SWOT Analysis Cabot Pharmaceuticals, Inc.

case study

The four key elements of SWOT analysis are - Strengths, Weaknesses, Opportunities
& Threats. Cabot Marsh can use strengths to create niche positioning in the market, can
strive to reduce & remove weaknesses so that it can better compete with competitors,
look out to leverage opportunities provided by industry structure, regulations and other
development in external environment, and finally make provisions and develop
strategies to mitigate threats that can undermine the business model of Cabot Marsh.

Opportunities Threats
Strengths Strength Opportunities (SO) Strength Threats (ST) Strategies
Strategies
Cabot Marsh can use two approaches - building on
Using Cabot Marsh strengths to present strengths, or analyze the trend and build
consolidate and expand the market processes to two pronged market penetration
position. approach.
Weaknesses Weakness Opportunities (WO) Weaknesses Threats (WT) Strategies
Strategies
Cabot Marsh should just get out of these business
Building strategies based on areas and focus on strength and threats box , or on
consumer oriented product weakness and opportunities box.
development and marketing
approach.
For more detailed SWOT Matrix strategy please go through the detailed analysis of
strengths, weaknesses, opportunities, and threats in next section.

What are Strengths in SWOT Analysis

Strengths - Cabot Pharmaceuticals, Inc.

Strengths are the Cabot Marsh capabilities and resources that it can leverage to build a
sustainable competitive advantage in the marketplace. Strengths come from positive
aspects of five key resources & capabilities - past experiences and successes, financial
resources, activities & processes, human resources, and physical resources such as land,
building .
- Superior product and services quality can help Cabot Marsh to further increase its
market share as the current customer are extremely loyal to it. According to Frank V.
Cespedes, John T. Gourville in Cabot Pharmaceuticals, Inc. study – there are enough
evidences that with such a high quality of products and services, Cabot Marsh can
compete with other global players in international market.

- Strong Balance Sheet and Financial Statement of Cabot Marsh can help it to invest in
new and diverse projects that can further diversify the revenue stream and increase
Return on Sales (RoS) & other metrics.

- First Mover Advantage – Cabot Marsh has first mover advantage in number of
segments. It has experimented in various areas Human resource management, Sales.
The Sales & Marketing solutions & strategies has helped Cabot Marsh in coming up
with unique solution to tap the un-catered markets.

- Robust Domestic Market that Cabot Marsh Operates in - The domestic market in
which Cabot Marsh is operating is both a source of strength and roadblock to the
growth and innovation of the company. Based on details provided in the Cabot
Pharmaceuticals, Inc. case study – Cabot Marsh can easily grow in its domestic market
without much innovation but will require further investment into research and
development to enter international market. The temptation so far for the managers at
Cabot Marsh is to focus on the domestic market only.

- Successful Go To Market Track Record – Cabot Marsh has a highly successful track
record of both launching new products in the domestic market but also catering to the
various market based on the insights from local consumers. According to Frank V.
Cespedes, John T. Gourville , Cabot Marsh has tested various concepts in different
markets and come up with successful Sales & Marketing solutions.

- Strong Brand Equity and Brand Awareness – Cabot Marsh has some of the most
recognized brands in the domestic market it operates in. According to Frank V.
Cespedes, John T. Gourville , brand recognition plays a significant role in attracting new
customers looking for solutions in Human resource management, Sales adjacent
industries.

- Strong relationship with existing suppliers – As an incumbent in the industry, Cabot

Marsh has strong relationship with its suppliers and other members of the supply chain.
According to Frank V. Cespedes, John T. Gourville , the organization can increase
products and services by leveraging the skills of its suppliers and supply chain partners.
What are Weakness in SWOT Analysis

Weakness- Cabot Pharmaceuticals, Inc.

Weaknesses are the areas, capabilities or skills in which Cabot Marsh lacks. It limits the
ability of the firm to build a sustainable competitive advantage. Weaknesses come from
lack or absence of five key resources & capabilities - financial resources, past
experiences and successes, human resources, activities & processes, and physical
resources such as land, building .

- Lack of critical talent – I believe that Cabot Marsh is suffering from lack of critical talent
especially in the field of technology & digital transformation. Cabot Marsh is struggling
to restructure processes in light of developments in the field of Artificial Intelligence (AI)
and machine learning.

- Customer Dissatisfaction – Even though the demand for products have not gone down
but there is a simmering sense of dissatisfaction among the customers of Cabot Marsh .
It is reflected on the reviews on various on-line platforms. Cabot Marsh should focus on
areas where it can improve the customer purchase and post purchase experience.

- Lack of Work force diversity – I believe that Cabot Marsh is not diverse enough given
that most of its growth so far is in its domestic market. According to Frank V. Cespedes,
John T. Gourville , this can reduce the potential of success of Cabot Marsh in the
international market.

