Case Study Description of Ranbaxy Laboratories Limited: Changing Aspirations
This case captures the roller-coaster ride of India's first multinational pharmaceutical company that after winning several accolades lost its way only to eventually plead guilty for the unethical practices it had resorted to in fulfilling its growth aspirations. Tracing the strategic choices of the company since its inception until it ceased to exist, the case covers the reign of several different CEOs. It enables examination of the drivers of a firm's strategic choices at the point of decision making, and serves to illustrate the dynamic aspects of leadership. Among others, it highlights the role of aspirations as a driver of firm's choices and the difficult tradeoffs that are inherent to aspiration-driven strategies. Demonstrating the negative repercussions of an aspiration-led strategy as well as the challenges a firm's leadership faces as they seek to re-define the aspirations, it serves as an intriguing story of the dark side of aspirations. The teaching note provides a set of discussion questions and pre-reads that can be assigned to the class, and suggests a detailed teaching plan that is divided into five pastures.
Swot Analysis of "Ranbaxy Laboratories Limited: Changing Aspirations" written by J Ramachandran, Snigdha Manukonda, Kiran Awate includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Aspirations Aspiration facing as an external strategic factors. Some of the topics covered in Ranbaxy Laboratories Limited: Changing Aspirations case study are - Strategic Management Strategies, Leadership and Global Business.
Some of the macro environment factors that can be used to understand the Ranbaxy Laboratories Limited: Changing Aspirations casestudy better are - – challanges to central banks by blockchain based private currencies, increasing transportation and logistics costs, increasing energy prices, digital marketing is dominated by two big players Facebook and Google, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing government debt because of Covid-19 spendings, central banks are concerned over increasing inflation,
customer relationship management is fast transforming because of increasing concerns over data privacy, wage bills are increasing, etc
Introduction to SWOT Analysis of Ranbaxy Laboratories Limited: Changing Aspirations
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Ranbaxy Laboratories Limited: Changing Aspirations case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Aspirations Aspiration, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Aspirations Aspiration 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 Ranbaxy Laboratories Limited: Changing Aspirations can be done for the following purposes –
1. Strategic planning using facts provided in Ranbaxy Laboratories Limited: Changing Aspirations case study
2. Improving business portfolio management of Aspirations Aspiration
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 Aspirations Aspiration
Strengths Ranbaxy Laboratories Limited: Changing Aspirations | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Aspirations Aspiration in Ranbaxy Laboratories Limited: Changing Aspirations Harvard Business Review case study are -
Diverse revenue streams
– Aspirations Aspiration is present in almost all the verticals within the industry. This has provided firm in Ranbaxy Laboratories Limited: Changing Aspirations 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.
Organizational Resilience of Aspirations Aspiration
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Aspirations Aspiration 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 Aspirations Aspiration in the sector have low bargaining power. Ranbaxy Laboratories Limited: Changing Aspirations has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Aspirations Aspiration to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Aspirations Aspiration 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 J Ramachandran, Snigdha Manukonda, Kiran Awate 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.
Strong track record of project management
– Aspirations Aspiration is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Aspirations Aspiration 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 Aspirations Aspiration is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Ranbaxy Laboratories Limited: Changing Aspirations Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Aspirations Aspiration digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Aspirations Aspiration 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.
Training and development
– Aspirations Aspiration has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Ranbaxy Laboratories Limited: Changing Aspirations 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.
Superior customer experience
– The customer experience strategy of Aspirations Aspiration in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Aspirations Aspiration 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.
Sustainable margins compare to other players in Global Business industry
– Ranbaxy Laboratories Limited: Changing Aspirations firm has clearly differentiated products in the market place. This has enabled Aspirations Aspiration to fetch slight price premium compare to the competitors in the Global Business industry. The sustainable margins have also helped Aspirations Aspiration to invest into research and development (R&D) and innovation.
