Companion Diagnostics: Uncertainties for Approval and Reimbursement SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Companion Diagnostics: Uncertainties for Approval and Reimbursement
The FDA approvals of novel therapeutics were seen as signs in the personalized medicine community of real progress in the growth of personalized medicine; The FDA's approval of such drugs, along with companion diagnostics, suggested a shift in thinking and regulatory practices at the agency. Beyond the regulatory questions, many considered the reimbursement system archaic, dispersed, unpredictable, and unnecessarily time consuming. Many questioned whether the traditional models of reimbursement were relevant in the era of personalized medicine, and who should be covering the cost of tests needed to identify the sometimes small number of patients who could benefit from expensive targeted drugs. This case focuses on the array of possibilities and the ambiguity surrounding these regulatory and reimbursement issues.
Authors :: Richard G. Hamermesh, Norman C Selby, Phillip Andrews
Swot Analysis of "Companion Diagnostics: Uncertainties for Approval and Reimbursement" written by Richard G. Hamermesh, Norman C Selby, Phillip Andrews includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Reimbursement Personalized facing as an external strategic factors. Some of the topics covered in Companion Diagnostics: Uncertainties for Approval and Reimbursement case study are - Strategic Management Strategies, Entrepreneurship, Health and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Companion Diagnostics: Uncertainties for Approval and Reimbursement casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, talent flight as more people leaving formal jobs, increasing government debt because of Covid-19 spendings, wage bills are increasing, technology disruption,
increasing commodity prices, cloud computing is disrupting traditional business models, etc
Introduction to SWOT Analysis of Companion Diagnostics: Uncertainties for Approval and Reimbursement
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Companion Diagnostics: Uncertainties for Approval and Reimbursement case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Reimbursement Personalized, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Reimbursement Personalized 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement can be done for the following purposes –
1. Strategic planning using facts provided in Companion Diagnostics: Uncertainties for Approval and Reimbursement case study
2. Improving business portfolio management of Reimbursement Personalized
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 Reimbursement Personalized
Strengths Companion Diagnostics: Uncertainties for Approval and Reimbursement | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Reimbursement Personalized in Companion Diagnostics: Uncertainties for Approval and Reimbursement Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the Companion Diagnostics: Uncertainties for Approval and Reimbursement 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.
High brand equity
– Reimbursement Personalized has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Reimbursement Personalized to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Ability to recruit top talent
– Reimbursement Personalized is one of the leading recruiters in the industry. Managers in the Companion Diagnostics: Uncertainties for Approval and Reimbursement are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Organizational Resilience of Reimbursement Personalized
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Reimbursement Personalized does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Highly skilled collaborators
– Reimbursement Personalized 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Innovation driven organization
– Reimbursement Personalized is one of the most innovative firm in sector. Manager in Companion Diagnostics: Uncertainties for Approval and Reimbursement Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Reimbursement Personalized has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Companion Diagnostics: Uncertainties for Approval and Reimbursement 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.
Ability to lead change in Innovation & Entrepreneurship field
– Reimbursement Personalized 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 Reimbursement Personalized in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Low bargaining power of suppliers
– Suppliers of Reimbursement Personalized in the sector have low bargaining power. Companion Diagnostics: Uncertainties for Approval and Reimbursement has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Reimbursement Personalized to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Reimbursement Personalized in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Effective Research and Development (R&D)
– Reimbursement Personalized has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Companion Diagnostics: Uncertainties for Approval and Reimbursement - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Reimbursement Personalized 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.
Weaknesses Companion Diagnostics: Uncertainties for Approval and Reimbursement | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Companion Diagnostics: Uncertainties for Approval and Reimbursement are -
High cash cycle compare to competitors
Reimbursement Personalized 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Reimbursement Personalized 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, Reimbursement Personalized 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.
Aligning sales with marketing
– It come across in the case study Companion Diagnostics: Uncertainties for Approval and Reimbursement 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement can leverage the sales team experience to cultivate customer relationships as Reimbursement Personalized is planning to shift buying processes online.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Companion Diagnostics: Uncertainties for Approval and Reimbursement, is just above the industry average. Reimbursement Personalized 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.
Low market penetration in new markets
– Outside its home market of Reimbursement Personalized, firm in the HBR case study Companion Diagnostics: Uncertainties for Approval and Reimbursement needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Companion Diagnostics: Uncertainties for Approval and Reimbursement HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Reimbursement Personalized has relatively successful track record of launching new products.
Products dominated business model
– Even though Reimbursement Personalized 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 - Companion Diagnostics: Uncertainties for Approval and Reimbursement should strive to include more intangible value offerings along with its core products and services.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Companion Diagnostics: Uncertainties for Approval and Reimbursement, it seems that the employees of Reimbursement Personalized don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Capital Spending Reduction
– Even during the low interest decade, Reimbursement Personalized 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.
Slow to strategic competitive environment developments
– As Companion Diagnostics: Uncertainties for Approval and Reimbursement HBR case study mentions - Reimbursement Personalized 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.
Opportunities Companion Diagnostics: Uncertainties for Approval and Reimbursement | 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement are -
Learning at scale
– Online learning technologies has now opened space for Reimbursement Personalized 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Reimbursement Personalized can use these opportunities to build new business models that can help the communities that Reimbursement Personalized operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Using analytics as competitive advantage
– Reimbursement Personalized 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Reimbursement Personalized to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Developing new processes and practices
– Reimbursement Personalized can develop new processes and procedures in Innovation & Entrepreneurship 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Reimbursement Personalized 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.
Building a culture of innovation
– managers at Reimbursement Personalized 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 Innovation & Entrepreneurship segment.
Manufacturing automation
– Reimbursement Personalized 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.
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. Reimbursement Personalized can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Reimbursement Personalized can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Reimbursement Personalized 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
– Reimbursement Personalized 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.
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. Reimbursement Personalized 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. Reimbursement Personalized 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.
Buying journey improvements
– Reimbursement Personalized can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Companion Diagnostics: Uncertainties for Approval and Reimbursement 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.
Threats Companion Diagnostics: Uncertainties for Approval and Reimbursement External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Companion Diagnostics: Uncertainties for Approval and Reimbursement 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. Reimbursement Personalized 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
– Reimbursement Personalized has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Reimbursement Personalized 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.
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.
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. Reimbursement Personalized 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.
Shortening product life cycle
– it is one of the major threat that Reimbursement Personalized is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Innovation & Entrepreneurship field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Reimbursement Personalized can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Regulatory challenges
– Reimbursement Personalized 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 Innovation & Entrepreneurship industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Reimbursement Personalized in the Innovation & Entrepreneurship industry. The Innovation & Entrepreneurship 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Companion Diagnostics: Uncertainties for Approval and Reimbursement, Reimbursement Personalized 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 .
Consumer confidence and its impact on Reimbursement Personalized 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.
Stagnating economy with rate increase
– Reimbursement Personalized 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.
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 Reimbursement Personalized in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Weighted SWOT Analysis of Companion Diagnostics: Uncertainties for Approval and Reimbursement 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement 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 Companion Diagnostics: Uncertainties for Approval and Reimbursement 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 Reimbursement Personalized needs to make to build a sustainable competitive advantage.