Strategic Management and Sustainability: A Case Study of AstraZeneca

This essay provides an analysis of AstraZeneca's strategic management and sustainability practices within the pharmaceutical industry. It begins with an introduction to strategic management concepts and AstraZeneca's background, highlighting its involvement in the development of the Oxford-AstraZeneca Covid-19 vaccine. The analysis employs frameworks such as PESTLE and Porter's Five Forces to assess the external and internal factors influencing AstraZeneca's operations. The PESTLE analysis examines political, economic, social, technological, environmental, and legal factors, while Porter's Five Forces assesses the competitive landscape, including the threat of new entrants, bargaining power of suppliers and buyers, the threat of substitute products, and industry rivalry. The essay concludes by emphasizing the importance of strategic adaptation and sustainability in the face of industry challenges and competitive pressures. Desklib offers a wealth of resources, including similar essays and study tools, to support students in their academic endeavors.

Strategic
Management and
Sustainability

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY...................................................................................................................................3
CONCLUSION ...............................................................................................................................8
REFERNCES:..................................................................................................................................9
Books and Journals:....................................................................................................................9

INTRODUCTION
The word strategies can be understood by all those efforts to achieve organizational
goals and objectives, and where one can play to succeed or win. It determines a particular
course of action that drives from the current position to the future position. Strategic
Management is a process in which goals and targets or procedures are set in order to provide a
company competitive benefits (Ariza, 2021). On the other words, employees and other
resources are deployed achieve desired goals. The essay highlights the organization named
AstraZeneca which is British multi-national company, specialized in pharmaceutical and
biotechnology. The company was introduced in 1999. it headquartered in Cambridge, UK. The
company has a portfolio of their goods and services for major diseases in areas such as
infection, inflammation, cardiovascular, oncology and many more. The company operates their
business in more than 100 countries. The company is also very well-known for his major
involvement in the development of Oxford-AstraZeneca Covid-19 vaccine. As the
pharmaceutical industry deals a high pressure due to the Covid-19 situation, the essay includes
various aspects and frameworks such as PESTLE analysis or industry five forces that has a
major impact on the business environment.
MAIN BODY
The Strategic Management assists companies take stock of their current situation,
strategies have been chalk out, deploy them and examine the effectiveness of the strategies
that are implemented. These are involve five general strategies and while implementing it can
be varied which is depending the business surroundings. It is a process of implementing and
formulating strategies depending on the business goals and objectives and these initiatives are
taken by managers on the behalf of the stakeholder of the company. In context to AstraZeneca,
it cater overall direction to the company which is consist with goals, developing plans and
policies, and allocation of resources. It is based on the assessment of internal and external
surroundings in which business is operated. The pharmaceutical industry involves both private
and public sectors. While considering UK, it plays a vital role in the pharma sector globally. Also,
it has big pool of engineers and scientists who have potential to lead this industry to the greater
achievements. The Covid-19 and its resultant lockdown majorly affect the pharmaceutical
industry as well. Due to this unpredictable situation and challenging time, the pharmaceutical
companies are highly impacted and rapid challenges are arise from disruption in supply chains.
Many business process needs to be change to handle this situation (Buckley, 2018). As the
situation already affected a lot but if it lasts more longer than expected, the supply of active

