Case Study Description of Zoetis, Pfizer's Animal Health Spin-Off (B)
This case illustrates different growth strategies in the pharmaceutical industry. R&D management is a critical component of growth strategies, and the case demonstrates the importance of using a holistic framework for R&D when expanding the firm's business footprint. The case serves the purpose of comparing organic and inorganic growth strategies, and identifying the steps that are critical for the execution of these strategies.
Authors :: Shantanu Bhattacharya, Sjiva De Meester, Sameer Hasija
Swot Analysis of "Zoetis, Pfizer's Animal Health Spin-Off (B)" written by Shantanu Bhattacharya, Sjiva De Meester, Sameer Hasija includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Strategies Zoetis facing as an external strategic factors. Some of the topics covered in Zoetis, Pfizer's Animal Health Spin-Off (B) case study are - Strategic Management Strategies, Research & development, Supply chain and Leadership & Managing People.
Some of the macro environment factors that can be used to understand the Zoetis, Pfizer's Animal Health Spin-Off (B) casestudy better are - – there is backlash against globalization, central banks are concerned over increasing inflation, digital marketing is dominated by two big players Facebook and Google, there is increasing trade war between United States & China, increasing commodity prices, competitive advantages are harder to sustain because of technology dispersion, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing transportation and logistics costs, challanges to central banks by blockchain based private currencies, etc
Introduction to SWOT Analysis of Zoetis, Pfizer's Animal Health Spin-Off (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Zoetis, Pfizer's Animal Health Spin-Off (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Strategies Zoetis, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Strategies Zoetis 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 Zoetis, Pfizer's Animal Health Spin-Off (B) can be done for the following purposes –
1. Strategic planning using facts provided in Zoetis, Pfizer's Animal Health Spin-Off (B) case study
2. Improving business portfolio management of Strategies Zoetis
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 Strategies Zoetis
Strengths Zoetis, Pfizer's Animal Health Spin-Off (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Strategies Zoetis in Zoetis, Pfizer's Animal Health Spin-Off (B) Harvard Business Review case study are -
Innovation driven organization
– Strategies Zoetis is one of the most innovative firm in sector. Manager in Zoetis, Pfizer's Animal Health Spin-Off (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Training and development
– Strategies Zoetis has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Zoetis, Pfizer's Animal Health Spin-Off (B) 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.
Operational resilience
– The operational resilience strategy in the Zoetis, Pfizer's Animal Health Spin-Off (B) 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.
High brand equity
– Strategies Zoetis has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Strategies Zoetis to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Effective Research and Development (R&D)
– Strategies Zoetis 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 Zoetis, Pfizer's Animal Health Spin-Off (B) - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Sustainable margins compare to other players in Leadership & Managing People industry
– Zoetis, Pfizer's Animal Health Spin-Off (B) firm has clearly differentiated products in the market place. This has enabled Strategies Zoetis to fetch slight price premium compare to the competitors in the Leadership & Managing People industry. The sustainable margins have also helped Strategies Zoetis to invest into research and development (R&D) and innovation.
Strong track record of project management
– Strategies Zoetis is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Diverse revenue streams
– Strategies Zoetis is present in almost all the verticals within the industry. This has provided firm in Zoetis, Pfizer's Animal Health Spin-Off (B) 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.
High switching costs
– The high switching costs that Strategies Zoetis 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.
Low bargaining power of suppliers
– Suppliers of Strategies Zoetis in the sector have low bargaining power. Zoetis, Pfizer's Animal Health Spin-Off (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Strategies Zoetis to manage not only supply disruptions but also source products at highly competitive prices.
Ability to lead change in Leadership & Managing People field
– Strategies Zoetis 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 Strategies Zoetis 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 Strategies Zoetis in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Zoetis, Pfizer's Animal Health Spin-Off (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Zoetis, Pfizer's Animal Health Spin-Off (B) are -
Increasing silos among functional specialists
– The organizational structure of Strategies Zoetis is dominated by functional specialists. It is not different from other players in the Leadership & Managing People segment. Strategies Zoetis needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Strategies Zoetis to focus more on services rather than just following the product oriented approach.
