Digital Transformation at Novartis to Improve Customer Engagement SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Leadership & Managing People
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Digital Transformation at Novartis to Improve Customer Engagement
The pharmaceutical industry was under siege, with regular price rollbacks and the powerful advance of generics frequently making news headlines. Many of the industry's leading companies, including Novartis, were cutting their sales forces, while sales representatives who still had jobs felt increasingly disengaged. David Epstein, the head of Novartis's Pharmaceuticals division, bucked the trend. He introduced a strategic initiative that aimed to fundamentally transform Novartis' selling model. Epstein committed to an aspirational goal of equipping 80% of the company's field forces worldwide with the latest iPad technology by the end of 2012, in just 15 months. A few months later, he set his teams an even more ambitious challenge: to equip 100% of the sales force by the end of 2013, which meant rolling out 25,000 new devices across the globe within a two-year period. Novartis was about to embark on a digital transformation journey, with the ultimate goal of providing the right drug to the right patient at the right time.
Swot Analysis of "Digital Transformation at Novartis to Improve Customer Engagement" written by Donald A. Marchand, Polina Bochukova includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Novartis Epstein facing as an external strategic factors. Some of the topics covered in Digital Transformation at Novartis to Improve Customer Engagement case study are - Strategic Management Strategies, Customers, Sales and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Digital Transformation at Novartis to Improve Customer Engagement casestudy better are - – increasing transportation and logistics costs, there is backlash against globalization, digital marketing is dominated by two big players Facebook and Google, increasing commodity prices, banking and financial system is disrupted by Bitcoin and other crypto currencies, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels,
increasing government debt because of Covid-19 spendings, increasing inequality as vast percentage of new income is going to the top 1%, etc
Introduction to SWOT Analysis of Digital Transformation at Novartis to Improve Customer Engagement
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Digital Transformation at Novartis to Improve Customer Engagement case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Novartis Epstein, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Novartis Epstein 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 Digital Transformation at Novartis to Improve Customer Engagement can be done for the following purposes –
1. Strategic planning using facts provided in Digital Transformation at Novartis to Improve Customer Engagement case study
2. Improving business portfolio management of Novartis Epstein
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 Epstein
Strengths Digital Transformation at Novartis to Improve Customer Engagement | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Novartis Epstein in Digital Transformation at Novartis to Improve Customer Engagement Harvard Business Review case study are -
Strong track record of project management
– Novartis Epstein is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Superior customer experience
– The customer experience strategy of Novartis Epstein in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Novartis Epstein is present in almost all the verticals within the industry. This has provided firm in Digital Transformation at Novartis to Improve Customer Engagement 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.
Effective Research and Development (R&D)
– Novartis Epstein 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 Digital Transformation at Novartis to Improve Customer Engagement - 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
– Novartis Epstein 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 Donald A. Marchand, Polina Bochukova 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.
Sustainable margins compare to other players in Leadership & Managing People industry
– Digital Transformation at Novartis to Improve Customer Engagement firm has clearly differentiated products in the market place. This has enabled Novartis Epstein to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Novartis Epstein to invest into research and development (R&D) and innovation.
High switching costs
– The high switching costs that Novartis Epstein 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
- Novartis Epstein 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 Novartis Epstein is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Digital Transformation at Novartis to Improve Customer Engagement Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Innovation driven organization
– Novartis Epstein is one of the most innovative firm in sector. Manager in Digital Transformation at Novartis to Improve Customer Engagement Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High brand equity
– Novartis Epstein has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Novartis Epstein to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Organizational Resilience of Novartis Epstein
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Novartis Epstein does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Training and development
– Novartis Epstein has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Digital Transformation at Novartis to Improve Customer Engagement 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 Digital Transformation at Novartis to Improve Customer Engagement | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Digital Transformation at Novartis to Improve Customer Engagement are -
Interest costs
– Compare to the competition, Novartis Epstein 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 operating costs
– Compare to the competitors, firm in the HBR case study Digital Transformation at Novartis to Improve Customer Engagement 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 Epstein 's lucrative customers.
Slow to strategic competitive environment developments
– As Digital Transformation at Novartis to Improve Customer Engagement HBR case study mentions - Novartis Epstein 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.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Digital Transformation at Novartis to Improve Customer Engagement, in the dynamic environment Novartis Epstein has struggled to respond to the nimble upstart competition. Novartis Epstein has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Skills based hiring
– The stress on hiring functional specialists at Novartis Epstein 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.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Digital Transformation at Novartis to Improve Customer Engagement 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 Novartis Epstein has relatively successful track record of launching new products.
Slow decision making process
– As mentioned earlier in the report, Novartis Epstein 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 Epstein 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.
Products dominated business model
– Even though Novartis Epstein 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 - Digital Transformation at Novartis to Improve Customer Engagement should strive to include more intangible value offerings along with its core products and services.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Novartis Epstein is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Digital Transformation at Novartis to Improve Customer Engagement 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 cash cycle compare to competitors
Novartis Epstein 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.
Increasing silos among functional specialists
– The organizational structure of Novartis Epstein is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Novartis Epstein needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Novartis Epstein to focus more on services rather than just following the product oriented approach.
Opportunities Digital Transformation at Novartis to Improve Customer Engagement | 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 Digital Transformation at Novartis to Improve Customer Engagement are -
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 Epstein 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 Epstein can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Buying journey improvements
– Novartis Epstein can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Digital Transformation at Novartis to Improve Customer Engagement 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.
Using analytics as competitive advantage
– Novartis Epstein 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 Digital Transformation at Novartis to Improve Customer Engagement - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Novartis Epstein 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 Novartis Epstein to increase its market reach. Novartis Epstein 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.
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 Epstein can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Building a culture of innovation
– managers at Novartis Epstein can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Leadership & Managing People segment.
Leveraging digital technologies
– Novartis Epstein 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.
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 Epstein can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
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 Epstein 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, Novartis Epstein is facing challenges because of the dominance of functional experts in the organization. Digital Transformation at Novartis to Improve Customer Engagement 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Novartis Epstein 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Novartis Epstein 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 Epstein 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, Novartis Epstein 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, Digital Transformation at Novartis to Improve Customer Engagement, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Digital Transformation at Novartis to Improve Customer Engagement External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Digital Transformation at Novartis to Improve Customer Engagement are -
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 Epstein in the Leadership & Managing People sector and impact the bottomline of the organization.
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 Novartis Epstein.
Stagnating economy with rate increase
– Novartis Epstein 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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Digital Transformation at Novartis to Improve Customer Engagement, Novartis Epstein 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 .
Regulatory challenges
– Novartis Epstein 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.
Technology acceleration in Forth Industrial Revolution
– Novartis Epstein 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 Epstein 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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Novartis Epstein 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.
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 Epstein will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Shortening product life cycle
– it is one of the major threat that Novartis Epstein is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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. Novartis Epstein needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
High dependence on third party suppliers
– Novartis Epstein 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 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.
Consumer confidence and its impact on Novartis Epstein 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.
Weighted SWOT Analysis of Digital Transformation at Novartis to Improve Customer Engagement 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 Digital Transformation at Novartis to Improve Customer Engagement 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 Digital Transformation at Novartis to Improve Customer Engagement 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 Digital Transformation at Novartis to Improve Customer Engagement 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 Digital Transformation at Novartis to Improve Customer Engagement 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 Epstein needs to make to build a sustainable competitive advantage.
