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, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, increasing energy prices,
challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, 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 -
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.
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.
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.
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.
Sustainable margins compare to other players in Strategy & Execution industry
– Takeda Pharmaceutical Company (B): The Millennium Acquisition firm has clearly differentiated products in the market place. This has enabled Takeda Millennium to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Takeda Millennium to invest into research and development (R&D) and innovation.
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.
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.
Learning organization
- Takeda Millennium 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 Takeda Millennium is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Takeda Pharmaceutical Company (B): The Millennium Acquisition Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to lead change in Strategy & Execution field
– Takeda Millennium 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 Takeda Millennium in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
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.
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.
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 -
Increasing silos among functional specialists
– The organizational structure of Takeda Millennium is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Takeda Millennium needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Takeda Millennium to focus more on services rather than just following the product oriented approach.
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.
Skills based hiring
– The stress on hiring functional specialists at Takeda Millennium 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.
High cash cycle compare to competitors
Takeda Millennium 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.
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.
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.
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.
Lack of clear differentiation of Takeda Millennium products
– To increase the profitability and margins on the products, Takeda Millennium needs to provide more differentiated products than what it is currently offering in the marketplace.
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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Takeda Pharmaceutical Company (B): The Millennium Acquisition, is just above the industry average. Takeda Millennium 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Charles O'Reilly, Asaka Itoh, Hiromichi Kimura, Chris D Beaumont suggests that, Takeda Millennium 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.
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 -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Takeda Millennium is facing challenges because of the dominance of functional experts in the organization. Takeda Pharmaceutical Company (B): The Millennium Acquisition 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.
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.
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.
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.
Manufacturing automation
– Takeda Millennium 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.
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.
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 Takeda Millennium 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.
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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Takeda Millennium 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 Takeda Millennium to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Takeda Millennium 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, Takeda Pharmaceutical Company (B): The Millennium Acquisition, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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.
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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Takeda Millennium can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 -
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.
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.
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.
Increasing wage structure of Takeda Millennium
– 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 Takeda Millennium.
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.
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.
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 .
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.
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.
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. Takeda Millennium needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Consumer confidence and its impact on Takeda Millennium 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
– Takeda Millennium 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. Takeda Millennium can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Technology acceleration in Forth Industrial Revolution
– Takeda Millennium has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Takeda Millennium 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.
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.
