STRATEGIC ANALYSIS PLANNING

REPORT OF

SUBMITTED TO:
Dr. ANJALI DAISY S Assistant Professor II,
School of Management SASTRA Deemed University,
Thanjavur – 613401.
DONE BY :
Chandramohan.S 122071022
Shujaullah.MD 122071054
Siva Sakthi Saravan Sunder.R
122071102
Suriya Selvan.R 122071102
Vigneshwaran.M 122071118

TABLE OF CONTENT:
Chapter I
1.1Introduction
1.2 Company Description
1.3 Mission, Vision, Values

Chapter 2
Strategies Followed:
2.1 Market Development
2.2 product Development
2.3 Diversification

Chapter 3
3.1 Competitive Profile Matrix (CPM)
3.2 External Factor Evaluation (EFE)
3.3 Internal Factor Evaluation (IFE)
3.4 Strategy position and action evaluation (SPACE) matrix
3.5 Grand space matrix (GSM)
3.6 Boston consulting group matrix (BCG)

Chapter 4
4.1 value chain analysis
4.2 porter’s 5 forces analysis
4.3 Recommendations for future
4.4 Conclusion

Chapter 1
1.1 Introduction:
Pfizer Inc. (Pfizer) is a research-based global
biopharmaceutical company. The Company is engaged in the discovery,
development, and manufacture of healthcare products. Its global portfolio
includes medicines and vaccines. The Company manages its commercial
operations through two business segments: Pfizer Innovative Health (IH) and
Pfizer Essential Health (EH). IH focuses on developing and commercializing
medicines and vaccines. IH therapeutic areas include internal medicine,
vaccines, oncology, inflammation and immunology, rare diseases, and
consumer healthcare. EH includes legacy brands, branded generics, generic
sterile injectable products, and biosimilars and infusion systems. EH also
includes a research and development (R&D) organization, as well as its contract
manufacturing business. Its brands include Prevnar 13, Xeljanz, Eliquis, Lipitor,
Celebrex, Pristiq, and Viagra.

1.2 Company description:

Pfizer Inc. (Pfizer) is a research-based global biopharmaceutical company. The
Company is engaged in the discovery, development and manufacture of healthcare
products. Its global portfolio includes medicines and vaccines. The Company manages its
commercial operations through two business segments: Pfizer Innovative Health (IH) and
Pfizer Essential Health (EH). IH focuses on developing and commercializing medicines and
vaccines. IH therapeutic areas include internal medicine, vaccines, oncology, inflammation
and immunology, rare diseases and consumer healthcare. EH includes legacy brands,
branded generics, generic sterile inject able products, and biosimilars and infusion systems.
EH also includes a research and development (R&D) organization, as well as its contract
manufacturing business. Its brands include Prevnar 13, Xeljanz, Eliquis, Lipitor, Celebrex,
Pristiq and Viagra

VISION:
We dedicate ourselves to humanity’s quest for longer, healthier, happier lives through
innovation in pharmaceutical, consumer and animal health products
MISION:.
, customers, colleagues, investors, business partners, and the communities where we wWe
will become the world’s most valued company to patientsork and live.

VALUES:
1. Courage
2. Excellent
3. Equity
4. Joy

1.3 Companies Mission, vision & value:

Pfizer:
Pfizer Inc. (Pfizer) is a research-based global biopharmaceutical company. The Company is
engaged in the discovery, development and manufacture of healthcare products. Its global
portfolio includes medicines and vaccines. The Company manages its commercial operations
through two business segments: Pfizer Innovative Health (IH) and Pfizer Essential Health
(EH). IH focuses on developing and commercializing medicines and vaccines. IH therapeutic
areas include internal medicine, vaccines, oncology, inflammation and immunology, rare
diseases and consumer healthcare. EH includes legacy brands, branded generics, generic
sterile inject able products, and biosimilars and infusion systems. EH also includes a research
and development (R&D) organization, as well as its contract manufacturing business. Its
brands include Prevnar 13, Xeljanz, Eliquis, Lipitor, Celebrex, Pristiq and Viagra.

Vision: We dedicate ourselves to humanity’s quest for longer, healthier, happier lives
through innovation in pharmaceutical, consumer and animal health products.
Mission: We will become the world’s most valued company to patients, customers,
colleagues, investors, business partners, and the communities where we work and live.

Values:
• Courage
• Excellence
• Equity
• Joy

Merck:
Merck & Co., Inc. is a global healthcare company. The Company offers health solutions
through its prescription medicines, vaccines, biologic therapies and animal health products. It
operates through four segments: Pharmaceutical, Animal Health, Healthcare Services and
Alliances. The Company's Pharmaceutical segment includes human health pharmaceutical
and vaccine products marketed either directly by the Company or through joint ventures.
Human health pharmaceutical products consist of therapeutic and preventive agents,
generally sold by prescription, for the treatment of human disorders. The Company sells its
human health pharmaceutical products primarily to drug wholesalers and retailers, hospitals,
government agencies and managed healthcare providers, such as health maintenance
organizations, pharmacy benefit managers and other institutions. Vaccine products consist of
preventive pediatric, adolescent and adult vaccines, primarily administered at physician
offices.