ingredients and material and the trade of pharmaceuticals impact negatively. There is also
chances to impact negatively on the R&D projects and programmes as well as manufacturing
activities. The full impact of situation of Covid-19 is still not known, so that pharma companies
like AstraZeneca require to respond, retrieve and grow.
PESTLE analysis is a strategic tool that focuses on to analyse the macro environment
factors of the company. This involves factors like political, economic, social, technological, legal
and environment that affect the external environment of AstraZeneca. The changes in these
factors not only impact the AstraZeneca company but other players in the pharmaceutical and
healthcare industry as well (Lee And Et.al, 2018). The company operates in a dynamic and
complex environment featured by growing environment activism, regulatory changes,
technological changes, collective social trends and evolving legal procedures. In context to
AstraZeneca, this framework facilitates a great detail about operating challenges and the
company will face in macro surroundings other than its competitive forces.
Political factors posses a vital role that impact on the long term profitability of the company in a
certain market and country. As it has their operations in more than 100 nations, they are facing
political challenges and risks in order to supply their products and services. The presence in the
global market increases the sensitivity of organization to changes in political system in several
nations. In order to drive the business successfully , it is important to diversified the systematic
risks. As the company involves in the development of Covid-19 vaccines, they are facing
several tarrifs on import, new health and safety laws, possible raise in the VAT. So that is why
these factors have several impacts on the AstraZeneca and its profitability.
Economic factors also majorly affects the AstraZeneca at national and international level. No
matter, the economy is at boom, recession or at recovery will impact on the consumer behaviour
and confidence of purchasing a product (Aghasafari and Et.al., 2020). It is significant to
understand for the company economic factors such as inflation and savings rate, labour market
condition, interest rate or foreign exchange as they are considering the economic environment
of the nation. The company can use economic factors of the country such as inflation, growth
rate and industry's economic indicators like Healthcare industry. With an addition to
AstraZeneca, the Covid-19 outbreaks the poor performance of market. For example, due to this
virus, many of the workers falls sick which lead to temporary lack of employees. Whether the
employees making their decisions or quarantine themselves to stay home.
Social factors includes the culture of society and way of doings things that impact the culture of
the company. Consumers shared beliefs and attitudes plays a major role in how marketers of
the respective company will comprehend the consumers of certain market and how they design

content for the message for pharmaceutical industry consumers. The disease of Covid-19,
results in panic. This will seen in many aspects such as citizens tends to stay at their home for
extended period of the times, they must visit to grocery stores to stock up the essential goods
such as food, toilet papers, water (Molodchik, Jardon and Bykova, 2019). Due to such
situations, consumers more likely to wear masks whenever they go outside their home,
maintain distance, choose remote working, avoid travelling and many more.
Technological factor is the fourth factor of pestle analysis. The rapid growth of technologies
and technological diffusion throughout the world has increases the significance of technological
factors while making strategical decisions. Understanding of technological factors help the
respective firm to follow the current trends to accomplishing certain business benefits such as
boosting innovation process, increasing profitability and improving operational efficiency. The
upgraded technologies help scientist to get the information about the nature and spread of the
disease. So that would know better how the disease can be treated. One of the best example is
the creation of drive through testing centres, through which people can test themselves for the
virus without exposing themselves to any doctor or to the hospital.
Environmental factors considered as an important part of the analysis due to the growing
consciousness on the environment and changing climatic conditions. The environmental laws,
regulations and standards are different from country to country (Chen and Et.al., 2018). As the
presence of AstraZeneca is global, they are require to consider those differences to carefully
neglect the undesired circumstances. As recycling has become the new business norm, the
respective firm adopt innovative recycling and waste management practices. Many of the
nations cater these services while offer subsidies for promoting investment in renewable
technologies, in order to ensure the long term sustainability, the respective firm can get benefits
through it.
Legal factor is the last factor of analysis of macro environment. Before entering into new
market, the company must acknowledge the local laws and regulatory structure of the new
consumer market. A careful evaluation of legal aspects is essential before entering into new
market otherwise it can cause unwanted circumstances such as loss of competitive benefits and
many more. In respect of AstraZeneca, they must consider the employee’s health and safety as
there are many countries which have strict laws for the labour safety. Providing the safe work
environment to the workers is the moral obligation of the company and ethical as well.
Industry's five forces or poter's five forces analysis is another strategical tool of the
management which helps to analyse the industry (Porter and Yiftachel, 2019). With an addition
to AstraZeneca, this analysis offers to understand how five competitive forces develop a

