MorphoSys AG: The Evolution of a Biotechnology Business Model SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of MorphoSys AG: The Evolution of a Biotechnology Business Model
In the biotech world, the 18-year-old Munich-based company MorphoSys was a rarity: it was profitable. The company achieved this profitability not by developing and selling its own drugs, but by licensing access to its proprietary library of human antibodies. Recently, the company decided to deviate from this model, and attempt to develop its own proprietary products. The case allows analysis of "license vs. vertically integrate" business model decisions, and can be used to teach principles of business model design and the functioning of markets for know-how.
Authors :: Gary P. Pisano, Ryan Johnson, Carin-Isabel Knoop
Swot Analysis of "MorphoSys AG: The Evolution of a Biotechnology Business Model" written by Gary P. Pisano, Ryan Johnson, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Morphosys Proprietary facing as an external strategic factors. Some of the topics covered in MorphoSys AG: The Evolution of a Biotechnology Business Model case study are - Strategic Management Strategies, Joint ventures, Research & development, Risk management, Strategic planning, Strategy execution and Technology & Operations.
Some of the macro environment factors that can be used to understand the MorphoSys AG: The Evolution of a Biotechnology Business Model casestudy better are - – increasing transportation and logistics costs, there is increasing trade war between United States & China, increasing inequality as vast percentage of new income is going to the top 1%, banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google,
there is backlash against globalization, increasing energy prices, etc
Introduction to SWOT Analysis of MorphoSys AG: The Evolution of a Biotechnology Business Model
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in MorphoSys AG: The Evolution of a Biotechnology Business Model case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Morphosys Proprietary, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Morphosys Proprietary 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 MorphoSys AG: The Evolution of a Biotechnology Business Model can be done for the following purposes –
1. Strategic planning using facts provided in MorphoSys AG: The Evolution of a Biotechnology Business Model case study
2. Improving business portfolio management of Morphosys Proprietary
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 Morphosys Proprietary
Strengths MorphoSys AG: The Evolution of a Biotechnology Business Model | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Morphosys Proprietary in MorphoSys AG: The Evolution of a Biotechnology Business Model Harvard Business Review case study are -
High brand equity
– Morphosys Proprietary has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Morphosys Proprietary to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to lead change in Technology & Operations field
– Morphosys Proprietary 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 Morphosys Proprietary in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Innovation driven organization
– Morphosys Proprietary is one of the most innovative firm in sector. Manager in MorphoSys AG: The Evolution of a Biotechnology Business Model Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Digital Transformation in Technology & Operations segment
- digital transformation varies from industry to industry. For Morphosys Proprietary digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Morphosys Proprietary 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.
Training and development
– Morphosys Proprietary has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in MorphoSys AG: The Evolution of a Biotechnology Business Model 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
- Morphosys Proprietary 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 Morphosys Proprietary is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in MorphoSys AG: The Evolution of a Biotechnology Business Model Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Morphosys Proprietary 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.
Cross disciplinary teams
– Horizontal connected teams at the Morphosys Proprietary are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Low bargaining power of suppliers
– Suppliers of Morphosys Proprietary in the sector have low bargaining power. MorphoSys AG: The Evolution of a Biotechnology Business Model has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Morphosys Proprietary to manage not only supply disruptions but also source products at highly competitive prices.
Diverse revenue streams
– Morphosys Proprietary is present in almost all the verticals within the industry. This has provided firm in MorphoSys AG: The Evolution of a Biotechnology Business Model 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.
Analytics focus
– Morphosys Proprietary 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 Gary P. Pisano, Ryan Johnson, Carin-Isabel Knoop 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.
Effective Research and Development (R&D)
– Morphosys Proprietary 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 MorphoSys AG: The Evolution of a Biotechnology Business Model - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses MorphoSys AG: The Evolution of a Biotechnology Business Model | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of MorphoSys AG: The Evolution of a Biotechnology Business Model are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Morphosys Proprietary is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study MorphoSys AG: The Evolution of a Biotechnology Business Model can help to provide better information regarding products and services. It can also build an online community to further reach out to potential 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 Morphosys Proprietary supply chain. Even after few cautionary changes mentioned in the HBR case study - MorphoSys AG: The Evolution of a Biotechnology Business Model, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Morphosys Proprietary vulnerable to further global disruptions in South East Asia.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study MorphoSys AG: The Evolution of a Biotechnology Business Model, in the dynamic environment Morphosys Proprietary has struggled to respond to the nimble upstart competition. Morphosys Proprietary has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Low market penetration in new markets
– Outside its home market of Morphosys Proprietary, firm in the HBR case study MorphoSys AG: The Evolution of a Biotechnology Business Model needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Skills based hiring
– The stress on hiring functional specialists at Morphosys Proprietary 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.