- Implementation of Technology in Processes – Even though Cabot Marsh has

integrated technology in the backend processes it has still not able to harness the
power of technology in the front end processes.

- Project Management is too focused on internal delivery rather than considering all the
interests of external stakeholders. This approach can lead to poor public relation and
customer backlash.
- Cabot Marsh business model can be easily replicated even with the number of patents
and copyrights the company possess. The intellectual property rights are very difficult to
implement in the industry that Cabot Marsh operates in. According to Frank V.
Cespedes, John T. Gourville , Intellectual Property Rights are effective in thwarting same
size competition but it is difficult to stop start ups disrupting markets at various other
levels.

What are Opportunities in SWOT Analysis

Opportunities- Cabot Pharmaceuticals, Inc.

Opportunities are macro environment factors and developments that Cabot Marsh can
leverage either to consolidate existing market position or use them for further
expansion. Opportunities can emerge from various factors such as - technological
innovations, economic growth, increase in consumer disposable income, changes in
consumer preferences, and political developments & policy changes .

- Growing Market Size and Evolving Preferences of Consumers – Over the last decade
and half the market size has grown at brisk pace. The influx of new customers has also
led to evolution of consumer preferences and tastes. This presents Cabot Marsh two big
challenges – how to maintain loyal customers and how to cater to the new customers.
Cabot Marsh has tried to diversify first using different brands and then by adding
various features based on customer preferences.

- Developments in Artificial Intelligence – Cabot Marsh can use developments in artificial

intelligence to better predict consumer demand, cater to niche segments, and make
better recommendation engines.

- Increase in Consumer Disposable Income – Cabot Marsh can use the increasing
disposable income to build a new business model where customers start paying
progressively for using its products. According to Frank V. Cespedes, John T. Gourville of
Cabot Pharmaceuticals, Inc. case study, Cabot Marsh can use this trend to expand in
adjacent areas Human resource management, Sales.

- E-Commerce and Social Media Oriented Business Models – E-commerce business

model can help Cabot Marsh to tie up with local suppliers and logistics provider in
international market. Social media growth can help Cabot Marsh to reduce the cost of
entering new market and reaching to customers at a significantly lower marketing
budget. It can also lead to crowd sourcing various services and consumer oriented
marketing based on the data and purchase behavior.

- Reducing Cost of Market Entry and Marketing into International Markets – According
to Frank V. Cespedes, John T. Gourville, globalization along with boom in digital
marketing and social media has considerably reduced the risks of market entry and
marketing in international market.

- Opportunities in Adjacent Markets – Cabot Marsh can explore adjacent industries

Human resource management, Sales to further market growth especially by extending
the features of present products and services.

What are Threats in SWOT Analysis

Threats- Cabot Pharmaceuticals, Inc.

Threats are macro environment factors and developments that can derail business
model of Cabot Marsh. Threats can emerge from various factors such as - technological
innovations, economic growth, increase in consumer disposable income, changes in
consumer preferences, and political developments & policy changes .

- Government Regulations and Bureaucracy – Cabot Marsh should keep a close eye on
the fast changing government regulations under the growing pressure from protest
groups and non government organization especially regarding to environmental and
labor safety aspects.

- US China Trade Relations – Cabot Marsh has focused on China for its next phase of
growth. But there is growing tension between US China trade relations and it can lead to
protectionism, more friction into international trade, rising costs both in terms of labor
cost and cost of doing business.

- International Geo-Political Factors – Since the Trump election, geo-political factors

have taken a turn for growing protectionism. Developments such as Brexit, Russian
sanctions, foreign exchange crisis & inflation in Venezuela, lower oil prices etc are
impacting international business environment. Cabot Marsh should closely focus on
these events and make them integral to strategy making.
- Culture of sticky prices in the industry – Cabot Marsh operates in an industry where
there is a culture of sticky prices. According to Frank V. Cespedes, John T. Gourville of
Cabot Pharmaceuticals, Inc. case study, this can lead to inability on part of the
organization to increase prices that its premium prices deserve.

- Threats of New Entrants because of Reducing Costs and Increasing Efficiencies – As

Cabot Marsh can leverage low cost of reaching customers using social media and e-
commerce, so can the competitors – both local and international competitors.

- Squeezing Middle Class in Developed and Developing World – The growing inequality
is one of the biggest threat to not only globalization but also to capitalism. Cabot Marsh
first hand witnessed the impact of it where it has seen lower demand of its products
from middle class customers in US and EU market.

5C Marketing Analysis of Cabot Pharmaceuticals, Inc.

4P Marketing Analysis of Cabot Pharmaceuticals, Inc.

Porter Five Forces Analysis and Solution of Cabot Pharmaceuticals, Inc.

