STRATEGIC MANAGEMENT PROCESS OF ACI

PHARMACEUTICAL
 GROUP DETAILS
Serial Number Name Id Number

01 Md. Nuruzzaman M18150203716

02 Md. Saidur Rahman M18150203728

03 Raisul Islam Ratul M18150203733

04 Ananya Debnath M18150203737

05 Jannatul Ferdows M18150203739

 STRATEGY
• A strategy is a set of related actions that managers take to increase their
company’s performance.

Strategic Management Process

The strategic management process means defining the organization’s

strategy. It is also defined as the process by which managers make a
choice of a set of strategies for the organization that will enable it to
achieve better performance.
 ACI
Imperial Chemical Industries, a British multinational established a Branch in the then East
Pakistan changed to Advanced Chemical Industries (ACI) Limited.

Advanced Chemical Industries (ACI) Limited, being one of the largest conglomerates in
Bangladesh

With almost three decades of partnering life and engendering hope, ACI is one of the top
pharmaceutical companies in Bangladesh, employing more than 5,000 people all over the
country. As a progressive and forward-thinking company, ACI Pharma is dedicated to
improve the health of people of Bangladesh through introduction of innovative and reliable
pharmaceutical products.
 MISSION OF ACI

• ACI’s mission is to achieve the business success through

understanding the quality of life of people, meeting the need of
responsible application of knowledge and skills, exceeding the
technology and expectation of customers. ACI is providing high
quality products and committed for highest level of satisfaction to the
customer. The international standard of quality management system
is followed by ACI for achieving the customer’s satisfaction.
 VISION OF ACI

High and consistent quality of product should be providing, also value for money
should ensure to the customers.
Try to attain a leadership position in every category of our businesses.
Make development of employees by encouraging empowerment and rewarding system.
Make a friendly environment which is preferable for learning and personal growth.
By using high-level technology and effective resource utilization provide the best
quality of product.
By encouraging the distributer and suppliers for improving their efficiency, help to
inclusive the growth.
Ensure superior return on investment through judicious use of resources and efficient
operations, utilizing our core competencies.
 VALUES OF ACI

Continuous Improvement
Transparency
Fairness
Customer Focus
Quality
 OBJECTIVES

Analyzing the practice of strategic management of

ACI Limited.
To illustrate the strategic plan of the company.
To represent the porters five forces of model.
Identifying the strengths and weaknesses of ACI Ltd.
Analyzing the different level of strategies.
To illustrate the PEST Analysis of ACI.
 STRATEGIC PLAN OF ACI

• Strategic Business Units of Pharmaceuticals

• ACI carries the legacy of ICI- world renowned British Multinational

in providing the people of Bangladesh with quality medicines and
healthcare products. Its state-of-the art pharmaceutical plant
represents Bangladesh's quest for a truly world class manufacturing
facility. ACI's rich heritage leads to innovative and higher value-
added formulations.
 HIERARCHY LEVEL OF STRATEGY OF ACI

Functional Level Strategy:

They adopt flexible manufacturing technologies
so the company tries to innovate new product and modify
the existing product for customer attractiveness.
They continuously innovate products, promotional
activities, packaging and distribution.
 BUSINESS LEVEL STRATEGY

ACI always determine their positioning in the business against rivals

The company tries to influence the nature of competition through strategic
actions.
Using product features or services
Increase market share by expanding the network Functional Level
Strategies.
Focus is on efficiency, quality, innovation, and customer responsiveness.
Focus on After Sales Service Human Resource.
 CORPORATE LEVEL STRATEGY

 Identifying the overall goals of the corporation.

 Defining where in the corporation competition is to be
localized.
 GLOBAL LEVEL STRATEGIES

ACI Limited is using multi domestic strategies because it expanded

its telecom business under different countries with different name.
Provides different strategies for different countries depend on the
people demands Corporate Level Strategies.
Vertically integrated and concentrated on other field.
They import the raw materials from the places where it is less
costly, thus achieve location economy.
 EXTERNAL ANALYSIS

• The essential purpose of the external analysis is to identify strategic opportunities

and threats within the organization’s operating environment that will affect how it
pursues its mission.

 Industry environment.
 The country or national environment.
 And the wider socioeconomic or Macroenvironment.
 PORTER’S FIVE FORCES MODEL

1. Potential Entry of new competitors

Entry barriers in pharmaceutical industry is high for foreign companies
as the govt. rules does not permit foreign companies to enter the market
without joint venture with a Bangladeshi firm owning at least 50% share
of the company.

Even though there are high entry barriers in the industry, threats from
potential new entrants in this industry are also significant because of the
industry profitability and the rapid growth of the market.
2. RIVALRY AMONG COMPETING SELLERS

• The competition among companies in this industry ranges from

moderate to high.
• So the competition between firms in pharmaceutical industry is
based mostly on non-price factors.
• The top 30 companies (including ACI) control more than 90% of
the market, which makes the industry consolidated in nature.
• Competitive firms are using price cuts and other competitive
weapons to boost unit volume and to realize the economies of
scale which is also causing intensive rivalry.
3. THREAT FROM SUBSTITUTE PRODUCTS
• Although there is no direct substitute for pharmaceuticals products, there are some cases where limited
substitutes are available. there is no direct substitute for pharmaceuticals products, there are some cases
where limited substitutes are available.
• , In rural areas affluent people pay good money for Ayurvedic and Homeopathic medicine. They are also very
cheap, as they are not scientifically produced.
 4 BARGAINING POWER OF BUYERS

• . The unique power of physicians to make any band establishment and in some case.
• Unethical practices of sharing mutual benefits among physicians and firms have
increased this bargaining power even higher.

