The "Wonder Drug" that Killed Babies SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The "Wonder Drug" that Killed Babies
In the early 1960s, a popular drug taken by patients worldwide for a range of maladies was found to cause severe birth defects and other health problems in babies born to mothers who had taken it during a certain stage of fetal development. As many as 10,000 children may have been affected. Just a handful of these children were born in the U.S., where safety concerns were raised by Dr. Frances Oldham Kelsey, the medical officer handling the thalidomide application at the U.S. Food and Drug Administration. However, the company hoping to distribute the product in the U.S. had already given away thousands of pills for doctors to run clinical trials. Once the full extent of the global thalidomide crisis became generally known, the U.S. Congress significantly reformed the country's drug approval process, to ensure that all new products were both safe and effective. It subsequently became much more arduous for pharmaceutical firms to bring new drugs to market. Some critics therefore argued that the new regulations were actually detrimental, as they prevented or delayed good drugs from coming to market. What was the right balance between consumer protection and access to potentially life-saving drugs?
Authors :: Joshua Lev Krieger, Tom Nicholas, Matthew Preble
Topics :: Global Business
Tags :: Corporate governance, Ethics, Government, Health, Marketing, Public relations, Social responsibility, SWOT Analysis, SWOT Matrix, TOWS, Weighted SWOT Analysis
Swot Analysis of "The "Wonder Drug" that Killed Babies" written by Joshua Lev Krieger, Tom Nicholas, Matthew Preble includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Thalidomide Drug facing as an external strategic factors. Some of the topics covered in The "Wonder Drug" that Killed Babies case study are - Strategic Management Strategies, Corporate governance, Ethics, Government, Health, Marketing, Public relations, Social responsibility and Global Business.
Some of the macro environment factors that can be used to understand the The "Wonder Drug" that Killed Babies casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, there is backlash against globalization, increasing commodity prices,
technology disruption, increasing energy prices, etc
Introduction to SWOT Analysis of The "Wonder Drug" that Killed Babies
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The "Wonder Drug" that Killed Babies case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Thalidomide Drug, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Thalidomide 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 The "Wonder Drug" that Killed Babies can be done for the following purposes –
1. Strategic planning using facts provided in The "Wonder Drug" that Killed Babies case study
2. Improving business portfolio management of Thalidomide Drug
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Thalidomide Drug
Strengths The "Wonder Drug" that Killed Babies | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Thalidomide Drug in The "Wonder Drug" that Killed Babies Harvard Business Review case study are -
Successful track record of launching new products
– Thalidomide Drug has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Thalidomide Drug 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.
Organizational Resilience of Thalidomide Drug
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Thalidomide Drug does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Low bargaining power of suppliers
– Suppliers of Thalidomide Drug in the sector have low bargaining power. The "Wonder Drug" that Killed Babies has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Thalidomide Drug to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the The "Wonder Drug" that Killed Babies 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.
Sustainable margins compare to other players in Global Business industry
– The "Wonder Drug" that Killed Babies firm has clearly differentiated products in the market place. This has enabled Thalidomide Drug to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Thalidomide Drug to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Thalidomide Drug is one of the leading recruiters in the industry. Managers in the The "Wonder Drug" that Killed Babies 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 Global Business field
– Thalidomide 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 Thalidomide Drug in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management
– Thalidomide Drug is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Thalidomide Drug has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The "Wonder Drug" that Killed Babies 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.
Highly skilled collaborators
– Thalidomide 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 The "Wonder Drug" that Killed Babies HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Effective Research and Development (R&D)
– Thalidomide 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 The "Wonder Drug" that Killed Babies - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Thalidomide Drug is present in almost all the verticals within the industry. This has provided firm in The "Wonder Drug" that Killed Babies case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Weaknesses The "Wonder Drug" that Killed Babies | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The "Wonder Drug" that Killed Babies are -
Need for greater diversity
– Thalidomide 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.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study The "Wonder Drug" that Killed Babies, is just above the industry average. Thalidomide 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.
High operating costs
– Compare to the competitors, firm in the HBR case study The "Wonder Drug" that Killed Babies has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Thalidomide Drug 's lucrative customers.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Thalidomide Drug is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study The "Wonder Drug" that Killed Babies can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Slow decision making process
– As mentioned earlier in the report, Thalidomide Drug 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. Thalidomide Drug 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.
Low market penetration in new markets
– Outside its home market of Thalidomide Drug, firm in the HBR case study The "Wonder Drug" that Killed Babies needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High cash cycle compare to competitors
Thalidomide 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.
High bargaining power of channel partners
– Because of the regulatory requirements, Joshua Lev Krieger, Tom Nicholas, Matthew Preble suggests that, Thalidomide 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Thalidomide Drug needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the The "Wonder Drug" that Killed Babies 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 Thalidomide Drug has relatively successful track record of launching new products.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study The "Wonder Drug" that Killed Babies, it seems that the employees of Thalidomide Drug 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.
Opportunities The "Wonder Drug" that Killed Babies | 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 The "Wonder Drug" that Killed Babies are -
Developing new processes and practices
– Thalidomide Drug can develop new processes and procedures in Global Business 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.
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 Thalidomide Drug in the consumer business. Now Thalidomide Drug can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Thalidomide 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Thalidomide Drug 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.
Better consumer reach
– The expansion of the 5G network will help Thalidomide Drug to increase its market reach. Thalidomide 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Thalidomide 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, The "Wonder Drug" that Killed Babies, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Global Business industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Thalidomide Drug 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. Thalidomide Drug 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.
Manufacturing automation
– Thalidomide Drug can use the latest technology developments to improve its manufacturing and designing process in Global Business 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, Thalidomide Drug can use these opportunities to build new business models that can help the communities that Thalidomide Drug operates in. Secondly it can use opportunities from government spending in Global Business sector.
Learning at scale
– Online learning technologies has now opened space for Thalidomide 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Thalidomide Drug 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 Thalidomide Drug to hire the very best people irrespective of their geographical location.
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 Thalidomide Drug 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Thalidomide Drug can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Threats The "Wonder Drug" that Killed Babies External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The "Wonder Drug" that Killed Babies are -
Environmental challenges
– Thalidomide Drug 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. Thalidomide Drug can take advantage of this fund but it will also bring new competitors in the Global Business industry.
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 Thalidomide Drug business can come under increasing regulations regarding data privacy, data security, etc.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Thalidomide 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 The "Wonder Drug" that Killed Babies .
Easy access to finance
– Easy access to finance in Global Business field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Thalidomide Drug can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Thalidomide 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study The "Wonder Drug" that Killed Babies, Thalidomide 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 Global Business .
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 Thalidomide Drug in the Global Business sector and impact the bottomline of the organization.
High dependence on third party suppliers
– Thalidomide 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.
Increasing wage structure of Thalidomide Drug
– 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 Thalidomide Drug.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Thalidomide Drug.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Thalidomide Drug with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Thalidomide Drug in the Global Business industry. The Global Business 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.
Consumer confidence and its impact on Thalidomide 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.
Weighted SWOT Analysis of The "Wonder Drug" that Killed Babies 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 The "Wonder Drug" that Killed Babies 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 The "Wonder Drug" that Killed Babies 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 The "Wonder Drug" that Killed Babies 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 The "Wonder Drug" that Killed Babies 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 Thalidomide Drug needs to make to build a sustainable competitive advantage.