Health for All: Dr. Reddy's Laboratories and Rural India (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Health for All: Dr. Reddy's Laboratories and Rural India (B)
Supplement to case IMD848. This two-part case series is set in India and examines the challenges encountered by a leading Indian pharmaceutical company, Dr. Reddy's Laboratories (DRL), following its strategic decision to create Indura - a business unit dedicated to the rural market. In recent years, the strategic direction set by the new CEO and his "Health for All" vision has shifted the company's attention to its domestic market and the rural areas of the country. The case focuses on the implementation hurdles of such a vision and invites business executives to explore the role of strategy in building ecosystems that are essential for successful strategy implementation. Case A sets the scene by describing the business model of pharmaceutical companies in India and the rationale behind DRL's decision to pursue an alternative growth avenue. It presents the Indura project, which takes the company to rural markets. Given its large size and growth potential, rural India seems to offer a fascinating opportunity to DRL. The case highlights the unique obstacles Indura faced in its effort to access rural customers and concludes by putting the spotlight on the sustainability question: Can DRL translate its "Health for All" vision into a sustainable business model? Case B is a brief follow-on case that presents key actions taken by DRL's management during the period 2013-2015. Alok Sonig, the newly appointed leader of the India business, together with his direct report Rajaram Bagayatkar, changed the name of the unit to Pride and adopted a new plan of action, which focused on motivating the sales force. While this addressed most of the challenges, some issues remained. Case B invites participants to go beyond DRL management's actions and explore possible ways to leverage technology and social media and innovative approaches to address both the access and talent challenges.
Swot Analysis of "Health for All: Dr. Reddy's Laboratories and Rural India (B)" written by Charles Dhanaraj, Athanasios Kondis, Chandrasekhar Sripada, Padma Rajeswari Tata includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Drl Indura facing as an external strategic factors. Some of the topics covered in Health for All: Dr. Reddy's Laboratories and Rural India (B) case study are - Strategic Management Strategies, and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Health for All: Dr. Reddy's Laboratories and Rural India (B) casestudy better are - – cloud computing is disrupting traditional business models, increasing household debt because of falling income levels, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, increasing commodity prices,
wage bills are increasing, increasing government debt because of Covid-19 spendings, etc
Introduction to SWOT Analysis of Health for All: Dr. Reddy's Laboratories and Rural India (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Health for All: Dr. Reddy's Laboratories and Rural India (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Drl Indura, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Drl Indura 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) can be done for the following purposes –
1. Strategic planning using facts provided in Health for All: Dr. Reddy's Laboratories and Rural India (B) case study
2. Improving business portfolio management of Drl Indura
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 Drl Indura
Strengths Health for All: Dr. Reddy's Laboratories and Rural India (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Drl Indura in Health for All: Dr. Reddy's Laboratories and Rural India (B) Harvard Business Review case study are -
Organizational Resilience of Drl Indura
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Drl Indura does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Health for All: Dr. Reddy's Laboratories and Rural India (B) 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.
Effective Research and Development (R&D)
– Drl Indura 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Learning organization
- Drl Indura 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 Drl Indura is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Health for All: Dr. Reddy's Laboratories and Rural India (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Analytics focus
– Drl Indura 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 Dhanaraj, Athanasios Kondis, Chandrasekhar Sripada, Padma Rajeswari Tata 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 lead change in Strategy & Execution field
– Drl Indura 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 Drl Indura in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Cross disciplinary teams
– Horizontal connected teams at the Drl Indura 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.
High switching costs
– The high switching costs that Drl Indura 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.
Strong track record of project management
– Drl Indura is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Drl Indura digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Drl Indura 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.
Low bargaining power of suppliers
– Suppliers of Drl Indura in the sector have low bargaining power. Health for All: Dr. Reddy's Laboratories and Rural India (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Drl Indura to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Drl Indura is present in almost all the verticals within the industry. This has provided firm in Health for All: Dr. Reddy's Laboratories and Rural India (B) 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.
Weaknesses Health for All: Dr. Reddy's Laboratories and Rural India (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Health for All: Dr. Reddy's Laboratories and Rural India (B) are -
Workers concerns about automation
– As automation is fast increasing in the segment, Drl Indura 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.
Slow to strategic competitive environment developments
– As Health for All: Dr. Reddy's Laboratories and Rural India (B) HBR case study mentions - Drl Indura 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 cash cycle compare to competitors
Drl Indura 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Health for All: Dr. Reddy's Laboratories and Rural India (B), in the dynamic environment Drl Indura has struggled to respond to the nimble upstart competition. Drl Indura has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Drl Indura 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.
Increasing silos among functional specialists
– The organizational structure of Drl Indura is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Drl Indura needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Drl Indura to focus more on services rather than just following the product oriented approach.
Aligning sales with marketing
– It come across in the case study Health for All: Dr. Reddy's Laboratories and Rural India (B) that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Health for All: Dr. Reddy's Laboratories and Rural India (B) can leverage the sales team experience to cultivate customer relationships as Drl Indura is planning to shift buying processes online.
No frontier risks strategy
– After analyzing the HBR case study Health for All: Dr. Reddy's Laboratories and Rural India (B), it seems that company is thinking about the frontier risks that can impact Strategy & Execution strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Lack of clear differentiation of Drl Indura products
– To increase the profitability and margins on the products, Drl Indura needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Drl Indura 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. Drl Indura 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Drl Indura is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Health for All: Dr. Reddy's Laboratories and Rural India (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Health for All: Dr. Reddy's Laboratories and Rural India (B) | 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Drl Indura 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, Health for All: Dr. Reddy's Laboratories and Rural India (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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. Drl Indura 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. Drl Indura 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.
Learning at scale
– Online learning technologies has now opened space for Drl Indura 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Drl Indura can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Drl Indura 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.
Developing new processes and practices
– Drl Indura 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.
Using analytics as competitive advantage
– Drl Indura has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Health for All: Dr. Reddy's Laboratories and Rural India (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Drl Indura to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Drl Indura 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.
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 Drl Indura in the consumer business. Now Drl Indura can target international markets with far fewer capital restrictions requirements than the existing system.
Manufacturing automation
– Drl Indura 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Drl Indura 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 Drl Indura to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Drl Indura can use these opportunities to build new business models that can help the communities that Drl Indura operates in. Secondly it can use opportunities from government spending in Strategy & Execution sector.
Low interest rates
– Even though inflation is raising its head in most developed economies, Drl Indura 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.
Threats Health for All: Dr. Reddy's Laboratories and Rural India (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Health for All: Dr. Reddy's Laboratories and Rural India (B) are -
Regulatory challenges
– Drl Indura 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.
Stagnating economy with rate increase
– Drl Indura 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.
Consumer confidence and its impact on Drl Indura 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
– Drl Indura 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. Drl Indura can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
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. Drl Indura needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Increasing wage structure of Drl Indura
– 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 Drl Indura.
Shortening product life cycle
– it is one of the major threat that Drl Indura is facing in Strategy & Execution sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Drl Indura.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Health for All: Dr. Reddy's Laboratories and Rural India (B), Drl Indura 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 .
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Drl Indura 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) .
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.
Technology acceleration in Forth Industrial Revolution
– Drl Indura has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Drl Indura 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Drl Indura with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Weighted SWOT Analysis of Health for All: Dr. Reddy's Laboratories and Rural India (B) 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) 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 Health for All: Dr. Reddy's Laboratories and Rural India (B) 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 Drl Indura needs to make to build a sustainable competitive advantage.
