Pharmacy Service Improvement at CVS (A) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Pharmacy Service Improvement at CVS (A)
CVS's retail pharmacy operations are functioning poorly and dissatisfying customers. Many customers are defecting as a result. A pharmacy service improvement team has documented the current prescription fulfillment process, its exception rates, and the problems generated by exceptions. The company must now decide how to change this process, and what information system changes to make in support of the redesigned process.
Swot Analysis of "Pharmacy Service Improvement at CVS (A)" written by Andrew McAfee includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pharmacy Cvs's facing as an external strategic factors. Some of the topics covered in Pharmacy Service Improvement at CVS (A) case study are - Strategic Management Strategies, Customer service, Customers, IT and Technology & Operations.
Some of the macro environment factors that can be used to understand the Pharmacy Service Improvement at CVS (A) casestudy better are - – there is backlash against globalization, there is increasing trade war between United States & China, increasing household debt because of falling income levels, increasing commodity prices, talent flight as more people leaving formal jobs, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion,
cloud computing is disrupting traditional business models, technology disruption, etc
Introduction to SWOT Analysis of Pharmacy Service Improvement at CVS (A)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Pharmacy Service Improvement at CVS (A) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pharmacy Cvs's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pharmacy Cvs's 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 Pharmacy Service Improvement at CVS (A) can be done for the following purposes –
1. Strategic planning using facts provided in Pharmacy Service Improvement at CVS (A) case study
2. Improving business portfolio management of Pharmacy Cvs's
3. Assessing feasibility of the new initiative in Technology & Operations field.
4. Making a Technology & Operations topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Pharmacy Cvs's
Strengths Pharmacy Service Improvement at CVS (A) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pharmacy Cvs's in Pharmacy Service Improvement at CVS (A) Harvard Business Review case study are -
Low bargaining power of suppliers
– Suppliers of Pharmacy Cvs's in the sector have low bargaining power. Pharmacy Service Improvement at CVS (A) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Pharmacy Cvs's to manage not only supply disruptions but also source products at highly competitive prices.
Learning organization
- Pharmacy Cvs's 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 Pharmacy Cvs's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Pharmacy Service Improvement at CVS (A) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Operational resilience
– The operational resilience strategy in the Pharmacy Service Improvement at CVS (A) 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.
Innovation driven organization
– Pharmacy Cvs's is one of the most innovative firm in sector. Manager in Pharmacy Service Improvement at CVS (A) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Pharmacy Cvs's 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 Pharmacy Service Improvement at CVS (A) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Pharmacy Cvs's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Pharmacy Service Improvement at CVS (A) 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.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Pharmacy Cvs's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Pharmacy Cvs's 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.
Diverse revenue streams
– Pharmacy Cvs's is present in almost all the verticals within the industry. This has provided firm in Pharmacy Service Improvement at CVS (A) 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.
Successful track record of launching new products
– Pharmacy Cvs's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pharmacy Cvs's 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.
Strong track record of project management
– Pharmacy Cvs's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Pharmacy Cvs's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Pharmacy Cvs's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Pharmacy Cvs's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Weaknesses Pharmacy Service Improvement at CVS (A) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Pharmacy Service Improvement at CVS (A) are -
No frontier risks strategy
– After analyzing the HBR case study Pharmacy Service Improvement at CVS (A), it seems that company is thinking about the frontier risks that can impact Technology & Operations 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.
Aligning sales with marketing
– It come across in the case study Pharmacy Service Improvement at CVS (A) 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 Pharmacy Service Improvement at CVS (A) can leverage the sales team experience to cultivate customer relationships as Pharmacy Cvs's is planning to shift buying processes online.
High operating costs
– Compare to the competitors, firm in the HBR case study Pharmacy Service Improvement at CVS (A) 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 Pharmacy Cvs's 's lucrative customers.
Interest costs
– Compare to the competition, Pharmacy Cvs's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Pharmacy Service Improvement at CVS (A) 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 Pharmacy Cvs's has relatively successful track record of launching new products.
Lack of clear differentiation of Pharmacy Cvs's products
– To increase the profitability and margins on the products, Pharmacy Cvs's needs to provide more differentiated products than what it is currently offering in the marketplace.
High bargaining power of channel partners
– Because of the regulatory requirements, Andrew McAfee suggests that, Pharmacy Cvs's 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 to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Pharmacy Cvs's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Pharmacy Service Improvement at CVS (A) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Skills based hiring
– The stress on hiring functional specialists at Pharmacy Cvs's 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Pharmacy Cvs's 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.
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 Pharmacy Cvs's supply chain. Even after few cautionary changes mentioned in the HBR case study - Pharmacy Service Improvement at CVS (A), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Pharmacy Cvs's vulnerable to further global disruptions in South East Asia.
Opportunities Pharmacy Service Improvement at CVS (A) | 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 Pharmacy Service Improvement at CVS (A) are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Pharmacy Cvs's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Technology & Operations segment, and it will provide faster access to the consumers.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Pharmacy Cvs's can use these opportunities to build new business models that can help the communities that Pharmacy Cvs's operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Learning at scale
– Online learning technologies has now opened space for Pharmacy Cvs's 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
– Pharmacy Cvs's 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
– Pharmacy Cvs's 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 Pharmacy Service Improvement at CVS (A) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Pharmacy Cvs's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Pharmacy Cvs's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Pharmacy Cvs's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Pharmacy Cvs's can develop new processes and procedures in Technology & Operations 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.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Pharmacy Cvs's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Creating value in data economy
– The success of analytics program of Pharmacy Cvs's has opened avenues for new revenue streams for the organization in the industry. This can help Pharmacy Cvs's to build a more holistic ecosystem as suggested in the Pharmacy Service Improvement at CVS (A) case study. Pharmacy Cvs's can build new products and services such as - data insight services, data privacy related products, data based consulting services, 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 Pharmacy Cvs's 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.
Manufacturing automation
– Pharmacy Cvs's can use the latest technology developments to improve its manufacturing and designing process in Technology & Operations 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Technology & Operations industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Pharmacy Cvs's 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. Pharmacy Cvs's 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.
Threats Pharmacy Service Improvement at CVS (A) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Pharmacy Service Improvement at CVS (A) are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Pharmacy Cvs's 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 Pharmacy Service Improvement at CVS (A) .
Consumer confidence and its impact on Pharmacy Cvs's 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.
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.
Environmental challenges
– Pharmacy Cvs's 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. Pharmacy Cvs's can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Pharmacy Service Improvement at CVS (A), Pharmacy Cvs's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Technology & Operations .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Pharmacy Cvs's in the Technology & Operations industry. The Technology & Operations 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Pharmacy Cvs's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Pharmacy Cvs's in the Technology & Operations sector and impact the bottomline of the organization.
Increasing wage structure of Pharmacy Cvs's
– 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 Pharmacy Cvs's.
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. Pharmacy Cvs's needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Regulatory challenges
– Pharmacy Cvs's 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 Technology & Operations industry regulations.
Stagnating economy with rate increase
– Pharmacy Cvs's 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.
Weighted SWOT Analysis of Pharmacy Service Improvement at CVS (A) 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 Pharmacy Service Improvement at CVS (A) 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 Pharmacy Service Improvement at CVS (A) 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 Pharmacy Service Improvement at CVS (A) 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 Pharmacy Service Improvement at CVS (A) 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 Pharmacy Cvs's needs to make to build a sustainable competitive advantage.
