Name: Mahamid RahmanID: 15264031

A Shock to the System

Assuming myself as a trainee in a firm of management consultants and for my induction process I have chosen Square pharmaceuticals ltd. to work on. I will be discussing on organization structure of Square pharmaceuticals ltd, its products and on the key external influences which have affected its operations in recent years.

Following I have discussed on organization structure of Square pharmaceuticals ltd:

Square Pharmaceuticals Limited is the largest pharmaceutical company in Bangladesh and it has been continuously in the 1st position among all national and multinational co. since1985. It was established in 1958 and converted into a public limited company in 1991. The sales turnover of SPL was more than Taka 11.46 Billion (US$ 163.71 million) with about 16.43%market share (April 2010± March 2011) having a growth rate of about 16.72%.

 Square now has one of the largest and competent sales force and large distribution network of its own, operated from 18 different locations throughout the country. A most dynamic skilled and dedicated marketing team comprising of pharmacists and doctors are at the core of the marketing operation. These highly skilled professionals play a crucial role in providing the necessary strategic guideline for the promotion of its product.

Functions of Departments:Responsibility of Product Management Department (PMD):

Preparation of marketing plan Preparation of printing promotional materials. Replying to quarries from the doctors and as well as the fiend forces related to a particular brand. Preparation of packing and packaging materials.

Responsibility of Medical Services Department (MSD): Provide medical information to the doctors’ parallel to the field force engaged in promotion of the

SPL. Performing the medical promotion like direct marketing of publications, free distribution of medical

newsletters, free videos. Continuous Medical Education (CME) for graduate doctors with alliance of Sales Department

Responsibility of Personal & Administration (PAD): Recruitment of employees Promotion of employees Transfer of employees Retirement of employees’ bill with remuneration, increments, and other fringe benefits namely

house rent, allowances, insurance’s, profit bonus, etc.

Responsibility of Accounts and Finance Department: Maintains all the accounts like recording of transaction, preparation final accounting reports,

costing and budgeting, taxation, bookkeeping’s, providing funds to the projects etc. Maintaining accounts receivables accounts, which is broken down into each market of SPL and

bank accounts.

Preparation final accounting report for performance analysis of SPL.

Responsibility of Information Technology (IT) Department: Providing computer and other related accessories supports to all the user Maintenance of server and ensure smooth LAN operation Providing up to date technical and software support to all the sectors of SQUARE Development and maintenance of centralized databases and provide routine and ad hoc reports

for management decision making.

Responsibility of International Marketing Department: Exploration of new markets all over the world Operating of export business in the different countries Provide training to field forces in overseas countries Provide all types of documents for registration of SPL’s products in overseas countries.

Responsibility of Supply Chain Management:  Purchase of raw materials, and packaging materials Purchase of machinery and equipments Purchase of chemicals, as advised by the department Purchase of stationary items and office applies.

Products of Square pharmaceuticals are as followings:

THE EXISTING PRODUCTS:

The formulation plants are producing wide range of dosage forms like –

Product Mix Product Name

Tablets Total Dosage Form = 190 NosNon-Coated (Plain, Chewable, Dispersible, Vaginal)

Coated (Sugar, Coated, Film Coated, Enteric Coated,)Sustained/Extended Released (Coated, Non-Coated)

Capsules Total Dosage Form = 53 NosGranulated Material Field, Pellets Filled

Suppositories Total Dosage Form = 08 Nos Suppocire based

Injections Total Dosage Form = 41 NosVials Containing Dry Powder for InjectionsSmall Volume Liquid Parenterals

Liquids Total Dosage Form = 38 NosOral Syrups (Sugar based, Non-Sugar based)Oral Suspensions Topical Liquids

  Spray, Drops, Ointment

Product Mix Product Name

Cram and Powder Total Dosage Form = 56 NosSmall Volume Sterile Eye and Ear Drops

Small Volume Nasal Drops and SpraysTopical Ointments and CreamTopical Antibiotic Powder

Oral Dry Powder Total Dosage Form = 30 NosDry Suspensions (Antibiotic and Anti Infective)Dry Syrups (Antibiotics)

Dry Powder Total Dosage Form = 04 NosPartial Filled (Premix) Capsules for RespiratoryTract Application with a Device

Metered Dose Inhaler Total Dosage Form = 10 NosPressurized Canisters for Oral use with an Actualor

External factors which have affected in recent years are as following:PRODUCT FACTORS:  Quality. Approvals. Design factors / design specifications. Physical criteria / physical parameters. R&D costs / development costs / customization. Technology / technology factors & development. Product life / longevity. Performance / product efficiency / product integrity. Reliability / product failure / product defects. Operating criteria / product operation or usage. Probability of technical development / technical. Product life cycle / product obsolescence.