Mission: To discover, develop and provide innovative products and services that save and
improve lives around the world.
Vision: Merck will be a formidable force for good in the world.
Values:
• Improve life
 • Achieve scientific excellence
• Operate with the highest standards of in
• Expand access to our products
• Employ a diverse workforce

Novartis:
Novartis AG is a Switzerland-based pharmaceutical company. The Company develops
manufactures, and markets branded and generic prescription drugs, active pharmaceutical
ingredients (APIs), biosimilars and ophthalmic products. The Company uses science and
digital technologies for treatments in the disease areas of immunology, dermatology, cancer,
ophthalmology, neuroscience, respiratory, cardiovascular, and renal and metabolism. The
business activities of the Company are divided into two segments: Innovative Medicines,
which includes innovative patent-protected prescription medicines for blood pressure, cancer
and other ailments, and Sandoz, which includes generic pharmaceuticals and biosimilars.
Mission:
• Discover new ways to improve and extend people’s lives by

• Delivering breakthrough treatments to as many people as possible

• Using science-based innovation

• Aim to provide a shareholder return

Vision: Be a trusted leader in changing the practice of medicine.

Values:
• Innovation
• Quality
• Collaboration
• Performance
• Courage
• Integrity

Chapter 2
Strategies Followed
2.1 Market Development:
“We see a range of promising growth opportunities over the next three to five years
where we will take advantage of our global scale,” said Ian Read, president of
Worldwide Pharmaceutical Operations. “We will run our business with much more
flexibility as we continue to empower Pfizer colleagues closest to our customers.”
To advance these growth opportunities, the Company highlighted innovative
commercial models that take advantage of its broad portfolio of medicines and its
significant global footprint spanning R&D, manufacturing, sales, and marketing to
change the way it meets the needs of customers around the world 
Optimizing the patent-protected Portfolio. The company will continue its focus on
delivering revenue from patent-protected medicines, seven of which are global
market leaders in their disease areas. 

The Company is also establishing a new Business Unit focused solely on oncology
in its Worldwide Pharmaceutical Group. This unit will bring together global oncology
functions including clinical development, medical affairs, commercial development,
sales, and marketing. It will have the resources to seize growth opportunities to
strengthen Pfizer’s research investment in oncology.
Seizing Growth Opportunities in Emerging Markets. Pfizer also announced plans to
capture greater revenue in emerging markets in Latin America, Eastern Europe, and
Asia. The company will leverage its global scale and breadth of products to provide
health solutions to the growing and untapped market of middle-income patients living
in these markets.

2.2 Product development:

Pfizer is researching and developing medicines and vaccines that will benefit
patients around the world. We are committed to addressing unmet needs across
several important therapeutic areas including, Oncology, Inflammation &
Immunology, Vaccines, Internal Medicine, and Rare Disease, to deliver innovative
products to patients. 
Pfizer is using real-world data, alongside clinical data, for better insights into patient
outcomes. We’re also applying statistical modeling to design trials that hone in on
the most relevant new data and to repurpose existing data for significant time and
cost savings.
We’re automating repetitive processes, integrating clinical trial data systems, and
applying artificial intelligence to enhance our decision-making.
 We’re using digital tools to reach people who have not had access to trials before
and including wearables and devices to help make trial participation easier for
patients, as well as to collect more thorough and accurate data.

2.3 Diversification:
The pharmaceutical industry is characterized by intense competition. However,
Pfizer has managed to attain an optimal market position as a result of its
effectiveness in formulating and implementing operational strategies. Pfizer has
adopted a comprehensive diversification strategy that has enabled it to develop an
extensive product portfolio. Because firms are affected by changes in the
macroeconomic environment, the firm’s diversification strategy is faced with several
opportunities and problems. Hence, the firm’s management team needs to focus on
improving the diversification strategy. This will culminate in the firm developing a
high level of competitiveness. Currently, Pfizer focuses its operations on nine main
areas of competition in its healthcare businesses which include primary care,
oncology, specialty care, animal health, consumer healthcare, capsule, and
established products. Because consumers are faced with a variety of healthcare
products to select from, diversifying its product portfolio will result in the firm
increasing its revenue generation for example by establishing multiple businesses.
Additionally, diversifying the firm’s product portfolio will enable Pfizer to gain higher
leverage against its suppliers.
 