strategy to gain long term competitive benefits and influences profitability in the pharmaceutical
industry.
Michael Porter observed five forces that has a vital affect on the profitability. This framework will
help the respective organisation to analyse how sustainable can be build in the healthcare
industry. It also helps to explore the profitable opportunities in the healthcare sector.
Threat of new entrants will bring innovation, pressure and things of doing things in a new way.
It put pressure on the company through reducing costs, lower pricing strategy and offer new
value proposition to the customers (Dzwigol, 2020). The company has to face all such
challenges and highly focused on to built effective barrier as a safeguard to protect its
competitive edge. By innovating new products and services, it will not only attract the new
customers but also give existing customers a reason to maintain relationship with AstraZeneca.
New entrants needs to spend money on R&D, as the threat of the new entrant will be less.
Bargaining power of suppliers, the healthcare industry has a countless number of suppliers
through which they can buy raw materials. It is identified that suppliers in the dominant position
can reduce the profit margin that a company can earn in the marketplace. Emerging market are
featured by economic suppliers who are impacted by several macro environment factors. There
are also suppliers who supplies similar products but has different qualities. Powerful suppliers
can negotiate their prices in order to earn from various pharmaceutical companies. Overall the
bargaining power of suppliers reduces the long term profitability of AstraZeneca. Hence, the
bargaining power of suppliers in the pharmaceutical industry is also low.
Bargaining power of buyers, in pharmaceutical industry, the government posses a significant
role and has a power over the companies as they necessitate the companies to cater their
services and products at different prices according to the geographical areas and market's
constituency. Buyers often demanding a lot in the industry. They always try to purchase from
those company who offers less to them and this put the companies in stress and ultimately
affects their long-term profitability. For this, the companies also produces products which have
less side effects. With an addition to AstraZeneca, if the bargaining power of customers is high
then their ability to seek into offers and discounts is also high.
Threats of substitute products or services, when a new products delivers and satisfy the
same level of satisfaction to the customer then it affects the profitability of companies in many
ways. It is found that in this industry type, most of the companies offers unique range of
products which leads to low threat of substitutes. Patent protection delivers a little regard for the
companies in certain emerging markets. For such, the threat of substitute is low. Patent
expiration also reduces the profit margin of companies as a result it leads to proliferation of

generics. In context to AstraZeneca, from the above it is clear that the threat of substitute
products and services is low to high in the healthcare industry.
Competition or rivalries, if the competition among the existing companies is intense it will
result in down prices and reduced profitability of the companies (Akça, 2018). Now a days
pharmaceutical industry exploit big opportunities by using advanced and upgraded
technologies. When patents of drugs or medicines has expired then the company faces stiff
competition in the pharmaceutical industry. In context to AstraZeneca, it operates in a very
strong competitive market. For such, the respective company is also focuses on to create
sustainability and collaborating with various companies so that they can increase their market
share rather than they can just compete in small market. Therefore, this competition decreases
the long term profitability of pharmaceutical companies.
It is analysed from the above five competitive forces is that the mentioned organisation
can get a complete picture of what can affects their profitability in the industry (Alfawaire and
Atan, 2021). They can also get early game changing strategies can swiftly exploit to grab the
greater opportunities. Overall, by understanding porter's five forces, the managers and leaders
of the AstraZeneca, can mould those forces in favour.
Pharmaceutical life cycle management strategies can be referred as process of handling the
entire life cycle of a product and services consisting its research, design and manufacture,
services and disposal (Täuscher and Abdelkafi, 2018). It is great tool that helps to boost the
sales of a product and act as competitive edge to cater long term profitability and focuses on to
retain market share when the patent expires. Successful companies such as AstraZeneca,
consider the entire life cycle from discovery through end of life. Maturity has the third stage of
product life cycle after introduction and growth. It can be challenging for the manufactures. In
the very first two stages, the company tries to cover the market area and then try to increase the
sales as a large market area (Kodali and Bharadwaj, 2018). During maturity stage, the main
focus is on to maintain the company's market share in the face many different challenges such
as rising development costs, pricing pressures, declining R&D productivity . In context to
pharmaceutical industry, companies invest their funds intro preserving patent life and profits of
the product which takes many years to geneate. They are required with defensive strategies to
retain market share and fight their generic competitors (Pharmaceutical Lifecycle Management
Strategies in 2017). These challenges leave pharmaceutical companies such as AstraZeneca
exposed to generic which can crumble a important percentage of the market share and sales
within a minimum period of time.

