Strategic Management Analysis: PAREXEL International Business Report

This report provides a comprehensive strategic analysis of PAREXEL International, a major pharmaceutical and biotechnological company. It examines the company's challenges, including decreased market share, resource constraints, and ineffective HR planning. The analysis employs various strategic frameworks such as VRIO, SWOT, PESTLE, and Porter's Five Forces to identify influencing factors and assess the company's competitive position. The report highlights issues in resource allocation, customer satisfaction, and profitability, and recommends strategies to overcome these challenges. Key recommendations include improving resource management, enhancing product quality, and developing innovative products to address competition and improve overall performance. The report also includes an analysis of VRIO, SWOT, and other strategic tools to assess internal and external factors impacting the company's performance.

Business strategy

Executive Summary
Strategic management is a process through which companies are able to implement plans
and strategies in order to achieve target. It helps in overcoming various challenges and maintain
effectiveness of the process. PAREXEL international is second largest pharmaceutical and
biotechnological company of USA. More that 95% of medical products are supplied by this
organisation. They are providing services into through four units i.e. clinical Research service,
clinical Trial Logistic service, PAREXEL Informatics and Consulting. Currently, they are facing
various challenges such as decreased market shares, inadequate resources and poor management,
, ineffective HR planning, etc. There all factors adversely affects growth and profitability of
company due to decrease in customer satisfaction. There are various strategies are applied such
as VRIO, SWOT, PESTLE, Porters 5 force model, market share and HR management strategics.
Through implementing these framework various influencing factors are identified. In order to
overcome identified issues various strategies are recommended such as quality, resource
management, etc. The various issues are faced by company .The company is not bale to allocate
resources,the needs of customers are not fulfilled,lack of profit etc. The huge rivalry is faced by
company in market as PAREXEL is not profitable in conducting studies with specific focus on
market. So the various strategies such as financial need to be made to reduce expenses and cost.
The employees need to be appointed as that better services can be delivered to customers. The
high-quality products and innovative products need to be made by company so as to deal with
competition that is faced in market.

Table of Contents
INTRODUCTION...........................................................................................................................1
Strategic analysis ...................................................................................................................1
Reason behind company is not yielding a competitive advantage.........................................2
Summary of strategic analysis .............................................................................................13
Reflection.............................................................................................................................18
CONCLUSION .............................................................................................................................19
REFERENCES..............................................................................................................................21

Illustration Index
Illustration 1: Porter's Five Force model..........................................................................................9
Illustration 2: Model of strategies HR management......................................................................11
Illustration 3: BCG growth- share matrix......................................................................................12