 Chapter 3
3.1 competitive profile matrix:
It is defined as a tool that compares the firm and
its rivals and reveals their relative strengths and weaknesses. In order to better
understand the external environment and the competition in a particular industry, firms often
use CPM. The matrix identifies a firm’s key competitors and compares them using industry’s
critical success factors. The analysis also reveals company’s relative strengths and
weaknesses against its competitors, so a company would know, which areas it should
improve and, which areas to protect

Critical Success Factors:

Critical success factors (CSF) are the key areas, which must be performed at
the highest possible level of excellence if organizations want succeed in the
particular industry. They vary between different industries or even strategic groups
and include both internal and external factors.

competitive profile matrix of Pfizer:

pfizer merck & novarti

co s
Critical success Weight  Range  Score  Range  score Range  Score 
factor   
Advertising  0.05 4 0.20 3 0.15 3 0.15
Market penetration 0.10 3 0.30 3 0.30 4 0.40
R&D 0.14 3 0.42 4 0.56 4 0.56
Store locations  0.04 4 0.16 2 0.08 3 0.12

Customer  0.09 4 0.36 2 0.18 4 0.36

 service
Employee dedication  0.09 3 0.27 2 0.18 4 0.36
Financial report 0.10 4 0.40 4 0.40 2 0.20
Customer loyalty 0.06 3 0.18 2 0.12 3 0.18
Market share 0.10 4 0.40 3 0.30 2 0.20
Product quality 0.09 3 0.27 3 0.27 3 0.27
Top management 0.05 3 0.15 3 0.15 2 0.10
Price competitiveness 0.09 3 0.27 4 0.36 3 0.27
Total  3.38 3.05 3.17

Weight

Each critical success factor should be assigned a weight ranging from 0.0 (low
importance) to 1.0 (high importance). The number indicates how important the factor
is in succeeding in the industry. If there were no weights assigned, all factors would
be equally important, which is an impossible scenario in the real world. The sum of
all the weights must equal 1.0. Separate factors should not be given too much
emphasis (assigning a weight of 0.3 or more) because the success in an industry is
rarely determined by one or few factors .

Rating

The ratings in CPM refer to how well companies are doing in each area. They range
from 4 to 1, where 4 means a major strength, 3 – minor strength, 2 – minor
weakness and 1 – major weakness. Ratings, as well as weights, are assigned
subjectively to each company, but the process can be done easier through
benchmarking. Benchmarking reveals how well companies are doing compared to
each other or industry’s average. Just remember that firms can be assigned equal
ratings for the same factor. 

Score & Total Score

The score is the result of weight multiplied by rating. Each company receives a score
on each factor. Total score is simply the sum of all individual score for the company.
The firm that receives the highest total score is relatively stronger than its
competitors.
Competitive profile matrix of Pfizer:

►The most important factor to being successful in the industry is the Research and
development as indicated by weight of 0.14.
►We can notice that Pfizer has the best market advertising, customer service, store
locations, financial profit and market share but they were defeated in terms of
research and development which we note as the most important factor.
►Overall Pfizer is still the best among its competitors with a score of 3.38 and
Novartis as its strongest rival with 3.17 weighted score.

3.2 External Factor Evaluation (EFE):

The External Factor Evaluation matrix (EFE) is an evaluation of the environmental

factors that can affect a business. This is a business tool that was created to show
the external factors that affect a business. This business tool enables a company to
determine its external factors, which can have a negative or a positive influence on
its operations. You can use this business tool to help the business to determine its
strengths and weaknesses in the future.

EFE of Pfizer :

External factors weight Range  Score 

Opportunities 
Increasing awareness of health related issues in developing 0.2 0.20 0.04
countries
Potential partnership with government 0.2 0.15 0.3
Collaboration with R&D with pharmaceutical companies 0. 0.13 0.013
Threats 
Unfavourable  patent laws 0.1 0.3 0.03
Stringent regulatory environment  0.1 0.5 0.05
Threat of drug resistant strains in the future 0.1 0.8 0.8
Tough competition from generic drug making 0.2 0.10 0.22
Total  1 2.22

The table illustrated above shows that Pfizer got a total weighted score of 2.22 for its
External Factor Evaluation (EFE) matrix which shows an above average response to
its existing opportunities and threats in the industry.
►The current strategies that the company is using is satisfactory, but these will
need to be improved for Pfizer to keep the top position among its competitors.

3.3 Internal Factor Evaluation:

The Internal Factor Evaluation matrix (IFE) is also a business tool to be used by a
company to determine the internal factors that can affect its business. It enables a
company to determine its internal strengths and weaknesses, in order to build its
strategies and to make internal changes. You must analyze the internal strengths
and weaknesses of your company to determine its potential for growth.

