Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Technology & Operations
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991
Outlines the evolution of Lilly's corporate manufacturing strategy over the past decade. The corporate vice president of manufacturing must decide on the next phase of Lilly's strategy for the early 1990s, as well as to what extent and what role process development will play. Provides data outlining three different points in the product development process at which manufacturing process development might be initiated. Using learning curve concepts and data, students can estimate the economic costs and benefits (as well as organizational issues and challenges) associated with each. Illustrates process improvement's substantial impact in a capital-intensive industry, describes possible roles of manufacturing process technology in an industry that has viewed product R&D as its primary competitive advantage, illustrates phases through which manufacturing can evolve in pursuit of comparative advantage, and introduces students to a challenging and changing industry.
Authors :: Steven C. Wheelwright, Gary P. Pisano, Jonathan West
Swot Analysis of "Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991" written by Steven C. Wheelwright, Gary P. Pisano, Jonathan West includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Manufacturing Lilly's facing as an external strategic factors. Some of the topics covered in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 case study are - Strategic Management Strategies, Manufacturing, Product development, Productivity and Technology & Operations.
Some of the macro environment factors that can be used to understand the Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 casestudy better are - – increasing energy prices, digital marketing is dominated by two big players Facebook and Google, challanges to central banks by blockchain based private currencies, there is backlash against globalization, there is increasing trade war between United States & China, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs,
cloud computing is disrupting traditional business models, banking and financial system is disrupted by Bitcoin and other crypto currencies, etc
Introduction to SWOT Analysis of Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Manufacturing Lilly's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Manufacturing Lilly'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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 can be done for the following purposes –
1. Strategic planning using facts provided in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 case study
2. Improving business portfolio management of Manufacturing Lilly'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 Manufacturing Lilly's
Strengths Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Manufacturing Lilly's in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 Harvard Business Review case study are -
Ability to lead change in Technology & Operations field
– Manufacturing Lilly's 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 Manufacturing Lilly's in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Sustainable margins compare to other players in Technology & Operations industry
– Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 firm has clearly differentiated products in the market place. This has enabled Manufacturing Lilly's to fetch slight price premium compare to the competitors in the Technology & Operations industry. The sustainable margins have also helped Manufacturing Lilly's to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Manufacturing Lilly's is one of the leading recruiters in the industry. Managers in the Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Superior customer experience
– The customer experience strategy of Manufacturing Lilly's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Highly skilled collaborators
– Manufacturing Lilly'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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Cross disciplinary teams
– Horizontal connected teams at the Manufacturing Lilly's 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.
High switching costs
– The high switching costs that Manufacturing Lilly's 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.
Analytics focus
– Manufacturing Lilly's 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 Steven C. Wheelwright, Gary P. Pisano, Jonathan West 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.
Operational resilience
– The operational resilience strategy in the Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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.
Learning organization
- Manufacturing Lilly'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 Manufacturing Lilly's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Manufacturing Lilly's is one of the most innovative firm in sector. Manager in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Manufacturing Lilly's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Manufacturing Lilly's has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Manufacturing Lilly's 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. Manufacturing Lilly's 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.
Increasing silos among functional specialists
– The organizational structure of Manufacturing Lilly's is dominated by functional specialists. It is not different from other players in the Technology & Operations segment. Manufacturing Lilly's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Manufacturing Lilly's to focus more on services rather than just following the product oriented approach.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991, in the dynamic environment Manufacturing Lilly's has struggled to respond to the nimble upstart competition. Manufacturing Lilly's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Lack of clear differentiation of Manufacturing Lilly's products
– To increase the profitability and margins on the products, Manufacturing Lilly's needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow to strategic competitive environment developments
– As Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 HBR case study mentions - Manufacturing Lilly's 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.
Aligning sales with marketing
– It come across in the case study Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 can leverage the sales team experience to cultivate customer relationships as Manufacturing Lilly's is planning to shift buying processes online.
Products dominated business model
– Even though Manufacturing Lilly's 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 - Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Manufacturing Lilly's 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.
Skills based hiring
– The stress on hiring functional specialists at Manufacturing Lilly'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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Manufacturing Lilly's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Opportunities Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 | 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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 are -
Redefining models of collaboration and team work
– As explained in the weaknesses section, Manufacturing Lilly's is facing challenges because of the dominance of functional experts in the organization. Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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.
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. Manufacturing Lilly's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Manufacturing Lilly's in the consumer business. Now Manufacturing Lilly's can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Manufacturing Lilly's 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Manufacturing Lilly's can use these opportunities to build new business models that can help the communities that Manufacturing Lilly's operates in. Secondly it can use opportunities from government spending in Technology & Operations sector.
Leveraging digital technologies
– Manufacturing Lilly'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.
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. Manufacturing Lilly'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. Manufacturing Lilly'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.
Building a culture of innovation
– managers at Manufacturing Lilly's 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Manufacturing Lilly's 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
– Manufacturing Lilly'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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Manufacturing Lilly's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Manufacturing Lilly'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.
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. Manufacturing Lilly's can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Buying journey improvements
– Manufacturing Lilly's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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.
Threats Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Manufacturing Lilly'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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 .
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Manufacturing Lilly'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.
Environmental challenges
– Manufacturing Lilly'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. Manufacturing Lilly's can take advantage of this fund but it will also bring new competitors in the Technology & Operations industry.
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. Manufacturing Lilly's 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.
Technology acceleration in Forth Industrial Revolution
– Manufacturing Lilly's has witnessed rapid integration of technology during Covid-19 in the Technology & Operations industry. As one of the leading players in the industry, Manufacturing Lilly's 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.
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 Manufacturing Lilly's business can come under increasing regulations regarding data privacy, data security, etc.
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 Manufacturing Lilly's in the Technology & Operations sector and impact the bottomline of the organization.
Consumer confidence and its impact on Manufacturing Lilly'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.
Shortening product life cycle
– it is one of the major threat that Manufacturing Lilly's is facing in Technology & Operations sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Manufacturing Lilly's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Increasing wage structure of Manufacturing Lilly'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 Manufacturing Lilly's.
Stagnating economy with rate increase
– Manufacturing Lilly'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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Eli Lilly and Co.: Manufacturing Process Technology Strategy--1991 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 Manufacturing Lilly's needs to make to build a sustainable competitive advantage.