Management Principles in Australian Pharmaceutical Industry

Running head: MANAGEMENT PRINCIPLES
Management principles
Name of the student
Name of the university
Author note

1MANAGEMENT PRINCIPLES
Executive summary
The aim of this report is to discuss about the major challenges being faced by the firms in the
Australian pharmaceutical industry. In doing so, different challenges and issues for the firms are
identified in this report. It is also identified that different firms in the Australian pharmaceutical
industry are following diverse sets of business strategies. In this report, Amcal, Priceline and
Chemist warehouse is selected for analysis and each one of them is following different strategies.
Henry Fayol’s management principles are used to critically analyze the management practices of
these organizations. This report recommended that new product development will be the most
viable option for the Australian pharmaceutical industry in order to gain long term viability. In
addition, it is also identified that Chemist warehouse will be the most profitable Australian
pharmaceutical company in 2022.

2MANAGEMENT PRINCIPLES
Table of Contents
Introduction......................................................................................................................................3
Identification of the issues...............................................................................................................3
Bargaining power of the buyers...................................................................................................4
Bargaining power of the suppliers...............................................................................................4
Threat of new entrants.................................................................................................................5
Threat of substitutes.....................................................................................................................5
Competitive rivalry......................................................................................................................6
Analysis of the business strategies..................................................................................................6
Identification of the current management practices.........................................................................7
Identification of the issues in the competitive pharmaceutical industry..........................................8
Identification of the differences between the operations of the pharmaceutical firms....................8
Identification of the most profitable pharmaceutical company.......................................................9
Evaluation of the suggested solutions............................................................................................10
Recommendations and conclusions...............................................................................................10
Reference.......................................................................................................................................12

3MANAGEMENT PRINCIPLES
Introduction
Global pharmaceutical industry is one of the most competitive and intense business
sectors in the world. This is due to the reason that this industry is having the presence of huge
number of brands competing while revenue generation sources are limited. Maximum price to be
charged in the market is capped and thus the competing organizations are having the challenge in
generating and increasing their revenue from the market. Similar to the global pharmaceutical
industry, Australia is also having the similar state of scenarios with the high intensity of
competition in the market [1]. Some of the major brands operating in the Australian
pharmaceutical sector are Amcal, Priceline and Chemist warehouse. These organizations are
holding the majority market share in the Australian pharmaceutical industry. However, on the
other hand, there are few challenges also being faced by this industry and especially by the above
mentioned companies. In this case, it is also important to review the business level strategies of
these companies in having the idea about their differentiated approaches [2].
This report will discuss about the different management theories in relation to the
business strategies of these companies. In addition, the corporate and business level strategies of
these companies will be analyzed and on the basis of the identified factors, the major challenges
in the Australian pharmaceutical industry will be identified. This report will discuss a few
recommended steps for the pharmaceutical industry that can help in overcoming the major
issues. Action plan for the implementation of the recommended steps will also be discussed.
Identification of the issues
One of the major issues for the pharmaceutical companies is the capping of the end price
of the medicines and other pharmaceutical products by the authority. Thus, the available sources