Transforming Alkermes into a Global Biopharmaceutical Company SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Finance & Accounting
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Transforming Alkermes into a Global Biopharmaceutical Company
In the summer of 2011, Jim Frates, CFO of Alkermes faced choices about how to finance the acquisition of Dublin, Ireland-based Elan Drug Technologies (EDT) - a deal that was expected to close in the fall. The case describes the history of Alkermes, provides information about the planned merger, and details the funding options. The case gives students the opportunity to analyze the role CFOs play in biopharmaceutical firms, to evaluate the attractiveness of the merger, and to select a funding option.
Swot Analysis of "Transforming Alkermes into a Global Biopharmaceutical Company" written by C. Fritz Foley, Nicholas Haas includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Alkermes Biopharmaceutical facing as an external strategic factors. Some of the topics covered in Transforming Alkermes into a Global Biopharmaceutical Company case study are - Strategic Management Strategies, Financial management, Mergers & acquisitions and Finance & Accounting.
Some of the macro environment factors that can be used to understand the Transforming Alkermes into a Global Biopharmaceutical Company casestudy better are - – challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing inequality as vast percentage of new income is going to the top 1%,
supply chains are disrupted by pandemic , increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of Transforming Alkermes into a Global Biopharmaceutical Company
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Transforming Alkermes into a Global Biopharmaceutical Company case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Alkermes Biopharmaceutical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Alkermes Biopharmaceutical 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 Transforming Alkermes into a Global Biopharmaceutical Company can be done for the following purposes –
1. Strategic planning using facts provided in Transforming Alkermes into a Global Biopharmaceutical Company case study
2. Improving business portfolio management of Alkermes Biopharmaceutical
3. Assessing feasibility of the new initiative in Finance & Accounting field.
4. Making a Finance & Accounting topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Alkermes Biopharmaceutical
Strengths Transforming Alkermes into a Global Biopharmaceutical Company | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Alkermes Biopharmaceutical in Transforming Alkermes into a Global Biopharmaceutical Company Harvard Business Review case study are -
Analytics focus
– Alkermes Biopharmaceutical 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 C. Fritz Foley, Nicholas Haas 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 Transforming Alkermes into a Global Biopharmaceutical Company 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.
Ability to lead change in Finance & Accounting field
– Alkermes Biopharmaceutical 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 Alkermes Biopharmaceutical in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Alkermes Biopharmaceutical 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 Transforming Alkermes into a Global Biopharmaceutical Company - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Successful track record of launching new products
– Alkermes Biopharmaceutical has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Alkermes Biopharmaceutical has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
High brand equity
– Alkermes Biopharmaceutical has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Alkermes Biopharmaceutical to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Alkermes Biopharmaceutical 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.
Innovation driven organization
– Alkermes Biopharmaceutical is one of the most innovative firm in sector. Manager in Transforming Alkermes into a Global Biopharmaceutical Company Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Alkermes Biopharmaceutical in the sector have low bargaining power. Transforming Alkermes into a Global Biopharmaceutical Company has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Alkermes Biopharmaceutical to manage not only supply disruptions but also source products at highly competitive prices.
Training and development
– Alkermes Biopharmaceutical has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Transforming Alkermes into a Global Biopharmaceutical Company 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.
Organizational Resilience of Alkermes Biopharmaceutical
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Alkermes Biopharmaceutical does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Ability to recruit top talent
– Alkermes Biopharmaceutical is one of the leading recruiters in the industry. Managers in the Transforming Alkermes into a Global Biopharmaceutical Company are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Transforming Alkermes into a Global Biopharmaceutical Company | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Transforming Alkermes into a Global Biopharmaceutical Company are -
Slow decision making process
– As mentioned earlier in the report, Alkermes Biopharmaceutical 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. Alkermes Biopharmaceutical 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.
Aligning sales with marketing
– It come across in the case study Transforming Alkermes into a Global Biopharmaceutical Company 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 Transforming Alkermes into a Global Biopharmaceutical Company can leverage the sales team experience to cultivate customer relationships as Alkermes Biopharmaceutical is planning to shift buying processes online.
Low market penetration in new markets
– Outside its home market of Alkermes Biopharmaceutical, firm in the HBR case study Transforming Alkermes into a Global Biopharmaceutical Company needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
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 Alkermes Biopharmaceutical supply chain. Even after few cautionary changes mentioned in the HBR case study - Transforming Alkermes into a Global Biopharmaceutical Company, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Alkermes Biopharmaceutical vulnerable to further global disruptions in South East Asia.
