SWOT Analysis / TOWS Matrix for Takeda Pharmaceutical (United States)
Based on various researches at Oak Spring University , Takeda Pharmaceutical is operating in a macro-environment that has been destablized by – increasing household debt because of falling income levels, talent flight as more people leaving formal jobs, increasing energy prices, supply chains are disrupted by pandemic , increasing inequality as vast percentage of new income is going to the top 1%, cloud computing is disrupting traditional business models, increasing commodity prices,
there is increasing trade war between United States & China, digital marketing is dominated by two big players Facebook and Google, etc
Introduction to SWOT Analysis of Takeda Pharmaceutical
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Takeda Pharmaceutical can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Takeda Pharmaceutical, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Takeda Pharmaceutical 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 Takeda Pharmaceutical can be done for the following purposes –
1. Strategic planning of Takeda Pharmaceutical
2. Improving business portfolio management of Takeda Pharmaceutical
3. Assessing feasibility of the new initiative in United States
4. Making a Major Drugs sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Takeda Pharmaceutical
Strengths of Takeda Pharmaceutical | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Takeda Pharmaceutical are -
Highly skilled collaborators
– Takeda Pharmaceutical has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive Major Drugs industry. Secondly the value chain collaborators of Takeda Pharmaceutical have helped the firm to develop new products and bring them quickly to the marketplace.
Organizational Resilience of Takeda Pharmaceutical
– The covid-19 pandemic has put organizational resilience at the centre of everthing Takeda Pharmaceutical does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Sustainable margins compare to other players in Major Drugs industry
– Takeda Pharmaceutical has clearly differentiated products in the market place. This has enabled Takeda Pharmaceutical to fetch slight price premium compare to the competitors in the Major Drugs industry. The sustainable margins have also helped Takeda Pharmaceutical to invest into research and development (R&D) and innovation.
Ability to lead change in Major Drugs
– Takeda Pharmaceutical is one of the leading players in the Major Drugs industry in United States. Over the years it has not only transformed the business landscape in the Major Drugs industry in United States but also across the existing markets. The ability to lead change has enabled Takeda Pharmaceutical in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Successful track record of launching new products
– Takeda Pharmaceutical has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Takeda Pharmaceutical 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.
Superior customer experience
– The customer experience strategy of Takeda Pharmaceutical in Major Drugs industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Cross disciplinary teams
– Horizontal connected teams at the Takeda Pharmaceutical 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.
Ability to recruit top talent
– Takeda Pharmaceutical is one of the leading players in the Major 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.
Strong track record of project management in the Major Drugs industry
– Takeda Pharmaceutical is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Operational resilience
– The operational resilience strategy of Takeda Pharmaceutical 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.
Diverse revenue streams
– Takeda Pharmaceutical is present in almost all the verticals within the Major Drugs industry. This has provided Takeda Pharmaceutical 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.
Effective Research and Development (R&D)
– Takeda Pharmaceutical has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in – Takeda Pharmaceutical 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 Takeda Pharmaceutical | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Takeda Pharmaceutical are -
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Takeda Pharmaceutical is slow explore the new channels of communication. These new channels of communication can help Takeda Pharmaceutical 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 dependence on Takeda Pharmaceutical ‘s star products
– The top 2 products and services of Takeda Pharmaceutical 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 Takeda Pharmaceutical has relatively successful track record of launching new products.
Capital Spending Reduction
– Even during the low interest decade, Takeda Pharmaceutical 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 Major Drugs industry using digital technology.
Interest costs
– Compare to the competition, Takeda Pharmaceutical 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.
Aligning sales with marketing
– From the outside it seems that Takeda Pharmaceutical needs to have more collaboration between its sales team and marketing team. Sales professionals in the Major Drugs industry have deep experience in developing customer relationships. Marketing department at Takeda Pharmaceutical can leverage the sales team experience to cultivate customer relationships as Takeda Pharmaceutical is planning to shift buying processes online.
High operating costs
– Compare to the competitors, Takeda Pharmaceutical has high operating costs in the Major Drugs industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Takeda Pharmaceutical lucrative customers.
