Strategic Management Project: Home Pharmaceutical Case Study Analysis

This project is a strategic management analysis of Home Pharmaceutical, covering various aspects of strategic planning and execution. It begins with a capability gap analysis, comparing Home Pharmaceutical's functional areas and capabilities with those of its competitors. The project then delves into key success factor (KSF) analysis, evaluating Home Pharmaceutical's capabilities in relation to KSFs such as innovation, R&D, and global footprint. It includes a rating of KSFs with capabilities and an evaluation of Home Pharmaceutical's ability to compete in the market. The project further explores competitive advantage, resources, capabilities, and competencies. It examines the relationship between resources, capabilities, and competencies, highlighting the importance of KSFs in achieving organizational goals. The project also covers strategy evaluation, identifying models for success and financial indicators. Finally, it discusses corporate and business-level strategies, strategic decisions, and the future direction of the organization, including the application of generic strategies.

Running head: STRATEGIC MANAGEMENT
Strategic Management
Name of Student
Name of University
Author Note

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Table of Contents
PART-A.....................................................................................................................................2
Question 1: Capability Gap Analysis.....................................................................................2
Question 2: KSF Capability Analysis.....................................................................................3
Question 3: Rating KSF with Capabilities.............................................................................4
Question 4: KSF/Capabilities Evaluation...............................................................................6
1. Explaining rating of KSF....................................................................................................6
2. Explaining ability of Home Pharmaceutical in the competitive market.............................7
PART-B......................................................................................................................................8
Question 5: Competitive Advantage......................................................................................8
Question 6: Key Success Factor...........................................................................................10
Question 7: Strategy Evaluation...........................................................................................11
1. Identifying models for success strategy...........................................................................11
2. Identifying financial indicators.........................................................................................12
3. Explaining application of social media and Corporate Social Responsibility.................12
Question 8: Strategic Development......................................................................................13
PART-C....................................................................................................................................14
Question 9: Corporate and Business level strategies............................................................14
1. Corporate level strategy....................................................................................................14
2. Business level strategy.....................................................................................................15
Question 10: Strategic decisions..........................................................................................15

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1. Explaining meaning and selection of strategies...............................................................15
2. Defining the future of the organisation............................................................................16
3. Following a generic strategy............................................................................................16
Reference..................................................................................................................................17

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PART-A
Question 1: Capability Gap Analysis
Column 1: Functional area Column 2: Home
Pharmaceutical
Capabilities
Column 3: Capabilities of
closest competitors
Selling of pharmaceutical
drugs
1. Good wholesale prices;
popular among customers; a
strong distribution system
2. PB manufactures and sales
drugs; KP is a trusted
healthcare brand; HB
provides innovative medical
preparations: 0
Reputation in the countries 3. Gradual progress in the
market; local research made
by the managers
4. KP is the trusted
pharmaceutical firm in
Malaysia; HB has a wide
distribution of products: +1
Ability to provide solutions
to diseases
5. Highly skilled research
teams; provides best
estimates about the
occurrence of a disease
6. PB has facilities that
provide online health check-
up; PB has also expanded its
hospital network; HB
supplements over 400
healthcare products: +1
Powerful presence in the
international market
7. Have grown in the
international market;
Researchers are normally
from international market
8. PB expanded its healthcare
facilities; KP exports its
vitamins to five other
countries; CD signed deals in

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the international market: 0
Innovativeness 9. Creation of wireless
Bluetooth and FM
technology are major
innovations; improved
capital provides innovation
10. The competitors rely
more on the traditional
approach: -1
Table 1: Capability Gap Analysis
(Source: Created by author)
Question 2: KSF Capability Analysis
Column 1: Key Success Factors
(Pharmaceutical industry)
Column 2: Home Pharmaceutical
Capabilities
KSF 1: Innovation Creation of wireless Bluetooth and FM
technology help in reducing the hearing
problems for about 1 in 6 people of the
population
KSF 2: Strong R&D The R&D team of the company is mainly
from the local markets. Apart from this the
researchers from Malaysia is also involved in
gaining success
KSF 3: Global footprint The company have developed and
manufactured medicines that are widely
popular in the global market. The innovative
nature of the hearing aids makes it globally
significant. The cost of the company,
however, have increased with the increase in

