Johnson & Johnson Case Study

The situational analysis of Johnson & Johnson is based on the different external and internal aspects that can provide details regarding changes that have taken place and their impact on the overall organizational operations. The reputation, size and levels of investments made by the company are major aspects that are considered to be a part of the situational analysis. The strengths and the weaknesses of the company and the strategies that have been developed for maintaining future operations are also discussed as a part of the situational analysis process. The difficulties that are faced by the companies based on their international operations in different parts of the world are a part of the situational analysis framework. The other aspects that are a part of the situational analysis include research and development, rational segmentation and the diversification of products.

Johnson & Johnson is a major international organization that is a part of the consumer goods sector and the company also operates a pharmaceutical arm. The various products that are offered by the organization include Band-aid, Johnson’s Baby products, Neutrogena beauty and skin products, Tylenol medications and the contact lenses of Acuvue. The pharmaceutical sector within which the company offers its products is considered to be highly competitive and regulated and it faces major issues that are related to changes taking place in needs and the demands of customers. On the other hand, the consumer goods industry in which the company operates is also competitive based on the other companies that offer similar types of products to the customers. The industry of consumer goods aims at attracting various customers who require the beauty and baby products on a regular basis. However, Johnson & Johnson is a major company within the baby products development sector. The types of baby products that are offered to the customers have been able to provide an effective position to Johnson & Johnson and this has also enhanced the levels of revenues gained by the firm. The legal aspects of regulations developed by governments in different countries can have a huge impact on the profit margins that can be gained by companies. The costs related to research and development that are faced by the companies are also able to influence the prices of products being offered to the customers. The increasing costs have also intensified the levels of domestic and foreign competition. The drug companies have thereby faced pressures that are related to setting prices of the products and the overall customer base that can be formed by them as well.

The major focus of the business level strategy of Johnson & Johnson is based on the long-term based management of the company, development of the long-term assets, building the levels of customer loyalty and forming value of the shareholders. The organic growth of Johnson & Johnson is also based on the innovation levels, the acquisitions, partnerships and the licensing process. The research and development centres of Johnson & Johnson that are operated by Johnson & Johnson have played a major role in ensuring that the company can gain insights regarding needs of patients. Mindset of Johnson & Johnson is mainly based on the focus that is provided to the new technologies, new products and new models of the business that can be helpful in connecting with the living process of the company. The strong network of distribution that has been formed by Johnson & Johnson is able to play an important role in formation of its business level strategy in the industry. The reputation that has been gained by Johnson & Johnson was mainly related to the performance levels of the company and the achievement of the firm in the industry. The company mainly promotes itself based on different activities that include campaigns, sponsor-based events and showcasing the CSR or corporate social responsibility-based activities.

The corporate-level strategies that have been pursued by Johnson & Johnson are related to growth in the sector, horizontal integration and the expansions that have been made through the mergers or acquisitions. The company has mainly relied on the activities related to acquisition that have been performed in different parts of the world. The existing strategy of growth that has been implemented by Johnson & Johnson for expanding its operations in various countries and operating around 250 businesses as well. The divisional structure of the organization is also based on the corporate strategy developed by Johnson & Johnson. The portfolio of products formed by Johnson & Johnson is also related to the corporate strategy of the company and number of customers gained by the company in various countries as well. The leadership imperatives of Johnson & Johnson have the ability to guide the growth levels of the company and its position in the industry as well.

The subsidiary companies of Johnson & Johnson aim at competing with different companies globally and locally in various parts of the world. The levels of competition that exist in the various product lines based on the size and number of the companies that are a part of the industry. The competition that is provided by the companies based on improvement and development of the existing and new processes and products is considered to be a significant aspect that can have an impact on the strategies that are implemented by them. The process of protecting portfolio of the company is mainly related to the competition that can be faced by Johnson & Johnson in the industry. Competitive environment faced by the company requires the substantial levels of investments that can be made for gaining success in the overall industry. The development and further maintenance of the demands of customers for the products being offered by Johnson & Johnson can mainly involve the expenditures based on promotions and advertisement.

Research and development are a major strength of Johnson & Johnson as the company has spent around 20.13 percent of the total profits on the research activities. R&D is considered to be a major component of the process of drug development that is implemented by the company. The firm has been able to gain revenues of more than 80 billion dollars and it has been successful in providing health products to the consumers, pharmaceutical products and medical devices to customers in different countries. The presence of Johnson & Johnson in around 60 countries based on the products that are sold to customers in more than 140 countries.  

The distribution of revenues of Johnson & Johnson is uneven and this has proved to be a major weakness faced by the company. The various unethical practices that were implemented by the company and the marketing campaigns of the company have affected the reputation of the firm in a negative way. The sales of consumer health products have reduced in the last few years and this has a major influence on the profits of Johnson & Johnson and its position in the industry. The bribery related issues faced by the firm is also a major issue that has led to the formation of a major weakness.

The single dose-based vaccine that was developed by Johnson & Johnson after Covid-19 has provided major growth opportunities to the company. The robotic systems that can be used by the company can play an important role in development of the clinical trials of Johnson & Johnson. The future mergers and acquisitions that can be made by the company will also provide opportunities related to growth to the firm and this can also play a major role in development of its advantage in the industry. Telehealth sector has provided opportunities to Johnson & Johnson for enhancing its future growth in the industry.

The various lawsuits faced by Johnson & Johnson have led to major threats being faced by the company. The increase in levels of competition in the industry is also considered to be a major issue that Johnson & Johnson has faced in pharmaceutical sector. Regulations that have been formed by the various governments are considered to be major factors that have an influence on the strategies being used by a company like Johnson & Johnson.

Political factors – Johnson & Johnson has its operations in various countries and the government policies and capacities are different based on which the company can aim at developing the strategies. The political unrest in different companies can affect the operations and revenues of the company.

Economic factors – Economic aspects can affect the operations and decisions made by Johnson & Johnson and the countries that offer high rates of interest can attract the firm for making investments.

Social factors – Social factors that are mainly based on the cultural aspects and norms can influence the types of products that can be offered by Johnson & Johnson.

Technological factors – The technological advancements in the different countries have increased the importance of social media for marketing and promotional activities of Johnson & Johnson.

Environmental factors – The growth in concern related to global changes in climate and increase in levels of pollution are considered to be major environmental aspects that influence the strategies of the company.

Legal factors – The laws related to anti-discrimination and human resources influence the strategies of Johnson & Johnson.

The customers of Johnson & Johnson belong to various age groups who require the health care, personal care and the home care products.

The customers of Johnson & Johnson belong to various age groups who require the health care, personal care and the home care products.

The customers of Johnson & Johnson mainly require the health care, personal care and the home care products.

The target market of the company is focussed on the healthy products.

The growth strategy of J&J appeals to the market.

Baby category, skin care products, wound care products and medical equipment.

Affordable pricing strategy has been used by Johnson & Johnson.

The pharmaceutical industry is highly competitive.

Similar products are offered by competitors.

Prices of products of competitors are affordable.

Distribution strategies of competitors are effective.

Promotional strategies of competitors are efficient.