Express Scripts: Promoting Prescription Drug Home Delivery (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Communication
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Express Scripts: Promoting Prescription Drug Home Delivery (B)
The pharmacy benefit manager (PBM) sector processes prescription drug claims on behalf of companies that offer a prescription drug benefit to their employees. This case follows Bob Nease, Chief Scientist at Express Scripts, as he considers methods to promote home delivery of prescription drugs by mail-a process proven to lower prescription fill error rates, increase cost savings, and improve medication adherence.
Authors :: John Beshears, Patrick Rooney, Jenny Sanford
Swot Analysis of "Express Scripts: Promoting Prescription Drug Home Delivery (B)" written by John Beshears, Patrick Rooney, Jenny Sanford includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Prescription Scripts facing as an external strategic factors. Some of the topics covered in Express Scripts: Promoting Prescription Drug Home Delivery (B) case study are - Strategic Management Strategies, Compensation, Decision making, Personnel policies, Supply chain and Communication.
Some of the macro environment factors that can be used to understand the Express Scripts: Promoting Prescription Drug Home Delivery (B) casestudy better are - – geopolitical disruptions, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, increasing household debt because of falling income levels, increasing energy prices, challanges to central banks by blockchain based private currencies, increasing inequality as vast percentage of new income is going to the top 1%,
there is increasing trade war between United States & China, wage bills are increasing, etc
Introduction to SWOT Analysis of Express Scripts: Promoting Prescription Drug Home Delivery (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Express Scripts: Promoting Prescription Drug Home Delivery (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Prescription Scripts, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Prescription Scripts 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 Express Scripts: Promoting Prescription Drug Home Delivery (B) can be done for the following purposes –
1. Strategic planning using facts provided in Express Scripts: Promoting Prescription Drug Home Delivery (B) case study
2. Improving business portfolio management of Prescription Scripts
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 Prescription Scripts
Strengths Express Scripts: Promoting Prescription Drug Home Delivery (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Prescription Scripts in Express Scripts: Promoting Prescription Drug Home Delivery (B) Harvard Business Review case study are -
Diverse revenue streams
– Prescription Scripts is present in almost all the verticals within the industry. This has provided firm in Express Scripts: Promoting Prescription Drug Home Delivery (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.
Strong track record of project management
– Prescription Scripts is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Training and development
– Prescription Scripts has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Express Scripts: Promoting Prescription Drug Home Delivery (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.
Analytics focus
– Prescription Scripts 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 John Beshears, Patrick Rooney, Jenny Sanford 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.
Innovation driven organization
– Prescription Scripts is one of the most innovative firm in sector. Manager in Express Scripts: Promoting Prescription Drug Home Delivery (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
High switching costs
– The high switching costs that Prescription Scripts 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 Prescription Scripts in the sector have low bargaining power. Express Scripts: Promoting Prescription Drug Home Delivery (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Prescription Scripts to manage not only supply disruptions but also source products at highly competitive prices.
Operational resilience
– The operational resilience strategy in the Express Scripts: Promoting Prescription Drug Home Delivery (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.
Effective Research and Development (R&D)
– Prescription Scripts 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 Express Scripts: Promoting Prescription Drug Home Delivery (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.
Superior customer experience
– The customer experience strategy of Prescription Scripts in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Learning organization
- Prescription Scripts 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 Prescription Scripts is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Express Scripts: Promoting Prescription Drug Home Delivery (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Sustainable margins compare to other players in Communication industry
– Express Scripts: Promoting Prescription Drug Home Delivery (B) firm has clearly differentiated products in the market place. This has enabled Prescription Scripts to fetch slight price premium compare to the competitors in the Communication industry. The sustainable margins have also helped Prescription Scripts to invest into research and development (R&D) and innovation.
Weaknesses Express Scripts: Promoting Prescription Drug Home Delivery (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Express Scripts: Promoting Prescription Drug Home Delivery (B) are -
Workers concerns about automation
– As automation is fast increasing in the segment, Prescription Scripts 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.
Products dominated business model
– Even though Prescription Scripts 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 - Express Scripts: Promoting Prescription Drug Home Delivery (B) should strive to include more intangible value offerings along with its core products and services.
