Strategic Management: Case Study Of Biocon India Group

Executive Summary
In the assignment, a company named Biocon has been taken as the case study and its
functioning in the Indian and the international market. A SWOT analysis along with PEST
analysis is done to identify the potential advantage and the disadvantage in the Indian market.
Porter's model has been analysed to identify the competition in the market. There is huge
competition in the international as well the national market. The factors, which have helped
them to succeed in the Indian market, have also been analysed in the assignment. The value
chain analysis of the company has also been provided in the analysis. Suitable
recommendations are provided to the company so that they can think over their existing
functioning.
 Table of Contents

Introduction 3

Mission, vision and Objectives of Biocon Limited: 3

Environmental Analysis- Pros and Cons 4

SWOT 4

PEST 5

Market attractiveness evaluation 7

Five force analysis 7

Identification of key success factors 9

Value chain analysis 9

Strategic choice development 11

Choice of best-fit strategy and implementation 13

Conclusion 13

References 14

Appendices 19
Introduction

Strategic management avails a business organisation opportunity to form and achieve specific
goals through logical and steps. Indian pharmaceutical sector has grown over past few years
to become one of the best-organised sectors. The industry is responsible for the development
and sustenance of global medicine industry. Biocon Limited is a major part of this industry,
and in this study, strategic opportunities of this organisation in the above-mentioned market
have been evaluated and development strategies have been suggested based on the
evaluation.
Biocon Limited is a biopharmaceutical company from India. This company has brought bio-
revolution in India. The founder of this company was Kiran Mazumdar Shaw. This company
evolved with time from the field of enzyme manufacturing to bio-pharmaceutical. Biocon
limited was established in the year 1978. It was a joint venture of Biocon India with Ireland.
In the year 1998, Biocon India took over Unilever's part of the company
(Bioconfoundation.org, 2016). Biocon Limited produces generic active ingredients and sells
them in developed European market. Current revenue of this company is 22.40 billion INR.

Mission, vision and Objectives of Biocon Limited:

Vision:
The organisation's main vision is to increase global healthcare to innovate and affordable
biopharmaceuticals for all.
Mission:
The organisation wants to create intellectual asset through the process of discovery,
development and research.
The organisation wants to provide internationally benchmarked quality products.
Biocon wants to focus on customer relationship with outstanding products. Training,
empowering and monitoring are some of the techniques that the company wants to make for
developing human resource development within the organisation.
Objectives:
The main objective of this company is to decrease the vulnerability to health associated
problems to malnourished and poor people.
It intends to raise aware in making the significance of the preventive health. In assistance of
communities for providing health, measures are another important mission of Biocon
Limited.
In India, providing sanitation and public health is another vital objective of this organisation.
The organisation wants in initiating education and screening for infectious diseases for
preventing the diseases. In order to optimise the management of diseases, the organisation
has been trying to manifest significant measures.
Biocon Limited believes in the expansion of repertoire of the social protection, such as
Arogya Raksha Yojana, Health micro-insurance for the most unprivileged section.

Resources and Core-Capabilities of company:

Resources and capabilities can be treated as the competitive advantage of the company. An
organisation can have physical resources, legal resources, informational resources, relational
resources and human resources.
Biocon Limited has a well-managed human resource team. Current revenue of this company
is 22.40 billion INR. Net income of the company at present is 3.61 billion INR
(Bioconfoundation.org, 2016). This company is present in stock market. The organisation has
been securing well growth with sustainable financial performance.
Capabilities of the company depend on product management, pricing management, channel
management and customer relation management. This company has been working in the field
since 1978 with good reputation. Biocon Limited tries to improve the unmet needs of the
patients. This company is the largest company in insulin making. This organisation is fully
integrated company in biopharmaceutical focusing to reduce the costs in therapy. It is one of
the leading companies in oncology department. This organisation has leading scientists for
developing the affordable and efficacious products for all. They are working on development
of the new solution in small molecules. This organisation engages scientists for technical and
knowledge creation.

