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 - – increasing household debt because of falling income levels, there is backlash against globalization, technology disruption, increasing commodity prices, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic ,
geopolitical disruptions, central banks are concerned over increasing inflation, 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 -
Successful track record of launching new products
– Bayer Intellectual has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Bayer Intellectual 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Bayer Intellectual digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Bayer Intellectual 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.
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.
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.
Ability to recruit top talent
– Bayer Intellectual is one of the leading recruiters in the industry. Managers in the Bayer in India: Intellectual Property Expropriation? are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Sustainable margins compare to other players in Strategy & Execution industry
– Bayer in India: Intellectual Property Expropriation? firm has clearly differentiated products in the market place. This has enabled Bayer Intellectual to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Bayer Intellectual to invest into research and development (R&D) and innovation.
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.
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.
Training and development
– Bayer Intellectual has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Bayer in India: Intellectual Property Expropriation? 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.
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.
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.
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 -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Bayer Intellectual is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Bayer in India: Intellectual Property Expropriation? 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, Peter M. Bican, Quynh Nhu Truong suggests that, Bayer Intellectual 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 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.
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.
Low market penetration in new markets
– Outside its home market of Bayer Intellectual, firm in the HBR case study Bayer in India: Intellectual Property Expropriation? needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Bayer Intellectual 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.
Increasing silos among functional specialists
– The organizational structure of Bayer Intellectual is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Bayer Intellectual needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Bayer Intellectual to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Bayer Intellectual products
– To increase the profitability and margins on the products, Bayer Intellectual needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Bayer in India: Intellectual Property Expropriation?, is just above the industry average. Bayer Intellectual 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.
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.
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.
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 -
Leveraging digital technologies
– Bayer Intellectual 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Strategy & Execution industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Bayer Intellectual 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. Bayer Intellectual 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.
Buying journey improvements
– Bayer Intellectual can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Bayer in India: Intellectual Property Expropriation? 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.
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.
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.
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.
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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Bayer Intellectual 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, Bayer in India: Intellectual Property Expropriation?, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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.
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.
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.
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. Bayer Intellectual can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 -
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? .
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.
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. Bayer Intellectual needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
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.
Stagnating economy with rate increase
– Bayer Intellectual 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 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Bayer Intellectual with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
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.
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.
Shortening product life cycle
– it is one of the major threat that Bayer Intellectual is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
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.
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.