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global recognition
KSF 4: Innovative culture Home Pharmaceutical develops an innovative
culture in order to help people across the
world to understand the reputation of the
company. The growth of capital have injected
a new innovative and technical competence
in the company
KSF 5: Process management The company can forecast the requirements
that can help in managing the resources. The
ability to involve researchers and gain the
approval of the customers is helpful for
increasing the reputation of the company.
Table 2: KSF Capability Analysis
(Source: Created by author)
Question 3: Rating KSF with Capabilities
KSFs
Column 1:
Home
Pharmaceutical
Capabilities
KSF 1:
Innovation
KSF 2:
Strong R&D
KSF 3:
Global
footprint
KSF 4:
Innovative
culture
KSF 5:
Process
management

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1. Good
wholesale
prices; popular
among
customers; a
strong
distribution
system
7 3 7 8 4
2. Gradual
progress in the
market; local
research made
by the managers
5 6 6 9 2
3. Highly skilled
research teams;
provides best
estimates about
the occurrence
of a disease
4 7 5 7 10
4. Have grown
in the
international
market;
Researchers are
normally from
9 6 4 7 8

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international
market
5. Creation of
wireless
Bluetooth and
FM technology
are major
innovations;
improved capital
provides
innovation
3 9 6 4 6
Total 28 31 28 35 30
Table 3: KSF and Capabilities Rating
(Source: Created by author)
Question 4: KSF/Capabilities Evaluation
1. Explaining rating of KSF
After the analysis of the tables, it can be seen that the capabilities of Home
Pharmaceutical vary with the KSFs. The capabilities depend upon the resources available in
the company and the ways by which the company can apply it in order to build its reputation.
In this regard, it can be said that the highest rated capability is the high rated research teams
that help in the development of the medicines. The research team can provide a useful
estimation of the occurrence of a disease. Not only this, the management of the research team
is well taken care of by the managers of the company.

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On the other hand, the analysis shows that the gradual progress in the market is
considered as low for the company. The way by which the company establishes growth in the
market affects the process management of the organisation. The researchers take a
considerable amount of time in order to complete the research resulting in the stunted growth
of the reputation in the market. The managers of Home Pharmaceutical identify market
researchers that are local in order to reduce the cost of employment. Hence, this can be
considered as a lower attribute of the company.
The reason behind these factors being the highest and lowest is the fact that the
company invests heavily in developing a proper research of the medicines. This can help the
company to establish a competitive advantage, as the competitors are superior. The common
factor in the highest and lowest rating is the process management of the company. The
process management of the company includes the production, process and customer
management in Home Pharmaceutical. The researchers are given the required benefits in
order to conduct the research in a considerable manner. The slow of growth in the market
degrades it from achieving its target. Thus, the high and low valued capabilities posses a
common attribute that helps in understanding the flaws of the company.
2. Explaining ability of Home Pharmaceutical in the competitive market
The analysis of the competitors and capability table provides evidence that Home
Pharmaceutical does not dominate the competitors. Most of the times it has been seen that the
company either is at par with the capabilities of the competitors or lack the capabilities
possessed by the competitors. This provides evidence about the fact that Home
Pharmaceutical need to develop its reputation in the country and provide proper solutions to
prevent diseases. However, the company excels in the innovation department. The fact that it
has introduced the process of innovation as part of the organisational culture is a huge