Environmental Analysis- Pros and Cons

SWOT

The Indian pharmaceutical market is considered almost US $10.76 billion (Berman and
Evans, 2013, p.1). The annual growth is almost 9.9% and is fast developing and creating new
positions in the field of medicine through research and innovation.
 Strength Weakness

● Cheap labour in Indian labour ● Proper infrastructure underdeveloped

market ● Unable to purchase expensive
● Comparatively less production cost equipment
● Availability skilled labour ● Separate education and research
● Patients are treatment naive work
● Growing GDP, which helps common
people spend more on medicine

Opportunities Threats

● Great exposure to global market ● Skilled people moving out of country

● Tax reduction by government
● The success of new ventures
● Demand in global sphere increasing
● Highly competitive market with new
investments
● The success of subsidiary unit than
parent unit
● Inflation of wage
● Regulatory acts of government
● Foreign groups are introduced in
Indian market

Table 1: SWOT Analysis

(Source: Jayakumar, 2010, p.12)
The cost of production is low and hence gets enough boosts to enhance its growth. The GDP
is increasing giving more liquid money in hands of common people (Grundy et al. 2011,
p.214). They are able to invest in the healthcare sector and to indirectly help the company.
People are becoming more aware of their physical illness and they are heading towards
treatment.
New improved techniques are required to compete with the quality of products of the
international market (Kor and Mesko, 2013, p.233). The equipment and machinery that
Biocon India requires are quite costly and they are unable to avail all machinery (for further
details refer to appendix 1).
PESTLE

The success of a company is very much dependent on internal and external macro and
microenvironments. Both the internal and the external factors should be taken into
consideration when the estimation of profit is done on the part of the management of the
company.

Political ● Strategies of the government concerning the safety of the

product made by the organisation influences its operations in a
considerable manner
● The internationalisation of the operations of the business
organisation would be hugely influenced by the foreign policies
of the government and the international relations of the Indian
government with that of the target country
● Indian Patent Act restricts the business organisation to secure
the rights of using their innovation in term of manufacturing of
the medicines which restricts the organisation’s capability of
generating competitive advantage via research and development
activities

Economic ● Value of money changes, which reduced the value of the seats
of the company
● Levy of taxes assigned by government increases the expenses
of the pharmaceutical company

Social ● A major part of the target market believe more in homoeopathic

than allopathic treatment, which restricts the business prospect
of the company
● Not all have the capability to buy the same amount of medicine.

Technological ● India is not technologically highly developed

● Huge cost might be incurred in importing the machinery

Legal ● Drug Price Control Order 1970 has taken over the price making
decision on the medicines
 Environmental ● Regulations on noise pollution have been established
● Regulations on environmental pollution have been established
● Regulations on waste disposal have been introduced.

Table 2: PESTLE for the external environment of Biocon India Group

(Source: Lavie et al. 2012, p.1479)
The Indian Patent Act, which has been introduced by the Indian government, has created a
great problem (Grace, 2014, p.55) (refer to appendix 2).
As opined by Casadesus-Masanell and Zhu (2013, p.466), technological advancement should
be taken into consideration as it is one of the most crucial factors, which help in development
of this sector.
The legal procedure of the land, has taken control over the price making decision on the
medicine produced by the company. The Drug Price Control Order 1970, has taken control
on the pricing capability of the company. According to the law, the government has set a
price for the medicines and the companies cannot cross the limit. This has created a negative
impact as they have to control the price by cutting the coast in the other sections of the
functioning of the organisation.
Environment has been greatly affected by the industries. Hence, there are different
regulations laid down by government so that the environment can be protected. The company
Biocon has to limit its production and restrict its waste products. For this purpose, they had to
take certain precautions like recycling the waste products and filtering the air.