Ability to lead change in Global Business field
– Aspirations Aspiration 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 Aspirations Aspiration in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Ranbaxy Laboratories Limited: Changing Aspirations | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Ranbaxy Laboratories Limited: Changing Aspirations are -
Capital Spending Reduction
– Even during the low interest decade, Aspirations Aspiration 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.
Lack of clear differentiation of Aspirations Aspiration products
– To increase the profitability and margins on the products, Aspirations Aspiration needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Aspirations Aspiration 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. Aspirations Aspiration 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Ranbaxy Laboratories Limited: Changing Aspirations, in the dynamic environment Aspirations Aspiration has struggled to respond to the nimble upstart competition. Aspirations Aspiration has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Aspirations Aspiration 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Aspirations Aspiration is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Ranbaxy Laboratories Limited: Changing Aspirations can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High cash cycle compare to competitors
Aspirations Aspiration has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Interest costs
– Compare to the competition, Aspirations Aspiration 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.
High operating costs
– Compare to the competitors, firm in the HBR case study Ranbaxy Laboratories Limited: Changing Aspirations 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 Aspirations Aspiration 's lucrative customers.
No frontier risks strategy
– After analyzing the HBR case study Ranbaxy Laboratories Limited: Changing Aspirations, 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.
High bargaining power of channel partners
– Because of the regulatory requirements, J Ramachandran, Snigdha Manukonda, Kiran Awate suggests that, Aspirations Aspiration 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.
Opportunities Ranbaxy Laboratories Limited: Changing Aspirations | 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 Ranbaxy Laboratories Limited: Changing Aspirations are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Aspirations Aspiration 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 Aspirations Aspiration to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Aspirations Aspiration in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Aspirations Aspiration 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.
Using analytics as competitive advantage
– Aspirations Aspiration 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 Ranbaxy Laboratories Limited: Changing Aspirations - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Aspirations Aspiration to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Aspirations Aspiration 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 Aspirations Aspiration in the consumer business. Now Aspirations Aspiration can target international markets with far fewer capital restrictions requirements than the existing system.
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. Aspirations Aspiration 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. Aspirations Aspiration 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.
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 Aspirations Aspiration 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Aspirations Aspiration can use these opportunities to build new business models that can help the communities that Aspirations Aspiration operates in. Secondly it can use opportunities from government spending in Global Business sector.
Manufacturing automation
– Aspirations Aspiration 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.
Buying journey improvements
– Aspirations Aspiration can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Ranbaxy Laboratories Limited: Changing Aspirations 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.
Building a culture of innovation
– managers at Aspirations Aspiration 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, Aspirations Aspiration 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, Ranbaxy Laboratories Limited: Changing Aspirations, 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 Ranbaxy Laboratories Limited: Changing Aspirations External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Ranbaxy Laboratories Limited: Changing Aspirations are -
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Aspirations Aspiration in the Global Business sector and impact the bottomline of the organization.
Environmental challenges
– Aspirations Aspiration 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. Aspirations Aspiration can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Stagnating economy with rate increase
– Aspirations Aspiration can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Aspirations Aspiration 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 Ranbaxy Laboratories Limited: Changing Aspirations .
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Aspirations Aspiration will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
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.
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 Aspirations Aspiration business can come under increasing regulations regarding data privacy, data security, etc.
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. Aspirations Aspiration needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
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.
Technology acceleration in Forth Industrial Revolution
– Aspirations Aspiration has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Aspirations Aspiration 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.
Increasing wage structure of Aspirations Aspiration
– 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 Aspirations Aspiration.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Ranbaxy Laboratories Limited: Changing Aspirations, Aspirations Aspiration 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 .
Regulatory challenges
– Aspirations Aspiration 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.
Weighted SWOT Analysis of Ranbaxy Laboratories Limited: Changing Aspirations 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 Ranbaxy Laboratories Limited: Changing Aspirations 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 Ranbaxy Laboratories Limited: Changing Aspirations 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 Ranbaxy Laboratories Limited: Changing Aspirations 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 Ranbaxy Laboratories Limited: Changing Aspirations 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 Aspirations Aspiration needs to make to build a sustainable competitive advantage.