Harvard Business School case: Smithkline Beecham. Corporate strategy. Scope, Scale,5 forces, SWOT, Direction, long term, Competitive advantages, Stakeholders.

1.Direction

The first key concept of strategy is the direction the guild wants to follow. The direction of SmithKline Beecham clearly adjusts in redact to cope with the increase competition in the pharmaceutic industry.

In 1989, SmithKline Beecham was formed out of a merger of SmithKline Beckman and the Beecham Group. Five years subsequent, the Annual Report oral sex Executive Leschly wrote: Through a series of strategic acquisitions and disposals, SB made progress in its transformation from a caller-up made up of four successful, but separate, businesses into a unify organisation focused on human healthcare.

To reach SBs ism several actions were taken by management:

·they were the second secure that integrated vertically (with DPS);

·DPS was sold in 1999 because of failed efforts to control diffusion channels;

·It divided its operations into four and later in three businesses: SB Pharmaceuticals, SB Healthcare Services and SB Consumer Healthcare.

The direction of the management can best be seen as vision because of their philosophy. They have a vision and want to achieve it, no matter what road they take. The figure below represents this approach.

2.Long term

The most eye-catching trait of the current global pharmaceutic industry is that the largest pharmaceutical companies consolidate to become the number one in the industry.



For display case the merger between Zeneca and Astra, which became AstraZeneca, which is now the world leading pharmaceutical company. These facts were all to the detriment of SmithKline Beecham, which became smaller in comparison with its colossus competitors .

SB slipped from the 4th position in rank to the 9th player in the market in eight years, since 1989. Therefore it focused on a merger strategy and went into merger talks with AHP and later with Glaxo Wellcome. A merger with Glaxo would make the new combination a number one,

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