Strategic Management and Sustainability in AstraZeneca Plc

This report discusses the impact of Covid-19 on the pharmaceutical industry and analyses the external environment of AstraZeneca Plc using PESTLE analysis. It also includes SWOT analysis and Porter's Five Forces Model to understand the competitive environment.

Strategic management
and sustainability

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
External environment analysis....................................................................................................3
Competitive environment............................................................................................................8
CONCLUSION .............................................................................................................................10
REFERNCES:................................................................................................................................11
Books and Journals:..................................................................................................................11
Online........................................................................................................................................11

INTRODUCTION
Strategic management refers to the process in which management is require to make
effective procedures, objectives and goals for a company in order to enhance the competitive
ability of employees and gain competitive advantage in the market (Makadok, Burton and
Barney, 2018). An organisation is required to have effective strategies so that they can be able to
make effective use of their resources. This requires a company to use their resources sustainably
which will help them to enhance their profitability. This report is going to explain about the
strategic management and sustainability in AstraZeneca Plc. It is a multinational company
having their headquarters in Cambridge Biomedical Campus in Cambridge, England and was
founded in the year 1999. It is a pharmaceutical and biotechnological company which deals in
several products to provide treatment for the major disease like oncology, cardiovascular,
gastrointestinal and many more (AstraZeneca PLC PESTEL Analysis, 2018). This report is going
to contain discussion related to global pandemic and its impact on pharmaceutical industry.
There is use of numerous models that help to strategically analyse the external business
environment.
MAIN BODY
External environment analysis
It is vital to note that Covid-19 has impact on every business organisation. Each and
every company should work in a proper manner so as to deal with the environment. The external
environment is dynamic and huge so a business has to know about the changes taking place in
external environment (Mease and et.al., 2019). It is seen that there are numerous factors in
business environment that influence the working of company. It is seen that AstraZeneca Plc.
Has its operations in various parts of world. It has big contribution in developing Oxford-
AstraZeneca COVID-19 vaccine. The mission of company is to turn the ideas into life changing
medicines that improve life of patient and benefit of society. So, to understand the external
environment, PESTLE Analysis will be helpful.
PESTLE Analysis
It is one of the famous tool that is used to study the external environment of an
organisation. It is seen that there are huge number of challenges that are faced by AstraZeneca
Plc. So by studying its external environment it will be easy for the management of company will

be able to formulate strategies that will help them to deal with the challenges. There are certain
factors such as political, legal, social, technological, economic and environmental that influence
the performance of business organisation. PESTLE Analysis in relation to AstraZeneca Plc. Is
discussed below:
Political factors: Political factors include tax policy, trade restrictions environmental
regulations, and tariffs, reform, also political stability. There is great role of government in
political factors as they can change the policies anytime (Batraga and et.al., 2020). In respect to
AstraZeneca Plc. The organisation is operating in healthcare sector in various countries so they
have to face risk of political conditions of various nations. It is seen that AstraZeneca Plc.
Checks various factors while entering a new market. The company check the rules and
regulations formulated in relation to healthcare sector and then follow all of them to operate
smoothly. The trade relations and tariffs are also analysed. It is analysed that AstraZeneca Plc
makes strong strategies that help them to work by following the health and safety rules and other
important aspects such as pricing regulations, taxation etc. in order to achieve success.
Economic factors: There are various factors that are included in economic factors such
as economic growth/decline, exchange, interest, inflation as well as wage rates, credit
availability, and cost of living. All these factors have influence of the operations of the
organisation. In relation to AstraZeneca Plc, they are able to earn good profits and also
contributes to economy of nation. It is seen that the company gets benefits of various government
initiatives in various of healthcare sector. They work in an effective manner and provide
employment opportunity to various people due to its large scale operations. Also, the company
spends huge money in research and development and work on providing the best to society
(Nádasdi and et.al., 2021). Also, it is essential to consider the situation of Covid-19. The lock
down situation in the country was problematic. But, at the same time AstraZeneca Plc operating
in pharmaceutical industry has not faced any loss. They were able to perform effectively by
gathering opportunities and that enhanced sales. By spending good amount on research and
development and were able to develop vaccine.
Social factors: Society is one of the major part of economy. Each and every business
works to satisfy the customers that are important part of society. There is need to focus on needs
and wants of society and provide the goods accordingly. There is rise in diseases and that leads
to increase in diseases. AstraZeneca Plc tries to understand the attitude and beliefs of society and

