BSRE301 Business Strategy and Profitable Growth

Blackmore Australia Case Study

The report analyzes the internal business and external operating environments of Blackmore Australia and makes a conclusion about the firm’s performance and other issues regarding it. The scope and the focus of the analysis and the information are limited to 5 years ago. Blackmore is a natural health company and one of the Australia’s leading company in the pharmaceutical industry in the globe. The company vision, mission, and values are rooted in the ideas and the vision of Maurice Blackmore who founded the company. The company passion includes the provision of natural health products for the population and inspiring them on how to invest health status. Therefore, the company is focused on developing health products that use a natural approach to curing health. The products are based on the expertise in minerals, vitamins, nutrients and herbs (Bengtson Nash, et al., 2014). The firm’s internal and external business environment has an impact on its management and the strategic direction taken in the provision of products and services across the globe.

Internal analysis of Blackmore Australia

The Internal Analysis of the company focuses on the factors and issues that affect the competitive advantage of the enterprise in the business environment. The report explores how the firm’s resources, capabilities, and the management affects its operations and strategic direction. The company recruits high-quality senior managers for the organization to make it competitive. Senior executives are selected based on their qualification, competence, innovation and their capability to drive the organization strategically and thus make it competitive. For example, the firm chooses managers who are capable of ensuring strong sales growth, recruiting the right people for the available position and one that provides the company is in the right strategic direction (Grant, 2016).

Further, the quality of senior managers in the company has been the source of the strong culture and the common purpose which holds the workforce together across together. For instance, the employees passionately believe in the benefits emanating from natural health and the existing opportunity that helps the population live a better life. The quality of the managers such as innovation has enabled the company to diversify its existing business and to develop the new sources and avenues of growth and setting strategic priorities. This is paramount as it helps support business growth and linking with the customers for the purpose of ensuring profitable growth (Cummings & Worley, 2014).  

Besides, Blackmore’s core capabilities and unique resources are essential for the transformation of the organization into one of the industry leader in the country and across the region for more than seven decades. As such, the role played by the form’s significant resources and core capabilities provide a sustainable competitive edge. An example includes guaranteed quality, thriving internal culture, well-trained employees and a CEO with adequate knowledge about the industry. Extensive product range and purchasing power of the firm, Research and Development and production of new products for the market and reputation, awareness and brand image (Stough, et al., 2014).

Blackmore’s Capabilities

One of the company capacity is to produce guaranteed quality product for the consumers. This ability is boosted by Blackmore’s’ organization policy that ensures the production of high-quality products which are made from ingredients that are sourced from many locations. This means that the company policies are guided by the need to guarantee quality as opposed to growth and this has boosted the reputation of the business as a whole. Also, training and development of the workforce are another capabilities of the company that makes it survive in the market. For instance, the company management focuses on the intensive training of their labour force, and this is essential to the achievement of Blackmore’s’ mission, vision and values (Cummings & Worley, 2014). This means the qualified health experts serves as a capability of the organization because the employees pass information to the suppliers of the firms’ product which is also passed to the consumers.

Blackmore’s Resources 

The quality of leaders in the company is one of the enterprise unique resources. For the purpose of the competitive business ability, the managers are ahead regarding ideas concerning the health as compared to other. Different managers such as marketing and HR have tacit knowledge on how to run the huge company business and have unique passion and understanding required for the complimentary healthcare. Another resource for the company is the purchasing power occasioned by financial muscle. The company has used it to their disadvantage to acquiring a huge share of the market within Australia and the Asian regions. As such, the bargaining power is a unique resource as it strategically enables the company to maintain the superior standard of products in a cost effective way.

External Environmental Analysis of Blackmore

According to Rachet, there are two forms of external marketing environments namely the micro and macro. The factors are beyond the company’s control, and they have a significant influence on the decisions made by the management when designing a strategy. The report analyses both the micro and macro environment of Blackmore to understand the impact of the factors on reaching market decisions and the firm’s success (Rachet, 2014).