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positivity for the organisation. The analysis provides evidence that supports the competitive
ability of Home Pharmaceutical in the industry.
The analysis shows that the pharmaceutical industry is largely grown in the modern
world. Countries like China and Malaysia have excelled in the industry and have developed
fierce competition in the market. The rival companies of Home Pharmaceutical have a rapid
international success owing to the collaboration that has with other countries. In this regard,
Home Pharmaceutical lacks the ability to excel in the international market and create a
reputation that can catapult the company to success. However, with the innovative nature of
the business, the company can convert its weakness and create opportunities to excel in the
regional as well as the international market at a rapid rate. Hence, the industrial chances of
survival and success of the company are balanced between its abilities and drawbacks.
PART-B
Question 5: Competitive Advantage
According to Hill, Jones and Schilling (2014), in order to gain a competitive
advantage, it is necessary to identify the factors that provide for competence in the market.
These factors include the resources, capabilities and competencies that a company possess.
Resources: The resources indicate both physical as well as natural resources.
Employees are considered as the most important resource for an organisation as without
employees an organisation cannot succeed. The tangible, intangible and human resources
make way for the development of organisational capabilities. In the case of Home
Pharmaceutical, the company has loyal employees that dedicate themselves to the innovative
culture of the company. The fact that the new capital investment has made the company gain

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innovativeness is a positive factor for the company that helps in the development of
capabilities within the organisation.
Capabilities: The capabilities of the company depend upon the type of employees
they possess. This is because the skilled employees can perform better and efficient work that
can help in improving the goals of an organisation. Peppard and Ward (2016) stated that the
capabilities of an organisation determine the KSF. This, in turn, determines the type of
strategy that an organisation needs to adopt in order to maintain a competitive advantage in
the market. Home Pharmaceutical develops these capabilities based on the support from the
resources it possesses. This leads to increasing the competencies in the market.
Competencies: The competencies result depending upon the strength of the resource
and the capabilities in the market. Competencies in an organisation depend upon the KSF and
the strategy that is implemented by the managers. Without proper competencies, it can be
difficult for the organisations to gain a competitive advantage. The level of competency
involved in Home Pharmaceutical can help it to outwit its competitors by creating a stable
platform for competition. Thus, the relation between the resources, capabilities and
competencies follow in a systematic manner in an organisation. Each level remains depended
on the other in order to provide an advantage to the organisation.

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Figure: Relation between resource, capability and competency
(Source: Peppard and Ward, 2016)
Question 6: Key Success Factor
Key Success Factors can be described as the combination of important factors that are
necessary for attaining the goals of an organisation. A company need to focus on the
development of certain areas that can help in improving a company and ensure that the
company gain a competitive advantage in the market (Wheelen and Hunger, 2017). A unique
KSF can help in attaining the organisational goals and formulate strategies that can help in
the success of an organisation. In the case of Home Pharmaceutical, the KSF of the company
lies in its ability to develop innovative products that help in increasing the reputation of the
company. In this regard, a link between the organisational capabilities and KSF can be
established in order to develop proper strategies. It can be said that without proper
capabilities the success of an organisation cannot be determined.

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Strategies are developed based on the resources and the competencies of an
organisation (Rothaermel, 2015). Hence, managers need to evaluate these factors in order to
identify the ways by which a competitive advantage can be derived by using proper
strategies. The link established is that the competency of the organisation is based on the type
of resource it possesses. This is an important factor for any organisation given the fact that
the resources available determine the potential of an organisation. The identified KSFs in the
case of Home Pharmaceutical include the adoption of innovation and innovative culture, a
strong team of researchers and developers and establishment of a global footprint. These
KSFs can only be achieved with the proper competency in the business. The competencies
involve the aim and objective of Home Pharmaceutical in establishing itself in the global
market. Hence, a systematic and planned link exists while developing competencies using
KSF.
Question 7: Strategy Evaluation
1. Identifying models for success strategy
In order to formulate a successful strategy, it is necessary to identify suitable models
that can help in establishing the strategy. The strategies have to be planned based on the
competencies of an organisation and the resources it possesses (Bettis et al. 2016). The
strategic method by which Home Pharmaceutical can attain success is by adopting the 7-S
strategic model. The application of this model can help the company formulate strategies by
thinking in a different manner. The 7-S model consists of seven factors that help in improving
the management system of an organisation. The seven factors consist of strategy, structure,
system, shared values, skills, style and staff. These factors can be categorised into hard and
soft elements depending upon the influence that can be caused by the managers while using
this model.