Need for greater diversity
– Alkermes Biopharmaceutical 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.
Lack of clear differentiation of Alkermes Biopharmaceutical products
– To increase the profitability and margins on the products, Alkermes Biopharmaceutical 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 Transforming Alkermes into a Global Biopharmaceutical Company, is just above the industry average. Alkermes Biopharmaceutical 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.
High cash cycle compare to competitors
Alkermes Biopharmaceutical 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.
Interest costs
– Compare to the competition, Alkermes Biopharmaceutical 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 Transforming Alkermes into a Global Biopharmaceutical Company HBR case study mentions - Alkermes Biopharmaceutical 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Transforming Alkermes into a Global Biopharmaceutical Company, in the dynamic environment Alkermes Biopharmaceutical has struggled to respond to the nimble upstart competition. Alkermes Biopharmaceutical has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Transforming Alkermes into a Global Biopharmaceutical Company | 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 Transforming Alkermes into a Global Biopharmaceutical Company are -
Building a culture of innovation
– managers at Alkermes Biopharmaceutical 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 Finance & Accounting segment.
Buying journey improvements
– Alkermes Biopharmaceutical can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Transforming Alkermes into a Global Biopharmaceutical Company 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Alkermes Biopharmaceutical can use these opportunities to build new business models that can help the communities that Alkermes Biopharmaceutical operates in. Secondly it can use opportunities from government spending in Finance & Accounting sector.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Alkermes Biopharmaceutical to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
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 Alkermes Biopharmaceutical in the consumer business. Now Alkermes Biopharmaceutical can target international markets with far fewer capital restrictions requirements than the existing system.
Better consumer reach
– The expansion of the 5G network will help Alkermes Biopharmaceutical to increase its market reach. Alkermes Biopharmaceutical 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
– Alkermes Biopharmaceutical can use the latest technology developments to improve its manufacturing and designing process in Finance & Accounting 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 Alkermes Biopharmaceutical can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Loyalty marketing
– Alkermes Biopharmaceutical 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.
Creating value in data economy
– The success of analytics program of Alkermes Biopharmaceutical has opened avenues for new revenue streams for the organization in the industry. This can help Alkermes Biopharmaceutical to build a more holistic ecosystem as suggested in the Transforming Alkermes into a Global Biopharmaceutical Company case study. Alkermes Biopharmaceutical can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Finance & Accounting industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Alkermes Biopharmaceutical 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. Alkermes Biopharmaceutical 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Alkermes Biopharmaceutical in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Finance & Accounting segment, and it will provide faster access to the consumers.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Alkermes Biopharmaceutical is facing challenges because of the dominance of functional experts in the organization. Transforming Alkermes into a Global Biopharmaceutical Company 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.
Threats Transforming Alkermes into a Global Biopharmaceutical Company External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Transforming Alkermes into a Global Biopharmaceutical Company are -
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 Alkermes Biopharmaceutical in the Finance & Accounting sector and impact the bottomline of the organization.
Environmental challenges
– Alkermes Biopharmaceutical 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. Alkermes Biopharmaceutical can take advantage of this fund but it will also bring new competitors in the Finance & Accounting industry.
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 dependence on third party suppliers
– Alkermes Biopharmaceutical 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 Alkermes Biopharmaceutical business can come under increasing regulations regarding data privacy, data security, etc.
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. Alkermes Biopharmaceutical 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.
Easy access to finance
– Easy access to finance in Finance & Accounting field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Alkermes Biopharmaceutical can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Alkermes Biopharmaceutical 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.
Technology acceleration in Forth Industrial Revolution
– Alkermes Biopharmaceutical has witnessed rapid integration of technology during Covid-19 in the Finance & Accounting industry. As one of the leading players in the industry, Alkermes Biopharmaceutical needs to keep up with the evolution of technology in the Finance & Accounting 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.
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.
Stagnating economy with rate increase
– Alkermes Biopharmaceutical 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Alkermes Biopharmaceutical 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 Transforming Alkermes into a Global Biopharmaceutical Company .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Transforming Alkermes into a Global Biopharmaceutical Company, Alkermes Biopharmaceutical may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Finance & Accounting .
Weighted SWOT Analysis of Transforming Alkermes into a Global Biopharmaceutical Company 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 Transforming Alkermes into a Global Biopharmaceutical Company 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 Transforming Alkermes into a Global Biopharmaceutical Company 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 Transforming Alkermes into a Global Biopharmaceutical Company 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 Transforming Alkermes into a Global Biopharmaceutical Company 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 Alkermes Biopharmaceutical needs to make to build a sustainable competitive advantage.
