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STEP 3. Industry Specific / Porter Five Forces Analysis of Danaher Corporation case study
STEP 5. Porter Value Chain Analysis / VRIO / VRIN Analysis Danaher Corporation case
study
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We have additionally used the concept of supply chain management and leadership framework to build a
comprehensive case study solution for the case – Danaher Corporation
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The external environment analysis of Danaher Corporation will ensure that we are keeping a tab on the
macro-environment factors that are directly and indirectly impacting the business of the firm.
Political factors impact seven key decision making areas – economic environment, socio-cultural
environment, rate of innovation & investment in research & development, environmental laws, legal
requirements, and acceptance of new technologies.
Government policies have significant impact on the business environment of any country. The firm in “
Danaher Corporation ” needs to navigate these policy decisions to create either an edge for itself or reduce
the negative impact of the policy as far as possible.
Data safety laws – The countries in which Danaher Color.between is operating, firms are required to store
customer data within the premises of the country. Danaher Color.between needs to restructure its IT policies
to accommodate these changes. In the EU countries, firms are required to make special provision for privacy
issues and other laws.
Competition Regulations – Numerous countries have strong competition laws both regarding the monopoly
conditions and day to day fair business practices. Danaher Corporation has numerous instances where the
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Import restrictions on products – Before entering the new market, Danaher Color.between in case study
Danaher Corporation" should look into the import restrictions that may be present in the prospective market.
Export restrictions on products – Apart from direct product export restrictions in field of technology and
agriculture, a number of countries also have capital controls. Danaher Color.between in case study “ Danaher
Corporation ” should look into these export restrictions policies.
Foreign Direct Investment Policies – Government policies favors local companies over international policies,
Danaher Color.between in case study “ Danaher Corporation ” should understand in minute details regarding
the Foreign Direct Investment policies of the prospective market.
Corporate Taxes – The rate of taxes is often used by governments to lure foreign direct investments or
increase domestic investment in a certain sector. Corporate taxation can be divided into two categories –
taxes on profits and taxes on operations. Taxes on profits number is important for companies that already
have a sustainable business model, while taxes on operations is far more significant for companies that are
looking to set up new plants or operations.
Tariffs – Chekout how much tariffs the firm needs to pay in the “ Danaher Corporation ” case study. The level
of tariffs will determine the viability of the business model that the firm is contemplating. If the tariffs are high
then it will be extremely difficult to compete with the local competitors. But if the tariffs are between 5-10%
then Danaher Color.between can compete against other competitors.
Research and Development Subsidies and Policies – Governments often provide tax breaks and other
incentives for companies to innovate in various sectors of priority. Managers at Danaher Corporation case
study have to assess whether their business can benefit from such government assistance and subsidies.
Consumer protection – Different countries have different consumer protection laws. Managers need to clarify
not only the consumer protection laws in advance but also legal implications if the firm fails to meet any of
them.
Political System and Its Implications – Different political systems have different approach to free market and
entrepreneurship. Managers need to assess these factors even before entering the market.
Freedom of Press is critical for fair trade and transparency. Countries where freedom of press is not
prevalent there are high chances of both political and commercial corruption.
Corruption level – Danaher Color.between needs to assess the level of corruptions both at the official level
and at the market level, even before entering a new market. To tackle the menace of corruption – a firm
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should have a clear SOP that provides managers at each level what to do when they encounter instances of
either systematic corruption or bureaucrats looking to take bribes from the firm.
Independence of judiciary – It is critical for fair business practices. If a country doesn’t have independent
judiciary then there is no point entry into such a country for business.
Government attitude towards trade unions – Different political systems and government have different
attitude towards trade unions and collective bargaining. The firm needs to assess – its comfort dealing with
the unions and regulations regarding unions in a given market or industry. If both are on the same page then
it makes sense to enter, otherwise it doesn’t.
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