Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version
This case should be printed in color.Farmacias Similares, serving Mexico's low-income sector, grew to $600 million sales and 3,400 drugstores while deep reforms to help the poor swept the public health system. Adjacent to each store, for $2 per visit, medical clinics provided access to doctors for 2.3 million people a month. Narrates the growth of the chain, examines the reasons for its success, and projects a pro forma of the company's financial returns. Places Farmacias Similares in the context of Mexico's public health system and the pharmaceutical industry.
Swot Analysis of "Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version" written by Michael Chu, Regina Garcia-Cuellar includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Similares Farmacias facing as an external strategic factors. Some of the topics covered in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version case study are - Strategic Management Strategies, Social enterprise and Global Business.
Some of the macro environment factors that can be used to understand the Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version casestudy better are - – digital marketing is dominated by two big players Facebook and Google, increasing government debt because of Covid-19 spendings, wage bills are increasing, banking and financial system is disrupted by Bitcoin and other crypto currencies, cloud computing is disrupting traditional business models, talent flight as more people leaving formal jobs, increasing household debt because of falling income levels,
increasing commodity prices, there is increasing trade war between United States & China, etc
Introduction to SWOT Analysis of Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Similares Farmacias, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Similares Farmacias 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version can be done for the following purposes –
1. Strategic planning using facts provided in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version case study
2. Improving business portfolio management of Similares Farmacias
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 Similares Farmacias
Strengths Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Similares Farmacias in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version Harvard Business Review case study are -
Innovation driven organization
– Similares Farmacias is one of the most innovative firm in sector. Manager in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Similares Farmacias 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 Similares Farmacias is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Strong track record of project management
– Similares Farmacias is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Cross disciplinary teams
– Horizontal connected teams at the Similares Farmacias 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.
Successful track record of launching new products
– Similares Farmacias has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Similares Farmacias 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 switching costs
– The high switching costs that Similares Farmacias 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.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Similares Farmacias digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Similares Farmacias 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.
Superior customer experience
– The customer experience strategy of Similares Farmacias in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Organizational Resilience of Similares Farmacias
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Similares Farmacias does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Similares Farmacias is present in almost all the verticals within the industry. This has provided firm in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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.
Ability to lead change in Global Business field
– Similares Farmacias 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 Similares Farmacias in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Training and development
– Similares Farmacias has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version are -
Workers concerns about automation
– As automation is fast increasing in the segment, Similares Farmacias 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.
Interest costs
– Compare to the competition, Similares Farmacias 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.
No frontier risks strategy
– After analyzing the HBR case study Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version, it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version, in the dynamic environment Similares Farmacias has struggled to respond to the nimble upstart competition. Similares Farmacias has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
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 Similares Farmacias supply chain. Even after few cautionary changes mentioned in the HBR case study - Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Similares Farmacias vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Similares Farmacias, firm in the HBR case study Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Similares Farmacias is dominated by functional specialists. It is not different from other players in the Global Business segment. Similares Farmacias needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Similares Farmacias to focus more on services rather than just following the product oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, Michael Chu, Regina Garcia-Cuellar suggests that, Similares Farmacias 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.
Aligning sales with marketing
– It come across in the case study Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version can leverage the sales team experience to cultivate customer relationships as Similares Farmacias is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Similares Farmacias 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. Similares Farmacias 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.
Products dominated business model
– Even though Similares Farmacias 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 - Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version should strive to include more intangible value offerings along with its core products and services.
Opportunities Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version | 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Similares Farmacias can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Similares Farmacias 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.
Building a culture of innovation
– managers at Similares Farmacias 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 Global Business segment.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Similares Farmacias 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, Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Buying journey improvements
– Similares Farmacias can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Similares Farmacias 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.
Developing new processes and practices
– Similares Farmacias 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.
Better consumer reach
– The expansion of the 5G network will help Similares Farmacias to increase its market reach. Similares Farmacias 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.
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. Similares Farmacias can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Similares Farmacias 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. Similares Farmacias 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.
Creating value in data economy
– The success of analytics program of Similares Farmacias has opened avenues for new revenue streams for the organization in the industry. This can help Similares Farmacias to build a more holistic ecosystem as suggested in the Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version case study. Similares Farmacias can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Similares Farmacias 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.
Using analytics as competitive advantage
– Similares Farmacias 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Similares Farmacias to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Threats Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version are -
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 Similares Farmacias with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
High dependence on third party suppliers
– Similares Farmacias 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Similares Farmacias 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.
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 Similares Farmacias.
Regulatory challenges
– Similares Farmacias needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Global Business industry regulations.
Consumer confidence and its impact on Similares Farmacias 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.
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 Similares Farmacias in the Global Business 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 Similares Farmacias business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version, Similares Farmacias 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 .
Shortening product life cycle
– it is one of the major threat that Similares Farmacias is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Stagnating economy with rate increase
– Similares Farmacias 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Farmacias Similares: Private and Public Health Care for the Base of the Pyramid in Mexico, Portuguese Version 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 Similares Farmacias needs to make to build a sustainable competitive advantage.
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