MARKETING FACTORS:  Distribution / warehousing / handling costs. Costs/prices at supplier sale price. Costs/prices at end user / retail sale price. Stock availability / lead times / delivery. Sales promotion & sales costs. Advertising posture & advertising costs. Competition / competitors' aggressiveness & posture. Market share / relative market shares. Seasonality / cyclical demand / demand fluctuations. Sensitivity to economic climate & conditions.

SUPPLIER FACTORS:  Processing / production / handling facilities & capacity. Processing/ handling capacity / flexibility of plant. Dependence on sub-contractors / in-house supplies. Technical capabilities / new product developments. Technological aptitude & innovations. Other capacity. Own buying influence / economies of scale. Alternative suppliers base. Commitment/capacity of other suppliers. Price advantages & pricing amongst other suppliers. DISTRIBUTION / CUSTOMER INTERFACE FACTORS:  Technical /marketing capabilities & capacity. Distribution facilities & manpower availability .Commitment to other suppliers. Sales volumes / turnover required. Margins added value. Captive customer base /customers handled. Area/s serviced & geographic coverage. Sales promotion / advertising / salesforce. Effects on existing products & customer base. Cash-flow requirements of distribution channel. Capital requirements.CUSTOMER FACTORS:  Propensity to consume / demand factors. Product purchase background / past product purchase. Purchasing criteria - commercial. Purchasing criteria - motivational. Purchase price / acquisition costs / product costs. DMU susceptibility / customer awareness. 

Pestle Analysis

It never ceases to amaze me why so many businesses fail to take the time to look at the macro and the micro environments when completing their business plans and strategies. These external forces will play a big part in shaping the final outcome of the ultimate corporate achievement. Yet, most managers’ focus only on internal factors and it is fair to say that sales growth and profits remain high on their agenda.

The macro environment tends to have a long term impact and requires extensive research. Couple this with the fact that many managers are over worked and under resourced and we begin to see why the process is often not completed. There is no published evidence to confirm this hypothesis, just anecdotal hearsay.

The remainder of this article will illustrate an example of a Macro or PESTLE analysis for the pharmaceutical industry. It is set at a very general level but it can be used as a template or adapted to be more specific if required:

PoliticalThere is now growing political focus and pressure on healthcare authorities across the world. This means that governments will be looking for savings across the board. Some of the questions the industry should ask are:

·         What pressures will be put on pricing?·         What services will be cut?·         Will the same selection of drugs be available to everyone?In addition to this, could there be more harmonization of healthcare systems across Europe or the USA? What impact will reforms have on insurance models?

EconomicThe global economic crisis still exists yet government reports still show that spend on healthcare per capital continues to grow. Will the current healthcare models exist tomorrow? The growth in home-care (as seen in the Nutrition sector) demonstrates how nursing services have moved to the private sector and have become a key business offering.

The reduction in consumer disposable income will have an impact on those countries using health insurance models particularly where part payment is required.

These economic pressures are seeing an increased growth in strategic buying groups who are forcing down prices.

Increased pressure from shareholders has caused a consolidation of the industry: more mergers and acquisitions will take place over the coming years.

Social / CultureThe increasing aging population offers a range of opportunities and threats to the pharmaceutical industry. The trick will be to capitalize on the opportunities.

There is also the problem of the increasing obesity amongst the population and its associated health risks.

Patients and home careers are becoming more informed. Their expectations have changed and they have become more demanding. Public activism has also increased through the harnessing of new social networking technologies. How can pharmaceutical companies get closer to consumers without over stepping the regulatory boundaries?

TechnologicalTechnological advancements will create new business prospects both in terms of new therapy systems and service provisions. The online opportunities will see the growth in:

·         New info and Communications technologies.·         Social Media for Healthcare.·         Customized Treatments.·         Direct to Patient Advertising.·         Direct to patient communications.

LegislationThe pharmaceutical industry has many regulatory and legislative restrictions. There is also a growing culture of litigation in many countries. The evolution of the internet is also stretching the legislative boundaries with patient’s demanding more rights in their healthcare programmes.

EnvironmentalThere is a growing environmental agenda and the key stake holders are now becoming more aware of the need for businesses to be more proactive in this field. Pharma companies need to see how their business and marketing plans link in with the environmental issues. There is also an opportunity to incorporate it within their Corporate Social Responsibility programmes. Marketing and new product development should identify eco opportunities to promote as well.

The information above illustrates just a fraction of the likely macro factors involved in the pharmaceutical industry.