The Unfinished Agenda: Dr. Reddy's Laboratories Ltd SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of The Unfinished Agenda: Dr. Reddy's Laboratories Ltd
Dr. K. Anji Reddy founded Dr. Reddy's Laboratories Ltd (DRL) in 1984. Since then, the company had grown to become one of the largest pharmaceutical companies in India. The company professionalized early on, and over the years, the family members defined and refined their roles for the efficient running of the company. Dr. Reddy passed away on March 15, 2013. His son-in-law, G. V. Prasad, had been with DRL for more than 25 years by then. Prasad acknowledged that a lot needed to be done to fulfill Dr. Reddy's dreams. He had been contemplating his own future role in the company and the need for a smooth succession. But who would succeed him? What would be the qualities of the person who would succeed Prasad, a passionate member of the founding family of DRL? Would a non-family CEO be a suitable replacement?
Swot Analysis of "The Unfinished Agenda: Dr. Reddy's Laboratories Ltd" written by Nupur Pavan Bang, Kavil Ramachandran includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Drl Reddy's facing as an external strategic factors. Some of the topics covered in The Unfinished Agenda: Dr. Reddy's Laboratories Ltd case study are - Strategic Management Strategies, Entrepreneurship, Generational issues, Leadership and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the The Unfinished Agenda: Dr. Reddy's Laboratories Ltd casestudy better are - – there is increasing trade war between United States & China, central banks are concerned over increasing inflation, customer relationship management is fast transforming because of increasing concerns over data privacy, increasing transportation and logistics costs, competitive advantages are harder to sustain because of technology dispersion, supply chains are disrupted by pandemic , geopolitical disruptions,
digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels, etc
Introduction to SWOT Analysis of The Unfinished Agenda: Dr. Reddy's Laboratories Ltd
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in The Unfinished Agenda: Dr. Reddy's Laboratories Ltd case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Drl Reddy's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Drl Reddy'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 The Unfinished Agenda: Dr. Reddy's Laboratories Ltd can be done for the following purposes –
1. Strategic planning using facts provided in The Unfinished Agenda: Dr. Reddy's Laboratories Ltd case study
2. Improving business portfolio management of Drl Reddy's
3. Assessing feasibility of the new initiative in Innovation & Entrepreneurship field.
4. Making a Innovation & Entrepreneurship topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Drl Reddy's
Strengths The Unfinished Agenda: Dr. Reddy's Laboratories Ltd | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Drl Reddy's in The Unfinished Agenda: Dr. Reddy's Laboratories Ltd Harvard Business Review case study are -
Analytics focus
– Drl Reddy'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 Nupur Pavan Bang, Kavil Ramachandran 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.
Ability to lead change in Innovation & Entrepreneurship field
– Drl Reddy'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 Drl Reddy'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 Innovation & Entrepreneurship industry
– The Unfinished Agenda: Dr. Reddy's Laboratories Ltd firm has clearly differentiated products in the market place. This has enabled Drl Reddy's to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Drl Reddy's to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Drl Reddy'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.
Organizational Resilience of Drl Reddy's
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Drl Reddy's does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Drl Reddy's digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Drl Reddy's 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.
Highly skilled collaborators
– Drl Reddy'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 The Unfinished Agenda: Dr. Reddy's Laboratories Ltd HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Training and development
– Drl Reddy's has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in The Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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.
Strong track record of project management
– Drl Reddy's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Successful track record of launching new products
– Drl Reddy's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Drl Reddy's 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.
Diverse revenue streams
– Drl Reddy's is present in almost all the verticals within the industry. This has provided firm in The Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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.
Operational resilience
– The operational resilience strategy in the The Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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.
Weaknesses The Unfinished Agenda: Dr. Reddy's Laboratories Ltd | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of The Unfinished Agenda: Dr. Reddy's Laboratories Ltd are -
High bargaining power of channel partners
– Because of the regulatory requirements, Nupur Pavan Bang, Kavil Ramachandran suggests that, Drl Reddy's 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study The Unfinished Agenda: Dr. Reddy's Laboratories Ltd, in the dynamic environment Drl Reddy's has struggled to respond to the nimble upstart competition. Drl Reddy's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Workers concerns about automation
– As automation is fast increasing in the segment, Drl Reddy's 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.
Slow to strategic competitive environment developments
– As The Unfinished Agenda: Dr. Reddy's Laboratories Ltd HBR case study mentions - Drl Reddy'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.
High operating costs
– Compare to the competitors, firm in the HBR case study The Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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 Drl Reddy's 's lucrative customers.
Need for greater diversity
– Drl Reddy's 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.
Products dominated business model
– Even though Drl Reddy'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 - The Unfinished Agenda: Dr. Reddy's Laboratories Ltd should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Drl Reddy's products
– To increase the profitability and margins on the products, Drl Reddy's needs to provide more differentiated products than what it is currently offering in the marketplace.
Interest costs
– Compare to the competition, Drl Reddy's 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.
Increasing silos among functional specialists
– The organizational structure of Drl Reddy's is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Drl Reddy's needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Drl Reddy's to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Drl Reddy's 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.
Opportunities The Unfinished Agenda: Dr. Reddy's Laboratories Ltd | 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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd are -
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Drl Reddy's can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Manufacturing automation
– Drl Reddy's can use the latest technology developments to improve its manufacturing and designing process in Innovation & Entrepreneurship 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.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Innovation & Entrepreneurship industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Drl Reddy'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. Drl Reddy'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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Drl Reddy's can use these opportunities to build new business models that can help the communities that Drl Reddy's operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Drl Reddy's in the consumer business. Now Drl Reddy'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, Drl Reddy'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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Drl Reddy's 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 Drl Reddy's to hire the very best people irrespective of their geographical location.
Better consumer reach
– The expansion of the 5G network will help Drl Reddy's to increase its market reach. Drl Reddy's 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.
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 Drl Reddy's 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Drl Reddy'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 Innovation & Entrepreneurship segment, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for Drl Reddy's 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.
Buying journey improvements
– Drl Reddy's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. The Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Drl Reddy's 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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats The Unfinished Agenda: Dr. Reddy's Laboratories Ltd External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study The Unfinished Agenda: Dr. Reddy's Laboratories Ltd are -
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. Drl Reddy's needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Technology acceleration in Forth Industrial Revolution
– Drl Reddy's has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Drl Reddy's needs to keep up with the evolution of technology in the Innovation & Entrepreneurship 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.
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.
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 Drl Reddy's.
Increasing wage structure of Drl Reddy'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 Drl Reddy's.
Stagnating economy with rate increase
– Drl Reddy'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.
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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd, Drl Reddy's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Innovation & Entrepreneurship .
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
– Drl Reddy'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. Drl Reddy's can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
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 Drl Reddy's in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
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 Drl Reddy's business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on Drl Reddy'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.
High dependence on third party suppliers
– Drl Reddy's 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.
Weighted SWOT Analysis of The Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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 Unfinished Agenda: Dr. Reddy's Laboratories Ltd 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 Drl Reddy's needs to make to build a sustainable competitive advantage.
