Takeda Pharmaceutical Company (B): The Millennium Acquisition SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Takeda Pharmaceutical Company (B): The Millennium Acquisition
Yasuchika Hasegawa, president of Takeda Pharmaceutical Company, had a vision to make Takeda a top tier company in oncology by 2015. In 2008, Takeda acquired Millennium Pharmaceuticals, a respected oncology company with annual sales of $528 million in 2007 and a promising pipeline of new drugs. Hasegawa and Millennium CEO Deborah Dunsire believed that it was critical to convey a consistent vision for the future of Millennium within Takeda and help Millennium employees feel positive about the company's future. Millennium would operate independently and become Takeda's "Center of Excellence in Oncology." This case explores the steps that Hasegawa took to successfully integrate Millennium. His priorities centered on retaining Millennium talent and addressing the friction that arose from two very different corporate cultures. He also used the opportunity to transform Takeda's risk averse culture into a more innovative and flexible one that would support Takeda becoming a truly global pharmaceutical company.
Authors :: Charles O'Reilly, Asaka Itoh, Hiromichi Kimura, Chris D Beaumont
Swot Analysis of "Takeda Pharmaceutical Company (B): The Millennium Acquisition" written by Charles O'Reilly, Asaka Itoh, Hiromichi Kimura, Chris D Beaumont includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Takeda Millennium facing as an external strategic factors. Some of the topics covered in Takeda Pharmaceutical Company (B): The Millennium Acquisition case study are - Strategic Management Strategies, Emerging markets, Growth strategy, Mergers & acquisitions and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Takeda Pharmaceutical Company (B): The Millennium Acquisition casestudy better are - – increasing commodity prices, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, there is increasing trade war between United States & China, increasing energy prices, technology disruption, talent flight as more people leaving formal jobs,
central banks are concerned over increasing inflation, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Takeda Pharmaceutical Company (B): The Millennium Acquisition
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Takeda Pharmaceutical Company (B): The Millennium Acquisition case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Takeda Millennium, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Takeda Millennium 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition can be done for the following purposes –
1. Strategic planning using facts provided in Takeda Pharmaceutical Company (B): The Millennium Acquisition case study
2. Improving business portfolio management of Takeda Millennium
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 Takeda Millennium
Strengths Takeda Pharmaceutical Company (B): The Millennium Acquisition | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Takeda Millennium in Takeda Pharmaceutical Company (B): The Millennium Acquisition Harvard Business Review case study are -
Cross disciplinary teams
– Horizontal connected teams at the Takeda Millennium 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.
Ability to recruit top talent
– Takeda Millennium is one of the leading recruiters in the industry. Managers in the Takeda Pharmaceutical Company (B): The Millennium Acquisition are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Takeda Millennium
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Takeda Millennium does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Takeda Millennium 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.
Analytics focus
– Takeda Millennium 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 Charles O'Reilly, Asaka Itoh, Hiromichi Kimura, Chris D Beaumont 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.
Superior customer experience
– The customer experience strategy of Takeda Millennium in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Takeda Millennium has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Takeda Pharmaceutical Company (B): The Millennium Acquisition 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.
Low bargaining power of suppliers
– Suppliers of Takeda Millennium in the sector have low bargaining power. Takeda Pharmaceutical Company (B): The Millennium Acquisition has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Takeda Millennium to manage not only supply disruptions but also source products at highly competitive prices.
Highly skilled collaborators
– Takeda Millennium 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Takeda Millennium is one of the most innovative firm in sector. Manager in Takeda Pharmaceutical Company (B): The Millennium Acquisition Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Takeda Millennium digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Takeda Millennium 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.
High brand equity
– Takeda Millennium has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Takeda Millennium to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses Takeda Pharmaceutical Company (B): The Millennium Acquisition | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Takeda Pharmaceutical Company (B): The Millennium Acquisition are -
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Takeda Pharmaceutical Company (B): The Millennium Acquisition, in the dynamic environment Takeda Millennium has struggled to respond to the nimble upstart competition. Takeda Millennium has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Takeda Millennium is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Takeda Pharmaceutical Company (B): The Millennium Acquisition can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Low market penetration in new markets
– Outside its home market of Takeda Millennium, firm in the HBR case study Takeda Pharmaceutical Company (B): The Millennium Acquisition 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, Takeda Millennium 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Takeda Pharmaceutical Company (B): The Millennium Acquisition, it seems that the employees of Takeda Millennium 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.
Interest costs
– Compare to the competition, Takeda Millennium 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.
Need for greater diversity
– Takeda Millennium 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 decision making process
– As mentioned earlier in the report, Takeda Millennium 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. Takeda Millennium even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Takeda Pharmaceutical Company (B): The Millennium Acquisition 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 Takeda Millennium has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Takeda Millennium 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 Takeda Millennium supply chain. Even after few cautionary changes mentioned in the HBR case study - Takeda Pharmaceutical Company (B): The Millennium Acquisition, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Takeda Millennium vulnerable to further global disruptions in South East Asia.
Opportunities Takeda Pharmaceutical Company (B): The Millennium Acquisition | 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition are -
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. Takeda Millennium 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. Takeda Millennium 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Takeda Millennium 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Takeda Millennium 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.
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. Takeda Millennium can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Loyalty marketing
– Takeda Millennium 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.
Leveraging digital technologies
– Takeda Millennium 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.
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. Takeda Millennium can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Takeda Millennium in the consumer business. Now Takeda Millennium can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Takeda Millennium to increase its market reach. Takeda Millennium 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Takeda Millennium can use these opportunities to build new business models that can help the communities that Takeda Millennium operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Developing new processes and practices
– Takeda Millennium 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.
Building a culture of innovation
– managers at Takeda Millennium 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.
Learning at scale
– Online learning technologies has now opened space for Takeda Millennium 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.
Threats Takeda Pharmaceutical Company (B): The Millennium Acquisition External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Takeda Pharmaceutical Company (B): The Millennium Acquisition are -
Regulatory challenges
– Takeda Millennium needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Strategy & Execution industry regulations.
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 Takeda Millennium in the Strategy & Execution sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Takeda Pharmaceutical Company (B): The Millennium Acquisition, Takeda Millennium 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Takeda Millennium with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Stagnating economy with rate increase
– Takeda Millennium 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Takeda Millennium 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition .
Shortening product life cycle
– it is one of the major threat that Takeda Millennium 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 Takeda Millennium business can come under increasing regulations regarding data privacy, data security, etc.
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.
High dependence on third party suppliers
– Takeda Millennium 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.
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. Takeda Millennium can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Takeda Millennium.
Weighted SWOT Analysis of Takeda Pharmaceutical Company (B): The Millennium Acquisition 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition 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 Takeda Pharmaceutical Company (B): The Millennium Acquisition 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 Takeda Millennium needs to make to build a sustainable competitive advantage.