Competitive Life Cycle Analysis:

There are four stages in the life cycle of the product. At first, the product is introduced in the
market. Then the growth of the product takes place (Darroch, 2014, p.44). Then the growth
level transform to the maturity level (Chen et al. 2016, p.2145). After the maturity level
comes the decline stage. When at first, Biocon introduced their enzymes in the market, it was
well accepted by the population and revenues started to roll in. Slowly, the enzymes were
recognised in the market and it led to the popularity of the enzyme. With the popularity of the
enzymes, the product reached its maximum point where it was earning huge profit. This
profit led to the formation of Syngene another organisation under Biocon. Over the years, it
has been seen that the popularity of enzymes fell from heights and paved for the other
innovative products.
Competitor analysis
With the help of the competitor analysis, Biocon has been able to identify the marketing
strategy with which it would evaluate the uniqueness of the product and attract the market
where they want to enter or increase their sales. Currently Biocon is facing competition from
companies like Alkem Lab, Ajanta Pharma, Ranbaxy Labs and many others from the size of
their market and their competition. There are other small companies like Surya pharma and
Ortin Labs that pose threat to Biocon. Though they are small in size, yet they are innovative
in their products, they are slowly capturing the market.

Market attractiveness evaluation

Market insight observes that Contract Research Organisation in India has various challenges
as well as it is an emerging market in India. The market of CRO did not observe boom as this
slow growth in this sector took the business in present time to the emerging markets, like
Indonesia and China (Cheng et al. 2014, p.22). The market values cannot be denied for the
large population, attractive investment and cost-effective market.

Five force analysis

In recent time, the business environment has gone to extremely competitive. Each market has
perfect competition. In perfect competition, no company can be price-taker (Henisz et al.
2014, p.1728). The companies are trying to create competitive advantage. Porter’s Five
Forces model analyses the competitive advantages of a market. Contract research
organisations are the pharmaceutical services providers that generally receive outsourcing
from the large pharmaceutical as well as biotechs to conduct clinical trials and some of the
other related services.
Industry competition: In generic pharmaceuticals, it is a highly competitive market. It is
important to innovate every moment to be in the field. Manty overseas companies have been
doing great works in generic pharmaceuticals (Dezso and Ross, 2012, p.1078). At first, the
drugs need to test and then, it can be produced in bulk. In order to be in the market, the price
of the products needs to be competitive. Clinical research in India is to begin to take off and it
could flourish in next few years.
 Figure 1: Porter’s Five Forces
(Source: Grundy, 2011, p.2014)
The threat of new entrants: For an entrepreneur, biopharmaceutical can be an option.
Capital requirement of this industry is low. It is easy to create a network for distribution is
easy. The government has put hindrance in the entry of this market. Having new patent is not
easy (Ronda‐Pupo et al. 2012, p.162). The market for the generics is potential and huge. The
pharmaceutical environment is dynamic. Development and new drugs play a significant role.
Pharmaceuticals companies can take to direct to consumers approach to selling their
products.
The threat of substitutes: When the industry thrives, the demand for the specific drugs goes
high. Pharmaceuticals industry has bright future, the threat of subsidiaries and biotechnology
are high for the advancement of technology and researchers. Competitiveness is high and
threats too (Peteraf et al. 2013, p.1389). The presence of strong multinational competitors in
the market and the government's restrictions on the patent concerning the edible goods that
require chemical for manufacture has increased the threat of substitute product in the market
(Fjeldstad et al. 2012, p.735)(Refer to appendix 3).