then makes strategies in specific manner. A company must work by taking care of customers
(Lazar, 2019). They conduct research and analyse the spread of disease and then formulate
medicine that will help in treatment. It is seen that people are ready to spend on medicines as
they have high income and they believe that health is wealth.
Technological factors: This factor includes development in technology and using
innovative means of doing business. In respect to AstraZeneca Plc, the company is investing in
latest technology as it helps to promote quality manufacturing. The organisation is able to gain
advantage over the competitors due to use of innovative ways of doing business. At the same
time AstraZeneca Plc also uses artificial intelligence that helps them in tracking and providing as
per the demand of customers. It helps the company to reduce the time takes for drug approval to
reach the market. By using the latest technology they enhance the skills of employees and they
are able to provide best to customers. The use of latest technology helps to enhance the supply
chain relations of the company.
Legal factors: All the laws and legislations that are applicable to a company are
considered in legal factors. It includes changes in legislation impacting employment, quotas,
resources, access to materials, imports/exports, and taxation. All the laws that are applicable on
the company should be abided by company. It is necessary for AstraZeneca Plc to take care of
laws as health of people are in their hands. But it is seen that there are changes in laws and the
company has to change themselves according to the laws. So, it causes problem to the company
(Snell and Yemen, 2017). At the same time, company operating in pharmaceutical industry has
no scope of error as that can be dangerous for the health of a person. So, the company take care
about all the laws and legislations and work in an appropriate manner that helps them to provide
quality products to its customers.
Environmental Factors: This factor focus on environment and influence of ecological
aspects. It includes discussion related to environmental protection laws, disposal laws, energy
consumption regulation. It is seen that all these factors must be kept at priority and will help the
business to operate effectively. They try to minimise the wastage of resources and provide
quality products to the customers. Each and every organisation must work in an appropriate
manner for development of nation. It is important to manage waste in health care centres for the
organisation.

From the above discussion it is analysed that all the factors have their own impact on the
performance of business. The company must formulate strategies in such a manner that they are
able to overcome any challenge if arise in path. By studied the impact of these factors in advance
the organisation is able to implement the strategies in a successful manner. The company takes
care about the political condition and follow all the rules that are applicable to the company. At
the same time the use of latest technology helps the business to serve customers in a effective
manner. Along with that they take care about the environmental factors and reduce the harm to
environment. Also, the company takes care about the society and the needs of customers so that
they are able to achieve success. Proper research and development helps the organisation to
provide as per the demand of customers. The strategies help them to face all the situations and
overcome them.
SWOT Analysis
It is also important for the organisation to know about the company. Internal analysis of
the company is also important to know about the points of strengths and weakness. For this
reason SWOT analysis of company is done (Vlados, 2019). It is necessary to work on weakness
and than prepare for weakness. At the same time there are opportunities and threats present in
market. They must prepare themselves to know the opportunities and also prepare for threats.
The SWOT Analysis of AstraZeneca Plc is done below:
Strengths
 The company has good customer
relations as they are able to understand
the needs and wants of customers and
provide the satisfaction. This helps to
enhance the brand equity of company.
 They have a good track record of
bringing innovations. They have been
successful in using technology and
bringing change for benefit of
customers as well as organisation
(Abdel-Basset, Mohamed and
Smarandache, 2018).
Weakness
 It is seen that there are numerous
competitors in the industry. If the
company do not focus on their
products, then they will fail to gain
customers.
 The company is not good at demand
forecasting and that is the reason they
are able to loose various opportunities.
It is necessary to note that this is also a
reason competitors are able to fain
advantage.
 The company is unable to manage

 The company has good brand image
and that is due to their product
portfolio. The company is able to
expand the products portfolio as that is
useful for the company.
 They have good expansion plan. This is
the reason the company is able to
expand effectively and operate on a
large scale.
finances. Financial planning is not done
in an effective manner and this may
lead to loss of company.
 No double, AstraZeneca Plc is one of
the successful company dealing in
pharmaceutical industry. But, they face
cultural related issues.
Opportunities
 The updates in the technology and
innovation open doors for various
opportunities. It helps to provide
customers with quality products. This
helps them to get loyal customers.
 The company deals in differentiated
pricing strategy that helps to serve
more customers. It helps them to gain
advantage over the competitors.
 The company is able to reduce the cost
of transportation due to low shipping
cost (WIDIAWATI, 2020). It help to
enhance the profitability and get more
market share.
 Along with that they are able to serve
more customers through online
channels. The company is able to
enhance its sales after starting their
business online.
Threats
 The increase in number of loyal
distributors has also enhances the
competition in market. Presence of
intense competition is a threat for the
organisation.
 They company does not supply
innovative products on regular basis
(Longhurst and et.al., 2020). Sales of
company keeps on changing due to
their irregularity.
 The company has to face issues related
laws. As they operate in various places
and due to which they have to follow
the rules and laws of all the places.
 They face shortage of skilled
employees and that is the reason they
are unable to work effectively. As
employees play a vital role in the
organisation.