INTRODUCTION
The process through which companies are able to formulate and implement plans, in
order to achieve their objective is known as strategic management. Ineffective management
creates huge impact on the growth and profitability of firm (Baumgartner and Rauter, 2017 ).
PAREXEL International is multinational company of USA. It is second largest
biopharmaceutical and biotechnological service provider and research organiser across the
world. More than 95% of the medical products are developed by this organisation . The vision
of the firm is to develop advance medical products and therapies and help people worldwide. It is
operating through four different units i.e. clinical Research service, clinical Trial Logistic
service, PAREXEL Informatics and Consulting. In today’s market place, the business group is
facing various strategic challenges such as decreased market shares, inadequate resources and
poor management, , ineffective HR planning, etc. There all factors adversely affects growth and
profitability of company due to decrease in customer satisfaction. The present report is based on
the critical analysis of the strategic challenges being faced by the PAREXEL International group.
In order to analyse the issue in detail, different approaches and concepts have been applied
strategic challenges roadmap, VRIO, SWOT, PESTLE, etc. so as to reduce existing challenges
and supports growth of firm (Borland and et.al., 2016 ).
Strategic analysis
Strategic analysis is a process through which companies are able to evaluate their
business strategies, identified issues and create suitable strategies. . PAREXEL International is
experiencing several business challenges in the current market into different units. Its clinical
Research service is suffering issues due to lack of talented and knowledgeable work force, as a
result, quality of research is getting affected. Clinical Trial Logistic service unit of company is
not producing productive outcomes due to ineffective HR management activities. Along with
this communication process of the firm is also not healthy (David and David, 2017). PAREXEL
Informatics and Consulting is unable to generate good profitability of company and creating
impact on market shares also.
Strategic challenges that is faced by the company
Lack of resources
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The company is not able to gain market shares as the resources are not used effectively.
The resource allocation planning and appointing planning of PAREXEL is dependent on the
global needs for individual function .In conducting studies with particular attention on a market
PAREXEL is not profitable enough as for internal communication a lot of time and hard-work is
needed .And also it is difficult to face additional resources available with specific language
capability. Due to this the projects at this company are facing delays,the customers satisfaction
also decreases due to this. The new business loss is experienced by the company because of the
problems that is faced. The complications that they are facing in allocating resources are that
they don't have a healthy authority .To understand the needs of resources they require a strong
local who know how to manage these things and must have a good skills of language.
Lack of profit
As the needs of the outcomes are not fulfilled at specific time -interval,the company is
facing loss in the profit. The products are not delivered at particular time. In some emerging
markets the investors are less experienced. To deliver reliable the experiences people are need.
Reason behind company is not yielding a competitive advantage
As the business is facing so many issues regarding proper allocation of resources,they do
not have particular language capability .The advantage over rivals can be gained through
competitive advantage. But since the company is experiencing loss of profit as resources that are
needs such as delivering of service at specific time-period is not fulfilled. So customer-
satisfaction is decreasing so it is not bale to gain competitive advantages. As the demands are not
bale to enforced by company properly, delays in projects and loss of new business is taking
place. The huge competition is faced by company from Quintiles IMS Holdings ,Inc. and
Covanve Inc. This is also the reason why the company is not able to gain competitive advantage.
By market research the unsatisfied needs of customer need to be identified. To achieve
competitive advantage through the acts of innovation is the main challenge for companies. The
importance of a firm's core competencies is emphasized by the resource-based view of form. The
core competencies need to be identified by the company. The industry has 0.62 quick ratio
whereas the quick ratio of company is 0.34 which clearly shows that liquidity ratio of company
is low. As a result of this it will not be able to pay the suppliers at particular time -period.
Suitable strategies option
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The suitable strategies will be made by the company in order to deal with issue that is
faced by company .The company need to pay attention on resources by making sure additional
resource are there so that work is does on time. The reporting need to done where the employees
thins that support is not adequate. To employees of team the additional training need to be give.
The guidance can be given so that they can explore their actual skills. With-in house or external
providers the training seminars can be conducted.
In case if workforce is limited due to which the company is not able to manufacture and
deliver produce then in this scenario company will hire or appoint new talents so that all the
product are delivered at appropriate time. Once the deserving candidates that are hired training
can be given to them s that they will be are about company's working.
To cope up with issues of customer satisfaction high-quality products needs to be made.
As now-a-days the customers focus more quality of products rather on price. To deal with rescue
profitability the company will decrease its expense .The financial strategies will be made by
company in order to control the cost. By using VRIO framework the company will evaluate their
resources and capabilities to find out if the company has competitive advantage. The strategies
will be made to bring innovation in company. New technology will be used to increase the
efficiency of business. In the formation of new product and process the companies core
competencies will valuable products. The training sessions will be made so as train workforce on
how to use new technology. To deal with competition that is faced by Quintiles IMS
Holdings ,Inc. and Covanve Inc the company need to focus on lifestyle and preference of
customers and resources ned to be allocated as per requirements.
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Illustration 1: Increasing return on invested capital
(Source:Increasing return on invested capital , 2017.)
From the above diagram it can be concluded that returns are not properly generated by the
company due to decline in profit. The return on investment is decreasing continuously from
2015.

