Anavex Life Sciences (AVXL) SWOT Analysis / TOWS Matrix / MBA Resources

Introduction to SWOT Analysis

SWOT Analysis / TOWS Matrix for Anavex Life Sciences (United States)

Based on various researches at Oak Spring University , Anavex Life Sciences is operating in a macro-environment that has been destablized by – central banks are concerned over increasing inflation, there is backlash against globalization, talent flight as more people leaving formal jobs, there is increasing trade war between United States & China, cloud computing is disrupting traditional business models, increasing energy prices, technology disruption, increasing household debt because of falling income levels, supply chains are disrupted by pandemic , etc

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Introduction to SWOT Analysis of Anavex Life Sciences

SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Anavex Life Sciences can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Anavex Life Sciences, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Anavex Life Sciences 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.

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SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix

SWOT analysis of Anavex Life Sciences can be done for the following purposes –
1. Strategic planning of Anavex Life Sciences
2. Improving business portfolio management of Anavex Life Sciences
3. Assessing feasibility of the new initiative in United States
4. Making a Biotechnology & Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Anavex Life Sciences

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Strengths of Anavex Life Sciences | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The strengths of Anavex Life Sciences are -

Operational resilience

– The operational resilience strategy of Anavex Life Sciences comprises – understanding the underlying the factors in the Biotechnology & 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.

Sustainable margins compare to other players in Biotechnology & Drugs industry

– Anavex Life Sciences has clearly differentiated products in the market place. This has enabled Anavex Life Sciences to fetch slight price premium compare to the competitors in the Biotechnology & Drugs industry. The sustainable margins have also helped Anavex Life Sciences to invest into research and development (R&D) and innovation.

Digital Transformation in Biotechnology & Drugs industry

- digital transformation varies from industry to industry. For Anavex Life Sciences digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Anavex Life Sciences has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.

Cross disciplinary teams

– Horizontal connected teams at the Anavex Life Sciences 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.

Strong track record of project management in the Biotechnology & Drugs industry

– Anavex Life Sciences is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.

Innovation driven organization

– Anavex Life Sciences is one of the most innovative firm in Biotechnology & Drugs sector.

Superior customer experience

– The customer experience strategy of Anavex Life Sciences in Biotechnology & Drugs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.

High brand equity

– Anavex Life Sciences has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Anavex Life Sciences to keep acquiring new customers and building profitable relationship with both the new and loyal customers.

Successful track record of launching new products

– Anavex Life Sciences has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Anavex Life Sciences 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.

Learning organization

- Anavex Life Sciences 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 Anavex Life Sciences is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Anavex Life Sciences emphasize – knowledge, initiative, and innovation.

Ability to recruit top talent

– Anavex Life Sciences is one of the leading players in the Biotechnology & Drugs industry in United States. It is in a position to attract the best talent available in United States. The firm has a robust talent identification program that helps in identifying the brightest.

Low bargaining power of suppliers

– Suppliers of Anavex Life Sciences in the Healthcare sector have low bargaining power. Anavex Life Sciences has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Anavex Life Sciences to manage not only supply disruptions but also source products at highly competitive prices.

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Weaknesses of Anavex Life Sciences | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The weaknesses of Anavex Life Sciences are -

Need for greater diversity

– Anavex Life Sciences 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.

Aligning sales with marketing

– From the outside it seems that Anavex Life Sciences needs to have more collaboration between its sales team and marketing team. Sales professionals in the Biotechnology & Drugs industry have deep experience in developing customer relationships. Marketing department at Anavex Life Sciences can leverage the sales team experience to cultivate customer relationships as Anavex Life Sciences is planning to shift buying processes online.

High bargaining power of channel partners in Biotechnology & Drugs industry

– because of the regulatory requirements in United States, Anavex Life Sciences 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 Biotechnology & Drugs industry.

High operating costs

– Compare to the competitors, Anavex Life Sciences has high operating costs in the Biotechnology & Drugs industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Anavex Life Sciences lucrative customers.

Lack of clear differentiation of Anavex Life Sciences products

– To increase the profitability and margins on the products, Anavex Life Sciences needs to provide more differentiated products than what it is currently offering in the marketplace.

Products dominated business model

– Even though Anavex Life Sciences has some of the most successful models in the Biotechnology & Drugs industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Anavex Life Sciences should strive to include more intangible value offerings along with its core products and services.

Low market penetration in new markets

– Outside its home market of United States, Anavex Life Sciences needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.