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In the case of Home Pharmaceutical, the company can apply this model in order o
enhance the performance. It has been evidenced from the case study that the rise in
pharmaceutical companies in the world has raised considerably with an industrial growth of
7.5% per annum. This indicates the competition that every pharmaceutical organisation needs
to face in order to establish itself in the market. Apart from this, the 7-S model also helps to
examine the effects changes may bring to the company (Hollensen, 2015). The possibilities
of merger and acquisition are also looked after by the application of the 7S framework. Home
Pharmaceutical can also use this approach in order to identify the best way to implement a
strategy. Thus, the 7S framework model can help Home Pharmaceutical to identify the
effectiveness of the strategies and implement it in a manner so that competitive advantage can
be attained.
2. Identifying financial indicators
According to Daellenbach (2014), the financial indicators help in identifying the
financial factors that are required to be maintained by an organisation. The basic factors that
make up a financial statement are analysed and based on the analysis, organisations make
strategies in order to maintain the finances. The financial indicators help to measure the
financial health of the business and make plans regarding the storage of cash in the future.
The four financial indicators applicable for Home Pharmaceutical include the gross profit
margin, net profit, net profit margin and the current ratio. These factors are indicative of the
business goals and the ways to attain the objectives. The reason for choosing these indicators
is that it provides a complete analysis of the expenses and income that have been incurred by
the organisation in the course of the financial year.
The indicators measure the profit and loss of a company and indicate the net worth of
an organisation. The calculation of the assets and liabilities of an organisation are also
provided in these indicators. In this case, Home Pharmaceutical can apply these measures in

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order to evaluate the success of the organisation. The application can be done based on the
expenses that the company has over the course of the year. The matrix that indicates the net
profit margin of an organisation helps in predicting the future profits of an organisation (Peng
and Liang, 2016). This helps in setting up the goals of an organisation and creates
benchmarks that indicate the level of excellence that is needed to be achieved. Thus, Home
Pharmaceutical can make plans for the future of the organisation and ensure that competitive
advantage is attained in the market. Thus, the financial indicators provide an opportunity to
identify the level of investments that are done by an organisation.
3. Explaining application of social media and Corporate Social Responsibility
In the modern day, social media plays an important role in the rise and fall of a business.
News about an organisation spreads quickly with the advent of social media. People are
influenced to make purchases based on the reviews that are given on the social media sites.
Thus, the buying behaviour of people is affected with the advent of social media in the
modern world. The number of likes provided in Facebook and the word-of-mouth of the
people plays an important role in the success of an organisation. In many occasions,
organisations take advantage of the modern technology in order to promote itself in the
market (Tai and Chuang, 2014). In the case of Home Pharmaceutical, the company can use
the social media in order to develop itself and increase its reputation in the international
market. It can even use it to search for talented researchers for the success of the business.
The Corporate Social Responsibility of an organisation defines the efforts it put in
order to maintain the reputation within the society. The responsibilities apply to the
stakeholders, organisation and the society. This is an important factor for a manager because
it defines the organisation and the purpose. It helps in increasing the reputation as well as the
recognition of the organisation. The Corporate Social Responsibility adopted by Home
Pharmaceutical is the adoption of providing proper health care facilities to the people residing