In order to overcome these problems various strategic management approaches are
available, through which impact of issues can be reduced. Strategic challenges roadmap, it is
distributed into different stages through which problems are identified, on the basis of that
influencing factors are analysed (DeVaro and Boyd, 2016 ). In the first step of the roadmap
process, identification of challenges takes place. Basis on that process various issues are
identified such as HR activities, skills of employees, resources allocation, communication,
market shares fall, limitation of resources, profitability, etc. Currently, its all the four
departments are facing different challenges based on their resources and operations. These
challenges arose by certain internal and external volatility. PAREXEL international is
experiencing such challenges due to both internal business strategies and external market
environment i.e. competition, consumer demand and others. Some of the internal influencing
factors are like quality of services, lack of resources, ineffective communication channel, HR
management, etc. Along with this there are various external factors are equally responsible such
as customer’s demands, availability of qualitative materials, adherence with the rules and
regulations, etc (Foss and Knudsen, 2013). It arise the need for the company to devise suitable
policies and plans for the successful environment.
Identified issues Strategies approach
Lack of resources VRIO
Customer satisfactions SWOT
Reducing profitability PESTLE
Competitive environment Porter 5 force model
HR management Model of strategies HR management
Decreased market shares Market shares management strategies
VRIO is considered an as internal analysis approach, through which company is able to
analysed and evaluate resources based on internal and external factors. With the help of method
they are able to focus of four criteria such as:
1. Value
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2. Rarity
3. Imitability
4. Organisation
Through applying this strategy into PAREXEL international, strategies challenges based on
resources allocation can be solved.
Resources Value Rarity Imitability Organised to
capture value
Competitive
advantage
Skilled
employees
Yes Yes Yes Yes Sustainable
competitive
advantage
Research and
development
Yes No No No Temporary
difference
Disease
detection and
diagnosis
Yes Yes No Yes Competitive
parity
Quality
measure
Yes Yes Yes Yes Sustainable
competitive
advantage
Table 1: VRIO analysis for PAREXEL
(Source:VRIO analysis for PAREXEL , 2017)
On the basis of above table is analysed that company is required skilled employees in
order to maintain competitive advantaged of the company. Along with this research and
development work of the company is also not able to generate effective outcome. Disease
detection and diagnosis process of PAREXEL international is producing competence results and
quality of services and products are also effective (J. Harrington and et.al., 2014 ). Therefore, it
is analysed that company is facing resources shortage because their resources are not being
utilised effectively. It I creating direct impact on the quality of the services. In order to overcome
these issues resources management approach can be applied. It helps in allocating resources
effectively in order to fulfil meet task.
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SWOT
SWOT analysis is considered as a process through which internal influencing factors can
be determined. It is distributed into four unit’s strengths, weaknesses, opportunities and threats.
For PAREXEL international, it is conducted here as under:
Strengths
1. Strong distributive network.
2. Global existence
3. The high growth rate
4. Effective monitoring system
5. Large customer base
6. Reduced labour costs
Weaknesses
1. Increased cost of the products.
2. Ineffective quality
3. Lack of skilled and knowledgable
employees.
4. Ineffective technologies
implementation
5. The barriers are faced by the industry.
6. The suppliers are missing
Opportunities
1. New services and therapies can be
launched.
2. Different market trends can be
approached.
3. Implementation of technologies helps
in decreasing development cost.
4. Increase in demand.
5. Income level is at a constant increase
Threats
1. Automation is considered as biggest
threat for the company.
2. Gradual increasing market
competition.
3. The increasing costs.
On the basis of above table it is analysed that there are various factors that are creating
direct impact on the quality services and products. Some of them are like gradually increasing
cost of products resulting less business profitability because consumers are moving towards
other brands which is available at least cost. Along with this due to lack of talented employees,
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quality of the services are also getting affected (Ma and Seidl, 2016 ). It also creating negative
impact in market and decreasing their customer’ base.
In order to overcome the such issues, quality management strategic can be be
implemented. With the help of this method company is able to improve manufacturing process
and research work. It supports PAREXEL in order to provide promising services in accordance
with the user requirements. Through this way they are able to meet their expectation level.
PESTLE analysis
PESTLE analysis is a framework through which organisations are able to determine
external factors that are influencing processing of the company. In this process analysis is
considered on the basis of six categories, such as political, economical, social, technical, legal
and environmental (Mejia-Villa and Alfaro, 2015 ). PAREXEL international is able to determine
impact of various factors on the profitability of company.
Political
1. Legal framework in order for
agreement related work.
2. Corruption level
3. Trading charges, rules and regulations
imposed in the form of duties.
4. Organisational safety and security
regulations
5. Employees wages and benefits.
Economical
1. Exchange rates.
2. Interest and inflation rate of company.
3. Economic growth and GDP.
4. Competitive advantages.
Social
1. Education and knowledge level.
2. Demands of customers
3. Environmental and health factors.
Technical
1. Implementation of technologies for
research and diagnosis process.
2. Impact of technologies on research and
services production process.
3. Techniques for maintaining distributing
system.
Legal
1. Consumer rights
Environmental
1. Rules and regulations for maintaining
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