Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version
Jan Eriksson is the country manager of the Indonesian joint venture of Basel-based Novartis (Novartis Indonesia), the world's largest pharmaceutical company, formed by the 1996 merger between Sandoz and Ciba-Geigy. The case describes the actions he has taken since assuming his post in May 1996. He was in the middle of merging the Indonesian operations of Sandoz and Ciba-Geigy when the financial crisis struck Indonesia. He has prepared two plans to deal with the crisis. In January 1996, headquarters had still not approved Erickssons' plans and he needs to decide how to proceed.
Swot Analysis of "Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version" written by Carin-Isabel Knoop, Anthony St. George includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Indonesian Novartis facing as an external strategic factors. Some of the topics covered in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version case study are - Strategic Management Strategies, Currency, International business, Joint ventures, Mergers & acquisitions, Recession and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version casestudy better are - – supply chains are disrupted by pandemic , technology disruption, there is increasing trade war between United States & China, increasing household debt because of falling income levels, customer relationship management is fast transforming because of increasing concerns over data privacy, geopolitical disruptions, increasing government debt because of Covid-19 spendings,
there is backlash against globalization, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Indonesian Novartis, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Indonesian Novartis 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version can be done for the following purposes –
1. Strategic planning using facts provided in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version case study
2. Improving business portfolio management of Indonesian Novartis
3. Assessing feasibility of the new initiative in Leadership & Managing People field.
4. Making a Leadership & Managing People topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Indonesian Novartis
Strengths Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Indonesian Novartis in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version Harvard Business Review case study are -
Innovation driven organization
– Indonesian Novartis is one of the most innovative firm in sector. Manager in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Ability to recruit top talent
– Indonesian Novartis is one of the leading recruiters in the industry. Managers in the Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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
– Indonesian Novartis has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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.
Successful track record of launching new products
– Indonesian Novartis has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Indonesian Novartis 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.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Indonesian Novartis digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Indonesian Novartis 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.
Diverse revenue streams
– Indonesian Novartis is present in almost all the verticals within the industry. This has provided firm in Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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.
Operational resilience
– The operational resilience strategy in the Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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.
Analytics focus
– Indonesian Novartis 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 Carin-Isabel Knoop, Anthony St. George 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.
Ability to lead change in Leadership & Managing People field
– Indonesian Novartis 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 Indonesian Novartis in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Superior customer experience
– The customer experience strategy of Indonesian Novartis in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Sustainable margins compare to other players in Leadership & Managing People industry
– Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version firm has clearly differentiated products in the market place. This has enabled Indonesian Novartis to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Indonesian Novartis to invest into research and development (R&D) and innovation.
Strong track record of project management
– Indonesian Novartis is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version are -
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Indonesian Novartis has relatively successful track record of launching new products.
Lack of clear differentiation of Indonesian Novartis products
– To increase the profitability and margins on the products, Indonesian Novartis needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– After analyzing the HBR case study Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version, it seems that company is thinking about the frontier risks that can impact Leadership & Managing People 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.
Slow to strategic competitive environment developments
– As Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version HBR case study mentions - Indonesian Novartis 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.
Interest costs
– Compare to the competition, Indonesian Novartis 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 bargaining power of channel partners
– Because of the regulatory requirements, Carin-Isabel Knoop, Anthony St. George suggests that, Indonesian Novartis 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.
Need for greater diversity
– Indonesian Novartis 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.
Low market penetration in new markets
– Outside its home market of Indonesian Novartis, firm in the HBR case study Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version, in the dynamic environment Indonesian Novartis has struggled to respond to the nimble upstart competition. Indonesian Novartis has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow decision making process
– As mentioned earlier in the report, Indonesian Novartis 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. Indonesian Novartis 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.
Capital Spending Reduction
– Even during the low interest decade, Indonesian Novartis 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.
Opportunities Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version | 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version are -
Learning at scale
– Online learning technologies has now opened space for Indonesian Novartis 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.
Developing new processes and practices
– Indonesian Novartis can develop new processes and procedures in Leadership & Managing People 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.
Loyalty marketing
– Indonesian Novartis 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Indonesian Novartis in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Leadership & Managing People segment, and it will provide faster access to the consumers.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Indonesian Novartis can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
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 Indonesian Novartis in the consumer business. Now Indonesian Novartis can target international markets with far fewer capital restrictions requirements than the existing system.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Indonesian Novartis 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, Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Changes in consumer behavior post Covid-19
– Consumer behavior has changed in the Leadership & Managing People industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Indonesian Novartis 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. Indonesian Novartis 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.
Using analytics as competitive advantage
– Indonesian Novartis 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Indonesian Novartis to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Better consumer reach
– The expansion of the 5G network will help Indonesian Novartis to increase its market reach. Indonesian Novartis 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 Indonesian Novartis 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 Indonesian Novartis to hire the very best people irrespective of their geographical location.
Buying journey improvements
– Indonesian Novartis can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Indonesian Novartis can use these opportunities to build new business models that can help the communities that Indonesian Novartis operates in. Secondly it can use opportunities from government spending in Leadership & Managing People sector.
Threats Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Indonesian Novartis business can come under increasing regulations regarding data privacy, data security, etc.
Technology acceleration in Forth Industrial Revolution
– Indonesian Novartis has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Indonesian Novartis needs to keep up with the evolution of technology in the Leadership & Managing People 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Indonesian Novartis with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
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. Indonesian Novartis 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Indonesian Novartis 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version .
Shortening product life cycle
– it is one of the major threat that Indonesian Novartis is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Indonesian Novartis 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.
Easy access to finance
– Easy access to finance in Leadership & Managing People field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Indonesian Novartis can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version, Indonesian Novartis may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Leadership & Managing People .
Increasing wage structure of Indonesian Novartis
– 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 Indonesian Novartis.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Indonesian Novartis in the Leadership & Managing People industry. The Leadership & Managing People 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.
Stagnating economy with rate increase
– Indonesian Novartis 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.
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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Jan Eriksson at Novartis Indonesia: Turmoil in the Indonesian Pharmaceutical Industry, Spanish Version 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 Indonesian Novartis needs to make to build a sustainable competitive advantage.
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