Identification of key success factors

Value chain analysis

Major factors in the value chain analysis are presented in the following figure.
 Figure 2: Value Chain analysis
(Source: Bowersox et al. 2012, p.55)
The activities of the business organisations concerning all the above-mentioned aspects
determine the factors that might lead to success for the organisation. For example, the
operational factors such as quality of the product and the expectations of the market
determine if the company would be able to generate preference among the consumers
concerning the products of the organisation. The research and development activities that
Biocon India Group undertakes, distinct it from the other organisations that compete to
acquire the preferences of consumers in the same market. (For further details, refer to
appendix 4). In the following section the manner in which Biocon India Group generates
competitive advantage for itself concerning, the above-mentioned factors have been
discussed:
Value analysis
The voluminous target molecular reagents and customised molecules of Syngene paved the
way for the early development and creation of the skills and infrastructural discovery of
molecules (Kalegaonkar et al. 2012, p.65). The creation and initiation of Clingene, resulted in
the loss of power and control by Biocon India Group, along with the entrapment of the
central organisational culture. In the process of this creation, collaborative attempts were
made to take into consideration safe and lower value business services for Clinigene, until it
is capable of self-testing of the molecules and running free clinical (Walls et al. 2012, p.913).
The distraction and deviation exposed by Clinigene regarding its consideration of the firm,
that is, Biocon India Group, acted as a loss for the company, compelling the management to
initiate the process of creation and development of the business all over again (Neffke and
Henning, 2013, p.300).
Planning and evaluation
In order to achieve an overall growth, Biocon India Group certainly needs to expand its
market share. In order to alleviate this situation, a simple yet expensive approach could be
the initiation of a prospective Clinical Research Organisation (CRO). This will result in the
escalation of the expertise and maintenance of stability within the relationship between the
company its clients within the organisational culture (Easterbrook et al. 2011, p.869). The
assistance and assurance from the Quality Assurance Company, regarding the quality of the
Biocon products, encouraged and motivated the company to start their business a fresh, in
spite of the deviation from Clingene. This is owing to the sharing of corporate values and
trust among the employees and the other staffs (Kapferer, 2012, p.89).
The high potential growth of the CRO might prove to be beneficial for Biocon, providing the
scope and opportunity to Clingene regarding the careful and conscious reading and
positioning within the CRO market.

Strategic choice development

Ansoff Matrix

Ansoff matrix provides a business attempts for tracking the dependency of new and existing
products in the market. In case of the existing market, the organisation needs to analyse the
market penetration and product development. In new market, the organisation needs to
analyse, market development and diversification (Darroch, 2014, p.35).

Market penetration Market development

The company wants to enhance the market The company needs to develop the
share of the present products and intends to geographical market through entering new
enter the markets of neighbouring countries markets. Pricing policies need to be adjusted
(Gulati et al. 2012, p.576). While the first as per the standards of the target market.
can be achieved through personal selling for Distribution channels such as online sites
the second the organisation needs to can provide assistance. The company has
undertake outsourcing or franchising. The taken global manufacturing with cost
company needs to increase the existing effective way. Biocon Limited started to
customers. Biocon Limited tries to innovate expand in Malaysia.
in emerging market of biotechnology,
research service and molecules.
Restructuring can be helpful for
overshadowing the competitors.

Product Development Diversification

The company needs to develop and research It is related to growth of market to the new
about the innovation of products with products. The company needs to analyse the
detailed analysis. They need to be the first in risk strategy (Hill and Jones, 2013, p.45).
the market. Biocon Limited tries to innovate The company first tries to grow the products
in insulin and molecules. They are working in lab then take it to market and Biocon
on oncology and next generation Limited is no exception to this. The
biotechnology. Research services, company takes the strategy of risk
biosimilars and novel molecules are some of assessment and able to procure reward for
the products they are currently working on. that.

Table 3: Application of Ansoff Matrix

(Source: Created by author)
Deliberate Strategy: Plan for market expansion
The management of Biocon India Groups can organise for a meeting to develop and create
appropriate strategies for the expansion of the market share through the product and services
(Refer to appendix 5).

Specific The organisation might expand its sphere further through entering the
neighbouring markets for which the organisation would need to
outsource some of its activities in the target market
Yet the policies of manufacturing and research and development would
be same as the home country for ensuring that the values of the company
remain the same in the target market as well

Measurable This might be measured through the performance of the company in the
international market

Achievable The organisation has enough financial base to achieve this target

Realistic Due to the current competition level of the industry and the existence of
MNCs in the market the organisation has faced the need for increasing
its sphere or operation hence it needs to undertake the
internationalisation. This would increase the appeal of the organisation in
the home market as well

Time base This needs the time span of 2 years

Table 3: SMART Analysis

(Source: Created by Author)
Emergent strategy: Hiring of qualified workers for international market expansion
In order to hire qualified workers for the market expansion, the management authorities of
Biocon can organise meetings regarding the recruitment of qualified workers (Ward and
Peppard, 2016, p.65). Consequently, an effective organisational culture will be established
where there is an existence of coordination, cooperation, stability and trust among the
employees and the managerial staffs.
 Specific Hiring the skilled employees for the research and development process is
essential for ensuring that the organisational current or future ventures are
completed in a successful manner