• 5 Bargaining power of suppliers

• Bargaining power of suppliers in this industry is moderately low.
• Most of the manufacturers in this industry import raw materials directly from abroad
which constitute low dependency on the raw materials suppliers.
• the number of suppliers is very high in the industry and the purchase volume is big.
 PESTEL ANALYSIS OF ACI PHARMACEUTICAL LTD.

• PESTEL analysis of any industry investigates the important factors that affect
the industry and the companies operating in the industry. Although, factors
affecting all these industries will be discussed in a general way, but this
analysis will have more focus on the pharmaceutical industry than the others.

• 1 Political factors:
• Relatively Instable political environment
• Strong Support of Government
• Corruption and bureaucracy
2 ECONOMIC FACTORS:3.SOCIAL FACTORS:

Positive and relatively higher Education

economic growth and market Use of Alternative medication
demand
Religion
Relatively higher inflation rate Spending pattern and consciousness
Relatively higher unemployment
rate
Unfavorable interest and exchange
rates
Unskilled Labor force
Higher population growth rate
Age
TECHNOLOGICAL FACTORS:

• Research and development

Legal Factors:
• Automation & Supply chain
Managements • Advertising Laws
• Labor laws of Bangladesh
Environment/Ethical
• Existing Laws and Government
Factors: Policies
• Natural disaster and epidemic • Liberal tax and fiscal policy.
• Waste Management
• Environmental Agenda and
community awareness
 INTERNAL ENVIRONMENT ANALYSIS

• Internal Environment Analysis consists of Competitive analysis,

Competitive advantage, Value chain analysis etc.

• 1 Value chain Analysis of ACI: Value chain represents the internal

activities a firm engages in when transforming inputs into outputs. ACI
Pharma is involved in a complex value chain involving three major
components:
• Manufacturing of the medicine.
• Distribution to the dispensing point.
• Dispensing to the end user.
 COMPETITIVE ADVANTAGES OF ACI PHARMACEUTICAL

• marketing About 80% of the drugs sold in Bangladesh are generics and 20% 5 registered brands which
have 8,300 different forms of dosages and strengths. The top 30 to 40 companies dominate almost
the entire market; the top 10 hold 70% of domestic market share; and the top three, Beximco
Square, ACI capture over 25% of the market.
• ACI Pharmaceuticals has 1,100 representatives and ACI Pharmaceuticals has 950 representatives
visiting pharmacies. None of the pharmacies visited restock any medicine that does not sell well.
• The following are the export manufacturers: Square, Novartis, Opsonin, Acme, Beximco, Aristropharma,
Eskayef, ACI, Renata, Orion, Jayson and Hudson.
SWOT ANALYSIS OF ACI PHARMACEUTICAL
• Strengths
• ACI has been able maintain its growth above the market growth
• ACI is the first company in Bangladesh to obtain certification of Quality
Management System in 1995.
• The marketing team of ACI is very efficient and effective
• Visionary and proficient leadership.
• Dedicated employees.
• Efficient materials management system.
• Appropriate organizational structure.
• Effective control system.
 WEAKNESSES

• ROE is decreased in 2019 than the previous year.

• Rigid credit policy.
• Capitals are borrowed from bank.

• Opportunities
• High potentiality in export sector
• Bargaining power of suppliers and buyers is low
• Increasing demand of modern technology in terms of cultivation for Agribusiness.
• Large market size.
• Large size of target customer.
• Opportunity of entering new related business.
• Low entry barriers.
• Opportunities
• High potentiality in export sector
• Bargaining power of suppliers and buyers is low
• Increasing demand of modern technology in terms of cultivation for Agribusiness.
• Large market size.
• Large size of target customer.
• Opportunity of entering new related business.
• Low entry barriers.
 THREAT:
• The industry is highly competitive
• Export may be reduced if world economy is affected
• Increase in domestic competitors.
• Changes in economic factors.
• Increase in regional competition.
• Rise of substitute products.
• Increase in industry rivalry.
COMPETITIVE ENVIRONMENT:

 SQURE PHARMA is the market leader of pharmaceutical industry

 in Bangladesh with 17.73% market share.
 Advanced chemical industries Limited (ACI), one of the leading
pharmaceuticals company with 4.43% market share.
 Renata Pharmaceuticals Limited with 4.97% market share.
 Beximco Pharmaceuticals Limited with 8.39% market share.
 Acme Laboratories Limited, another leading pharmaceuticals company
with 3.91% market share.
 So, it’s very known that the market of this sector is very competitive.
RECOMMENDATIONS
• Focused Differentiation: In a focused differentiation strategy ACI will concentrate
on producing the best quality product in the industry and sell it to a group of
sophisticated and conscious customers.
• Technology and Innovation: They have invested in technology to develop efficient,
economical and environmentally sound ways to find, produce and market medicine.
• Health, Safety and Environment: Increase emphasis on process safety, risk
management, emergency preparedness and environmental performance while
retaining intense focus on occupational safety.
• Sustainable Development: Update their strategies and action plans for these
important issues and focused on goals such as reducing waste and emissions.
 CONCLUSION

• ACI Pharmaceutical is not a market leader in this industry but with the
resourceless and capabilities that ACI has can be a close competitors of it. And
with the process managing of strategy it will not achievable for them.
• If the above recommended strategies fail to achieve desired objectives and incur
financial losses due to unforeseeable events ACI should dump the above
strategies and adopt a focused differentiation strategy. In a focused
differentiation strategy ACI will concentrate in producing the best quality
product of the industry and sell it to a group of sophisticated and conscious
customers. This will enable ACI to charge a premium price in the market and
also export to the quality conscious western countries to a certain extent.
THANK YOU