Johnson and Johnson Strategy Formulation
1. INTRODUCTION
This project is one of three assigned reports I will complete as part of the strategic analysis of Johnson and Johnson. This firs report focuses on the strengths, weaknesses, opportunities, and threats (SWOT) and includes the following sections. First, the major concepts related to the SWOT analysis will be defined. Second, those concepts will be applied to the specific case of Johnson and Johnson. Then the evidence from Johnson and Johnson will be evaluated to identify the major problem the company is facing and propose a solution that Johnson and Johnson can adopt to restore its lost competitive advantage.
2. CONCEPTS
The SWOT analysis is the examination of a company’s external environment and internal organization. This section will define key concepts involved in the SWOT analysis.
2.1. External Analysis The function of an external analysis is to identify opportunities and threats in a firm’s factors of general environment, and the industry forces. The general environment is composed of factors that can have a dramatic effect on the firms chosen strategy. Typically, a firm has little ability to predict trends and events in the general environment and even less ability to control them. The general environment can be separated into six segments: demographic, socio-cultural, political/legal, technological, economic, and global. Within each of these segments of the external environment each business is presented with opportunities and threats. An opportunity is an external factor that a company can take advantage of to assist in accomplishing its strategic objectives. Threats are external forces that will limit or undermine a company from achieving its strategic objectives.
2.2. Internal Analysis The purpose of the internal analysis is to identify strengths and weaknesses in a firm’s internal (or competitive) environment. The competitive environment consists of many factors that are particularly relevant to a firm’s
This project is one of three assigned reports I will complete as part of the strategic analysis of Johnson and Johnson. This firs report focuses on the strengths, weaknesses, opportunities, and threats (SWOT) and includes the following sections. First, the major concepts related to the SWOT analysis will be defined. Second, those concepts will be applied to the specific case of Johnson and Johnson. Then the evidence from Johnson and Johnson will be evaluated to identify the major problem the company is facing and propose a solution that Johnson and Johnson can adopt to restore its lost competitive advantage.
2. CONCEPTS
The SWOT analysis is the examination of a company’s external environment and internal organization. This section will define key concepts involved in the SWOT analysis.
2.1. External Analysis The function of an external analysis is to identify opportunities and threats in a firm’s factors of general environment, and the industry forces. The general environment is composed of factors that can have a dramatic effect on the firms chosen strategy. Typically, a firm has little ability to predict trends and events in the general environment and even less ability to control them. The general environment can be separated into six segments: demographic, socio-cultural, political/legal, technological, economic, and global. Within each of these segments of the external environment each business is presented with opportunities and threats. An opportunity is an external factor that a company can take advantage of to assist in accomplishing its strategic objectives. Threats are external forces that will limit or undermine a company from achieving its strategic objectives.
2.2. Internal Analysis The purpose of the internal analysis is to identify strengths and weaknesses in a firm’s internal (or competitive) environment. The competitive environment consists of many factors that are particularly relevant to a firm’s