Need for greater diversity
– Strategies Zoetis 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Strategies Zoetis is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Zoetis, Pfizer's Animal Health Spin-Off (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
High dependence on 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 Strategies Zoetis supply chain. Even after few cautionary changes mentioned in the HBR case study - Zoetis, Pfizer's Animal Health Spin-Off (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Strategies Zoetis vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the segment, Strategies Zoetis 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.
Aligning sales with marketing
– It come across in the case study Zoetis, Pfizer's Animal Health Spin-Off (B) 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 Zoetis, Pfizer's Animal Health Spin-Off (B) can leverage the sales team experience to cultivate customer relationships as Strategies Zoetis is planning to shift buying processes online.
Lack of clear differentiation of Strategies Zoetis products
– To increase the profitability and margins on the products, Strategies Zoetis 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 Zoetis, Pfizer's Animal Health Spin-Off (B), 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.
High cash cycle compare to competitors
Strategies Zoetis 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.
Skills based hiring
– The stress on hiring functional specialists at Strategies Zoetis 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.
Slow decision making process
– As mentioned earlier in the report, Strategies Zoetis 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. Strategies Zoetis 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.
Opportunities Zoetis, Pfizer's Animal Health Spin-Off (B) | 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 Zoetis, Pfizer's Animal Health Spin-Off (B) are -
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Strategies Zoetis 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, Zoetis, Pfizer's Animal Health Spin-Off (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Strategies Zoetis 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.
Developing new processes and practices
– Strategies Zoetis 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.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Strategies Zoetis 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 Strategies Zoetis to hire the very best people irrespective of their geographical location.
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 Strategies Zoetis in the consumer business. Now Strategies Zoetis can target international markets with far fewer capital restrictions requirements than the existing system.
Using analytics as competitive advantage
– Strategies Zoetis 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 Zoetis, Pfizer's Animal Health Spin-Off (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Strategies Zoetis to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– Strategies Zoetis 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.
Buying journey improvements
– Strategies Zoetis can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Zoetis, Pfizer's Animal Health Spin-Off (B) 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.
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. Strategies Zoetis 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. Strategies Zoetis 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.
Creating value in data economy
– The success of analytics program of Strategies Zoetis has opened avenues for new revenue streams for the organization in the industry. This can help Strategies Zoetis to build a more holistic ecosystem as suggested in the Zoetis, Pfizer's Animal Health Spin-Off (B) case study. Strategies Zoetis can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Strategies Zoetis can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Leveraging digital technologies
– Strategies Zoetis 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.
Better consumer reach
– The expansion of the 5G network will help Strategies Zoetis to increase its market reach. Strategies Zoetis 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.
Threats Zoetis, Pfizer's Animal Health Spin-Off (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Zoetis, Pfizer's Animal Health Spin-Off (B) are -
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. Strategies Zoetis can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Strategies Zoetis 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 Zoetis, Pfizer's Animal Health Spin-Off (B) .
Technology acceleration in Forth Industrial Revolution
– Strategies Zoetis has witnessed rapid integration of technology during Covid-19 in the Leadership & Managing People industry. As one of the leading players in the industry, Strategies Zoetis 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.
Regulatory challenges
– Strategies Zoetis 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.
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. Strategies Zoetis needs to understand the core reasons impacting the Leadership & Managing People industry. This will help it in building a better workplace.
Consumer confidence and its impact on Strategies Zoetis 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.
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. Strategies Zoetis 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 wage structure of Strategies Zoetis
– 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 Strategies Zoetis.
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 Strategies Zoetis in the Leadership & Managing People sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Strategies Zoetis is facing in Leadership & Managing People sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Zoetis, Pfizer's Animal Health Spin-Off (B), Strategies Zoetis 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 .
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 Zoetis, Pfizer's Animal Health Spin-Off (B) 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 Zoetis, Pfizer's Animal Health Spin-Off (B) 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 Zoetis, Pfizer's Animal Health Spin-Off (B) 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 Zoetis, Pfizer's Animal Health Spin-Off (B) 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 Zoetis, Pfizer's Animal Health Spin-Off (B) 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 Strategies Zoetis needs to make to build a sustainable competitive advantage.