High bargaining power of channel partners in Major Drugs industry
– because of the regulatory requirements in United States, Takeda Pharmaceutical 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.
Skills based hiring in Major Drugs industry
– The stress on hiring functional specialists at Takeda Pharmaceutical 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.
Workers concerns about automation
– As automation is fast increasing in the Major Drugs industry, Takeda Pharmaceutical 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 Takeda Pharmaceutical has some of the most successful models in the Major Drugs industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. Takeda Pharmaceutical should strive to include more intangible value offerings along with its core products and services.
Lack of clear differentiation of Takeda Pharmaceutical products
– To increase the profitability and margins on the products, Takeda Pharmaceutical needs to provide more differentiated products than what it is currently offering in the marketplace.
Takeda Pharmaceutical Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Takeda Pharmaceutical are -
Using analytics as competitive advantage
– Takeda Pharmaceutical 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 Takeda Pharmaceutical to build a competitive advantage using analytics. The analytics driven competitive advantage can help Takeda Pharmaceutical to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
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. Takeda Pharmaceutical can explore opportunities that can attract volunteers and are consistent with its mission and vision.
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 Takeda Pharmaceutical 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.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Takeda Pharmaceutical 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.
Use of Bitcoin and other crypto currencies for transactions in Major Drugs industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Takeda Pharmaceutical in the Major Drugs industry. Now Takeda Pharmaceutical can target international markets with far fewer capital restrictions requirements than the existing system.
Low interest rates
– Even though inflation is raising its head in most developed economies, Takeda Pharmaceutical 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.
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. Takeda Pharmaceutical can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Creating value in data economy
– The success of analytics program of Takeda Pharmaceutical has opened avenues for new revenue streams for the organization in Major Drugs industry. This can help Takeda Pharmaceutical to build a more holistic ecosystem for Takeda Pharmaceutical products in the Major Drugs industry by providing – data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Takeda Pharmaceutical 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.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Takeda Pharmaceutical is facing challenges because of the dominance of functional experts in the organization. Takeda Pharmaceutical can utilize new technology in the field of Major Drugs industry to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, 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, Takeda Pharmaceutical can use these opportunities to build new business models that can help the communities that Takeda Pharmaceutical operates in. Secondly it can use opportunities from government spending in Major Drugs sector.
Loyalty marketing
– Takeda Pharmaceutical 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, Takeda Pharmaceutical 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 Takeda Pharmaceutical to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Threats Takeda Pharmaceutical External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Takeda Pharmaceutical are -
Shortening product life cycle
– it is one of the major threat that Takeda Pharmaceutical is facing in Major Drugs sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Easy access to finance
– Easy access to finance in Major Drugs industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Takeda Pharmaceutical can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Stagnating economy with rate increase
– Takeda Pharmaceutical 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.
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 Takeda Pharmaceutical.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Takeda Pharmaceutical 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.
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.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Takeda Pharmaceutical may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Major Drugs sector.
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. Takeda Pharmaceutical 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.
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 Takeda Pharmaceutical business can come under increasing regulations regarding data privacy, data security, etc.
Environmental challenges
– Takeda Pharmaceutical 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. Takeda Pharmaceutical can take advantage of this fund but it will also bring new competitors in the Major Drugs industry.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to Major Drugs industry are lowering. It can presents Takeda Pharmaceutical with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the Major Drugs sector.
Regulatory challenges
– Takeda Pharmaceutical 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.
Technology acceleration in Forth Industrial Revolution
– Takeda Pharmaceutical has witnessed rapid integration of technology during Covid-19 in the Major Drugs industry. As one of the leading players in the industry, Takeda Pharmaceutical needs to keep up with the evolution of technology in the Major 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.
Weighted SWOT Analysis of Takeda Pharmaceutical Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Takeda Pharmaceutical 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 Takeda Pharmaceutical 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 Takeda Pharmaceutical 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 Takeda Pharmaceutical 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 Takeda Pharmaceutical needs to make to build a sustainable competitive advantage.