IFE Of Pfizer :

IFE 
Internal factors Weight  Range  Score 
Strength 
Strong brand name  0.1 2.4 2.4
Extensive portfolio with several best selling drugs 0.2 0.8 0.16
Focus on R&D innovation  0.1 0.5 0.5
High profitability & huge cash reserves 0.2 0.9 0.18
Weakness 
Negative publicity due to tax scandal 0.1 0.2 0.2
Drug testing  0.1 0.5 0.5
Failed mergers and acquisitions 0.01 1.3 0.13
Allegations & illegal marketing 0.1 0.7 0.7
Total  1 3.11

The table illustrated above shows that Pfizer got a total weighted score of 3.11 for its
Internal Factor Evaluation matrix.
►This shows an above average response to its existing Strengths and weaknesses
inside the company.
►Pfizer tries its best to capitalize on its strengths and eliminate its weaknesses .

3.4 Strategy position and action evaluation (SPACE) matrix:

SPACE MATRIX The SPACE Matrix for pfizer is constructed by using the market
data of the company like financial statement that the company presents to its
shareholders.
The SPACE Matrix is consisted of 4 quadrants which are representing different set of
strategies like:

Aggressive Quadrant: It includes strategies like integration, intensive and

diversification.

Conservative Quadrant: It includes strategies like intensive &diversification.

Defensive Quadrant: It includes Defensive strategies like retrenchment, divestiture

& liquidation strategies.
 Competitive Quadrant: It includes the integration and intensive strategies. And the
SPACE Matrix is used by gaining information regarding the company; the answers
for x-axis and y-axis are calculated by using the following information of the
company.

FP (Financial Position)
CP (Competitive Position)
SP (Stability Position)

Industry position: competitive position:

Growth potential =4 market share =-2

Financial stabiltity =3 product quality =-3
Ease of entry into market =4 customer loyalty =-2
Resource utilization =4 Technological know how =-4
Profit potential =5 control over suppliers & =-2
Industrial position IP average =4.0 distributors
Competitive position CP average =-
2.6

Financial position:
stability position:

Return of investment =3 rate of inflation =-4

leverage =6 Technological changes =-3
Liquidity =5 price elasticity =-4
Working capital =5 competitive pressure =-4
Cash flow =4 entry into market =-3
Financial position FP average =4.6 stability position Sp average =-3.6

x-axis y-axis
=cp+Ip =sp+fp
=-2.6+4 =-3.6+4.6
=1.4 =1.0
 FP

Conservative Aggressive
4

2
CP 1 IP
-1
-4 -3 -2 -1 1 2 3 4
-2

-3

Defensive -4
Competitive

SP

3.5 GRAND SPACE MATRIX:

A grand strategy matrix (GSM) is a tool used by businesses to devise alternative

strategies. The matrix is primarily based on four essential elements: rapid market
growth, slow market growth, strong competitive position and weak competitive
position

Quadrant 2 Quadrant 1

Integration strategy
Intensive strategies
Related diversification
weak
Strong

Quadrant 3 Quadrant 4

3.6 BCG matrix:

BCG Matrix of Pfizer Inc

The BCG Matrix for Pfizer Inc will help Pfizer Inc in implementing the business level
strategies for its business units. The analysis will first identify where the strategic
business units of Pfizer Inc fall within the BCG Matrix for Pfizer Inc.
Stars
The financial services strategic business unit is a star in the BCG matrix of Pfizer Inc.
It operates in a market that shows potential in the future. Pfizer Inc earns a
significant amount of its income from this SBU. Pfizer Inc should vertically integrate
by acquiring other firms in the supply chain. This will help it in earning more profits as
this Strategic business unit has potential.
The Number 1 brand Strategic business unit is a star in the BCG matrix of Pfizer Inc,
and this is also the product that generates the greatest sales amongst its product
portfolio. The potential within this market is also high as consumers are demanding
this and similar types of products. Pfizer Inc should undergo a product development
strategy for this SBU, where it develops innovative features on this product through
research and development. This will help Pfizer Inc by attracting more customers
and increases its sales.

CASH COWS

The supplier management service strategic business unit is a cash cow in the BCG
matrix of Pfizer Inc. This has been in operation for over decades and has earned
Pfizer Inc a significant amount in revenue. The market share for Pfizer Inc is high,
but the overall market is declining as companies manage their supplier themselves
rather than outsourcing it. The recommended strategy for Pfizer Inc is to stop further
investment in this business and keep operating this strategic business unit as long
as its profitable.
The Number 3 brand strategic business unit is a cash cow in the BCG matrix of
Pfizer Inc. This is an innovative product that has a market share of 25% in its
category. Pfizer Inc is also the market leader in this category. The overall category
has been declining slowly in the past few years. Pfizer Inc has the power to influence
the market as well in this category. It should, therefore, invest in research and
development so that the brand could be innovated. This will help the category grow
and will turn this cash cow into a star. The overall benefit would be an increase in
sales of Pfizer Inc.
The international food strategic business unit is a cash cow in the BCG matrix for
Pfizer Inc. This business unit has a high market share of 30% within its category, but
people are now inclined less towards international food. This change in trends has
led to a decline in the growth rate of the market. The recommended strategy for
Pfizer Inc is to invest enough to keep this strategic business unit under operations. If
it no longer remains profitable and turns into a dog, then Pfizer Inc should divest this
strategic business unit

