128,000 employees would participate in Culture of Health programs; 80% would know their key health indicators (e.g., blood pressure, body-mass index, blood sugar, cholesterol); and 80% would have a "low risk" health profile. To hit these goals, J&J managers in 2014 sought to: 1) reduce national variation in program adoption and popularity, 2) do more to help employees ensure their overall-physical, mental, and spiritual-health, and 3) accurately measure the investments in and return on the program.
Swot Analysis of "Johnson & Johnson: The Promotion of Wellness" written by John A. Quelch, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Health Johnson facing as an external strategic factors. Some of the topics covered in Johnson & Johnson: The Promotion of Wellness case study are - Strategic Management Strategies, Conflict, Ethics, Health, Human resource management, Leadership, Marketing, Motivating people, Strategy and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Johnson & Johnson: The Promotion of Wellness casestudy better are - – increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, technology disruption, there is backlash against globalization, geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, wage bills are increasing,
competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Johnson & Johnson: The Promotion of Wellness
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Johnson & Johnson: The Promotion of Wellness case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Health Johnson, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Health Johnson 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 Johnson & Johnson: The Promotion of Wellness can be done for the following purposes –
1. Strategic planning using facts provided in Johnson & Johnson: The Promotion of Wellness case study
2. Improving business portfolio management of Health Johnson
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 Health Johnson
Strengths Johnson & Johnson: The Promotion of Wellness | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Health Johnson in Johnson & Johnson: The Promotion of Wellness Harvard Business Review case study are -
Sustainable margins compare to other players in Sales & Marketing industry
– Johnson & Johnson: The Promotion of Wellness firm has clearly differentiated products in the market place. This has enabled Health Johnson to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Health Johnson to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Health Johnson 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 Johnson & Johnson: The Promotion of Wellness HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Health Johnson has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Johnson & Johnson: The Promotion of Wellness 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.
Successful track record of launching new products
– Health Johnson has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Health Johnson 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.
High brand equity
– Health Johnson has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Health Johnson to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Innovation driven organization
– Health Johnson is one of the most innovative firm in sector. Manager in Johnson & Johnson: The Promotion of Wellness Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Health Johnson are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Diverse revenue streams
– Health Johnson is present in almost all the verticals within the industry. This has provided firm in Johnson & Johnson: The Promotion of Wellness 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.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Health Johnson digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Health Johnson 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.
Effective Research and Development (R&D)
– Health Johnson has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Johnson & Johnson: The Promotion of Wellness - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Health Johnson 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 John A. Quelch, Carin-Isabel Knoop 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.
Low bargaining power of suppliers
– Suppliers of Health Johnson in the sector have low bargaining power. Johnson & Johnson: The Promotion of Wellness has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Health Johnson to manage not only supply disruptions but also source products at highly competitive prices.
Weaknesses Johnson & Johnson: The Promotion of Wellness | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Johnson & Johnson: The Promotion of Wellness are -
Interest costs
– Compare to the competition, Health Johnson 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Johnson & Johnson: The Promotion of Wellness 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 Health Johnson 's lucrative customers.
Slow decision making process
– As mentioned earlier in the report, Health Johnson 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. Health Johnson 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.
Skills based hiring
– The stress on hiring functional specialists at Health Johnson has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Workers concerns about automation
– As automation is fast increasing in the segment, Health Johnson 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.
Low market penetration in new markets
– Outside its home market of Health Johnson, firm in the HBR case study Johnson & Johnson: The Promotion of Wellness needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Capital Spending Reduction
– Even during the low interest decade, Health Johnson has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
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 Health Johnson supply chain. Even after few cautionary changes mentioned in the HBR case study - Johnson & Johnson: The Promotion of Wellness, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Health Johnson vulnerable to further global disruptions in South East Asia.
Lack of clear differentiation of Health Johnson products
– To increase the profitability and margins on the products, Health Johnson needs to provide more differentiated products than what it is currently offering in the marketplace.
Need for greater diversity
– Health Johnson 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.
Slow to strategic competitive environment developments
– As Johnson & Johnson: The Promotion of Wellness HBR case study mentions - Health Johnson takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Opportunities Johnson & Johnson: The Promotion of Wellness | 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 Johnson & Johnson: The Promotion of Wellness are -
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. Health Johnson can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Developing new processes and practices
– Health Johnson 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.
Loyalty marketing
– Health Johnson has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Low interest rates
– Even though inflation is raising its head in most developed economies, Health Johnson 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.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Health Johnson in the consumer business. Now Health Johnson can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Health Johnson 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, Johnson & Johnson: The Promotion of Wellness, 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 Health Johnson can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Health Johnson can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Health Johnson is facing challenges because of the dominance of functional experts in the organization. Johnson & Johnson: The Promotion of Wellness case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Health Johnson 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.
Buying journey improvements
– Health Johnson can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Johnson & Johnson: The Promotion of Wellness 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
– Health Johnson 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 Health Johnson has opened avenues for new revenue streams for the organization in the industry. This can help Health Johnson to build a more holistic ecosystem as suggested in the Johnson & Johnson: The Promotion of Wellness case study. Health Johnson can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Threats Johnson & Johnson: The Promotion of Wellness External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Johnson & Johnson: The Promotion of Wellness are -
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. Health Johnson can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Health Johnson in the Sales & Marketing sector and impact the bottomline of the organization.
Consumer confidence and its impact on Health Johnson 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.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Health Johnson 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.
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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Health Johnson 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 Johnson & Johnson: The Promotion of Wellness .
Technology acceleration in Forth Industrial Revolution
– Health Johnson has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Health Johnson 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Health Johnson with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Health Johnson business can come under increasing regulations regarding data privacy, data security, etc.
High dependence on third party suppliers
– Health Johnson 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.
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 Health Johnson.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Johnson & Johnson: The Promotion of Wellness, Health Johnson may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Weighted SWOT Analysis of Johnson & Johnson: The Promotion of Wellness 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 Johnson & Johnson: The Promotion of Wellness 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 Johnson & Johnson: The Promotion of Wellness 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 Johnson & Johnson: The Promotion of Wellness 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 Johnson & Johnson: The Promotion of Wellness 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 Health Johnson needs to make to build a sustainable competitive advantage.
