Remicade/Simponi: Confidential Instructions for Johnson & Johnson SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
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Case Study Description of Remicade/Simponi: Confidential Instructions for Johnson & Johnson
This two-party negotiation exercise features a real-life dispute between Merck and Johnson & Johnson regarding European distribution rights to two highly lucrative drugs.
Swot Analysis of "Remicade/Simponi: Confidential Instructions for Johnson & Johnson" written by Guhan Subramanian, Rhea Ghosh includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Johnson Simponi facing as an external strategic factors. Some of the topics covered in Remicade/Simponi: Confidential Instructions for Johnson & Johnson case study are - Strategic Management Strategies, Growth strategy, Managing uncertainty, Negotiations, Pricing, Risk management and Communication.
Some of the macro environment factors that can be used to understand the Remicade/Simponi: Confidential Instructions for Johnson & Johnson casestudy better are - – increasing inequality as vast percentage of new income is going to the top 1%, supply chains are disrupted by pandemic , increasing household debt because of falling income levels, increasing commodity prices, digital marketing is dominated by two big players Facebook and Google, talent flight as more people leaving formal jobs, customer relationship management is fast transforming because of increasing concerns over data privacy,
increasing transportation and logistics costs, geopolitical disruptions, etc
Introduction to SWOT Analysis of Remicade/Simponi: Confidential Instructions for Johnson & Johnson
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Remicade/Simponi: Confidential Instructions for Johnson & Johnson case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Johnson Simponi, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Johnson Simponi 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson can be done for the following purposes –
1. Strategic planning using facts provided in Remicade/Simponi: Confidential Instructions for Johnson & Johnson case study
2. Improving business portfolio management of Johnson Simponi
3. Assessing feasibility of the new initiative in Communication field.
4. Making a Communication topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Johnson Simponi
Strengths Remicade/Simponi: Confidential Instructions for Johnson & Johnson | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Johnson Simponi in Remicade/Simponi: Confidential Instructions for Johnson & Johnson Harvard Business Review case study are -
Ability to lead change in Communication field
– Johnson Simponi 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 Johnson Simponi in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Johnson Simponi has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Johnson Simponi 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
– Johnson Simponi is one of the most innovative firm in sector. Manager in Remicade/Simponi: Confidential Instructions for Johnson & Johnson Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Organizational Resilience of Johnson Simponi
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Johnson Simponi does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
High switching costs
– The high switching costs that Johnson Simponi 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.
Sustainable margins compare to other players in Communication industry
– Remicade/Simponi: Confidential Instructions for Johnson & Johnson firm has clearly differentiated products in the market place. This has enabled Johnson Simponi to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Johnson Simponi to invest into research and development (R&D) and innovation.
Diverse revenue streams
– Johnson Simponi is present in almost all the verticals within the industry. This has provided firm in Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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.
Cross disciplinary teams
– Horizontal connected teams at the Johnson Simponi 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.
Highly skilled collaborators
– Johnson Simponi 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Ability to recruit top talent
– Johnson Simponi is one of the leading recruiters in the industry. Managers in the Remicade/Simponi: Confidential Instructions for Johnson & Johnson are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Strong track record of project management
– Johnson Simponi is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Learning organization
- Johnson Simponi 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 Johnson Simponi is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Remicade/Simponi: Confidential Instructions for Johnson & Johnson Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Weaknesses Remicade/Simponi: Confidential Instructions for Johnson & Johnson | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Remicade/Simponi: Confidential Instructions for Johnson & Johnson are -
Skills based hiring
– The stress on hiring functional specialists at Johnson Simponi 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 to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Johnson Simponi is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 star products
– The top 2 products and services of the firm as mentioned in the Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Johnson Simponi has relatively successful track record of launching new products.
Lack of clear differentiation of Johnson Simponi products
– To increase the profitability and margins on the products, Johnson Simponi needs to provide more differentiated products than what it is currently offering in the marketplace.
Aligning sales with marketing
– It come across in the case study Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson can leverage the sales team experience to cultivate customer relationships as Johnson Simponi is planning to shift buying processes online.
Products dominated business model
– Even though Johnson Simponi 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 - Remicade/Simponi: Confidential Instructions for Johnson & Johnson should strive to include more intangible value offerings along with its core products and services.
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 Johnson Simponi supply chain. Even after few cautionary changes mentioned in the HBR case study - Remicade/Simponi: Confidential Instructions for Johnson & Johnson, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Johnson Simponi vulnerable to further global disruptions in South East Asia.
High operating costs
– Compare to the competitors, firm in the HBR case study Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Johnson Simponi 's lucrative customers.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Remicade/Simponi: Confidential Instructions for Johnson & Johnson, is just above the industry average. Johnson Simponi needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Interest costs
– Compare to the competition, Johnson Simponi 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, Johnson Simponi 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson | 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson are -
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Johnson Simponi can use these opportunities to build new business models that can help the communities that Johnson Simponi operates in. Secondly it can use opportunities from government spending in Communication sector.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Johnson Simponi can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Low interest rates
– Even though inflation is raising its head in most developed economies, Johnson Simponi can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Using analytics as competitive advantage
– Johnson Simponi 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Johnson Simponi to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Johnson Simponi 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, Remicade/Simponi: Confidential Instructions for Johnson & Johnson, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Johnson Simponi 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.
Creating value in data economy
– The success of analytics program of Johnson Simponi has opened avenues for new revenue streams for the organization in the industry. This can help Johnson Simponi to build a more holistic ecosystem as suggested in the Remicade/Simponi: Confidential Instructions for Johnson & Johnson case study. Johnson Simponi can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Johnson Simponi 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 Johnson Simponi to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Johnson Simponi in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Communication segment, and it will provide faster access to the consumers.
Leveraging digital technologies
– Johnson Simponi 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
– Johnson Simponi can use the latest technology developments to improve its manufacturing and designing process in Communication 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Johnson Simponi is facing challenges because of the dominance of functional experts in the organization. Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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.
Loyalty marketing
– Johnson Simponi 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.
Threats Remicade/Simponi: Confidential Instructions for Johnson & Johnson External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Remicade/Simponi: Confidential Instructions for Johnson & Johnson are -
Environmental challenges
– Johnson Simponi 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. Johnson Simponi can take advantage of this fund but it will also bring new competitors in the Communication industry.
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 Johnson Simponi business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Johnson Simponi
– 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 Johnson Simponi.
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. Johnson Simponi 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.
Consumer confidence and its impact on Johnson Simponi 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.
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 Johnson Simponi.
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 Johnson Simponi in the Communication sector and impact the bottomline of the organization.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Johnson Simponi in the Communication industry. The Communication 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.
Shortening product life cycle
– it is one of the major threat that Johnson Simponi is facing in Communication sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Johnson Simponi 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.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Johnson Simponi 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson .
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Remicade/Simponi: Confidential Instructions for Johnson & Johnson, Johnson Simponi may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Communication .
Technology acceleration in Forth Industrial Revolution
– Johnson Simponi has witnessed rapid integration of technology during Covid-19 in the Communication industry. As one of the leading players in the industry, Johnson Simponi needs to keep up with the evolution of technology in the Communication 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.
Weighted SWOT Analysis of Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Remicade/Simponi: Confidential Instructions for Johnson & Johnson 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 Johnson Simponi needs to make to build a sustainable competitive advantage.