Novartis: Leading a Global Enterprise Case Study Solution
Additionally, Novartis had experienced 12 percent growth in the sales of the company’s key products through shift in the resources of marketing. With purchase of 20 percent shares of Roche, despite of its unsuccessful acquisition Novartis had efficiently managed its shares through the power of blocking change of the capital structure of Roche with the requirement of large transaction.
In the early trials of Gleevec, the occurrence of liver toxicity had led to a risk of launching a toxic drug. With continuation of the Gleevec development, within a period of two years, it was later approved by FDA in 2001 and by 2013, it was referred to as the effective drug against six other life threatening illness conditions. Gleevec in association with its successor – Tasigna had contributed generation of about $5.7 billion sales throughout the world. Additionally, the alliance of Novartis with WHO for the provision of Coartem for the treatment of malaria was given based on no-profit approach to be used by the systems of public health which was mainly approved by three countries and FDA in 1999 and 2009 respectively.
The idea of closing the research headquarter was dropped as it was the organizational base and the changes in the strategic approach followed under the instructions of Fishman had allowed NIBR to grow with the establishment of ten institutes of research through the world with an approximate workforce of 6000 scientists with an expansion through the investment of $600 million through joining of Massachusetts Deval Patrick Governor and other local public figure by Fishman. Therefore, considering the initiatives and strategic approach regarding globalizing the base of investors included the stock listing of Novartis in the United States made clear focus of its goal to consider New Jersey despite of Rhine. Additionally, the acquisition of sub scale generic businesses, the global operations of Novartis had developed into a new division.
Global Value Connection Framework
Global Growth and Emerging Markets
Joe Jimenez, a co-founder of leading and profitable organization Novartis has shown his concern towards getting other healthcare businesses of the company up to critical mass in order to allow them to significantly contribute to the growth and profitability of an organization, thereby giving the counterbalance to its pharmaceutical business. He had contemplated to capitalize on the emerging markets opportunities and identified the markets with the potential for growth and success. He has designed the global growth goals for each emerging country. In 2008, Novartis has considerable shifted to the single country organization under the Global Emerging Markets. Since, the slower growth has been witnessed in the Europe and the United States, due to which the company has pondered targeting China and India. Each emerging market has posited different challenges to the company with severe implication.
Novartis has become first firm to produce valuable vaccine with the name of influence A (H1N1) with modern cell-culture biotechnology. The investment amounted 1 billion dollar had announced by the company with the intent of building the largest and leading research & development (R&D) institute in China.
The expanded investment of the company in R&D have resulted in innovative therapies for the patients in China as well as other countries, which have been nurtured by the growing Chinese scientific excellence. The company is committed to further invest in the government strategy for stimulating economic stability, growth and improving livelihood of people in china.
With the single country management, the expansion in china with the clear focus have lead the company to success path. The larger market size allow the company to staff the divisions at apt level with the distinct emphasis on their corresponding businesses.
In addition to this, the centralized management structure in china have resulted in major advantages which includes low cost via economies of scale, improved quality of work, reduced cost of regulation, enhanced productivity via reduction of duplicated efforts and overall greater degree ion agility and flexibility. Significantly, the company has experienced and realized growth exceeded 20 percent.
Emerging Market Opportunities
To capitalize on the opportunities in emerging markets during the global expansion posit some challenges to any organization which should be addressed in an appropriate manner,and should take some actions in global market in order to grow and stay competitive. The core concern of the company was to manage the cost and meet regulations. When the company decided to expand the business operations in the Chinese market, it faced the challenge of reconciling the high cost base with the immature market as well as the expectations of local employees. In 2011, the company bought vaccine organization in China, but with the passage of time, the cost of Vaccine Company got doubled with a significant increased rate. Also, the organization has been confronted with the issue of competing with the well-established local companies with different business practices and stringent rules.
In addition to this, structuring the organizational structural is centric to the successful global expansion. Each business has significantly completed the organization in individual country, which in turn have provided the increased focus on the customers and greater autonomy. The regional staff as well as the duplicative country have considered the impediment to the growth and profitability of the company.Other structural challenges that could have been faced by the company are balancing between capturing knowledge and innovation and minimizing complexity that is; making it easy to get decisions made and things done. Sometimes, it is often hard to get things right because of its size as well as the differences in the time zones which it tends to encompass. Furthermore, the inevitable activities’ duplications across regions, businesses and functions could likely create uncertainties about where to go in order to complete the task. The situation should be addressed through creating vertically integrated, self-contained global business within which complexity could be minimized and decisions should be quickly and rapidly made (Puranam, 2011).
Strategic Significance of Actions Taken by Joe
Developing and cultivating global leaders for the international markets requires the company to find the right people from the start. Joe has developed 360 s review process, which is one of the useful technique to the employees of an organization as it provides a balanced view and well-rounded view of their behaviors and skills. This also provides an accurate and fair picture of demonstrated behavior of employees. Shortly, it is a key to identify the employees’ strengths and weaknesses. The external professionals pursue the process of interview with their peers, executives and direct reports and conduct the open discussion sessions with them. It is due to the reason that the external professional could expand the talent pool, breath fresh life into globalized firm, and push employees to grow. Also, the global mindset, skill management, managed diverse workforce, and an effective leadership results in righteous and an appropriate selection of candidate in right time for the job.
In addition to this, he has highlighted the significance of global leaders physically living in the global market arena.This helps the company in recognizing and understanding the different cultures, political stability,economic conditions and favorable or unavoidable business and investment climate…………
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