Slow to strategic competitive environment developments
– As Express Scripts: Promoting Prescription Drug Home Delivery (B) HBR case study mentions - Prescription Scripts 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.
High bargaining power of channel partners
– Because of the regulatory requirements, John Beshears, Patrick Rooney, Jenny Sanford suggests that, Prescription Scripts is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Express Scripts: Promoting Prescription Drug Home Delivery (B), it seems that the employees of Prescription Scripts don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Increasing silos among functional specialists
– The organizational structure of Prescription Scripts is dominated by functional specialists. It is not different from other players in the Communication segment. Prescription Scripts needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Prescription Scripts to focus more on services rather than just following the product oriented approach.
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 Prescription Scripts supply chain. Even after few cautionary changes mentioned in the HBR case study - Express Scripts: Promoting Prescription Drug Home Delivery (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Prescription Scripts vulnerable to further global disruptions in South East Asia.
Low market penetration in new markets
– Outside its home market of Prescription Scripts, firm in the HBR case study Express Scripts: Promoting Prescription Drug Home Delivery (B) needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Prescription Scripts products
– To increase the profitability and margins on the products, Prescription Scripts needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Prescription Scripts 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.
Skills based hiring
– The stress on hiring functional specialists at Prescription Scripts 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.
Opportunities Express Scripts: Promoting Prescription Drug Home Delivery (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 Express Scripts: Promoting Prescription Drug Home Delivery (B) are -
Creating value in data economy
– The success of analytics program of Prescription Scripts has opened avenues for new revenue streams for the organization in the industry. This can help Prescription Scripts to build a more holistic ecosystem as suggested in the Express Scripts: Promoting Prescription Drug Home Delivery (B) case study. Prescription Scripts can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Prescription Scripts can use these opportunities to build new business models that can help the communities that Prescription Scripts operates in. Secondly it can use opportunities from government spending in Communication sector.
Learning at scale
– Online learning technologies has now opened space for Prescription Scripts to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Developing new processes and practices
– Prescription Scripts can develop new processes and procedures in Communication 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.
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 Prescription Scripts 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.
Using analytics as competitive advantage
– Prescription Scripts 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 Express Scripts: Promoting Prescription Drug Home Delivery (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Prescription Scripts to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Loyalty marketing
– Prescription Scripts 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Prescription Scripts 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, Express Scripts: Promoting Prescription Drug Home Delivery (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.
Low interest rates
– Even though inflation is raising its head in most developed economies, Prescription Scripts 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.
Buying journey improvements
– Prescription Scripts can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Express Scripts: Promoting Prescription Drug Home Delivery (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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Communication industry, but it has also influenced the consumer preferences. Prescription Scripts can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Better consumer reach
– The expansion of the 5G network will help Prescription Scripts to increase its market reach. Prescription Scripts 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.
Leveraging digital technologies
– Prescription Scripts 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.
Threats Express Scripts: Promoting Prescription Drug Home Delivery (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Express Scripts: Promoting Prescription Drug Home Delivery (B) are -
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Prescription Scripts 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.
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 Prescription Scripts in the Communication sector and impact the bottomline of the organization.
Shortening product life cycle
– it is one of the major threat that Prescription Scripts is facing in Communication sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
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 Prescription Scripts.
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.
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 Prescription Scripts business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Prescription Scripts 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. Prescription Scripts can take advantage of this fund but it will also bring new competitors in the Communication industry.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Prescription Scripts 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 Express Scripts: Promoting Prescription Drug Home Delivery (B) .
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.
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. Prescription Scripts 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.
Easy access to finance
– Easy access to finance in Communication field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Prescription Scripts can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Prescription Scripts with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Express Scripts: Promoting Prescription Drug Home Delivery (B), Prescription Scripts 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 .
Weighted SWOT Analysis of Express Scripts: Promoting Prescription Drug Home Delivery (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 Express Scripts: Promoting Prescription Drug Home Delivery (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 Express Scripts: Promoting Prescription Drug Home Delivery (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 Express Scripts: Promoting Prescription Drug Home Delivery (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 Express Scripts: Promoting Prescription Drug Home Delivery (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 Prescription Scripts needs to make to build a sustainable competitive advantage.