Porter Value Chain Analysis and Solution of Cabot Pharmaceuticals, Inc.

Case Memo & Recommendation Memo of Cabot Pharmaceuticals, Inc.

Blue Ocean Analysis and Solution of Cabot Pharmaceuticals, Inc.

Marketing Strategy and Analysis Cabot Pharmaceuticals, Inc.

VRIO /VRIN Analysis & Solution of Cabot Pharmaceuticals, Inc.

PESTEL / STEP / PEST Analysis of Cabot Pharmaceuticals, Inc.

Case Study Solution of Cabot Pharmaceuticals, Inc.

SWOT Analysis and Solution of Cabot Pharmaceuticals, Inc.
References & Further Readings

Frank V. Cespedes, John T. Gourville (2018), "Cabot Pharmaceuticals, Inc. Harvard Business Review Case
Study. Published by HBR Publications.
CASE STUDY SOLUTION OF CABOT PHARMACEUTICALS

Cabot Pharmaceuticals Inc.

The case study describes the 12-year career of Bob Marsh, a pharmaceutical salesperson. Bob Marsh is
eventually asked to resign from his position at Cabot Pharmaceuticals. Soon after his termination from
the company, Bob's former customers begin to complain, and the company' since president of sales is
asked to investigate Bob's termination and to decide, what to do.T he case study addresses issues of
aligning strategy and sales efforts, evaluation criteria of performance, and on-going performance
management in field selling.

Information About BOB MARSH

Academic Credentials • Top Flight Pharmacy School

Sales Experience • At a Drug store, successful

Military Experience • Naval Pilot, good service record

Family and Community • Full family and community life

Regional Fit • Grew up and lived in Toledo where he would work

Choice:

Bob was reluctant to follow management guidelines, but followed his own actions

Intensity

: Bob had put forth lot of efforts in his territory, the result was rejected in sales performance

Persistence:

He was continuing his efforts over the years. Bob’s Ability was great in terms of reaching the
expectations of his manager. Lack of motivational programs enable Bob’s to adhere Management
directives policies. After 10 years of working in Cabot, Bob’s career seemed to have plateau .
CAREER PLATEAU UNDER FRANKLIN
Satisfaction with income in comparison with peers.

No upward mobility.

Burden of unfair treatment from previous 3 managers.

Withdrawal during disengagement stage. Continued managerial apathy helped rush the stage.

No remonstration during termination reveals how Marsh had left the happenings to fate and reconciled
to the fact that the job was no longer his cup of tea.

The rejection of even the last request may have catalyzed feeling of reprisal against his beloved
company.

Marsh is perceived as being moody, unfriendly, indifferent, and lethargic

Marsh feel behind schedule in reading assignments and collecting required market data.

Bob’s Behaviour Analysis

Strengths - Sincere, enthusiastic, quick learner, loyal , dedicated

Very good customer rapport

Loyal & dedicated to the work & the company

Didn’t leave the company even after being put on probation multiple times

• Willingness to improve

• Good working relationship with fellow associates

Weakness - Non-conformance to management directives, company policies and sales objectives.

• Inconsistency in maintaining records & poorly organized sample bag

• Catch-as-catch-can approach, tendency to prejudge the customers

• Lacked in organization skills, planning and follow up activities

Organizational Factors

•- Continuous change in District manager creating pressure on Bob to match up with their
expectations
 - Managers using tough approach with a plateauing problem, without understanding the problem
properly
- Relying on past data by managers.

•- Bob’s positive Customer Relationship Management skills not considered in his evaluation

Good Decisions taken by Franklin

-Took time to “know” Marsh

-Set no time to reach objectives

Bad Decisions taken by Franklin

-Set a list of “survival procedures” almost unreachable

-Too many procedures

-No empathy at all

-No real reasons for firing him

SOLUTIONS

1)Bob didn’t seem to be motivated by salary hikes alone and Proper motivational toolstailored to Bob’s
Needs were missing and should be designed such that:

Better performance evaluation- MBO

Creating Perception of Better Effort lead to Better Performance- So that efforts become
valuable.

2).Motivational programs should have some elements tailored to Bob’s needs by includingnon-financial
rewards such as:

– Job enrichment – Recognition

– Opportunity for promotion

In the current scenario, the right set of actions should be to reinstate Bob because:3) Bob maintained a
very strong connection with the clients & his reinstatement would reduce the risk of losing long time
customers4) He has served the company with total dedication & loyalty for 12 long years & knows
theselling function inside-out5 )His experience can be of great use to the company.

To solve the motivational & plateauing problem, the company should:6) Highlight prospects for
promotions & higher7) Assign Bob a new territory, where he can start afresh8 )Give him a new
assignment, such as coaching new salespeople, gathering competitive intelligence, surveying customers
for new product ideas or developing a new territory