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Corporate Strategy Assignment (Doc)

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Added on  2020-10-05

Corporate Strategy Assignment (Doc)

   Added on 2020-10-05

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Corporate Strategy Assessment
Corporate Strategy Assignment (Doc)_1
Table of ContentsINTRODUCTION...........................................................................................................................3MAIN BODY...................................................................................................................................3Q1: EXTERNAL ANALYSIS ........................................................................................................3Evaluation of business environment and find out opportunities and threats..........................3Industry analysis by using porters five forces model.............................................................5Q2: INTERNAL ANALYSIS .........................................................................................................6Identifying strengths and weakness........................................................................................6Evaluation of capabilities through VRIO approach...............................................................7Q3: STRATEGY EVALUATION...................................................................................................9Evaluation of strategy undertook by company by using SAF test.........................................9CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
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INTRODUCTIONStrategy refers to plan or activities set by individual or group of individual to attain futuregoals (Rugman and Verbeke, 2017). With this, it can be said that corporate strategy refers to stepby step actions set by the management with the aim of achieving competitive advantage overothers companies by utilising resources to its maximum. For this report, joint venture ofGlaxoSmithKline plc and Pfizer Inc is taken for discussion which happens on 19th December2018. Both the companies operates in consumer healthcare industry. MAIN BODYQ1: EXTERNAL ANALYSIS Evaluation of business environment and find out opportunities and threatsJoint venture: It refers to collaborating or amalgamation between two or more than twocompanies who shares their resources and machinery to achieve a common purpose in the market(Furnham and Gunter, 2015). GlaxoSmithKline plc (GSK) is a British multinationalpharmaceutical company which deals vaccines, medicines, nutritional products etc and
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headquartered in London UK. On the other hand, Pfizer is an American MNC pharmaceuticalcompany which is in the same industry and headquarters in Connecticut USA. Both thecompanies have signed a joint venture agreements in which GSK will have 68% equity interestand remaining is with Pfizer and this venture will be work under the name of GSK consumerhealthcare. Both have the total sales of 9.8 billion euro which makes the competitive advantagefor a shorter period of time. It is important for any company to identify any opportunities or threats which they mightface in the future. For instance, if they failed then it will be huge blow to both the companies asfunds will not be fully utilised resulting in loss for the companies. On the other hand, if theysucceeded then competitive advantage would be achieve by them which leads to positive growthof companies. Various opportunities and threats are explained below, Opportunities: It means that different types of options which company has in the future whichcould help them to grow in sales and profitability context. Different opportunities which jointventure could achieve is explained below, It would be easier for both the companies to enter in countries where they have not beenoperating in the past individually because of share technology and resources. Both the companies have planned to divest its JV 25% of profit share in the R&Ddepartment so that new products and services would be made resulting in better sales andperformance in the future. Threats: It refers to various obstacles which might be faced by company in a coming future(Maas, Schaltegger and Crutzen, 2016). Company have to regularly assess the environment sothat they would be prepared to tackle the obstacle without affecting productivity of it. Differentthreats which this joint venture could face is given below,GSK have recently handover its one of the highest selling products like Boost, Maltovaetc to Unilever due to which they have lost their customer base which will leads to lowersales and profit for company. This will have negative impact on joint venture as lowamount of money would be invested by them.Due to high competitions in the pharmaceutical market, it would be hard for JV toperform with their highest potential as they have to compete with companies likeNovartis, Merck, Hoffmann-La Roche etc which is hard to beat. This venture will facedlow sales and ROI in the starting.
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