Macro Environment

The macro environment context of the company comprises the uncontrollable factors which are external to the organization. They include political, economic, social, technological, environmental and legal factors. Blackmore products fall into the category of pharmaceuticals which are consumed across the globe, and therefore the Pestle analysis scope includes the global forces named above. Macro environment (Grünig & Kühn, 2015).

Political forces 

The political forces of the domestic and foreign government have a significant effect on the performance of the organization. For instance, government policies on the industry can have positive and negative ramifications due to taxes proposals by the government and incentives to local companies to create a level playing field. Governments across the world focus on handling price control and monopoly challenges in all sector. This also affects the company because it transacts business across the world (Gereffi, 2017).

Environmental Forces 

The pharmaceutical products face harsh environmental issues which they need to satisfy. Across the globe, there is a growing environmental movement that advocates for the focus on the reduction of chemicals released in the environment and ensuring of carbon green environments (Bengtson Nash, et al., 2014). For Blackmore, the company cannot be able to ignore the issues because it’s range of products and services fall in the pharmaceutical industries across many countries in Australia and Asia. Therefore the company needs to implement practices and policies that save the environment from wastewater, industrial chemicals that contain active pharmaceutical ingredients and the combination of various chemical compounds and carbon which comes from their pharmaceutical industries (Roschangar, et al., 2015).

Social Forces

There are various issues such as physical activities, social life and the health of the community that have significant effects on the pharmaceutical sector. Across the globe, there are identifiable changes and trends taking place in social life, and this affects the strategic directions of the company and the international pharmaceutical sector. For example, the rate of birth has changed across the world, and this means the communities have a more aged population that requires more drugs when compared to the young generation and the emergence of new diseases such as SARS and AIDS (Gereffi, 2017).

Technological Factors

Technology in the pharmaceutical industry plays a critical role in the sector, and the companies are using sophisticated technologies for the development and production of new drugs. Technology also affects how the companies are researching and inventing new medicinal products for the market. For example, companies are now using advanced technology to measure chemical compounds accurately and control their reactions which have led to enhancing of scientific medicines. Technology has enabled the decrease of time, efforts and financial resources to produce accurate and reliable drugs (Yeoh & Calantone, 2015).

Economic Forces

The global economic trends have not significant effects on the pharmaceutical sector compared to other manufacturing industries. However, there are other factors such as global interest, inflation, taxes, and foreign exchange rates that have affected the pharmaceutical industry. For example, the changes in exchange rates have an overall effect on the imports and exports of drugs. Hike in interest rates is more likely to lead to little investment and the stakeholders (Yeoh & Calantone, 2015).

The pharmaceutical industry is one of the highly regulated sector regulated in the world. Some of the legal implication in the sector includes the patent law, pricing laws on the industry innovation are thus influenced by these factors. For example, the innovation of drugs is highly regulated, and this causes a delay in the production of new medicines due to the length of approval time (Mulinari, 2013).

Micro Environment Analysis of Blackmore

The Microenvironment factors that affect the organization are those whose influence is felt directly by the management operations and the level of success at a particular period. When formulating the company’s corporate strategy, it is imperative for the marketing manager and staff to conduct a thorough analysis of the factors such as employees, customers, rivals, media, shareholders, and suppliers.

The company’s workforce is the driving force in the organization, and the level of interaction with the enterprise determines the level their satisfaction. Thus, Blackmore’s management should be focused on creating and ensuring employee satisfaction as this determines the overall success of the business operation (Fleisher & Bensoussan, 2015). The company employs employees with relevant experience and skills to boost the competitive advantage of the product. The company process begins with the recruitment stage and is supported by regular training and promotion opportunities. For instance, the company uses training and development to boost the company a competitive edge and design other ways to motivate workers (Cummings & Worley, 2014).

The purpose of establishing a business is necessitated by the need to satisfy the customers’ needs and want. Blackmore philosophy is oriented around customers, and the marketing is designed to attract more and retain the existing customers by producing products that solve their health challenges and provision of excellent customer service across the globe (Grant, 2016).