Measurable Success of this particular strategy might be evaluated based on the

increased productivity of the organisation and its improved service quality
For this, the organisation might use

Achievable As the organisation operates in a market that has ample number of skilled
employees that agree to serve in considerably low wages hence the
recommendation is achievable

Realistic As the strategy does not emphasise on any large expense of the company
yet has the potential to improve the service and production level hence the
strategy can be considered realistic

Time base This strategy might be implemented in the time span of 3 months

Table 4: SMART Analysis

(Source: Created by Author)

Choice of best-fit strategy and implementation

Some strategies will emerge upon the implementation of the proposed strategies by the
employees. In the process of this implementation, the creativity and productivity of the
employees will be enhanced. They will gain much experience from the exposure of their
skills, expertise and knowledge on a regular basis. As a consideration of the internal and the
external factors, strategies for the expansion of Biocon market will enhance the reflex
capability of the employees. This will provide the scope for the undertaking of actions
according to the emergence of the business situations (Zhou and Li, 2012, p.1090).
Evaluation of the strategic options presented above has enabled the researcher to identify that
the internationalisation of the company might be essential yet it needs long-term
stratification. For the immediate improvement of the organisational position in the market,
the organisation needs to acquire employees that are more skilled and improve its product and
service quality (Zhu and Iansiti, 2012, p.88).
Conclusion

After concluding the assignment, it can be clearly stated that the management of Biocon
should take into consideration the Indian market. With the help of the SWOT analysis and the
Pest analysis, the potential disadvantages and advantages of operating in the Indian market
can be analysed. To judge the competitive advantage of the market, PORTER's theory has
been used. There is huge competition in the international and national market. The
recommendation is provided so that the company can improve their present condition and
achieve their targets with huge success.
References

Books

Berman, B.R. and Evans, J.R., (2013). Retail management: a strategic approach. United
Kingdom:Pearson Higher Ed

Darroch, J., (2014). Ansoff’s Growth Matrix—In Detail. In Why Marketing to Women
Doesn’t Work. UK: Palgrave Macmillan

Hill, C.W. and Jones, G.R., (2013). Strategic management theory. South-Western/Cengage
Learning

Kapferer, J.N., (2012). The new strategic brand management: Advanced insights and
strategic thinking. Kogan page publishers

Ward, J. and Peppard, J., (2016). The Strategic Management of Information Systems:
Building a Digital Strategy. John Wiley & Sons

Bowersox, D.J., Closs, D.J. and Cooper, M.B., 2002. Supply chain logistics management
(Vol. 2). New York, NY: McGraw-Hill.

Journals

Casadesus-Masanell, R. and Zhu, F., (2013). Business model innovation and competitive
imitation: The case of sponsor‐based business models.Strategic management journal, 34(4),
pp.464-482

Ronda‐Pupo, G.A. and Guerras‐Martin, L.Á., (2012). Dynamics of the evolution of the
strategy concept 1962–2008: a co‐word analysis. Strategic Management Journal, 33(2),
pp.162-188.

Cheng, B., Ioannou, I. and Serafeim, G., (2014). Corporate social responsibility and access to
finance. Strategic Management Journal, 35(1), pp.1-23

Dezsö, C.L. and Ross, D.G., (2012). Does female representation in top management improve
firm performance? A panel data investigation.Strategic Management Journal, 33(9),
pp.1072-1089
Easterbrook, P.J., Gopalan, R., Berlin, J.A. and Matthews, D.R., 1991. Publication bias in
clinical research. The Lancet, 337(8746), pp.867-872
Fjeldstad, D., Snow, C.C., Miles, R.E. and Lettl, C., (2012). The architecture of collaboration.
Strategic Management Journal, 33(6), pp.734-750