By knowing about the strengths and weakness, AstraZeneca Plc should work on reaching
more and more customers. They must try to gain advantage over the competitors. Also, they
must conduct effective research that will help them to expand the business and should follow all
the laws. The best practices of the company help them to gain advantage and achieve success.
Due to Covid-19 the online business strategy of business helps them to work effectively. It is
seen that a company that have understood the situation and formulated strong strategies are able
to achieve success and growth.
Competitive environment
The business world is dynamic and there are so many changes taking place. There is
uncertainty present in every level of business. The whole world has faced issue of Covid-19.
There were some players in market that were unable to deal with the situation (Choudhary and
Abbasi, 2020). Along with that some companies faced the situation and formulated strategies in
such a manner that they did not face any business loss. All this is present situation of nation. One
of the major point is competition. The competition is present in each and every industry and it is
also important for a company to analyse competitiveness present in industry. For this purpose
porter five forces model is used.
Porter Five Forces Model
The model was given by Michael E Porter to know about the competition present in the
market. All the forces that are given by Porter help to know about the competitiveness present in
market. A company that is able to know and analyse competition form strong strategies for
gaining advantage over the competitors. The five forces in relation to AstraZeneca Plc is
discussed below:
Threats of New Entrants: It is first force under this model. A company must know about
the new business organisations that can enter the business. The small businesses enter the
industry that has more profit and less barriers to enter. Due to Covid-19 more business
organisations are planning to start their business in pharmaceutical industry. New entrants can
start the business in pharmaceutical industry. For this reason AstraZeneca Plc forms the
following strategies as they help them to gain advantage over the competitors.
 By innovating the products and using latest technology they are able to retain the
customers. By using better pricing policy than the new entrants they will be able to gain success.

Bargaining Power of Suppliers: There is huge role of suppliers in pharmaceutical
industry. They can decrease the profit margins of the AstraZeneca Plc. The high power of
suppliers can lower down the profitability of company (Olafenwa, Ojikutu and Owoeye, 2021).
In this regard they formulated strategies such as:
 They must develop good and effective relations with suppliers so that they get raw
material on time. By making payments on time the company can retain the suppliers.
Bargaining Power of Buyers:The company works to satisfy the needs and wants of
suppliers. It is seen that there are numerous sellers that deal in pharmaceutical industry. The
switching cost is less so the company takes pressure of retaining customers. There are some
strategies that are followed by the company are as follows:
 The company large customer based and they provide quality goods to customers that
helps them to retain customers.
 By innovating the product on regular basis the company is able to deal with competition
and attract more and more customers.
Threats of Substitute Products: As per the force a similar product is able to satisfy the
needs and wants of customers (Papakostas and et.al., 2018). It is a fear for the company as
customers can switch to similar products easily. In this regard AstraZeneca Plc. Formulates
following strategies and they are mentioned below:
 They focus on core need of customers and provide the goods as per their specification.
 By providing online delivery to customers on time. As well as by providing online
delivery the company is able to achieve success.
Rivalry among the Existing Competitors: There are many players in market that deal in
similar products. This has direct impact on the profitability position of the company. There is
intense competition present in pharmaceutical industry and due to this reason AstraZeneca Plc
has to formulate strategies such as:
 By taking care of needs and wants of customers and providing them quality goods.
 By building a sustainable differentiation
These are some of the forces that show the competition in market. It is important to know
about each and every force and then form strategy that will help them to gain advantage over the

competitors. As one can not find a place without competition. It is important to face the same
gain advantage.
CONCLUSION
From the above report it can be concluded that strategic management is essential for
success of company. As there are certain situations that occur in an organisation and by
formulating effective strategies an organisation is able to deal with all the challenges. In the
report there is discussion related to external environment of the company. SWOT Analysis is
also done to know about own capacities and weaknesses of the organisation. In the end of this
report the competitive environment of company is also evaluated.

REFERNCES:
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AstraZeneca PLC PESTEL Analysis, 2018 [Online] Available through:
<https://www.case48.com/pestel-analysis/3774-AstraZeneca-PLC>