Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Strategy & Execution
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Case Study SWOT Analysis Solution
Case Study Description of Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India
"With the publication of CK Prahalad's "The Fortune at the Bottom of the Pyramid" (2005), the poor were suddenly seen as a potential market in the eyes of multinational corporations (MNCs). Although poor, the BOP is a large and growing market. The development community tends to focus on meeting the needs of the poorest of the poor (the 1 billion people who live on less than US$1 a day), but there is a larger segment of the low-income population, comprised of 3.8 billion people with incomes between $2 and $5 a day, that could be the focus of a market-oriented approach. They have no bank accounts, no access to modern financial services, no phones, are dependent on informal or subsistence livelihoods, and lack access to amenities and basic healthcare. Influenced by Prahalad's work, the top management at Novartis decided that it was time to seriously consider the pursuit of commercial opportunities among the world's poor. The case offers a description of the first steps to setting up the Arogya Parivar initiative by Novartis in India and raises strategic questions like how to improve its supply chain reliability, how to deal with the fact that many consumers were women and yet there were few female health educators, how to make the treatment affordable, whether to launch new brands of medicines for this segment, how to convince consumers to seek medical treatment and ensure compliance with the treatment protocol, etc., going forward. Please visit the dedicated case website http://cases.insead.edu/arogya-parivar/ (copy and paste the url into a browser) to access case videos and other support material."
Authors :: Amitava Chattopadhyay, Jean Wee, Anuj Pasrjia, Olivier Jarry
Swot Analysis of "Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India" written by Amitava Chattopadhyay, Jean Wee, Anuj Pasrjia, Olivier Jarry includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Parivar Arogya facing as an external strategic factors. Some of the topics covered in Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India case study are - Strategic Management Strategies, Innovation, Marketing, Social enterprise, Strategy and Strategy & Execution.
Some of the macro environment factors that can be used to understand the Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India casestudy better are - – challanges to central banks by blockchain based private currencies, geopolitical disruptions, competitive advantages are harder to sustain because of technology dispersion, increasing commodity prices, technology disruption, wage bills are increasing, increasing household debt because of falling income levels,
supply chains are disrupted by pandemic , digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Parivar Arogya, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Parivar Arogya 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India can be done for the following purposes –
1. Strategic planning using facts provided in Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India case study
2. Improving business portfolio management of Parivar Arogya
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 Parivar Arogya
Strengths Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Parivar Arogya in Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India Harvard Business Review case study are -
Superior customer experience
– The customer experience strategy of Parivar Arogya in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Low bargaining power of suppliers
– Suppliers of Parivar Arogya in the sector have low bargaining power. Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Parivar Arogya to manage not only supply disruptions but also source products at highly competitive prices.
High switching costs
– The high switching costs that Parivar Arogya 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.
Operational resilience
– The operational resilience strategy in the Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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.
Diverse revenue streams
– Parivar Arogya is present in almost all the verticals within the industry. This has provided firm in Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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.
Digital Transformation in Strategy & Execution segment
- digital transformation varies from industry to industry. For Parivar Arogya digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Parivar Arogya 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.
Analytics focus
– Parivar Arogya 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 Amitava Chattopadhyay, Jean Wee, Anuj Pasrjia, Olivier Jarry 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
– Parivar Arogya is one of the leading recruiters in the industry. Managers in the Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Parivar Arogya has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Parivar Arogya has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Highly skilled collaborators
– Parivar Arogya 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
High brand equity
– Parivar Arogya has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Parivar Arogya to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Training and development
– Parivar Arogya has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Parivar Arogya is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Parivar Arogya 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. Parivar Arogya even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, firm in the HBR case study Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Parivar Arogya 's lucrative customers.
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 Parivar Arogya supply chain. Even after few cautionary changes mentioned in the HBR case study - Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Parivar Arogya vulnerable to further global disruptions in South East Asia.
Increasing silos among functional specialists
– The organizational structure of Parivar Arogya is dominated by functional specialists. It is not different from other players in the Strategy & Execution segment. Parivar Arogya needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Parivar Arogya to focus more on services rather than just following the product oriented approach.
High cash cycle compare to competitors
Parivar Arogya 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.
Capital Spending Reduction
– Even during the low interest decade, Parivar Arogya 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.
Need for greater diversity
– Parivar Arogya 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Amitava Chattopadhyay, Jean Wee, Anuj Pasrjia, Olivier Jarry suggests that, Parivar Arogya 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.
No frontier risks strategy
– After analyzing the HBR case study Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India, 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.
Slow to strategic competitive environment developments
– As Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India HBR case study mentions - Parivar Arogya 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.
Opportunities Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India | 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India are -
Manufacturing automation
– Parivar Arogya 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.
Loyalty marketing
– Parivar Arogya 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 Parivar Arogya 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 Parivar Arogya has opened avenues for new revenue streams for the organization in the industry. This can help Parivar Arogya to build a more holistic ecosystem as suggested in the Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India case study. Parivar Arogya can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Learning at scale
– Online learning technologies has now opened space for Parivar Arogya 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.
Leveraging digital technologies
– Parivar Arogya 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.
Using analytics as competitive advantage
– Parivar Arogya 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Parivar Arogya to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Parivar Arogya 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 Parivar Arogya to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Parivar Arogya to increase its market reach. Parivar Arogya 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.
Developing new processes and practices
– Parivar Arogya 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.
Buying journey improvements
– Parivar Arogya can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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.
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. Parivar Arogya can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Parivar Arogya is facing challenges because of the dominance of functional experts in the organization. Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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.
Threats Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India are -
High dependence on third party suppliers
– Parivar Arogya 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 Parivar Arogya in the Strategy & Execution sector and impact the bottomline of the organization.
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 Parivar Arogya.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Parivar Arogya 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Parivar Arogya 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India, Parivar Arogya 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 .
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 Parivar Arogya business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Parivar Arogya 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.
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. Parivar Arogya needs to understand the core reasons impacting the Strategy & Execution industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Parivar Arogya with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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.
Technology acceleration in Forth Industrial Revolution
– Parivar Arogya has witnessed rapid integration of technology during Covid-19 in the Strategy & Execution industry. As one of the leading players in the industry, Parivar Arogya 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.
Regulatory challenges
– Parivar Arogya 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.
Weighted SWOT Analysis of Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Arogya Parivar: Novartis' BOP Strategy for Healthcare in Rural India 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 Parivar Arogya needs to make to build a sustainable competitive advantage.
