Genzyme: Engineering the Market for Orphan Drugs SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Genzyme: Engineering the Market for Orphan Drugs
Genzyme has made money with external technology in orphan drug markets generally considered to be too small to be attractive to other drug companies. Now competition is entering these same markets, placing Genzyme's business model under new pressures.
Swot Analysis of "Genzyme: Engineering the Market for Orphan Drugs" written by Henry W. Chesbrough, Clarissa Ceruti includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Orphan Genzyme facing as an external strategic factors. Some of the topics covered in Genzyme: Engineering the Market for Orphan Drugs case study are - Strategic Management Strategies, Innovation, Marketing, Supply chain, Technology and Technology & Operations.
Some of the macro environment factors that can be used to understand the Genzyme: Engineering the Market for Orphan Drugs casestudy better are - – increasing transportation and logistics costs, there is backlash against globalization, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is increasing trade war between United States & China, increasing energy prices,
technology disruption, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Genzyme: Engineering the Market for Orphan Drugs
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Genzyme: Engineering the Market for Orphan Drugs case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Orphan Genzyme, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Orphan Genzyme 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 Genzyme: Engineering the Market for Orphan Drugs can be done for the following purposes –
1. Strategic planning using facts provided in Genzyme: Engineering the Market for Orphan Drugs case study
2. Improving business portfolio management of Orphan Genzyme
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 Orphan Genzyme
Strengths Genzyme: Engineering the Market for Orphan Drugs | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Orphan Genzyme in Genzyme: Engineering the Market for Orphan Drugs Harvard Business Review case study are -
Organizational Resilience of Orphan Genzyme
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Orphan Genzyme does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Orphan Genzyme 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 Genzyme: Engineering the Market for Orphan Drugs 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.
Analytics focus
– Orphan Genzyme 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 Henry W. Chesbrough, Clarissa Ceruti 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.
Strong track record of project management
– Orphan Genzyme is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Innovation driven organization
– Orphan Genzyme is one of the most innovative firm in sector. Manager in Genzyme: Engineering the Market for Orphan Drugs Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Sustainable margins compare to other players in Technology & Operations industry
– Genzyme: Engineering the Market for Orphan Drugs firm has clearly differentiated products in the market place. This has enabled Orphan Genzyme to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Orphan Genzyme to invest into research and development (R&D) and innovation.
Highly skilled collaborators
– Orphan Genzyme 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 Genzyme: Engineering the Market for Orphan Drugs HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to lead change in Technology & Operations field
– Orphan Genzyme 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 Orphan Genzyme in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Orphan Genzyme has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Genzyme: Engineering the Market for Orphan Drugs 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.
Learning organization
- Orphan Genzyme 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 Orphan Genzyme is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Genzyme: Engineering the Market for Orphan Drugs Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Diverse revenue streams
– Orphan Genzyme is present in almost all the verticals within the industry. This has provided firm in Genzyme: Engineering the Market for Orphan Drugs 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 Genzyme: Engineering the Market for Orphan Drugs | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Genzyme: Engineering the Market for Orphan Drugs are -
Low market penetration in new markets
– Outside its home market of Orphan Genzyme, firm in the HBR case study Genzyme: Engineering the Market for Orphan Drugs needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Henry W. Chesbrough, Clarissa Ceruti suggests that, Orphan Genzyme 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.
Interest costs
– Compare to the competition, Orphan Genzyme 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.
Products dominated business model
– Even though Orphan Genzyme 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 - Genzyme: Engineering the Market for Orphan Drugs should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Orphan Genzyme 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Genzyme: Engineering the Market for Orphan Drugs 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 Orphan Genzyme has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Orphan Genzyme 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. Orphan Genzyme 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 strategic competitive environment developments
– As Genzyme: Engineering the Market for Orphan Drugs HBR case study mentions - Orphan Genzyme 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.
Lack of clear differentiation of Orphan Genzyme products
– To increase the profitability and margins on the products, Orphan Genzyme needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Genzyme: Engineering the Market for Orphan Drugs, is just above the industry average. Orphan Genzyme 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
– Orphan Genzyme 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.
Opportunities Genzyme: Engineering the Market for Orphan Drugs | 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 Genzyme: Engineering the Market for Orphan Drugs are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Orphan Genzyme can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Manufacturing automation
– Orphan Genzyme 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Orphan Genzyme 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Orphan Genzyme is facing challenges because of the dominance of functional experts in the organization. Genzyme: Engineering the Market for Orphan Drugs 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.
Developing new processes and practices
– Orphan Genzyme 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Orphan Genzyme 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.
Leveraging digital technologies
– Orphan Genzyme 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Orphan Genzyme 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 Orphan Genzyme to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Orphan Genzyme to increase its market reach. Orphan Genzyme 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.
Creating value in data economy
– The success of analytics program of Orphan Genzyme has opened avenues for new revenue streams for the organization in the industry. This can help Orphan Genzyme to build a more holistic ecosystem as suggested in the Genzyme: Engineering the Market for Orphan Drugs case study. Orphan Genzyme 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 Orphan Genzyme 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.
Buying journey improvements
– Orphan Genzyme can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Genzyme: Engineering the Market for Orphan Drugs 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.
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 Orphan Genzyme in the consumer business. Now Orphan Genzyme can target international markets with far fewer capital restrictions requirements than the existing system.
Threats Genzyme: Engineering the Market for Orphan Drugs External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Genzyme: Engineering the Market for Orphan Drugs are -
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.
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. Orphan Genzyme needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Orphan Genzyme is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Orphan Genzyme 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.
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. Orphan Genzyme 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.
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 Orphan Genzyme.
Consumer confidence and its impact on Orphan Genzyme 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Orphan Genzyme 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 Genzyme: Engineering the Market for Orphan Drugs .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Orphan Genzyme with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Easy access to finance
– Easy access to finance in Technology & Operations field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Orphan Genzyme can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Orphan Genzyme 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.
High dependence on third party suppliers
– Orphan Genzyme 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.
Technology acceleration in Forth Industrial Revolution
– Orphan Genzyme has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Orphan Genzyme needs to keep up with the evolution of technology in the Technology & Operations 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.
Weighted SWOT Analysis of Genzyme: Engineering the Market for Orphan Drugs 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 Genzyme: Engineering the Market for Orphan Drugs 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 Genzyme: Engineering the Market for Orphan Drugs 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 Genzyme: Engineering the Market for Orphan Drugs 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 Genzyme: Engineering the Market for Orphan Drugs 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 Orphan Genzyme needs to make to build a sustainable competitive advantage.