SWOT Analysis / TOWS Matrix for Constellation Pharmaceuticals (United States)
Based on various researches at Oak Spring University , Constellation Pharmaceuticals is operating in a macro-environment that has been destablized by – there is backlash against globalization, talent flight as more people leaving formal jobs, wage bills are increasing, increasing government debt because of Covid-19 spendings, increasing energy prices, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%,
technology disruption, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Constellation Pharmaceuticals
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Constellation Pharmaceuticals can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Constellation Pharmaceuticals, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Constellation Pharmaceuticals 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 Constellation Pharmaceuticals can be done for the following purposes –
1. Strategic planning of Constellation Pharmaceuticals
2. Improving business portfolio management of Constellation Pharmaceuticals
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 Constellation Pharmaceuticals
Strengths of Constellation Pharmaceuticals | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Constellation Pharmaceuticals are -
Innovation driven organization
– Constellation Pharmaceuticals is one of the most innovative firm in Biotechnology & Drugs sector.
Sustainable margins compare to other players in Biotechnology & Drugs industry
– Constellation Pharmaceuticals has clearly differentiated products in the market place. This has enabled Constellation Pharmaceuticals to fetch slight price premium compare to the competitors in the Biotechnology & Drugs industry. The sustainable margins have also helped Constellation Pharmaceuticals to invest into research and development (R&D) and innovation.
Strong track record of project management in the Biotechnology & Drugs industry
– Constellation Pharmaceuticals is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Ability to lead change in Biotechnology & Drugs
– Constellation Pharmaceuticals is one of the leading players in the Biotechnology & Drugs industry in United States. Over the years it has not only transformed the business landscape in the Biotechnology & Drugs industry in United States but also across the existing markets. The ability to lead change has enabled Constellation Pharmaceuticals in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Highly skilled collaborators
– Constellation Pharmaceuticals has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Biotechnology & Drugs industry. Secondly the value chain collaborators of Constellation Pharmaceuticals have helped the firm to develop new products and bring them quickly to the marketplace.
High switching costs
– The high switching costs that Constellation Pharmaceuticals 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.
Successful track record of launching new products
– Constellation Pharmaceuticals has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Constellation Pharmaceuticals 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.
Organizational Resilience of Constellation Pharmaceuticals
– The covid-19 pandemic has put organizational resilience at the centre of everthing Constellation Pharmaceuticals does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Superior customer experience
– The customer experience strategy of Constellation Pharmaceuticals in Biotechnology & Drugs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to recruit top talent
– Constellation Pharmaceuticals 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.
Diverse revenue streams
– Constellation Pharmaceuticals is present in almost all the verticals within the Biotechnology & Drugs industry. This has provided Constellation Pharmaceuticals 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.
Digital Transformation in Biotechnology & Drugs industry
- digital transformation varies from industry to industry. For Constellation Pharmaceuticals digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Constellation Pharmaceuticals 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.
Weaknesses of Constellation Pharmaceuticals | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Constellation Pharmaceuticals are -
High operating costs
– Compare to the competitors, Constellation Pharmaceuticals 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 Constellation Pharmaceuticals lucrative customers.
High bargaining power of channel partners in Biotechnology & Drugs industry
– because of the regulatory requirements in United States, Constellation Pharmaceuticals 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.
Lack of clear differentiation of Constellation Pharmaceuticals products
– To increase the profitability and margins on the products, Constellation Pharmaceuticals needs to provide more differentiated products than what it is currently offering in the marketplace.
Capital Spending Reduction
– Even during the low interest decade, Constellation Pharmaceuticals 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 Biotechnology & Drugs industry using digital technology.
Skills based hiring in Biotechnology & Drugs industry
– The stress on hiring functional specialists at Constellation Pharmaceuticals 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.
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 Constellation Pharmaceuticals supply chain. Even after few cautionary changes, Constellation Pharmaceuticals is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Constellation Pharmaceuticals vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Constellation Pharmaceuticals is one of the leading players in the Biotechnology & Drugs industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the Biotechnology & Drugs industry in last five years.
Slow decision making process
– As mentioned earlier in the report, Constellation Pharmaceuticals 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. Constellation Pharmaceuticals 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.