QUESTION MARK

The local foods strategic business unit is a question mark in the BCG matrix for
Pfizer Inc. The recent trends within the market show that consumers are focusing
more towards local foods. Therefore, this market is showing a high market growth
rate. However, Pfizer Inc has a low market share in this segment. The recommended
strategy for Pfizer Inc is to invest in research and development to come up with
innovative features. This product development strategy will ensure that this strategic
business unit turns into a cash cow and brings profits for the company in the future.
The Number 4 brand strategic business unit is a question mark in the BCG matrix for
Pfizer Inc. This strategic business unit is a part of a market that is rapidly growing.
However, this strategic business unit has been incurring losses in the past few years.
It has also failed in the attempts made at innovation by research and development
teams. The recommended strategy for Pfizer Inc is to divest and prevent any future
losses from occurring.
The confectionery strategic business unit is a question mark in the BCG matrix for
Pfizer Inc. The confectionery market is an attractive market that is growing over the
years. However, Pfizer Inc has a low market share in this attractive market. The low
sales are as a result of low reach and poor distribution of Pfizer Inc in this segment.
The recommended strategy for Pfizer Inc is to undergo market penetration, where it
pushes to make its product present on more outlets. This will ensure increased sales
for Pfizer Inc and convert this strategic business unit into a cash cow

DOGS

The plastic bags strategic business unit is a dog in the BCG matrix of Pfizer Inc. This
strategic business unit has been in the loss for the last 5 years. It also operates in a
market that is declining due to greater environmental concerns. The recommended
strategy for Pfizer Inc is to divest this strategic business unit and minimise its losses.
The Number 5 brand strategic business unit is a dog in the BCG matrix for Pfizer Inc.
This is operating in a market segment that is declining in the past 5 years. The
company also has negative profits for this strategic business unit. However, it is
expected that the market will grow in the future with environmental changes that are
occurring. The recommended strategy for Pfizer Inc is to invest in the business
enough to convert into a cash cow. This will ensure profits for Pfizer Inc if the market
starts growing again in the future.
The synthetic fibre products strategic business unit is a dog in the BCG matrix of
Pfizer Inc. The market for such products has been declining, and as a result of this
decline, Pfizer Inc has been facing a loss in the past 3 years. The market share for it
is also less than 5%. The recommended strategy for Pfizer Inc is to divest this
strategic business unit to minimise any further losses.
The artificially flavoured products strategic business unit is a dog in the BCG matrix
for Pfizer Inc. These products were launched recently, with the prediction that this
segment would grow. However, with increasing health consciousness, people are
now refraining from consumption of artificial flavours. The market is shrinking, and
Pfizer Inc has no significant market share. The recommended strategy for Pfizer Inc
is to call back this product.
Some of the strategic business units identified in the BCG matrix for Pfizer Inc have
the potential of changing from their current classification. For example, a dog
changing to a cash cow. These have been identified in the BCG matrix of Pfizer Inc
and recommended strategies to ensure such change have also been made.

Chapter 4:
4.1 Value Chain Analysis Of Pfizer
1.1 Advantages of conducting Value Chain Analysis of Pfizer
Value Chain Analysis of Pfizer can offer various advantages:
1.1.1 Identify competitive advantage sources
By conducting the Value Chain Analysis of Pfizer during the planning process,

possible sources of competitive advantage can be identified. The firm/company is a

collection of different activities that share relatedness to some extent. Pfizer cannot

trade all activities in the external market. The Value Chain approach suggests that a

company can consider these activities as economic rent sources. These activities

can also act as barriers to new entrants or cause cost disadvantages to competitors.

1.1.2 Identify complex inter-relationships and interdependencies

Pfizer can identify various internal and external linkages among activities through the

value chain lens. The internal linkages are- interrelationships between activities

within same organisational units and external linkages are between business units of

same or different firms. Studying these interrelationships can help a company take

benefit from coordination and joint optimisation.

1.1.3 Improved flow of materials, information and finances

The use of Value Chain Analysis can optimise the finances, products and information

flow.

• The improved information flow can help the company identify and exploit new

opportunities and reduce external threats. The continuous Value Chain

evaluation can result in timely filling important gaps that may affect a firm's

productivity.

