Case Study Description of Bayer in India: Intellectual Property Expropriation?
Bayer Group needed to reassess its strategies regarding intellectual property, as well as its emphasis on research and development. The Indian government had ruled against Bayer by granting a compulsory licence to a local generic drug manufacturer that allowed them to distribute a copy of Bayer's blockbuster cancer drug at a fraction of the original price. This ruling demonstrated that pharmaceutical innovation could not be effectively protected by conventional intellectual property rights in emerging markets. As a result, the core of the pharmaceutical industry's business model was called into question: If ideas and inventions could not be protected, was the there any incentive for firms to innovate? Would this victory for generic drug manufacturers trigger similar rulings elsewhere? Would the prevailing patent-centric IP strategies need to be adapted to emerging markets? Or would innovator companies finally have to withdraw from markets with weak IP protection? Authors Peter M. Bican and Quynh Nhu Truong are affiliated with WHU - Otto Beisheim School of Management.
Swot Analysis of "Bayer in India: Intellectual Property Expropriation?" written by Peter M. Bican, Quynh Nhu Truong includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Bayer Intellectual facing as an external strategic factors. Some of the topics covered in Bayer in India: Intellectual Property Expropriation? case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Bayer in India: Intellectual Property Expropriation? casestudy better are - – banking and financial system is disrupted by Bitcoin and other crypto currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, cloud computing is disrupting traditional business models, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation, geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion,
digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Bayer in India: Intellectual Property Expropriation?
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Bayer in India: Intellectual Property Expropriation? case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Bayer Intellectual, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Bayer Intellectual 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 Bayer in India: Intellectual Property Expropriation? can be done for the following purposes –
1. Strategic planning using facts provided in Bayer in India: Intellectual Property Expropriation? case study
2. Improving business portfolio management of Bayer Intellectual
3. Assessing feasibility of the new initiative in Strategy & Execution field.
4. Making a Strategy & Execution topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Bayer Intellectual
Strengths Bayer in India: Intellectual Property Expropriation? | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Bayer Intellectual in Bayer in India: Intellectual Property Expropriation? Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Bayer Intellectual in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Bayer Intellectual in the sector have low bargaining power. Bayer in India: Intellectual Property Expropriation? has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Bayer Intellectual to manage not only supply disruptions but also source products at highly competitive prices.
Strong track record of project management
– Bayer Intellectual is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Bayer Intellectual is present in almost all the verticals within the industry. This has provided firm in Bayer in India: Intellectual Property Expropriation? 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.
Organizational Resilience of Bayer Intellectual
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Bayer Intellectual does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High brand equity
– Bayer Intellectual has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Bayer Intellectual to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Strategy & Execution field
– Bayer Intellectual 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 Bayer Intellectual in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Bayer Intellectual 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 Bayer in India: Intellectual Property Expropriation? - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Operational resilience
– The operational resilience strategy in the Bayer in India: Intellectual Property Expropriation? 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
- Bayer Intellectual 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 Bayer Intellectual is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Bayer in India: Intellectual Property Expropriation? Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Bayer Intellectual 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 Bayer in India: Intellectual Property Expropriation? HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Bayer Intellectual has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Weaknesses Bayer in India: Intellectual Property Expropriation? | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Bayer in India: Intellectual Property Expropriation? are -
High operating costs
– Compare to the competitors, firm in the HBR case study Bayer in India: Intellectual Property Expropriation? 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 Bayer Intellectual 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Bayer in India: Intellectual Property Expropriation?, it seems that the employees of Bayer Intellectual 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.
Capital Spending Reduction
– Even during the low interest decade, Bayer Intellectual 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.
Aligning sales with marketing
– It come across in the case study Bayer in India: Intellectual Property Expropriation? 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 Bayer in India: Intellectual Property Expropriation? can leverage the sales team experience to cultivate customer relationships as Bayer Intellectual is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Bayer in India: Intellectual Property Expropriation?, it seems that company is thinking about the frontier risks that can impact Strategy & Execution 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.
Slow to strategic competitive environment developments
– As Bayer in India: Intellectual Property Expropriation? HBR case study mentions - Bayer Intellectual 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.
Interest costs
– Compare to the competition, Bayer Intellectual 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 Bayer Intellectual 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 - Bayer in India: Intellectual Property Expropriation? should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Bayer in India: Intellectual Property Expropriation? 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 Bayer Intellectual has relatively successful track record of launching new products.
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 Bayer Intellectual supply chain. Even after few cautionary changes mentioned in the HBR case study - Bayer in India: Intellectual Property Expropriation?, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Bayer Intellectual vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Bayer Intellectual 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.
Opportunities Bayer in India: Intellectual Property Expropriation? | 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 Bayer in India: Intellectual Property Expropriation? are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Strategy & Execution industry, but it has also influenced the consumer preferences. Bayer Intellectual can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Learning at scale
– Online learning technologies has now opened space for Bayer Intellectual 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Bayer Intellectual in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Strategy & Execution segment, and it will provide faster access to the consumers.
Building a culture of innovation
– managers at Bayer Intellectual 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 Strategy & Execution segment.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Bayer Intellectual is facing challenges because of the dominance of functional experts in the organization. Bayer in India: Intellectual Property Expropriation? 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Bayer Intellectual can use these opportunities to build new business models that can help the communities that Bayer Intellectual operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Creating value in data economy
– The success of analytics program of Bayer Intellectual has opened avenues for new revenue streams for the organization in the industry. This can help Bayer Intellectual to build a more holistic ecosystem as suggested in the Bayer in India: Intellectual Property Expropriation? case study. Bayer Intellectual can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Developing new processes and practices
– Bayer Intellectual can develop new processes and procedures in Strategy & Execution 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Bayer Intellectual 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.
Better consumer reach
– The expansion of the 5G network will help Bayer Intellectual to increase its market reach. Bayer Intellectual 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Bayer Intellectual 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 Bayer Intellectual to hire the very best people irrespective of their geographical location.
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 Bayer Intellectual 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.
Manufacturing automation
– Bayer Intellectual can use the latest technology developments to improve its manufacturing and designing process in Strategy & Execution 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.
Threats Bayer in India: Intellectual Property Expropriation? External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Bayer in India: Intellectual Property Expropriation? are -
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Bayer Intellectual will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Consumer confidence and its impact on Bayer Intellectual 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.
Environmental challenges
– Bayer Intellectual 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. Bayer Intellectual can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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.
Increasing wage structure of Bayer Intellectual
– 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 Bayer Intellectual.
High dependence on third party suppliers
– Bayer Intellectual 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.
Technology acceleration in Forth Industrial Revolution
– Bayer Intellectual has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Bayer Intellectual needs to keep up with the evolution of technology in the Strategy & Execution 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.
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 Bayer Intellectual business can come under increasing regulations regarding data privacy, data security, etc.
Easy access to finance
– Easy access to finance in Strategy & Execution field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Bayer Intellectual can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Bayer Intellectual in the Strategy & Execution industry. The Strategy & Execution 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Bayer Intellectual 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 Bayer in India: Intellectual Property Expropriation? .
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 Bayer Intellectual.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Bayer in India: Intellectual Property Expropriation?, Bayer Intellectual may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Strategy & Execution .
Weighted SWOT Analysis of Bayer in India: Intellectual Property Expropriation? 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 Bayer in India: Intellectual Property Expropriation? 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 Bayer in India: Intellectual Property Expropriation? 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 Bayer in India: Intellectual Property Expropriation? 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 Bayer in India: Intellectual Property Expropriation? 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 Bayer Intellectual needs to make to build a sustainable competitive advantage.
