Case Study Description of Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged)
Describes a set of key strategic decisions facing the scientific founder and CEO of a promising, early stage bio-pharmaceuticals company. Should the company establish a proposed alliance with a pharmaceutical firm? Should it create a nutraceuticals business in parallel to its effort to develop anti-aging therapeutics? And, should it in-license a second drug development candidate?
Swot Analysis of "Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged)" written by Toby Stuart, James Webber includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Pharmaceuticals Nutraceuticals facing as an external strategic factors. Some of the topics covered in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) case study are - Strategic Management Strategies, Decision making, Entrepreneurship, Growth strategy, Leadership, Risk management and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) casestudy better are - – there is increasing trade war between United States & China, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, increasing transportation and logistics costs, digital marketing is dominated by two big players Facebook and Google, increasing inequality as vast percentage of new income is going to the top 1%, there is backlash against globalization,
increasing government debt because of Covid-19 spendings, technology disruption, etc
Introduction to SWOT Analysis of Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Pharmaceuticals Nutraceuticals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Pharmaceuticals Nutraceuticals 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) can be done for the following purposes –
1. Strategic planning using facts provided in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) case study
2. Improving business portfolio management of Pharmaceuticals Nutraceuticals
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 Pharmaceuticals Nutraceuticals
Strengths Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Pharmaceuticals Nutraceuticals in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) Harvard Business Review case study are -
High brand equity
– Pharmaceuticals Nutraceuticals has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Pharmaceuticals Nutraceuticals to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Cross disciplinary teams
– Horizontal connected teams at the Pharmaceuticals Nutraceuticals 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.
Innovation driven organization
– Pharmaceuticals Nutraceuticals is one of the most innovative firm in sector. Manager in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Pharmaceuticals Nutraceuticals 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.
Learning organization
- Pharmaceuticals Nutraceuticals 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 Pharmaceuticals Nutraceuticals is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Innovation & Entrepreneurship industry
– Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) firm has clearly differentiated products in the market place. This has enabled Pharmaceuticals Nutraceuticals to fetch slight price premium compare to the competitors in the Innovation & Entrepreneurship industry. The sustainable margins have also helped Pharmaceuticals Nutraceuticals to invest into research and development (R&D) and innovation.
Ability to lead change in Innovation & Entrepreneurship field
– Pharmaceuticals Nutraceuticals 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 Pharmaceuticals Nutraceuticals in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Effective Research and Development (R&D)
– Pharmaceuticals Nutraceuticals 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Analytics focus
– Pharmaceuticals Nutraceuticals 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 Toby Stuart, James Webber 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
– Pharmaceuticals Nutraceuticals is present in almost all the verticals within the industry. This has provided firm in Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 recruit top talent
– Pharmaceuticals Nutraceuticals is one of the leading recruiters in the industry. Managers in the Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Pharmaceuticals Nutraceuticals has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Pharmaceuticals Nutraceuticals 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.
Weaknesses Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) are -
No frontier risks strategy
– After analyzing the HBR case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged), it seems that company is thinking about the frontier risks that can impact Innovation & Entrepreneurship 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 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 Pharmaceuticals Nutraceuticals supply chain. Even after few cautionary changes mentioned in the HBR case study - Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Pharmaceuticals Nutraceuticals vulnerable to further global disruptions in South East Asia.
Aligning sales with marketing
– It come across in the case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) can leverage the sales team experience to cultivate customer relationships as Pharmaceuticals Nutraceuticals is planning to shift buying processes online.
Slow decision making process
– As mentioned earlier in the report, Pharmaceuticals Nutraceuticals 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. Pharmaceuticals Nutraceuticals 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 cash cycle compare to competitors
Pharmaceuticals Nutraceuticals 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged), in the dynamic environment Pharmaceuticals Nutraceuticals has struggled to respond to the nimble upstart competition. Pharmaceuticals Nutraceuticals has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Pharmaceuticals Nutraceuticals is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 dependence on star products
– The top 2 products and services of the firm as mentioned in the Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Pharmaceuticals Nutraceuticals has relatively successful track record of launching new products.
Workers concerns about automation
– As automation is fast increasing in the segment, Pharmaceuticals Nutraceuticals 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.
Low market penetration in new markets
– Outside its home market of Pharmaceuticals Nutraceuticals, firm in the HBR case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High bargaining power of channel partners
– Because of the regulatory requirements, Toby Stuart, James Webber suggests that, Pharmaceuticals Nutraceuticals 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) | 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) are -
Developing new processes and practices
– Pharmaceuticals Nutraceuticals 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Pharmaceuticals Nutraceuticals can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Pharmaceuticals Nutraceuticals 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Innovation & Entrepreneurship industry, but it has also influenced the consumer preferences. Pharmaceuticals Nutraceuticals can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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. Pharmaceuticals Nutraceuticals can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Pharmaceuticals Nutraceuticals in the consumer business. Now Pharmaceuticals Nutraceuticals 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, Pharmaceuticals Nutraceuticals can use these opportunities to build new business models that can help the communities that Pharmaceuticals Nutraceuticals operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
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 Pharmaceuticals Nutraceuticals 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Pharmaceuticals Nutraceuticals is facing challenges because of the dominance of functional experts in the organization. Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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.
Better consumer reach
– The expansion of the 5G network will help Pharmaceuticals Nutraceuticals to increase its market reach. Pharmaceuticals Nutraceuticals 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Pharmaceuticals Nutraceuticals 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 Pharmaceuticals Nutraceuticals to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Pharmaceuticals Nutraceuticals 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, Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged), 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
– Pharmaceuticals Nutraceuticals can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) are -
High dependence on third party suppliers
– Pharmaceuticals Nutraceuticals 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Pharmaceuticals Nutraceuticals 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) .
Technology acceleration in Forth Industrial Revolution
– Pharmaceuticals Nutraceuticals has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Pharmaceuticals Nutraceuticals 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.
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. Pharmaceuticals Nutraceuticals can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
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. Pharmaceuticals Nutraceuticals needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
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 Pharmaceuticals Nutraceuticals in the Innovation & Entrepreneurship sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged), Pharmaceuticals Nutraceuticals 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 .
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.
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. Pharmaceuticals Nutraceuticals 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.
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 Pharmaceuticals Nutraceuticals.
Environmental challenges
– Pharmaceuticals Nutraceuticals 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. Pharmaceuticals Nutraceuticals can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
Increasing wage structure of Pharmaceuticals Nutraceuticals
– 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 Pharmaceuticals Nutraceuticals.
Stagnating economy with rate increase
– Pharmaceuticals Nutraceuticals 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Sirtris Pharmaceuticals: Living Healthier, Longer (Abridged) 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 Pharmaceuticals Nutraceuticals needs to make to build a sustainable competitive advantage.