Compensation and incentives

– The revenue per employee of Anavex Life Sciences is just above the Biotechnology & 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.

Employees’ less understanding of Anavex Life Sciences strategy

– From the outside it seems that the employees of Anavex Life Sciences 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.

Slow decision making process

– As mentioned earlier in the report, Anavex Life Sciences has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the Biotechnology & Drugs industry over the last five years. Anavex Life Sciences 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.

Workers concerns about automation

– As automation is fast increasing in the Biotechnology & Drugs industry, Anavex Life Sciences 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.

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Anavex Life Sciences Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The opportunities of Anavex Life Sciences are -

Identify volunteer opportunities

– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Anavex Life Sciences can explore opportunities that can attract volunteers and are consistent with its mission and vision.

Creating value in data economy

– The success of analytics program of Anavex Life Sciences has opened avenues for new revenue streams for the organization in Biotechnology & Drugs industry. This can help Anavex Life Sciences to build a more holistic ecosystem for Anavex Life Sciences products in the Biotechnology & Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.

Developing new processes and practices

– Anavex Life Sciences can develop new processes and procedures in Biotechnology & Drugs 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.

Manufacturing automation

– Anavex Life Sciences can use the latest technology developments to improve its manufacturing and designing process in Biotechnology & 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.

Redefining models of collaboration and team work

– As explained in the weaknesses section, Anavex Life Sciences is facing challenges because of the dominance of functional experts in the organization. Anavex Life Sciences can utilize new technology in the field of Biotechnology & Drugs industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.

Leveraging digital technologies

– Anavex Life Sciences 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.

Lowering marketing communication costs

– 5G expansion will open new opportunities for Anavex Life Sciences in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Biotechnology & Drugs industry, and it will provide faster access to the consumers.

Remote work and new talent hiring opportunities

– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Anavex Life Sciences 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 Anavex Life Sciences to hire the very best people irrespective of their geographical location.

Finding new ways to collaborate

– Covid-19 has not only transformed business models of companies in Biotechnology & Drugs industry, but it has also influenced the consumer preferences. Anavex Life Sciences can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.

Increase in government spending

– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Anavex Life Sciences can use these opportunities to build new business models that can help the communities that Anavex Life Sciences operates in. Secondly it can use opportunities from government spending in Biotechnology & Drugs sector.

Harnessing reconfiguration of the global supply chains

– As the trade war between US and China heats up in the coming years, Anavex Life Sciences 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 Anavex Life Sciences to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.

Loyalty marketing

– Anavex Life Sciences 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.

Use of Bitcoin and other crypto currencies for transactions in Biotechnology & Drugs industry

– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Anavex Life Sciences in the Biotechnology & Drugs industry. Now Anavex Life Sciences can target international markets with far fewer capital restrictions requirements than the existing system.

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Threats Anavex Life Sciences External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis

The threats of Anavex Life Sciences are -

Easy access to finance

– Easy access to finance in Biotechnology & Drugs industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Anavex Life Sciences can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.

High dependence on third party suppliers

– Anavex Life Sciences 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.

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 Anavex Life Sciences in the Biotechnology & Drugs sector and impact the bottomline of the organization.

Increasing wage structure of Anavex Life Sciences

– 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 Anavex Life Sciences.

Environmental challenges

– Anavex Life Sciences 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. Anavex Life Sciences can take advantage of this fund but it will also bring new competitors in the Biotechnology & Drugs industry.

Trade war between China and United States

– The trade war between two of the biggest economies can hugely impact the opportunities for Anavex Life Sciences in Biotechnology & Drugs industry. The Biotechnology & 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 Anavex Life Sciences business can come under increasing regulations regarding data privacy, data security, etc.

Consumer confidence and its impact on Anavex Life Sciences 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 Biotechnology & Drugs industry and other sectors.

Learning curve for new practices

– As the technology based on artificial intelligence and machine learning platform is getting complex, Anavex Life Sciences may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Biotechnology & Drugs sector.

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.

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. Anavex Life Sciences needs to understand the core reasons impacting the Biotechnology & Drugs industry. This will help it in building a better workplace.

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 Anavex Life Sciences.

Shortening product life cycle

– it is one of the major threat that Anavex Life Sciences is facing in Biotechnology & Drugs sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.

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Weighted SWOT Analysis of Anavex Life Sciences Template, Example

Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Anavex Life Sciences 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 Anavex Life Sciences 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 Anavex Life Sciences 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 Anavex Life Sciences 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 Anavex Life Sciences needs to make to build a sustainable competitive advantage.

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