SWOT Analysis / TOWS Matrix for AstraZeneca Pharma (India)
Based on various researches at Oak Spring University , AstraZeneca Pharma is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, technology disruption, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, competitive advantages are harder to sustain because of technology dispersion, increasing government debt because of Covid-19 spendings, talent flight as more people leaving formal jobs,
supply chains are disrupted by pandemic , there is backlash against globalization, etc
Introduction to SWOT Analysis of AstraZeneca Pharma
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that AstraZeneca Pharma can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the AstraZeneca Pharma, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which AstraZeneca Pharma 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 AstraZeneca Pharma can be done for the following purposes –
1. Strategic planning of AstraZeneca Pharma
2. Improving business portfolio management of AstraZeneca Pharma
3. Assessing feasibility of the new initiative in India
4. Making a Major Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of AstraZeneca Pharma
Strengths of AstraZeneca Pharma | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of AstraZeneca Pharma are -
Diverse revenue streams
– AstraZeneca Pharma is present in almost all the verticals within the Major Drugs industry. This has provided AstraZeneca Pharma 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.
Sustainable margins compare to other players in Major Drugs industry
– AstraZeneca Pharma has clearly differentiated products in the market place. This has enabled AstraZeneca Pharma to fetch slight price premium compare to the competitors in the Major Drugs industry. The sustainable margins have also helped AstraZeneca Pharma to invest into research and development (R&D) and innovation.
Innovation driven organization
– AstraZeneca Pharma is one of the most innovative firm in Major Drugs sector.
Ability to recruit top talent
– AstraZeneca Pharma is one of the leading players in the Major Drugs industry in India. It is in a position to attract the best talent available in India. The firm has a robust talent identification program that helps in identifying the brightest.
Operational resilience
– The operational resilience strategy of AstraZeneca Pharma comprises – understanding the underlying the factors in the Major Drugs 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.
Ability to lead change in Major Drugs
– AstraZeneca Pharma is one of the leading players in the Major Drugs industry in India. Over the years it has not only transformed the business landscape in the Major Drugs industry in India but also across the existing markets. The ability to lead change has enabled AstraZeneca Pharma in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Strong track record of project management in the Major Drugs industry
– AstraZeneca Pharma is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Organizational Resilience of AstraZeneca Pharma
– The covid-19 pandemic has put organizational resilience at the centre of everthing AstraZeneca Pharma does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Cross disciplinary teams
– Horizontal connected teams at the AstraZeneca Pharma 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.
Analytics focus
– AstraZeneca Pharma 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 Major Drugs industry. The technology infrastructure of India is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Successful track record of launching new products
– AstraZeneca Pharma has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. AstraZeneca Pharma 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.
Effective Research and Development (R&D)
– AstraZeneca Pharma has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – AstraZeneca Pharma staying ahead in the Major Drugs industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Weaknesses of AstraZeneca Pharma | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of AstraZeneca Pharma are -
Ability to respond to the competition
– As the decision making is very deliberative at AstraZeneca Pharma, in the dynamic environment of Major Drugs industry it has struggled to respond to the nimble upstart competition. AstraZeneca Pharma has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Employees’ less understanding of AstraZeneca Pharma strategy
– From the outside it seems that the employees of AstraZeneca Pharma 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.
Lack of clear differentiation of AstraZeneca Pharma products
– To increase the profitability and margins on the products, AstraZeneca Pharma needs to provide more differentiated products than what it is currently offering in the marketplace.
Compensation and incentives
– The revenue per employee of AstraZeneca Pharma is just above the Major Drugs industry average. It 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.
Need for greater diversity
– AstraZeneca Pharma 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 decision making process
– As mentioned earlier in the report, AstraZeneca Pharma has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Major Drugs industry over the last five years. AstraZeneca Pharma 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.
Increasing silos among functional specialists
– The organizational structure of AstraZeneca Pharma is dominated by functional specialists. It is not different from other players in the Major Drugs industry, but AstraZeneca Pharma needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help AstraZeneca Pharma to focus more on services in the Major Drugs industry rather than just following the product oriented approach.
