AstraZeneca: Transforming How New Medicines Flow to Patients SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Innovation & Entrepreneurship
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of AstraZeneca: Transforming How New Medicines Flow to Patients
David Brennan, CEO of AstraZeneca UK Limited (AZN), was passionate about bringing new medicines to patients. But the industry was transforming to one that featured less patent protection, more competition from generic drugs, stiffer government regulations, and decreased productivity in R&D. The strategy? Build a pipeline with new prescription drugs that were unique enough to provide a differentiated benefit to patients, grow the business globally, streamline the organization and increase efficiency, and build a culture of courage, creativity, and collaboration. Would the firm be able to provide a sustainable and consistent pipeline of new products-at lower cost, likely with fewer people? How might the firm average two new products to market each year? What areas of R&D should the company invest in, and what would the R&D transformation look like?
Swot Analysis of "AstraZeneca: Transforming How New Medicines Flow to Patients" written by Scott Snell, Gerry Yemen includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Astrazeneca Patients facing as an external strategic factors. Some of the topics covered in AstraZeneca: Transforming How New Medicines Flow to Patients case study are - Strategic Management Strategies, Strategy and Innovation & Entrepreneurship.
Some of the macro environment factors that can be used to understand the AstraZeneca: Transforming How New Medicines Flow to Patients casestudy better are - – increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, there is backlash against globalization, increasing government debt because of Covid-19 spendings, increasing household debt because of falling income levels, central banks are concerned over increasing inflation, technology disruption,
increasing inequality as vast percentage of new income is going to the top 1%, customer relationship management is fast transforming because of increasing concerns over data privacy, etc
Introduction to SWOT Analysis of AstraZeneca: Transforming How New Medicines Flow to Patients
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in AstraZeneca: Transforming How New Medicines Flow to Patients case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Astrazeneca Patients, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Astrazeneca Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients can be done for the following purposes –
1. Strategic planning using facts provided in AstraZeneca: Transforming How New Medicines Flow to Patients case study
2. Improving business portfolio management of Astrazeneca Patients
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 Astrazeneca Patients
Strengths AstraZeneca: Transforming How New Medicines Flow to Patients | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Astrazeneca Patients in AstraZeneca: Transforming How New Medicines Flow to Patients Harvard Business Review case study are -
Operational resilience
– The operational resilience strategy in the AstraZeneca: Transforming How New Medicines Flow to Patients 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.
Superior customer experience
– The customer experience strategy of Astrazeneca Patients in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Innovation & Entrepreneurship field
– Astrazeneca Patients 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 Astrazeneca Patients in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Organizational Resilience of Astrazeneca Patients
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Astrazeneca Patients does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Astrazeneca Patients is one of the most innovative firm in sector. Manager in AstraZeneca: Transforming How New Medicines Flow to Patients Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Astrazeneca Patients 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 Astrazeneca Patients is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in AstraZeneca: Transforming How New Medicines Flow to Patients Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High switching costs
– The high switching costs that Astrazeneca Patients has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Digital Transformation in Innovation & Entrepreneurship segment
- digital transformation varies from industry to industry. For Astrazeneca Patients digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Astrazeneca Patients 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.
Effective Research and Development (R&D)
– Astrazeneca Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Diverse revenue streams
– Astrazeneca Patients is present in almost all the verticals within the industry. This has provided firm in AstraZeneca: Transforming How New Medicines Flow to Patients 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
– Astrazeneca Patients is one of the leading recruiters in the industry. Managers in the AstraZeneca: Transforming How New Medicines Flow to Patients are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Training and development
– Astrazeneca Patients has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in AstraZeneca: Transforming How New Medicines Flow to Patients Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Weaknesses AstraZeneca: Transforming How New Medicines Flow to Patients | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AstraZeneca: Transforming How New Medicines Flow to Patients are -
Slow decision making process
– As mentioned earlier in the report, Astrazeneca Patients 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. Astrazeneca Patients 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.
