Jhonsan&jhonsan - Case Study Example

Johnson & Johnson Johnson & Johnson Discussion Questions and Responses What corporate strategy does Johnson & Johnson pursue? Referencing Chapter 6: Corporate –Level Strategy: Creating Value through DiversificationJohnson & Johnson face a stiff competition from its competitors; the Pfizer Inc and Novartis AG. It has, therefore, pursued a corporate strategy called related diversification. The aim is to expand its operations by getting into new businesses, in the area of health care, and benefit from sharing activities.

Johnson & Johnson have gained and sustained competitive advantages through acquisitions such as Pfizer’s consumer health division and a $1.1 billion Mentor Corporation. These acquisitions have assisted the company to increase its market power in the consumer health industry and cosmetic medicine (Award, 2010). Referencing Chapter 7: International Strategy: Creating Value in Global Markets Johnson & Johnson has used the diversification strategy for international expansion and gaining more competitive advantage in the market.

It has developed over 200 companies across the globe and deployed 120,000 employees in these companies (Award, 2010).2. What implications does Johnson & Johnson’s corporate strategy have for its organizational design? Referencing Chapter 10: Creating Effective Organizational DesignsThe corporate strategy aims at improving the Johnson & Johnson’s structure through proper organizational design. The design has led to the formulation of a decentralized divisional structure which has encouraged the proper flow of information.

It has also enhanced working relationships between activities and functional department. Furthermore, the decentralized divisional structure has allowed different stakeholders with different skills to bring together different technologies and products. This has led to satisfying the unmet needs of customers (Award, 2010).3. Why is synergy important for Johnson & Johnson, and what has CEO Weldon done to foster synergy?Referencing Chapter 2: Analyzing the External Environment Synergy has assisted the Johnson & Johnson to acquire sustainable competitive advantage.

The CEO Weldon has come up with a decentralized divisional structure to foster synergy. He has used the structure in assessing external environment to identify a number of forces. The first one is demographic that determine how population growth have affected demand of Johnson & Johnson’s products not only across New Brunswick, USA, and New Jersey but also in 60 countries in the globe. The second one is socio-cultural factor that examine social issues such as poverty that affect the purchasing power of Johnson & Johnson’s products by the people in the globe (Award, 2010).

The third one is technological factor which determines the available healthcare technology such as Cougar Biotechnology and breast implant maker. The next factor is political which examines the requirement that local and national authorities expect Johnson & Johnson to meet in supplying and handling health care products. The last one is economic factors that reveal how currency fluctuates and how it may affect the costs of Johnson & Johnson’s products (Award, 2010). Upon assessing these forces, Weldon can determine the appropriate synergy to use in order to effectively deal with competition.

Porter’s Five ForcesDecentralized divisional structure has also been used to assess porter five forces model to identify areas where Johnson & Johnson might be more vulnerable. In addition, the assessment also assists in understanding Johnson & Johnson’s strong points in the market (Award, 2010). The following diagram shows the assess porter five forces model:4. As a leader, what has Weldon done to spur innovation? Referencing Chapter 11: strategic Leadership: Excellence, Ethics & ChangeIn the past, Johnson & Johnson was operating as a poor confederation of businesses.

Weldon sets a new direction for Johnson & Johnson and come up with a new innovation called the decentralized divisional structure. The structure enabled stakeholders from different business units, within the organization, to learn and share their knowledge with each other (Award, 2010). ReferenceAward, R.W.C. (2010). Johnson & Johnson Business Case Teaching Notes. Retrieved from http://www.scribd.com/doc/41603385/Johnson-Johnson-Business-Case-Teaching- Notes-Robert-W-Campbell-Award#scribd