Grace, C., (2014). The effect of changing intellectual property on pharmaceutical industry
prospects in India and China. DFID Health Systems Resource Centre, pp.1-68
Grundy, T., (2011). Rethinking and reinventing Michael Porter's five forces model. Strategic
Change, 15(5), pp.213-229
Gulati, R., Puranam, P. and Tushman, M., (2012). Meta‐organization design: Rethinking
design in interorganizational and community contexts. Strategic Management Journal, 33(6),
pp.571-586

Henisz, W.J., Dorobantu, S. and Nartey, L.J., (2014). Spinning gold: The financial returns to
stakeholder engagement. Strategic Management Journal,35(12), pp.1727-1748

Jayakumar, B.P., (2010). Indian Pharma on sterod-like growth. Business Standard. 1(2),
pp.12-15

Kor, Y.Y. and Mesko, A., (2013). Dynamic managerial capabilities: Configuration and
orchestration of top executives' capabilities and the firm's dominant logic. Strategic
Management Journal, 34(2), pp.233-244

Lavie, D., Haunschild, P.R. and Khanna, P., (2012). Organizational differences, relational
mechanisms, and alliance performance. Strategic Management Journal, 33(13), pp.1453-
1479

Neffke, F. and Henning, M., (2013). Skill relatedness and firm diversification.Strategic
Management Journal, 34(3), pp.297-316

Peteraf, M., Di Stefano, G. and Verona, G., (2013). The elephant in the room of dynamic
capabilities: Bringing two diverging conversations together.Strategic Management Journal,
34(12), pp.1389-1410

Walls, J.L., Berrone, P. and Phan, P.H., (2012). Corporate governance and environmental
performance: is there really a link?. Strategic Management Journal, 33(8), pp.885-913
Zhou, K.Z. and Li, C.B., (2012). How knowledge affects radical innovation: Knowledge
base, market knowledge acquisition, and internal knowledge sharing. Strategic Management
Journal, 33(9), pp.1090-1102

Zhu, F. and Iansiti, M., (2012). Entry into platform‐ based markets. Strategic Management
Journal, 33(1), pp.88-106

Chen, Y.M., Liu, H.H. and Wu, H.Y.,(2016). Reputation for toughness and anti-dumping
rebuttals: Competitive rivalry, perceived benefits, and stage of the product life cycle. Journal
of Business Research, 69(6), pp.2145-2150.

Websites

Bioconfoundation.org. (2016). Biocon Foundation - Promote social and economic inclusion

by ensuring that marginalized communities have equal access to healthcare services and
educational opportunities. Available at: http://www.bioconfoundation.org/ [Accessed on: 10
Jul. 2016]
Appendices

Appendix 1

However, there are certain new opportunities that can help Biocon to improve their position
in the Indian as well as the international market. With the help of foreign investment, the
company has been able to reach heights in their research products. The government of India
has helped them by reducing the taxes levied on them. The amount can be spent on the
improvement of the infrastructure of the company and the research work. The parent
organisation has come with two new subdivisions under the umbrella which has proved the
growing acceptance of the company in the global market.
Along with the opportunities, there are threats that the companies face in terms of growth of
their target. Most of the skilled people are moving out of the country as the company is
unable to pay the expected wage to the employees and the researchers. New foreign
companies are entering the market with excellent binfrasturucete which is posing a great
threat to the company. Some of the activities of government are taking the pricing of the
medicines under control. This creates a great threat to the revenue earned as through cost
cutting the investment of the research is minimised.
From above analysis, it can be stated that external and internal environment affects the
position of Biocon Limited in Indian pharmaceutical market.
The industry has reached new heights in India, as cheap and skilled labour is readily
available. Along with advantages, company faces certain challenges, which they need to
overcome to become more successful in the indian market. The organisation faces challenges
in the field of infrastructure. Moreover, a study that happens in the field of pharmaceuticals is
not in collaboration with research done by scientists. This has posed a great threat to
company management.
Appendix 2

