Adcock Ingram: Decisions and Motives That Steer Acquisitions SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Global Business
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Adcock Ingram: Decisions and Motives That Steer Acquisitions
The case sketches the story of a charismatic and ambitious young business leader who, through value-adding commercial transactions, has helped set a South African pharmaceutical company, Adcock Ingram, on a trajectory of growth. The case reader meets up with him in May 2009 when he faces lack of closure and an ambiguous outcome to an offer to acquire a smaller pharmaceutical company. The case demonstrates the power of relationships, where the ambitions of different parties around the negotiations table and the incentives that shape their alliances can make or break a strategic business deal. As opposed to presenting a strategic decision-point for class discussion, the case presents students with an opportunity to analyze an unfavorable outcome of a business deal, and build a concept of behavioral requirements of success in business transactions. The case has been designed for class discussion and analysis of factors of leadership that underpin or influence acquisitions. As opposed to an analysis of the commercial rationale of an acquisition, it focuses on the behavioral components of leadership decision-making and their effect on business results. The case can provide a platform for the discussion of motives, interpersonal skills and relationships, and business activities in acquisitions.
Swot Analysis of "Adcock Ingram: Decisions and Motives That Steer Acquisitions" written by Charlene C. Lew includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Adcock Ingram facing as an external strategic factors. Some of the topics covered in Adcock Ingram: Decisions and Motives That Steer Acquisitions case study are - Strategic Management Strategies, Mergers & acquisitions, Negotiations, Organizational culture and Global Business.
Some of the macro environment factors that can be used to understand the Adcock Ingram: Decisions and Motives That Steer Acquisitions casestudy better are - – increasing energy prices, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, geopolitical disruptions, there is increasing trade war between United States & China, supply chains are disrupted by pandemic , cloud computing is disrupting traditional business models,
there is backlash against globalization, increasing transportation and logistics costs, etc
Introduction to SWOT Analysis of Adcock Ingram: Decisions and Motives That Steer Acquisitions
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Adcock Ingram: Decisions and Motives That Steer Acquisitions case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Adcock Ingram, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Adcock Ingram 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions can be done for the following purposes –
1. Strategic planning using facts provided in Adcock Ingram: Decisions and Motives That Steer Acquisitions case study
2. Improving business portfolio management of Adcock Ingram
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 Adcock Ingram
Strengths Adcock Ingram: Decisions and Motives That Steer Acquisitions | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Adcock Ingram in Adcock Ingram: Decisions and Motives That Steer Acquisitions Harvard Business Review case study are -
High brand equity
– Adcock Ingram has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Adcock Ingram to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Adcock Ingram digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Adcock Ingram 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 Adcock Ingram in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Adcock Ingram has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Adcock Ingram does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Adcock Ingram: Decisions and Motives That Steer Acquisitions 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.
Highly skilled collaborators
– Adcock Ingram 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Analytics focus
– Adcock Ingram 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 Charlene C. Lew 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.
Diverse revenue streams
– Adcock Ingram is present in almost all the verticals within the industry. This has provided firm in Adcock Ingram: Decisions and Motives That Steer Acquisitions 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.
Successful track record of launching new products
– Adcock Ingram has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Adcock Ingram 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.
Innovation driven organization
– Adcock Ingram is one of the most innovative firm in sector. Manager in Adcock Ingram: Decisions and Motives That Steer Acquisitions Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to lead change in Global Business field
– Adcock Ingram 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 Adcock Ingram in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Adcock Ingram: Decisions and Motives That Steer Acquisitions | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Adcock Ingram: Decisions and Motives That Steer Acquisitions are -
Slow decision making process
– As mentioned earlier in the report, Adcock Ingram 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. Adcock Ingram 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.
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 Adcock Ingram supply chain. Even after few cautionary changes mentioned in the HBR case study - Adcock Ingram: Decisions and Motives That Steer Acquisitions, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Adcock Ingram vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Adcock Ingram: Decisions and Motives That Steer Acquisitions HBR case study mentions - Adcock Ingram 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.
No frontier risks strategy
– After analyzing the HBR case study Adcock Ingram: Decisions and Motives That Steer Acquisitions, 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.
Lack of clear differentiation of Adcock Ingram products
– To increase the profitability and margins on the products, Adcock Ingram needs to provide more differentiated products than what it is currently offering in the marketplace.
High cash cycle compare to competitors
Adcock Ingram 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 operating costs
– Compare to the competitors, firm in the HBR case study Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Adcock Ingram has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
Need for greater diversity
– Adcock Ingram 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions, is just above the industry average. Adcock Ingram 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Adcock Ingram: Decisions and Motives That Steer Acquisitions, in the dynamic environment Adcock Ingram has struggled to respond to the nimble upstart competition. Adcock Ingram has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Opportunities Adcock Ingram: Decisions and Motives That Steer Acquisitions | 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Adcock Ingram can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Adcock Ingram 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.
Loyalty marketing
– Adcock Ingram 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 Adcock Ingram has opened avenues for new revenue streams for the organization in the industry. This can help Adcock Ingram to build a more holistic ecosystem as suggested in the Adcock Ingram: Decisions and Motives That Steer Acquisitions case study. Adcock Ingram can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Adcock Ingram can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Adcock Ingram is facing challenges because of the dominance of functional experts in the organization. Adcock Ingram: Decisions and Motives That Steer Acquisitions 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.
Buying journey improvements
– Adcock Ingram can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Adcock Ingram: Decisions and Motives That Steer Acquisitions 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.
Better consumer reach
– The expansion of the 5G network will help Adcock Ingram to increase its market reach. Adcock Ingram 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.
Developing new processes and practices
– Adcock Ingram 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.
Building a culture of innovation
– managers at Adcock Ingram 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.
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. Adcock Ingram can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Adcock Ingram in the consumer business. Now Adcock Ingram can target international markets with far fewer capital restrictions requirements than the existing system.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Adcock Ingram can use these opportunities to build new business models that can help the communities that Adcock Ingram operates in. Secondly it can use opportunities from government spending in Global Business sector.
Threats Adcock Ingram: Decisions and Motives That Steer Acquisitions External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Adcock Ingram: Decisions and Motives That Steer Acquisitions are -
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Adcock Ingram: Decisions and Motives That Steer Acquisitions, Adcock Ingram 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 .
Stagnating economy with rate increase
– Adcock Ingram 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.
Technology acceleration in Forth Industrial Revolution
– Adcock Ingram has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Adcock Ingram needs to keep up with the evolution of technology in the Global Business 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.
Regulatory challenges
– Adcock Ingram 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 Adcock Ingram 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 Adcock Ingram in the Global Business sector and impact the bottomline of the organization.
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. Adcock Ingram can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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 Adcock Ingram.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Adcock Ingram 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Adcock Ingram with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
High dependence on third party suppliers
– Adcock Ingram 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 Adcock Ingram business can come under increasing regulations regarding data privacy, data security, etc.
Weighted SWOT Analysis of Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram: Decisions and Motives That Steer Acquisitions 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 Adcock Ingram needs to make to build a sustainable competitive advantage.
