Hans Fritz at Novartis Thailand (A): The First Month SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Hans Fritz at Novartis Thailand (A): The First Month
Dr. Hans Fritz is 37 years old when he arrives in Bangkok on March 1, 1998 to assume his position as general manager of Novartis Thailand. Novartis is the world's largest pharmaceutical company. He had lobbied to transition from a staff position to this line management assignment. He encounters an organization in chaos, a demoralized staff, and a market in crisis. The case describes his first month in this new position. His most important task at this stage is to set priorities when everything needs to be done at once. He has to decide whom to trust on his team and what to do in the short, medium, and long term.
Swot Analysis of "Hans Fritz at Novartis Thailand (A): The First Month" written by Michael Y. Yoshino, Carin-Isabel Knoop includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Novartis Fritz facing as an external strategic factors. Some of the topics covered in Hans Fritz at Novartis Thailand (A): The First Month case study are - Strategic Management Strategies, Decision making, Growth strategy, International business, Leadership transitions, Mergers & acquisitions, Organizational structure, Workspaces and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Hans Fritz at Novartis Thailand (A): The First Month casestudy better are - – increasing energy prices, competitive advantages are harder to sustain because of technology dispersion, technology disruption, increasing transportation and logistics costs, there is backlash against globalization, increasing commodity prices, supply chains are disrupted by pandemic ,
geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Hans Fritz at Novartis Thailand (A): The First Month
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Hans Fritz at Novartis Thailand (A): The First Month case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Novartis Fritz, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Novartis Fritz 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 Hans Fritz at Novartis Thailand (A): The First Month can be done for the following purposes –
1. Strategic planning using facts provided in Hans Fritz at Novartis Thailand (A): The First Month case study
2. Improving business portfolio management of Novartis Fritz
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 Novartis Fritz
Strengths Hans Fritz at Novartis Thailand (A): The First Month | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Novartis Fritz in Hans Fritz at Novartis Thailand (A): The First Month Harvard Business Review case study are -
Highly skilled collaborators
– Novartis Fritz 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 Hans Fritz at Novartis Thailand (A): The First Month HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Digital Transformation in Leadership & Managing People segment
- digital transformation varies from industry to industry. For Novartis Fritz digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Novartis Fritz 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.
High brand equity
– Novartis Fritz has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Novartis Fritz to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Novartis Fritz in the sector have low bargaining power. Hans Fritz at Novartis Thailand (A): The First Month has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Novartis Fritz to manage not only supply disruptions but also source products at highly competitive prices.
Organizational Resilience of Novartis Fritz
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Novartis Fritz does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Leadership & Managing People industry
– Hans Fritz at Novartis Thailand (A): The First Month firm has clearly differentiated products in the market place. This has enabled Novartis Fritz to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Novartis Fritz to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Novartis Fritz is present in almost all the verticals within the industry. This has provided firm in Hans Fritz at Novartis Thailand (A): The First Month 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.
Training and development
– Novartis Fritz has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Hans Fritz at Novartis Thailand (A): The First Month 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.
Analytics focus
– Novartis Fritz 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 Michael Y. Yoshino, Carin-Isabel Knoop 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.
Successful track record of launching new products
– Novartis Fritz has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Novartis Fritz 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.
Innovation driven organization
– Novartis Fritz is one of the most innovative firm in sector. Manager in Hans Fritz at Novartis Thailand (A): The First Month Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Cross disciplinary teams
– Horizontal connected teams at the Novartis Fritz 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.
Weaknesses Hans Fritz at Novartis Thailand (A): The First Month | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Hans Fritz at Novartis Thailand (A): The First Month are -
High operating costs
– Compare to the competitors, firm in the HBR case study Hans Fritz at Novartis Thailand (A): The First Month 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 Novartis Fritz 's lucrative customers.
Interest costs
– Compare to the competition, Novartis Fritz 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.
Capital Spending Reduction
– Even during the low interest decade, Novartis Fritz 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.
Workers concerns about automation
– As automation is fast increasing in the segment, Novartis Fritz 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.
High cash cycle compare to competitors
Novartis Fritz 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.
Products dominated business model
– Even though Novartis Fritz 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 - Hans Fritz at Novartis Thailand (A): The First Month should strive to include more intangible value offerings along with its core products and services.
Low market penetration in new markets
– Outside its home market of Novartis Fritz, firm in the HBR case study Hans Fritz at Novartis Thailand (A): The First Month needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Increasing silos among functional specialists
– The organizational structure of Novartis Fritz is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Novartis Fritz needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Novartis Fritz to focus more on services rather than just following the product oriented approach.
Lack of clear differentiation of Novartis Fritz products
– To increase the profitability and margins on the products, Novartis Fritz needs to provide more differentiated products than what it is currently offering in the marketplace.
Slow decision making process
– As mentioned earlier in the report, Novartis Fritz 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. Novartis Fritz 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.
No frontier risks strategy
– After analyzing the HBR case study Hans Fritz at Novartis Thailand (A): The First Month, 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.
Opportunities Hans Fritz at Novartis Thailand (A): The First Month | 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 Hans Fritz at Novartis Thailand (A): The First Month are -
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Novartis Fritz 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 Novartis Fritz to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Novartis Fritz 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Leadership & Managing People industry, but it has also influenced the consumer preferences. Novartis Fritz 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. Novartis Fritz can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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. Novartis Fritz 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. Novartis Fritz 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
– Novartis Fritz 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 Hans Fritz at Novartis Thailand (A): The First Month - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Novartis Fritz to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Novartis Fritz 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.
Manufacturing automation
– Novartis Fritz can use the latest technology developments to improve its manufacturing and designing process in Leadership & Managing People 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.
Creating value in data economy
– The success of analytics program of Novartis Fritz has opened avenues for new revenue streams for the organization in the industry. This can help Novartis Fritz to build a more holistic ecosystem as suggested in the Hans Fritz at Novartis Thailand (A): The First Month case study. Novartis Fritz can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Novartis Fritz 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Novartis Fritz is facing challenges because of the dominance of functional experts in the organization. Hans Fritz at Novartis Thailand (A): The First Month 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.
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 Novartis Fritz 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.
Buying journey improvements
– Novartis Fritz can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Hans Fritz at Novartis Thailand (A): The First Month 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 Hans Fritz at Novartis Thailand (A): The First Month External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Hans Fritz at Novartis Thailand (A): The First Month are -
Increasing wage structure of Novartis Fritz
– 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 Novartis Fritz.
Environmental challenges
– Novartis Fritz 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. Novartis Fritz can take advantage of this fund but it will also bring new competitors in the Leadership & Managing People industry.
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.
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 Novartis Fritz business can come under increasing regulations regarding data privacy, data security, etc.
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 Novartis Fritz in the Leadership & Managing People sector and impact the bottomline of the organization.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Novartis Fritz with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Technology acceleration in Forth Industrial Revolution
– Novartis Fritz has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Novartis Fritz 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.
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. Novartis Fritz can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Consumer confidence and its impact on Novartis Fritz 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.
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. Novartis Fritz 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.
Regulatory challenges
– Novartis Fritz 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 Leadership & Managing People industry regulations.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Novartis Fritz 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.
Weighted SWOT Analysis of Hans Fritz at Novartis Thailand (A): The First Month 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 Hans Fritz at Novartis Thailand (A): The First Month 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 Hans Fritz at Novartis Thailand (A): The First Month 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 Hans Fritz at Novartis Thailand (A): The First Month 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 Hans Fritz at Novartis Thailand (A): The First Month 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 Novartis Fritz needs to make to build a sustainable competitive advantage.