CONCLUSION
It has been concluded from the above report is that strategic management give assurance
to the company that aims and objectives are set, time and resources are pivoted, primary issues
are outlined, internal environment is set to accomplishing goals functioning is consolidated and
many more. It caters company to gain competitive edge over their rivalries in the market.
Strategic plan also offers company to get clear vision, goals and direction for their everyday
execution so that can achieve ultimate outcomes by the strategies. The report outlines various
frameworks such as pestle which helps companies to analyse different external factors such as
political, economic, social and many more in the business environment. It helps company to
identify significant changes and to expand their business. Porter's five forces helps to company to
analyse the strategy that suits its competitive market and to improve profitability for the
business. It is an important tool that shape the competition within the pharmaceutical industry.
Industry life cycle caters important information about growth prospects, supply chains, corporate
strategies, opportunities and challenges as well.

REFERNCES:
Books and Journals:
Aghasafari, H. and Et.al., 2020. Determination of the best strategies for development of organic
farming: A SWOT–Fuzzy Analytic Network Process approach. Journal of Cleaner
Production, 277, p.124039.
Akça, Z., 2018. Reflection of sustainability issues in airline strategies and overview of life cycle
cost analysis. International Journal of Sustainable Aviation, 4(2), pp.133-146.
Alfawaire, F. and Atan, T., 2021. The Effect of Strategic Human Resource and Knowledge
Management on Sustainable Competitive Advantages at Jordanian Universities: The
Mediating Role of Organizational Innovation. Sustainability, 13(15), p.8445.
Ariza, D., 2021. Cultural Values as Strategic Support to Organizational Sustainability in Times of
Pandemic: Case Study of a Company in the Formal Textile Trade Sector in Colombia.
In Handbook of Research on Management Techniques and Sustainability Strategies for
Handling Disruptive Situations in Corporate Settings (pp. 326-341). IGI Global.
Buckley, P.J., 2018. How theory can inform strategic management education and
learning. Academy of Management Learning & Education, 17(3), pp.339-358.
Chen, M. and Et.al., 2018. Variability in copepod trophic levels and feeding selectivity based on
stable isotope analysis in Gwangyang Bay of the southern coast of the Korean
Peninsula. Biogeosciences, 15(7), pp.2055-2073.
Dzwigol, H., 2020. Methodological and empirical platform of triangulation in strategic
management. Academy of Strategic Management Journal, 19(4), pp.1-8.
Kodali, B.S. and Bharadwaj, S., 2018. Foetal surgery: Anaesthetic implications and strategic
management. Indian journal of anaesthesia, 62(9), p.717.
Lee, B.S. And Et.al, 2018. Analysis of rate-limiting factors in thick electrodes for electric vehicle
applications. Journal of the Electrochemical Society, 165(3), p.A525.
Molodchik, M.A., Jardon, C.M. and Bykova, A.A., 2019. The performance effect of intellectual
capital in the Russian context: Industry vs company level. Journal of Intellectual
Capital.
Porter, L. and Yiftachel, O., 2019. Urbanizing settler-colonial studies: Introduction to the special
issue.
Täuscher, K. and Abdelkafi, N., 2018. Scalability and robustness of business models for
sustainability: A simulation experiment. Journal of Cleaner Production, 170, pp.654-
664.

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