• The effective implementation of the Value Chain Analysis of Pfizer can

improve the material and product flow due to improved demand and sales

forecasting. The inventory management also improves as Pfizer can minimise

the delays by tracking activities throughout the supply chain.

• Modern customers place high importance to the quick response and

convenient access to the important product related information. The

unexpected interruption in the information flow can affect the customer-

 supplier relationship. Pfizer Value Chain Analysis and its implementation can

highlight and remove the bottlenecks to the information flow.

1.1.4 Formulate effective firm-specific strategies

Pfizer Value Chain Analysis can be used in the competitive strategic decision-

making process. However, choosing the right competitive strategy (cost leadership,

differentiation or focus) requires knowledge of own and rivals’ cost structure.

1.2 Challenges associated with Value Chain Analysis of Pfizer

• The company may lose its vision and overall strategy by dividing operations

into different activities.

• Dividing the operations into primary and support activities may not be

separable due to increased complexity.

• The division process can be time consuming and finding the required

information can also be difficult.

• Effective value chain implementation does not only require familiarity but

detailed expertise.

• Pfizer may find it difficult to get required information if its Business Information

System is not structured accordingly.

Porter's value chain model is highly popular in the business world. However, Pfizer

must not take it as a rigid, standalone framework by assigning the equal importance

to all activities. The effective Value Chain Analysis requires Pfizer to realise that all

activities or functions do not require same scrutiny level. Hence, the first step of

adapting the Porter Value Chain framework is to identify the importance of activities

according to their role in product/service delivery process.

• Here is the list of primary value chain activities as proposed by Porter:

•

• 2.1 Primary Activities

• The primary value chain activities of Pfizer are directly involved in producing

and selling the product to targeted customers. Analysis of primary value chain

activities can improve the performance of Pfizer as explained below.

• 2.1.1 Inbound Logistics

• It is important to develop strong relationships with suppliers as their support is

necessary to receive, store and distribute the product. Without analysing the

in-bound logistics, Pfizer can face various challenges in product development

phases. Analysis of in-bound logistics requires a company to focus on every

aspect of transformation from raw material to finished product. Some

examples of inbound logistics are retrieving raw material, storing the inputs

and internally distributing the raw material and components to start

production.

• 2.1.2 Operations
• The importance of analysing operational activities raises when raw material

arrives, and Pfizer is ready to process the raw material into the end product

and launch it in the market. Some examples of operational activities are

machining, packing, assembling and testing. Equipment repair and

maintenance also falls into this category.

• It includes both- manufacturing and service operations. Analysis of

operational activities is important for improving productivity, maximising the

efficiency and ensuring the competitive success of Pfizer. The increased

productivity can help Pfizer to achieve consistent economic growth, increase

profitability and set a powerful basis for competitive advantage.

• 2.1.3 Outbound Logistics

• Outbound logistics include the activities that deliver the product to the

customer by passing through different intermediaries. Some outbound

logistics activities are material handling, warehousing, scheduling, order

processing, transporting and delivering to the destination. Pfizer can analyse

and optimise the outbound logistics to explore competitive advantage sources

and achieve its business growth objectives.

• Because, when outbound activities are timely managed with optimal costs and

product delivery processes put a minimum negative effect on the quality, it

maximises the customer satisfaction and increases growth opportunities for

the firm. Pfizer should pay specific importance to its outbound value chain

activities when its offered products are perishable and require quick delivery

to the end customer.

• 2.1.4 Marketing and Sales

• At this stage, Pfizer will highlight the benefits and differentiation points of

offered products to persuade the customers that its offering is better than

competitors. Only producing a high quality product at affordable costs and

distinctive features cannot create value until Pfizer invests on the marketing

and sales activities. The sales agents and marketers play an important role

here.

• Some examples of Pfizer's marketing and sales activities are- sales force,

advertising, promotional activities, pricing, channel selection, quoting and

 building relations with channel members. The company can use the marketing

funnel approach to structure its marketing and sales activities. The marketing

strategies can either be push or pull in nature, depending on the Pfizer’s

business objectives, brand image, competitive dynamics and current standing

in the market.

• Effective and wisely integrated marketing activities can develop the brand

equity of Pfizer and help it stand out from the competition. However, Pfizer

must avoid making false commitments about product features that cannot be

fulfilled by the production department. It indicates the need to ensure

coordination between different value chain activities.

• 2.1.5 Services
• The pre-sale and post-sale services offered by the Pfizer will play an

important role in developing customer loyalty. The modern customers

consider post-sale services as important as marketing and promotional

activities. The power of negative e-WOM due to poor support service cannot

be undermined in the current technologically advanced era. The company

must analyse its support activities to avoid damaging brand reputation, and

instead use it as a tool to spread positive word of mouth due to quick, timely

and efficient support services.

