Case Study Description of Father's Love: Novazyme Pharmaceuticals, Inc.
John Crowley, CEO of Novazyme Pharmaceuticals, a start-up biotechnology firm developing an orphan drug to treat a rare lysosomal storage disorder from which his children suffer, must choose between a partnership and a buyout to have sufficient funds and support to get the drug to the market. Accompanying this dilemma are questions relating to Novazyme's clinical trial strategy, marketing, sales, production, and pricing. This case introduces students to the FDA drug approval process and government-supported financial inducements to develop drugs for small patient populations. Also provides insight into the nature of strategic relationships in the biotechnology and pharmaceutical industries.
Swot Analysis of "Father's Love: Novazyme Pharmaceuticals, Inc." written by Richard Bohmer, Bradley Campbell includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Novazyme Drug facing as an external strategic factors. Some of the topics covered in Father's Love: Novazyme Pharmaceuticals, Inc. case study are - Strategic Management Strategies, Joint ventures, Manufacturing, Product development and Technology & Operations.
Some of the macro environment factors that can be used to understand the Father's Love: Novazyme Pharmaceuticals, Inc. casestudy better are - – there is backlash against globalization, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, increasing government debt because of Covid-19 spendings, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing energy prices, supply chains are disrupted by pandemic ,
increasing household debt because of falling income levels, wage bills are increasing, etc
Introduction to SWOT Analysis of Father's Love: Novazyme Pharmaceuticals, Inc.
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Father's Love: Novazyme Pharmaceuticals, Inc. case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Novazyme Drug, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Novazyme Drug 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 Father's Love: Novazyme Pharmaceuticals, Inc. can be done for the following purposes –
1. Strategic planning using facts provided in Father's Love: Novazyme Pharmaceuticals, Inc. case study
2. Improving business portfolio management of Novazyme Drug
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 Novazyme Drug
Strengths Father's Love: Novazyme Pharmaceuticals, Inc. | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Novazyme Drug in Father's Love: Novazyme Pharmaceuticals, Inc. Harvard Business Review case study are -
Ability to recruit top talent
– Novazyme Drug is one of the leading recruiters in the industry. Managers in the Father's Love: Novazyme Pharmaceuticals, Inc. are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Ability to lead change in Technology & Operations field
– Novazyme Drug 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 Novazyme Drug in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Novazyme Drug
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Novazyme Drug does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Novazyme Drug has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Father's Love: Novazyme Pharmaceuticals, Inc. 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.
Diverse revenue streams
– Novazyme Drug is present in almost all the verticals within the industry. This has provided firm in Father's Love: Novazyme Pharmaceuticals, Inc. 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.
Learning organization
- Novazyme Drug 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 Novazyme Drug is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Father's Love: Novazyme Pharmaceuticals, Inc. Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Highly skilled collaborators
– Novazyme Drug 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 Father's Love: Novazyme Pharmaceuticals, Inc. HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Novazyme Drug 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 Richard Bohmer, Bradley Campbell 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.
High switching costs
– The high switching costs that Novazyme Drug 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.
Innovation driven organization
– Novazyme Drug is one of the most innovative firm in sector. Manager in Father's Love: Novazyme Pharmaceuticals, Inc. Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Effective Research and Development (R&D)
– Novazyme Drug 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 Father's Love: Novazyme Pharmaceuticals, Inc. - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Novazyme Drug digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Novazyme Drug 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.
Weaknesses Father's Love: Novazyme Pharmaceuticals, Inc. | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Father's Love: Novazyme Pharmaceuticals, Inc. are -
Interest costs
– Compare to the competition, Novazyme Drug 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.
Slow to strategic competitive environment developments
– As Father's Love: Novazyme Pharmaceuticals, Inc. HBR case study mentions - Novazyme Drug 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.
Need for greater diversity
– Novazyme Drug 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.
Skills based hiring
– The stress on hiring functional specialists at Novazyme Drug 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.
High cash cycle compare to competitors
Novazyme Drug 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Novazyme Drug is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Father's Love: Novazyme Pharmaceuticals, Inc. can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Aligning sales with marketing
– It come across in the case study Father's Love: Novazyme Pharmaceuticals, Inc. 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 Father's Love: Novazyme Pharmaceuticals, Inc. can leverage the sales team experience to cultivate customer relationships as Novazyme Drug is planning to shift buying processes online.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Father's Love: Novazyme Pharmaceuticals, Inc. 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 Novazyme Drug has relatively successful track record of launching new products.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Father's Love: Novazyme Pharmaceuticals, Inc., is just above the industry average. Novazyme Drug 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.
Increasing silos among functional specialists
– The organizational structure of Novazyme Drug is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Novazyme Drug needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Novazyme Drug to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Richard Bohmer, Bradley Campbell suggests that, Novazyme Drug 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.
Opportunities Father's Love: Novazyme Pharmaceuticals, Inc. | 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 Father's Love: Novazyme Pharmaceuticals, Inc. are -
Better consumer reach
– The expansion of the 5G network will help Novazyme Drug to increase its market reach. Novazyme Drug 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.
Manufacturing automation
– Novazyme Drug 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Novazyme Drug can use these opportunities to build new business models that can help the communities that Novazyme Drug operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
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 Novazyme Drug in the consumer business. Now Novazyme Drug can target international markets with far fewer capital restrictions requirements than the existing system.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Novazyme Drug 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.
Learning at scale
– Online learning technologies has now opened space for Novazyme Drug 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.
Building a culture of innovation
– managers at Novazyme Drug 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 Technology & Operations segment.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Technology & Operations industry, but it has also influenced the consumer preferences. Novazyme Drug can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Novazyme Drug can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Loyalty marketing
– Novazyme Drug 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Novazyme Drug 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, Father's Love: Novazyme Pharmaceuticals, Inc., to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Novazyme Drug 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 Father's Love: Novazyme Pharmaceuticals, Inc. - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Novazyme Drug to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Novazyme Drug 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.
Threats Father's Love: Novazyme Pharmaceuticals, Inc. External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Father's Love: Novazyme Pharmaceuticals, Inc. are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Father's Love: Novazyme Pharmaceuticals, Inc., Novazyme Drug 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 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Novazyme Drug 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 Novazyme Drug in the Technology & Operations sector and impact the bottomline of the organization.
Consumer confidence and its impact on Novazyme Drug 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.
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. Novazyme Drug 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.
Regulatory challenges
– Novazyme Drug 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Novazyme Drug 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 Father's Love: Novazyme Pharmaceuticals, Inc. .
Technology acceleration in Forth Industrial Revolution
– Novazyme Drug has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Novazyme Drug 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.
Stagnating economy with rate increase
– Novazyme Drug 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.
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. Novazyme Drug needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Novazyme Drug 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.
Shortening product life cycle
– it is one of the major threat that Novazyme Drug is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Father's Love: Novazyme Pharmaceuticals, Inc. 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 Father's Love: Novazyme Pharmaceuticals, Inc. 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 Father's Love: Novazyme Pharmaceuticals, Inc. 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 Father's Love: Novazyme Pharmaceuticals, Inc. 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 Father's Love: Novazyme Pharmaceuticals, Inc. 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 Novazyme Drug needs to make to build a sustainable competitive advantage.