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in the region of business. This is an important factor for the organisation as it can help to
eliminate competitors and ensure that the society recognises the efforts put in by the
company. Apart from the facilities, the company can also indulge in spreading education
about the ways by which different diseases can be prevented. This can make a strong
contribution in bringing about recognition among the society and enhance the chances of a
rapid growth in the international market.
Question 8: Strategic Development
According to Clapp and Rowlands (2014), business strategy refers to the decisions
taken by a company in the course of maintaining a competitive advantage over the rivals. In
order to identify ways to get a competitive advantage, small business companies identify
product line, target market and the competition that exists in the market. The analysis of the
factors ensures that the company can rectify its errors and formulate strategies that can help
in gaining an advantage for the business. A business may choose from the generic strategy
proposed by Porter in order to remain competitive in the market. In the case of Home
Pharmaceutical, the company can identify the strength of the competitors and ensure that the
selection of strategy is aligned with the objective of the company.
Pedersen (2015) stated that the identification of opportunities outside the industry
leads to diversification in the business. In order to ensure that the uniqueness of the
organisation is maintained most business owners use corporate level strategy. The
diversification technique of the organisations provides a competitive edge as innovation can
be part of the organisational culture. The negotiation with the suppliers can be made as the
organisation can innovate products based on proper market research. Home Pharmaceutical
can innovate its products and create market value in order to gain competitive advantage.
These can be considered as new strategies that the company can adapt the existing strategies
do not provide an advantage for the company. In this regard, it can be said that the corporate-

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level strategy, as well as the business-level strategy, are interlinked as both provide an
opportunity for competitive advantage. The strategies that are formulated by the companies
depend upon the expertise in business that the organisations possess. Hence, the link between
the two levels of strategies can be established based on the advantage it provides to a
business.
PART-C
Question 9: Corporate and Business level strategies
1. Corporate level strategy
PRODUCTS OR SERVICES
EXISTING NEW
MARKETS EXISTING A Reduce cost of
products
B Vary the product
costs
NEW C Creating market value D Innovation
Table 4: Product Market Matrix
(Source: Created by author)
2. Business level strategy
COMPETITIVE ADVANTAGE
LOWER COST DIFFERENTIATION
COMPETITIVE
SCOPE
BROAD TARGET A Utilise human
resources
B Coordinate unit
activities
NARROW TARGET C Identify market
niche
D Develop advantages
Table 5: Generic Strategies

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(Source: Created by author)
Question 10: Strategic decisions
1. Explaining meaning and selection of strategies
In order to gain success, the business level strategy that Home Pharmaceutical has to
select is the identification of market niche. On the other hand, the corporate level strategy is
the innovation of the products. These two strategies can help the organisation to identify the
competitors and the customers that can be targeted in order to establish itself in the market.
Developing a market niche involves conducting an environmental analysis and the competitor
analysis in order to formulate strategies.
The modification of existing products results from a specific market research that
indicates the need for change. On the other hand, the innovation of products can provide
uniqueness for the company. Home Pharmaceutical possesses an innovative culture that helps
in the growth of the business and provides unique solutions to the control of diseases. This
contributes to an added advantage for the company and provides an opportunity for growth in
the pharmaceutical market. The reason for choosing these strategies over others is due to the
modern day demand of the people. Most people want products that are different from one
another. This often led to change in strategy in order to remain competitive in the market. The
direct application of the innovative and analysing strategy helps in creating an advantage.
2. Defining the future of the organisation
Based on the analysis of the case study, it can be said that Home Pharmaceutical aims
to grow in the market. The choice of a correct strategy can help in the growth of the company
and provide it with an international reputation. The products and services of the
Pharmaceutical Company are based on the customers it serves. Mostly the products are made
after proper research about the market. However, it has been seen that the company also

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manufactures the hearing aid in an innovative manner to avoid any hearing diseases. Thus,
the target customers of the company comprised of the people having problems in hearing and
require extensive care of the diseases. This can help in narrowing the target base and make
specific products to ensure the growth of the company.
3. Following a generic strategy
In order to gain success in the market, it is necessary that Home Pharmaceutical
follow the differentiation strategy. The innovative culture that the organisation possesses can
help in formulating this strategy. Hence, the strategy can be suitable for the organisation.

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