Workers concerns about automation
– As automation is fast increasing in the Major Drugs industry, AstraZeneca Pharma 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.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, AstraZeneca Pharma is slow explore the new channels of communication. These new channels of communication can help AstraZeneca Pharma to provide better information regarding Major Drugs products and services. It can also build an online community to further reach out to potential customers.
High bargaining power of channel partners in Major Drugs industry
– because of the regulatory requirements in India, AstraZeneca Pharma 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 Major Drugs industry.
High dependence on AstraZeneca Pharma ‘s star products
– The top 2 products and services of AstraZeneca Pharma still accounts for major business revenue. This dependence on star products in Major Drugs industry has resulted into insufficient focus on developing new products, even though AstraZeneca Pharma has relatively successful track record of launching new products.
AstraZeneca Pharma Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of AstraZeneca Pharma are -
Loyalty marketing
– AstraZeneca Pharma 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.
Low interest rates
– Even though inflation is raising its head in most developed economies, AstraZeneca Pharma 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.
Better consumer reach
– The expansion of the 5G network will help AstraZeneca Pharma to increase its market reach. AstraZeneca Pharma 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.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Major Drugs industry, but it has also influenced the consumer preferences. AstraZeneca Pharma can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, AstraZeneca Pharma 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 AstraZeneca Pharma to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– AstraZeneca Pharma has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Major Drugs sector. This continuous investment in analytics has enabled AstraZeneca Pharma to build a competitive advantage using analytics. The analytics driven competitive advantage can help AstraZeneca Pharma to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Manufacturing automation
– AstraZeneca Pharma can use the latest technology developments to improve its manufacturing and designing process in Major Drugs sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Creating value in data economy
– The success of analytics program of AstraZeneca Pharma has opened avenues for new revenue streams for the organization in Major Drugs industry. This can help AstraZeneca Pharma to build a more holistic ecosystem for AstraZeneca Pharma products in the Major Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– AstraZeneca Pharma can improve the customer journey of consumers in the Major Drugs industry by using analytics and artificial intelligence. It 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.
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 AstraZeneca Pharma 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.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects AstraZeneca Pharma can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Lowering marketing communication costs
– 5G expansion will open new opportunities for AstraZeneca Pharma in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Major Drugs industry, and it will provide faster access to the consumers.
Learning at scale
– Online learning technologies has now opened space for AstraZeneca Pharma 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.
Threats AstraZeneca Pharma External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of AstraZeneca Pharma are -
High dependence on third party suppliers
– AstraZeneca Pharma 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.
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. AstraZeneca Pharma needs to understand the core reasons impacting the Major Drugs industry. This will help it in building a better workplace.
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 AstraZeneca Pharma in the Major Drugs sector and impact the bottomline of the organization.
Regulatory challenges
– AstraZeneca Pharma 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 Major Drugs industry regulations.
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. AstraZeneca Pharma 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 AstraZeneca Pharma is facing in Major Drugs 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.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Major Drugs industry are lowering. It can presents AstraZeneca Pharma with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Major Drugs sector.
Increasing wage structure of AstraZeneca Pharma
– 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 AstraZeneca Pharma.
Stagnating economy with rate increase
– AstraZeneca Pharma 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 Major Drugs industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for AstraZeneca Pharma in Major Drugs industry. The Major Drugs 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.
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 AstraZeneca Pharma business can come under increasing regulations regarding data privacy, data security, etc.
Consumer confidence and its impact on AstraZeneca Pharma 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 Major Drugs industry and other sectors.
Weighted SWOT Analysis of AstraZeneca Pharma Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at AstraZeneca Pharma 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 AstraZeneca Pharma 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 AstraZeneca Pharma 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 AstraZeneca Pharma 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 AstraZeneca Pharma needs to make to build a sustainable competitive advantage.