1

Becton Dickinson and Company:

Multidivisional Marketing Programs

Group 5
Ankita (60008)
Ankita Pandey (60009)
Kumar Devashish (60019)
Neha Srivastava (60026)

Becton Dickinson at a Glance

Type

Public

Industry

Medical Equipment

Founded

East Rutherford, New Jersey (1897)

Founders

Maxwell Becton
Fairleigh S. Dickinson

Headquarters

Franklin Lakes, New Jersey

Areas Served

Worldwide

Key People

Edward Ludwig (Chairman)

Vincent Forlenza (President)

No. of Employees

28,803

Question 1
a. Why is the topic of "multidivisional marketing"
attracting corporate attention at Becton Dickinson
(BD) during the period covered by this case?
b. Is it a good idea?
c. What factors aid or inhibit the implementation of this
concept at BD?

Why is the topic of "multidivisional marketing"

attracting corporate attention at BD during the period
covered by this case?
To respond to customers seeking more efficient
and effective approaches to their operating and
service needs.
Achieving competitive advantage for BD
through superior customer service.
Growing trend of Group purchase systems
(GPO): primary decision making authority
shifting from end users to non users. Shift in the
power base.
Price war competition by Terumo
Multidivisional marketing was a prerequisite for
value added services for key accounts

Is Multidivisional Marketing a good idea?

Can demonstrate BDs importance within an
account in a better and more elaborate manner
Will help to promote the different services
already offered by BD to accounts
Effective use of resources to develop Value
added services (product bundling agreements
and/or provision of order processing systems
services that might be prohibitive for a single
division but feasible on a multidivisional level)
Broadest product line
Inventory management task was easier

c. What factors aid or inhibit the implementation of

this concept at BD?
Factors aiding in the implementation
Formation of new operating group- SCM
Health care players at all levels of the supply chain are
interested in asset-management techniques and
systems that can lower their total costs of obtaining
and using needed products and services
Not all divisions have great sales - products and
service will get aligned
Concept of Value added services
Removal of inefficiencies and duplication in operations
and overlap in purchasing processes due to sale of
similar products by various divisions
Broad distribution capabilities

c. What factors aid or inhibit the implementation of

this concept at BD?
Factors inhibiting the implementation
Loss of control feared by divisional managers
Divisional Managers concerned about the impact
of such a concept on their individual businesses
(BDs Acute Care, BDVS)
Divisions desired to define rules
Each division had its own information system
Averaging capabilities: unlike other divisions,
DM lacked a strong presence at HMC
High number of divisions

Question 2
a. More generally, under what circumstances
would the kind of marketing strategy inherent
in the multidivisional approach make sense?
b. Do those circumstances apply at the HMC
account?

a. Under what circumstances would the kind of marketing

strategy inherent in the multidivisional approach make
sense?
Resource constraint
Globalisation
Uncertainty
Price war
Mergers and acquisitions
Closely related products for a homogenous
customer base

10

b. Do those circumstances apply at the HMC account?

Circumstances

In context of HMC

Resource constraint

No

Globalisation

Yes

Uncertainty

Yes

Price war

Yes

Mergers and acquisitions

Yes
(Deseret Medical)

11

Question 3
a. What is at stake at the HMC account: for BD?
for Becton Dickinson Division (BDD)? for
other BD divisions? for various personnel at
HMC?
b. Who are the key players that must be
considered in responding to the competitive
threat at this account?

12

a. What is at stake at the HMC account: for BD? for Becton Dickinson Division
(BDD)? for other BD divisions? for various personnel at HMC?

For BD:
Terumo as competitor
Sales share

For BDD:

Loss of an important national account

Sales will decline
Pricing structure protection
Emergence of Terumo as a prime competitor

13

For other BD divisions:

BDAC loss of potential sales
DM chance to increase sales and introduce new
products
BDVS fear of losing straight rebuy status due to end
user brand preference
BDMS possibility of having to be involved with a
purchasing committee

For HMC Personnel:

3-4 months for product evaluation
End users preferred quality - BDD products
New Information systems would have helped lower
inventory levels and operating costs by helping in
choice of the right distributor

14

b. Who are the key players that must be considered in responding to the
competitive threat at this account?

At HMCs end

Stan Delany Vice President, Financial Services

Phil Robinson administrator of finance services
Judy Koski director of materials management
Joanne Wilson purchasing manager
Personnel dealing with different divisions- Dr.
Henry Jackson (Director Anesthesia) and Cynthia
Smith (IV Therapy Supervisor)

15

Question 4
a. What should Mr. Jones, VP of Sales at BDD, do
with regard to the HMC account? Specifically,
should he pursue a multidivisional approach in
this situation, a price decrease or another
option?
b. How should any actions concerning HMC be
implemented?

16

a. What should Mr. Jones, VP of Sales at BDD, do

with regard to the HMC account?
Pursue multidivisional approach
Price cant be reduced - works on quality and service
Rest of the purchasing groups will ask for price reduction
All divisions are selling to same client; should have
synergy
HMC is facing financial crunch - value addition should
result in tangible benefit
By providing value added services with the help of MIS,
BD can help HMC in material management and thus in
cost reduction
A consolidated efforts by all the divisions will allow to
smaller discount to match the price offered by Terumo

17

b. How should any actions concerning HMC be implemented?

Implementation
Highlighting the cost benefits such a strategy will
provide to HMC
Using the MIS developed by BD, HMC will improve
material management and thus cost reduction
The powerful players in the buying centre should be
identified (Joanne Wilson, Cynthia Smith) and should
be brought on board
Finally individual divisions should contact the key
personnel in HMC for their individual processes and
convince them about the newly implemented strategy

18

Question 5
In which companies operating in India do you
think a similar situation could arise?
AMUL & Tata Steel
Reasons
No of divisions are high
Closely related products
Homogenous customer base

19