Products dominated business model
– Even though Morphosys Proprietary 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 - MorphoSys AG: The Evolution of a Biotechnology Business Model should strive to include more intangible value offerings along with its core products and services.
High bargaining power of channel partners
– Because of the regulatory requirements, Gary P. Pisano, Ryan Johnson, Carin-Isabel Knoop suggests that, Morphosys Proprietary 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.
Capital Spending Reduction
– Even during the low interest decade, Morphosys Proprietary 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.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study MorphoSys AG: The Evolution of a Biotechnology Business Model, it seems that the employees of Morphosys Proprietary don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Increasing silos among functional specialists
– The organizational structure of Morphosys Proprietary is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Morphosys Proprietary needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Morphosys Proprietary to focus more on services rather than just following the product oriented approach.
Slow decision making process
– As mentioned earlier in the report, Morphosys Proprietary 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. Morphosys Proprietary 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.
Opportunities MorphoSys AG: The Evolution of a Biotechnology Business Model | 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 MorphoSys AG: The Evolution of a Biotechnology Business Model are -
Low interest rates
– Even though inflation is raising its head in most developed economies, Morphosys Proprietary 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Morphosys Proprietary 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, MorphoSys AG: The Evolution of a Biotechnology Business Model, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Leveraging digital technologies
– Morphosys Proprietary 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 Morphosys Proprietary 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 Morphosys Proprietary to hire the very best people irrespective of their geographical location.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Morphosys Proprietary can use these opportunities to build new business models that can help the communities that Morphosys Proprietary operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Developing new processes and practices
– Morphosys Proprietary 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.
Better consumer reach
– The expansion of the 5G network will help Morphosys Proprietary to increase its market reach. Morphosys Proprietary 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
– Morphosys Proprietary 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Morphosys Proprietary can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Using analytics as competitive advantage
– Morphosys Proprietary 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 MorphoSys AG: The Evolution of a Biotechnology Business Model - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Morphosys Proprietary to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Creating value in data economy
– The success of analytics program of Morphosys Proprietary has opened avenues for new revenue streams for the organization in the industry. This can help Morphosys Proprietary to build a more holistic ecosystem as suggested in the MorphoSys AG: The Evolution of a Biotechnology Business Model case study. Morphosys Proprietary can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Morphosys Proprietary can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. MorphoSys AG: The Evolution of a Biotechnology Business Model 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Morphosys Proprietary 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.
Threats MorphoSys AG: The Evolution of a Biotechnology Business Model External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study MorphoSys AG: The Evolution of a Biotechnology Business Model are -
High dependence on third party suppliers
– Morphosys Proprietary 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.
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 Morphosys Proprietary business can come under increasing regulations regarding data privacy, data security, etc.
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. Morphosys Proprietary 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 Morphosys Proprietary 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.
Stagnating economy with rate increase
– Morphosys Proprietary 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.
Regulatory challenges
– Morphosys Proprietary 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Morphosys Proprietary with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Environmental challenges
– Morphosys Proprietary 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. Morphosys Proprietary can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
Consumer confidence and its impact on Morphosys Proprietary 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.
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. Morphosys Proprietary 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.
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. Morphosys Proprietary needs to understand the core reasons impacting the Technology & Operations industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Morphosys Proprietary has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Morphosys Proprietary 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 MorphoSys AG: The Evolution of a Biotechnology Business Model 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 MorphoSys AG: The Evolution of a Biotechnology Business Model 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 MorphoSys AG: The Evolution of a Biotechnology Business Model 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 MorphoSys AG: The Evolution of a Biotechnology Business Model 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 MorphoSys AG: The Evolution of a Biotechnology Business Model 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 Morphosys Proprietary needs to make to build a sustainable competitive advantage.