• 2.2 Secondary Activities

• The support activities play an important role in coordinating and facilitating the

primary value chain activities. Pfizer can also benefit from analysis of its

support activities as explained below.

• 2.2.1 Firm infrastructure

• The firm infrastructure denotes a range of activities, such as- quality

management, legal matters handling, accounting, financing, planning and

strategic management. Effective infrastructure management can allow Pfizer

 to optimise the value of the whole value chain. Pfizer can control the

infrastructure activities (or commonly called overhead costs) to strengthen the

competitive positioning in the market.

• 2.2.2 Human resource management

• Pfizer can analyse human resource management by evaluating different HR

aspects, including- recruiting, selecting, training, rewarding, performance

management and other personnel management activities. The effective HR

management can allow Pfizer to reduce competitive pressure based on

motivation, commitment and skills of its workforce. The company can also

achieve its cost minimisation objectives by analysing hiring and training costs

with their relative return. The heavy dependence of Pfizer on employees'

talent will increase the importance of this value chain support activity.

• 2.2.3 Technology development

• In a modern, technological advanced era, almost all value chain activities

depend on technological support. The technological integration in production,

distribution, marketing and human resource activities requires Pfizer to realise

the importance of technology development. It can be divided into product and

process technological development activities. Some examples are-

automation software, technology-supported customer service, product design

research and data analytics. The research and development department of

Pfizer is classified in this category.

• 2.2.4 Procurement
• The procurement in value chain denotes the processes involved in purchasing

the inputs that may range from equipment, machinery, raw material, supplies,

raw material and other items necessary for producing the finished product.

Due to its linkage with multiple value chain activities, Pfizer should carefully

consider its procurement activities to optimise the inbound, operational and

outbound value chain.

• As mentioned above, the application of Porter Value Chain model depends on

understanding the importance of all activities. After understanding the relative

importance of identified value chain activities, Pfizer should highlight areas

where value can be added, cost efficiency can be achieved, differentiation

basis can be set, or processes can be optimised.

• 3. Competitive Advantages through Value Chain Analysis of Pfizer

• It is important for Pfizer to base its competitive advantage on activities in

which it has access to the rare or scare resources. It may include- intellectual

capital, assets, skills or distribution network. The Value Chain Analysis can

help Pfizer identify those activities and develop those areas to get a strong

competitive edge over rivals. There are many examples (like Toshiba and

Sharp) that consider Value Chain Analysis as a tool to get a competitive

advantage and invest heavily in research and development activities within

their value chain network. Porter’s generic strategies for achieving the

competitive advantage and value chain model can be used together to set

strong competitive advantage basis.

• Following diagram shows Porter's competitive advantage model:

• The analysis of the value chain activities can be done to understand the

competitive advantage sources. Pfizer can either use the operations,

marketing and other relevant value chain activities to avail the cost

advantages or it can use the human resource, technology, infrastructure,

service or other relevant activities to set the strong differentiation basis.

Broadly, the competitive advantage sources can be grouped into two types-

cost and differentiation. Pfizer can obtain a competitive advantage from one or

both sources, depending on the depth and breadth of its Value Chain

Analysis. Next parts of the article present in detail how Pfizer can configure
 primary and/or secondary value chain activities to achieve the desired cost

and differentiation objectives.

4.2 PORTERS 5 FORCE OF PFIZER :

Pfizer is an American Pharmaceutical company with head quarters in

New york . The company has ambition to come up with innovative and
differentiated products that would help to overcome the health challenges
worldwide. Pfizer is one of the largest pharmaceutical companies all across
the world with its operations from more than 150 years. Innovation and
differentiation is now a major contributing factor to success of pharmaceutical
companies. Successful innovation can be applied if the company understand
the industry. The analysis of the global pharmaceutical industry is done by
using porters 5 force analysis for helping pfizers for future planning.

• COMPETITIVE RIVALRY:
• The demand for medicine and pharmaceutical products around the globe is
exceptional and industry has gained enormous growth in the last few
decades. The Chinese pharmaceutical sector has the highest rate of growth in
2014. The major competitor in the pharmaceutical industry comes from
America and Europe that leads the industry in terms of revenues. Pfizer is the
largest in 2018 with annual revenue of 53.7billionusdollar.Roche, Johnson &
Johnson .Sanofi , Merch, Novartis, abbive ,& amgen ,GSK collected revenues
of 45.6,40.7,39.3,34.9,32.8,23.7and 23billion US dollar in 2018(ELLIS) .The
collection of such a large amount of revenue by these company shows the
growth of industry and the tough competition among firms as there are
multiple players dominating the industry rather than two or three.
• The presence of these players with exceptional financial and revenue
strengths intensifies the competitive rivalry in the pharmaceutical industry at a
global level.

