Strategic Management Analysis _Biocon India (GC0464)
Table of Contents
1.0 Introduction.
2.0 Identify Biocon India Group key stakeholders and map these stakeholders in terms of the power/interest grid
2.1 Key Stakeholders.
2.2 Stakeholder Map.
3.0 Five Forces Analysis on Biocon India Group.
3.1 Biocon India Group strategies to manage its resources and capabilities.
3.2 Biocon India Group Value Chain Analysis.
4.0 Business and Corporate Strategies.
4.1 TOWS Analysis of Biocon India Group.
4.2 Strategic alternatives for the Biocon India Group.
5.0 Conclusion.
References.
1.0 Introduction
The strategic analysis focuses on the development and implementation of business strategies in gaining sustainable competitive advantages. The strategic analysis outlines both internal and external business environments. For analyzing internal business factors, a number of models are applied such as TWOS and Value Chain Analysis tool. For analyzing external business factors, and Porter’s Five Forces model is widely used. This report has conducted a strategic analysis of Biocon India Group business conducting its external business environment analysis, strategic capability and capacity analysis, and strategic fit analysis.
2.0 Identify Biocon India Group key stakeholders and map these stakeholders in terms of the power/interest grid
2.1 Key Stakeholders
According to Kotler et al. (2014), stakeholders of an organization can be grouped as internal and external stakeholders. The key stakeholders of Biocon India Group are identified as follows along with their interest:
Internal stakeholders
Employees
Employees are the key stakeholder of Biocon India. It has more than 5585 employees who are working in different departments. It is challenging for Biocon India to attract and retain skills and talented people. This is because employees look for standard salaries, attractive and competitive incentives and rewards, a diverse and safe workplace (Biocon India Annual Report, 2015) (Biocon India Group Annual Report, 2015).
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Investors
There are a number of investors who have invested in Biocon India. Investors always look for better dividends and profit from Biocon India. Thus, they always look for better performance of Biocon India. Biocon India needs to convince its investors to retain and satisfy them (Biocon India Group Annual Report, 2015).
Director
Biocon India has a number of directors who are the key responsible for making business decisions and strategies development. Thus, these directors have more interest and power in the business of Biocon India. Biocon India needs to provide very high salaries and incentives and rewards to retain and motivate these directors (Biocon India Group Annual Report, 2015).
Scientist
Biocon India has a number of scientists and researchers who have been conducting research continuously on several diseases and patients. This is expensive to motivate and retain these researchers and scientists because Biocon India needs to offer them high salaries and rewards (Biocon India Group Annual Report, 2015).
External stakeholders
Customers/Patents
The customer is the key external stakeholder of Biocon India. Biocon India needs to develop strategies to meet the changing needs and expectations of Biocon India. In addition, Biocon India needs to hire patients for clinical trials which is expensive. Biocon India spends about 70% of the cost of recruiting patients and medical personnel for clinical trials (Biocon India Group Annual Report, 2015).
Government
The government is the powerful stakeholder of Biocon India. Biocon India needs to follow the regulations imposed by the government. The key regulations imposed by the government for the pharmaceutical industry are the Drug Price Control Order (DPCO), and the India Patent Act (IPA). In addition, the government imposes a tax, which impacts the performance of Biocon India (Biocon India Group Annual Report, 2015).
Clinic
Biocon India needs to hire several clinical for clinical trials which is expensive. In this case, Biocon India faces great challenges and risks including ethical challenges, financial losses, compensation to victims, damage to reputation, and organizational survival. These challenges may impact the reputation of Biocon India (Biocon India Group Annual Report, 2015).
Trade union
As Biocon India has been dealing with more than 5585 staff, it needs to deal with trade unions for several purposes. In this case, it may face several challenges including financial losses, time and effort losses, and brand reputation losses (Biocon India Group Annual Report, 2015).
2.2 Stakeholder Map
According to Mendelow’s Power-Interest Grid in Mullins (2014), all stakeholders do not have an equal interest and influencing power in the business. The power and interest of Biocon India’s stakeholders are shown in the following map through Mendelow’s Power-Interest Grid:
Diagram: Power/Interest of stakeholders of Biocon India Group
The directors, government, and employees have high interest and high power in the business of Biocon India. According to Mullins (2014) suggestions, these stakeholders should be monitored and dealt with maximum effort. The suppliers and community have high interest and low interest in Biocon India. Thus, as Mullins (2014) suggests, they should be informed constantly by Biocon India. Customers, investors, and clinics have high power but low interest. Biocon India should keep satisfied them. Finally, scientists and trade unions have low interest and low power. Thus, as Mullins (2014) notes, Biocon India should work closely with these stakeholders.
3.0 Five Forces Analysis on Biocon India Group
Porter’s Five Forces model is also a widely used tool in modern business organizations to analyze the external business environment of a business (Kotler et al., 2014). Porter’s Five Forces model refers to five key factors that come from the external business environment on business performance. These five forces are the bargaining power of customers, bargaining power of suppliers, threats of new entrants, threats of substitutes, and intensity of competitive rivalry. The bargaining power of suppliers is evaluated by supplier/vendor number, switching costs of retailer, and threat of integration from suppliers. The threat of substitutes is evaluated by the substitutions for products. The threat of new entrants is evaluated by barriers to entry. The bargaining power of customers is evaluated by demand elasticity, switching costs, product differentiation. The intensity of rivalry is evaluated by industry growth, competitors’ number, market share of competitors (Hautte, 2015)……………
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