Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug
Amgen Inc.'s Epogen was the first biotech blockbuster drug. Epogen helped prevent anemia, a condition that leads to severe fatigue, increased risk of cardiovascular disease, and even death. At the time, the market for Epogen, which included dialysis patients and persons with cancer undergoing chemotherapy, was estimated to be a $1 billion opportunity. After a critical scientific breakthrough, which allowed Amgen to identify the EPO gene, the company applied for a number of patents to protect its achievement. However, much to its surprise, Amgen learned that EPO had already been patented. Genetics Institute, the holder of the patent, demanded a royalty-free cross-license. Amgen's manager needed to decide how best to compete with its rival.
Swot Analysis of "Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug" written by Felix Oberholzer-Gee, Dennis Yao includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Epogen Amgen facing as an external strategic factors. Some of the topics covered in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug case study are - Strategic Management Strategies, Intellectual property, Marketing, Regulation, Strategic planning and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug casestudy better are - – competitive advantages are harder to sustain because of technology dispersion, wage bills are increasing, increasing energy prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing commodity prices, technology disruption, digital marketing is dominated by two big players Facebook and Google,
central banks are concerned over increasing inflation, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Epogen Amgen, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Epogen Amgen 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug can be done for the following purposes –
1. Strategic planning using facts provided in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug case study
2. Improving business portfolio management of Epogen Amgen
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 Epogen Amgen
Strengths Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Epogen Amgen in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug Harvard Business Review case study are -
Ability to recruit top talent
– Epogen Amgen is one of the leading recruiters in the industry. Managers in the Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
High brand equity
– Epogen Amgen has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Epogen Amgen to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Epogen Amgen
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Epogen Amgen does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Epogen Amgen digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Epogen Amgen 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.
Superior customer experience
– The customer experience strategy of Epogen Amgen in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Epogen Amgen 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.
Learning organization
- Epogen Amgen 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 Epogen Amgen is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Epogen Amgen is present in almost all the verticals within the industry. This has provided firm in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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.
Ability to lead change in Strategy & Execution field
– Epogen Amgen 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 Epogen Amgen in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Epogen Amgen is one of the most innovative firm in sector. Manager in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Operational resilience
– The operational resilience strategy in the Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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.
Training and development
– Epogen Amgen has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug are -
Skills based hiring
– The stress on hiring functional specialists at Epogen Amgen 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.
Need for greater diversity
– Epogen Amgen 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug, is just above the industry average. Epogen Amgen 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 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 Epogen Amgen supply chain. Even after few cautionary changes mentioned in the HBR case study - Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Epogen Amgen vulnerable to further global disruptions in South East Asia.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Epogen Amgen has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Felix Oberholzer-Gee, Dennis Yao suggests that, Epogen Amgen 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.
Slow decision making process
– As mentioned earlier in the report, Epogen Amgen 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. Epogen Amgen 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.
Low market penetration in new markets
– Outside its home market of Epogen Amgen, firm in the HBR case study Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Epogen Amgen 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug, it seems that the employees of Epogen Amgen 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug, in the dynamic environment Epogen Amgen has struggled to respond to the nimble upstart competition. Epogen Amgen has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug | 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug are -
Better consumer reach
– The expansion of the 5G network will help Epogen Amgen to increase its market reach. Epogen Amgen 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Epogen Amgen 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Epogen Amgen can use these opportunities to build new business models that can help the communities that Epogen Amgen operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Loyalty marketing
– Epogen Amgen 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.
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 Epogen Amgen 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.
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. Epogen Amgen 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. Epogen Amgen 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 Epogen Amgen can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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. Epogen Amgen 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 Epogen Amgen 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.
Creating value in data economy
– The success of analytics program of Epogen Amgen has opened avenues for new revenue streams for the organization in the industry. This can help Epogen Amgen to build a more holistic ecosystem as suggested in the Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug case study. Epogen Amgen can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Epogen Amgen 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.
Building a culture of innovation
– managers at Epogen Amgen 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.
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 Epogen Amgen in the consumer business. Now Epogen Amgen can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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. Epogen Amgen 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug, Epogen Amgen 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 .
Shortening product life cycle
– it is one of the major threat that Epogen Amgen is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Epogen Amgen 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug .
Increasing wage structure of Epogen Amgen
– 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 Epogen Amgen.
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 Epogen Amgen in the Strategy & Execution sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Epogen Amgen 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.
Environmental challenges
– Epogen Amgen 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. Epogen Amgen can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Epogen Amgen can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Epogen Amgen with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Epogen Amgen needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Epogen Amgen 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.
Weighted SWOT Analysis of Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Amgen Inc.'s Epogen--Commercializing the First Biotech Blockbuster Drug 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 Epogen Amgen needs to make to build a sustainable competitive advantage.