• THREAT OF SUBSTITITES:
• Medicine and other health related products are the basic needs of human life.
If there are no medicines or health related products ,the death rate will be high
.it is not possible that a human being can survive without health products ,the
death rate will be high, it is not possible that a human being can survive
without health products. Now looking at the pharmaceutical industry. There
are no products currently that have the benefits of curing the persons health
other than products from the pharmaceutical industry. The threat of substitute
for specific products within the industry is always high as the innovation keeps
 on replacing the older products but the pharmaceutical industry itself is safe
from the threat of being replaced .The lack of significance and availability of
substitutes for health related products have decreased the threat of
substitutes for the pharmaceutical industry.

• THE THREAT OF NEW ENTRANTS:

• Due to growth and size of industry and contribution of innovation in the
products, the new entrants are always keen to start business in the
pharmaceutical industry. The research that are expert in research and
findings out innovative products and ideas in the industry attach venture
capitalists with them to enter in to the new entrants. The lack of knowledge of
customers for pharmaceutical products is another benefit that attracts the
new entrants towards the pharmaceutical industry . This lack of knowledge
leads to high price setting by the industry players. Therefore,the threat of new
entrants is high.

• BARGAINING POWER OF SUPPLIERS:

• The power of suppliers is high when the products provided by suppliers is
high when the products provided by suppliers are scarce or do not have
multiples providers. This is not the case with drug suppliers for the
pharmaceutical companies which is the reason for the low bargaining power
of suppliers. but in case of equipment suppliers of pharmaceutical machinery,
the suppliers are less as compared to drug suppliers. The machinery is
technical equipment that is not possible to be provided by anyone. In the case
of machinery, the bargaining power of suppliers is high, therefore ,balancing
the impact of both types of suppliers for the pharmaceutical industry, the
overall bargaining power of suppliers is moderate .

• BARGAINING POWER OF BUYERS:

• Pharmaceutical products are those products that are completely unknown to
customers in terms of differentiation and costing. Despite the number of
companies available, the buyers do not have any control over the pricing of
the products. They have to buy at the price what is set by the companies.
Government do have control over the price but the lack of knowledge about
the products lead to no control or bargaining of buyers over the
product(Holland 2014). Therefore the bargaining power of buyers for the
pharmaceutical industry is low.

4.3 Recommendation for future:

From this table, Pfizer consider best because is get the value of 4 which

considered

as highly attractive to customers in pharmaceutical industry over 50 countries.

That is the reason why Pfizer is a famous brand in pharmaceutical industry.

Pfizer

bring credibility and best quality of healthcare medicine to customers and fulfil

customer satisfaction. From the EPE and IFE matrix also show that opportunities

and strengths of Pfizer are higher than threats and weaknesses.

Recommendation of Pfizer

• Ensure Pfizer marketing collateral including product information and usage

• being translate into different language and cultures preference for non-

• speaking English customers

• Perform top products innovation through research and development

• Stay ahead of rivals by replacing products that have patent expiration

• Provide incentive training program to employees to enhance their skills and

• qualities

• Undergo in-depth research on Europe pharmaceutical market and trend to

• further expand market share

 • Better logistic management and system planning

• Eliminate cannibalizing for similar products categories

• Integrate and utilize all resources to implement benchmarking procedures

• for different products in different market segment (specialty care and

• oncology, consumer health and animal health)

• Research on new medical findings

• Acquire or merge smaller generic drug companies to prevent competition of

• product line

• Eliminate defected products from markets to prevent lawsuits

• Increase market share and brand awareness by educating customer through

• sophisticated online tools

• Outsourcing to reduce operation cost

• Participate in social responsibility program in operation area to further

• expose public on causes.

4.4 conclusion:

The biggest issues affecting pharmaceutical industry is competition from generic

products manufacturers. Large pharmaceutical companies concern heavily on

reliant on patent legislation to protect exclusiveness in producing and selling on

certain high profitable products (drugs). Patents products have period (time) limit

thus generic manufacturers are able to produce them at less cost, as they do not

involve in expensive research and development stage. Generally, large firms like

Pfizer often incur substantial legal costs through establish and enforcing patented

products to prevent profit loss.

Political changes in countries could easily impact on business. For example,

website barackobama.com outlines the President’s approach in reducing cost of

drugs and widely use of generic drugs. Similarly in 2008, European Union (EU)

forbidden pharmaceutical companies from entering market with newly developed

drugs and consider as breach of antitrust rules.

Major pharmaceutical companies facing continues business threat from generic

competitions and various political and regulatory challenges thus companies such

as Pfizer are likely to seek new way to protect revenue and margins given

significant changes of sector landscape and mergers.