Interest costs
– Compare to the competition, Constellation Pharmaceuticals 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.
Employees’ less understanding of Constellation Pharmaceuticals strategy
– From the outside it seems that the employees of Constellation Pharmaceuticals 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.
High cash cycle compare to competitors
Constellation Pharmaceuticals has a high cash cycle compare to other players in the Biotechnology & Drugs industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
Constellation Pharmaceuticals Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Constellation Pharmaceuticals are -
Buying journey improvements
– Constellation Pharmaceuticals can improve the customer journey of consumers in the Biotechnology & 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.
Developing new processes and practices
– Constellation Pharmaceuticals 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.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Constellation Pharmaceuticals 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 Constellation Pharmaceuticals to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
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 Constellation Pharmaceuticals in the Biotechnology & Drugs industry. Now Constellation Pharmaceuticals can target international markets with far fewer capital restrictions requirements than the existing system.
Loyalty marketing
– Constellation Pharmaceuticals 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.
Using analytics as competitive advantage
– Constellation Pharmaceuticals has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in Biotechnology & Drugs sector. This continuous investment in analytics has enabled Constellation Pharmaceuticals to build a competitive advantage using analytics. The analytics driven competitive advantage can help Constellation Pharmaceuticals to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Constellation Pharmaceuticals is facing challenges because of the dominance of functional experts in the organization. Constellation Pharmaceuticals 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.
Better consumer reach
– The expansion of the 5G network will help Constellation Pharmaceuticals to increase its market reach. Constellation Pharmaceuticals 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.
Building a culture of innovation
– managers at Constellation Pharmaceuticals can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Biotechnology & Drugs industry.
Low interest rates
– Even though inflation is raising its head in most developed economies, Constellation Pharmaceuticals 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.
Learning at scale
– Online learning technologies has now opened space for Constellation Pharmaceuticals 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.
Creating value in data economy
– The success of analytics program of Constellation Pharmaceuticals has opened avenues for new revenue streams for the organization in Biotechnology & Drugs industry. This can help Constellation Pharmaceuticals to build a more holistic ecosystem for Constellation Pharmaceuticals products in the Biotechnology & Drugs industry by providing – 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, Constellation Pharmaceuticals can use these opportunities to build new business models that can help the communities that Constellation Pharmaceuticals operates in. Secondly it can use opportunities from government spending in Biotechnology & Drugs sector.
Threats Constellation Pharmaceuticals External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Constellation Pharmaceuticals are -
Technology acceleration in Forth Industrial Revolution
– Constellation Pharmaceuticals has witnessed rapid integration of technology during Covid-19 in the Biotechnology & Drugs industry. As one of the leading players in the industry, Constellation Pharmaceuticals needs to keep up with the evolution of technology in the Biotechnology & Drugs 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.
Environmental challenges
– Constellation Pharmaceuticals 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. Constellation Pharmaceuticals can take advantage of this fund but it will also bring new competitors in the Biotechnology & Drugs industry.
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.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Constellation Pharmaceuticals 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.
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.
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. Constellation Pharmaceuticals can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Shortening product life cycle
– it is one of the major threat that Constellation Pharmaceuticals is facing in Biotechnology & Drugs sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Biotechnology & Drugs industry are lowering. It can presents Constellation Pharmaceuticals with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Biotechnology & Drugs sector.
Consumer confidence and its impact on Constellation Pharmaceuticals 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.
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 Constellation Pharmaceuticals business can come under increasing regulations regarding data privacy, data security, etc.
Increasing wage structure of Constellation Pharmaceuticals
– 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 Constellation Pharmaceuticals.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Constellation Pharmaceuticals 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 Constellation Pharmaceuticals prominent markets.
High dependence on third party suppliers
– Constellation Pharmaceuticals 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.
Weighted SWOT Analysis of Constellation Pharmaceuticals Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Constellation Pharmaceuticals 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 Constellation Pharmaceuticals 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 Constellation Pharmaceuticals 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 Constellation Pharmaceuticals 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 Constellation Pharmaceuticals needs to make to build a sustainable competitive advantage.