The economic condition of the country should be taken into consideration when the
management is considering the growth of the company. In India, the economic condition is
not stable as it is greatly influenced by the fall and rise of the value of money. Though the
GDP is growing, the company have to face the problems affecting them at the time of their
production and outsourcing. The Indian government has levied taxes so that the company can
invest more in improving their infrastructure.
The social culture of India is quite different from that of the other parts of the world. Here
people are more relied on the homoeopathic than the allopathic medicines. Though there has
been a change in the mind structure of the people, yet there are a large number of people who
believe in the power of the homoeopathic medicines. Moreover, the type of medicines that
people can afford in India should be taken into consideration. All the people do not have the
power to buy the same medicine at the same price. Hence the medicines that are to be made
should be made within the price range of the people.
The political situation of Indian pharmaceutical market has an immediate influence on the
functioning of the company. The strategies made by the government are creating a barrier in
the fields of expansion of the company. Without the patent certification, any other company
can get hold of the formula and manufacture the same medicine in their name. Moreover, the
international market has increased with many other companies, which are much more
developed and have more funds. India is technologically developing and not developed.
Therefore, that management of the company should be able to make a decision as to develop
the infrastructure as per the requirements. Huge costs might be inferred at the time of
importing the machinery.
 Appendix 3

Bargaining power of customers Moderate

Industry competitiveness High

Bargaining power of suppliers Low

Threat of substitute product High

Threat of new entrants High

Table: Five force analysis

Bargaining Power of Buyers: The main feature of the pharmaceutical industry is that the
ultimate user of the product is different from the influence that is doctors. The customers of
this products are influenced to buy these products. The main prices of the products depend on
the consumers. In this particular pharmaceutical industry, the customers do not have enough
power in the pricing of the products. In this industry, in Indian government plays an
important role in managing the prices. Big Pharmaceuticals Company and CRO industry have
a master-servant relationship.
Bargaining power of suppliers: Pharmaceutical industries depend on various organic
chemicals. In the chemical industry, there is huge competition. Suppliers do not have enough
bargaining power for the competition; it is also a fragmented market for the suppliers. The
company can easily switch to other suppliers for removing high cost. Japan is the second
largest market in the pharmaceutical industry. There is an effect on switching cost to one
supplier to another.
Appendix 4

From a shed in the unexplored area of Bangalore, Biocon India Group was transformed into a
successful beer company in India to such an extent that it was taken over by Unilever. Under
the guidance of Unilever, Biocon made significant contributions in the foods business of
Unilever. Consequently, it made Unilever as one of the independent and privately owned
entity.

Analysis of activities
In order to convert and extend the business expertise, Syngene was created and developed to
qualify Biocon not only as manufacturers but also as chemical and biological researchers.
This creation enabled the company to make significantly serve and cater to the synthetic
chemistry, molecular biology and informatics. Apart from this, another joint initiative of the
managerial authority of Biocon India Group was the extraction of the most out of its
subsidiary, Clinigene.
Appendix 5

Through this meeting, planning can be executed for taking into consideration the resources,
equipment and other data. This will improve the performance of the company through the
international undertakings . This will enable the company to outsource their products and
services within the international market. Apart from this, there will be an escalation in the
demand for the financial products related to healthcare. Along with this, the simultaneous
growth and profits in the segments of the pharmaceutical company of India, there will be an
overall growth in the business of the Biocon.
In order to bring out the reflexive undertakings of the employees, managerial authority of
Biocon can take the assistance of the cognitive and the other schools. These schools will aid
the employees in the achievement of the specified goals through the help of the coordinating
and the emerging strategies. Through the enhancement of the skills and expertise of the
employees, they will enable the company to engage in foreign trade and transactions. This
will pave the way for the economic escalation of the industry. This will also enable the
company to get an access to the smaller segments of the industry. Owing to all these factors,
the industry will emerge as one of the global hubs of pharmaceutical products as a result of
low labour costs.
For this, they need adequate financial resources, which could be obtained from the trade and
transactions with the foreign companies. Apart from the financial resources, the company
needs to reduce the labour cost. For this, the company can take into account the process of
classical planning which will lead to the effective selection of the workers based on their
skills, expertise and knowledge