Suppliers in the business are tasked with the responsibility of providing businesses with materials needed for the production of products. Blackmore supplier's behavior has direct impact on its products, and this increases the Marketing Mix Strategy. The company ensures there is a healthy supplier relationship which is essential in retaining the competitive in the market and ensure the production of high quality products (Cummings & Worley, 2014).

Shareholders

As businesses grow and expand, they require people who can invest capital. In this case, the company can transform move from private to public by raising money from prospective investors who have an interest in the enterprise. the company’s shareholders invest capital with the expectation of getting a return on their capital and this makes them pile a lot of pressure for the company to perform and make huge profits and this affect the organizational strategy. (Cummings & Worley, 2014).

It is critical for the company to maintain a better relationship with the media tools for the purpose of product and services publicity. This can make or break the team. Blackmore manages the media relations and this help in forming a favourable image of the company and minimize the occurrence of event which can spoil the firm’s reputation. Therefore, to achieve this, the company has a fully-fledged department that deals with press releases about particular incidents (Barge-Gil & Modrego, 2011).

Companies used many distinct market strategies to achieve differentiation of their product. Blackmore is one of them, and the objective is to offer health products which are better than those of the competitors. Further, the company engages in competitor analysis to get information that can improve its market position which means the management is fully aware of the opponent's moves and therefore react strategically to the moves (Barge-Gil & Modrego, 2011; Fleisher & Bensoussan, 2015).  

Conclusion

In conclusion, the organization strategic directions are affected by both the internal and external environment present in the country and regions where operates. The company has control of these factors, and they cannot control some can be handled by applying strategies. For example, policies, environmental, legal, technological are factors that affect the organization performance, and they require the company to come up with ways to address them to their competitive advantage. On the other hand, the resources, capabilities, and resources can be well utilized to increase market share and innovative product products.

References

Barge-Gil, A. & Modrego, A., 2011. The impact of research and technology organizations on firm competitiveness. Measurement and determinants. The Journal of Technology Transfer, 36(1), pp. 61-83.

Bengtson Nash, S., Schlabach, M. & Nichols, P., 2014. A nutritional-toxicological assessment of Antarctic krill oil versus fish oil dietary supplements. Nutrients, 6(9), pp. 3382-3402.

Cummings, T. & Worley, C., 2014. Organization development and change. Boston: Cengage learning.

Fleisher, C. & Bensoussan, B., 2015. Business and competitive analysis: effective application of new and classic methods. Upper Saddle River, NJ: FT Press.

Gereffi, G., 2017. The pharmaceutical industry and dependency in the Third World. Princeton, NJ: Princeton University Press.

Grant, R., 2016. Contemporary strategy analysis: Text and cases edition. Hoboken, NJ: John Wiley & Sons.

Grünig, R. & Kühn, R., 2015. Global Environmental Analysis. In The Strategy Planning Process (pp. 89-96). Heidelberg: Springer Berlin Heidelberg.

Mulinari, S., 2013. Regulating drug information in Europe: a pyrrhic victory for pharmaceutical industry critics?. Sociology of health & illness, 35(5), pp. 761-777.

Rachet, B., 2014. PESTEL analysis and Porters Five Forces For Innocent Drinks Company. s.l.:Docs. school Publications..

Roschangar, F., Sheldon, R. & Senanayake, C., 2015. Overcoming barriers to green chemistry in the pharmaceutical industry–the Green Aspiration Level concept. Green Chemistry, 17(2), pp. 752-768.

Stough, C. et al., 2014. Reducing occupational stress with a B-vitamin focussed intervention: a randomized clinical trial: study protocol. Nutrition journal, 13(1), p. 122.

Yeoh, P. & Calantone, R., 2015. Success Factors in Global Product Innovation: An Illustration from the Pharmaceutical Industry. In Proceedings of the 1993 World Marketing Congress (pp. 11-11). New York City, NY: Springer International Publishing.