Provides an overview of the founding and development of the biotechnology firm, GenPharm International, Inc., with a particular focus on its globalization strategy. GenPharm was founded in 1989 and quickly became a pioneer in the field of transgenic animal technology. Between 1991 and 1994, the company pursued cutting-edge research in the field of transgenic animal technology, established collaboration agreements with several leading corporations, and raised millions of dollars. In February 1994, GenPharm was preparing to make an initial public offering (IPO) of its shares when a competitor filed a lawsuit alleging that GenPharm had misappropriated its trade secrets. GenPharm's board decided not to proceed with the planned IPO, and the company was forced to decrease the size and modify the nature of its business in 1995 and 1996. In March 1997, the legal situation was resolved with a settlement and cross-license agreement. Shortly thereafter, the board received an offer from a publicly traded biotechnology firm, Medarex, Inc., to acquire GenPharm for up to $65 million. The case ends asking students to develop a recommendation for the GenPharm board with respect to the acquisition.
Swot Analysis of "GenPharm International" written by George Foster, Andrea Higuera includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Genpharm Transgenic facing as an external strategic factors. Some of the topics covered in GenPharm International case study are - Strategic Management Strategies, IPO, Joint ventures, Mergers & acquisitions, Regulation and Strategy & Execution.
Some of the macro environment factors that can be used to understand the GenPharm International casestudy better are - – there is backlash against globalization, competitive advantages are harder to sustain because of technology dispersion, central banks are concerned over increasing inflation, technology disruption, supply chains are disrupted by pandemic , increasing government debt because of Covid-19 spendings, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing inequality as vast percentage of new income is going to the top 1%, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of GenPharm International
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in GenPharm International case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Genpharm Transgenic, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Genpharm Transgenic 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 GenPharm International can be done for the following purposes –
1. Strategic planning using facts provided in GenPharm International case study
2. Improving business portfolio management of Genpharm Transgenic
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 Genpharm Transgenic
Strengths GenPharm International | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Genpharm Transgenic in GenPharm International Harvard Business Review case study are -
Analytics focus
– Genpharm Transgenic 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 George Foster, Andrea Higuera 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.
Cross disciplinary teams
– Horizontal connected teams at the Genpharm Transgenic 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.
Superior customer experience
– The customer experience strategy of Genpharm Transgenic in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Genpharm Transgenic is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Sustainable margins compare to other players in Strategy & Execution industry
– GenPharm International firm has clearly differentiated products in the market place. This has enabled Genpharm Transgenic to fetch slight price premium compare to the competitors in the Strategy & Execution industry. The sustainable margins have also helped Genpharm Transgenic to invest into research and development (R&D) and innovation.
Effective Research and Development (R&D)
– Genpharm Transgenic 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 GenPharm International - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Genpharm Transgenic is present in almost all the verticals within the industry. This has provided firm in GenPharm International 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.
Organizational Resilience of Genpharm Transgenic
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Genpharm Transgenic 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 Genpharm Transgenic digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Genpharm Transgenic 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
– Genpharm Transgenic has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Genpharm Transgenic to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Genpharm Transgenic has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in GenPharm International 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.
Innovation driven organization
– Genpharm Transgenic is one of the most innovative firm in sector. Manager in GenPharm International Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Weaknesses GenPharm International | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of GenPharm International are -
No frontier risks strategy
– After analyzing the HBR case study GenPharm International, 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.
Low market penetration in new markets
– Outside its home market of Genpharm Transgenic, firm in the HBR case study GenPharm International needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Genpharm Transgenic is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study GenPharm International can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Lack of clear differentiation of Genpharm Transgenic products
– To increase the profitability and margins on the products, Genpharm Transgenic needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study GenPharm International has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Genpharm Transgenic 's lucrative customers.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study GenPharm International, it seems that the employees of Genpharm Transgenic 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.
Slow to strategic competitive environment developments
– As GenPharm International HBR case study mentions - Genpharm Transgenic 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Genpharm Transgenic 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study GenPharm International, is just above the industry average. Genpharm Transgenic 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.
Need for greater diversity
– Genpharm Transgenic 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.
Products dominated business model
– Even though Genpharm Transgenic has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - GenPharm International should strive to include more intangible value offerings along with its core products and services.
Opportunities GenPharm International | 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 GenPharm International are -
Using analytics as competitive advantage
– Genpharm Transgenic 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 GenPharm International - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Genpharm Transgenic to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Genpharm Transgenic 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Genpharm Transgenic 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, GenPharm International, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Genpharm Transgenic 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 Genpharm Transgenic to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Genpharm Transgenic 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.
Creating value in data economy
– The success of analytics program of Genpharm Transgenic has opened avenues for new revenue streams for the organization in the industry. This can help Genpharm Transgenic to build a more holistic ecosystem as suggested in the GenPharm International case study. Genpharm Transgenic can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Genpharm Transgenic can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. GenPharm International suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
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. Genpharm Transgenic 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. Genpharm Transgenic 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.
Loyalty marketing
– Genpharm Transgenic 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Genpharm Transgenic 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Genpharm Transgenic is facing challenges because of the dominance of functional experts in the organization. GenPharm International 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.
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. Genpharm Transgenic can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Building a culture of innovation
– managers at Genpharm Transgenic 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.
Threats GenPharm International External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study GenPharm International are -
Technology acceleration in Forth Industrial Revolution
– Genpharm Transgenic has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Genpharm Transgenic 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.
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 Genpharm Transgenic.
Stagnating economy with rate increase
– Genpharm Transgenic 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Genpharm Transgenic with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Genpharm Transgenic in the Strategy & Execution industry. The Strategy & Execution industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
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 Genpharm Transgenic business can come under increasing regulations regarding data privacy, data security, etc.
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 Genpharm Transgenic in the Strategy & Execution sector and impact the bottomline of the organization.
Consumer confidence and its impact on Genpharm Transgenic 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.
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.
Environmental challenges
– Genpharm Transgenic 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. Genpharm Transgenic can take advantage of this fund but it will also bring new competitors in the Strategy & Execution industry.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study GenPharm International, Genpharm Transgenic 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 .
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. Genpharm Transgenic 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Genpharm Transgenic 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 GenPharm International .
Weighted SWOT Analysis of GenPharm International 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 GenPharm International 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 GenPharm International 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 GenPharm International 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 GenPharm International 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 Genpharm Transgenic needs to make to build a sustainable competitive advantage.