Increasing silos among functional specialists
– The organizational structure of Astrazeneca Patients is dominated by functional specialists. It is not different from other players in the Innovation & Entrepreneurship segment. Astrazeneca Patients needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Astrazeneca Patients to focus more on services rather than just following the product oriented approach.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study AstraZeneca: Transforming How New Medicines Flow to Patients, is just above the industry average. Astrazeneca Patients 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.
Products dominated business model
– Even though Astrazeneca Patients 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 - AstraZeneca: Transforming How New Medicines Flow to Patients should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As AstraZeneca: Transforming How New Medicines Flow to Patients HBR case study mentions - Astrazeneca Patients 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.
Aligning sales with marketing
– It come across in the case study AstraZeneca: Transforming How New Medicines Flow to Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients can leverage the sales team experience to cultivate customer relationships as Astrazeneca Patients is planning to shift buying processes online.
Skills based hiring
– The stress on hiring functional specialists at Astrazeneca Patients 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.
Interest costs
– Compare to the competition, Astrazeneca Patients 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 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 Astrazeneca Patients supply chain. Even after few cautionary changes mentioned in the HBR case study - AstraZeneca: Transforming How New Medicines Flow to Patients, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Astrazeneca Patients vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study AstraZeneca: Transforming How New Medicines Flow to Patients 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 Astrazeneca Patients 's lucrative customers.
High cash cycle compare to competitors
Astrazeneca Patients 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.
Opportunities AstraZeneca: Transforming How New Medicines Flow to Patients | 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 AstraZeneca: Transforming How New Medicines Flow to Patients are -
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 Astrazeneca Patients 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.
Using analytics as competitive advantage
– Astrazeneca Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Astrazeneca Patients 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
– Astrazeneca Patients 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, Astrazeneca Patients 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.
Leveraging digital technologies
– Astrazeneca Patients 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Astrazeneca Patients 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, AstraZeneca: Transforming How New Medicines Flow to Patients, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Manufacturing automation
– Astrazeneca Patients 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.
Learning at scale
– Online learning technologies has now opened space for Astrazeneca Patients 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.
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. Astrazeneca Patients 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. Astrazeneca Patients 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.
Loyalty marketing
– Astrazeneca Patients 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.
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. Astrazeneca Patients can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Astrazeneca Patients is facing challenges because of the dominance of functional experts in the organization. AstraZeneca: Transforming How New Medicines Flow to Patients 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Astrazeneca Patients can use these opportunities to build new business models that can help the communities that Astrazeneca Patients operates in. Secondly it can use opportunities from government spending in Innovation & Entrepreneurship sector.
Threats AstraZeneca: Transforming How New Medicines Flow to Patients External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study AstraZeneca: Transforming How New Medicines Flow to Patients are -
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 Astrazeneca Patients business can come under increasing regulations regarding data privacy, data security, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Astrazeneca Patients with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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 Astrazeneca Patients.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study AstraZeneca: Transforming How New Medicines Flow to Patients, Astrazeneca Patients 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 Astrazeneca Patients 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Astrazeneca Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients .
Environmental challenges
– Astrazeneca Patients 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. Astrazeneca Patients can take advantage of this fund but it will also bring new competitors in the Innovation & Entrepreneurship industry.
High dependence on third party suppliers
– Astrazeneca Patients 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.
Technology acceleration in Forth Industrial Revolution
– Astrazeneca Patients has witnessed rapid integration of technology during Covid-19 in the Innovation & Entrepreneurship industry. As one of the leading players in the industry, Astrazeneca Patients 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.
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. Astrazeneca Patients needs to understand the core reasons impacting the Innovation & Entrepreneurship industry. This will help it in building a better workplace.
Shortening product life cycle
– it is one of the major threat that Astrazeneca Patients is facing in Innovation & Entrepreneurship sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Astrazeneca Patients 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.
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.
Weighted SWOT Analysis of AstraZeneca: Transforming How New Medicines Flow to Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients 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 AstraZeneca: Transforming How New Medicines Flow to Patients 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 Astrazeneca Patients needs to make to build a sustainable competitive advantage.