Allergan South Africa s Merger Contextual Leadership Sustaining Culture Case Solution

The Harvard Business Review published a case study that primarily focuses on Allergan South Africa s Merger Contextual Leadership Sustaining Culture. The following case solution has been designed to give the reader an overview about the business world along with a clear understanding of its growth dynamics. Recently, Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been subjected to strategic as well as managerial problems that require immediate attention so that they can be resolved to allow future growth, expansion, and competitive edge within the marketplace. This case study solution is being written to provide a strategic solution to Allergan South Africa s Merger Contextual Leadership Sustaining Culture using various appropriate tools and frameworks. Harvard Business Review’s case studies involve a central problem that is faced by a particular company. The problem identified involves strategic and managerial implications for the company. Therefore, it is important for readers to critically identify the problem Allergan South Africa s Merger Contextual Leadership Sustaining Culture faces. Moreover, it is also essential to highlight the key stakeholders that are impacted and influenced by the problem identified.

External Environmental Analysis

The external environment holds significant importance for Allergan South Africa s Merger Contextual Leadership Sustaining Culture to ensure that the company is able to respond to all the changes in the macro-environment. This is because Allergan South Africa s Merger Contextual Leadership Sustaining Culture cannot control the factors and thus can directly influence the company's operations (Indris & Primiana, 2015). The external environment of Allergan South Africa s Merger Contextual Leadership Sustaining Culture will be assessed using PESTLE Analysis.

Political

• A stable political environment provides a favorable market growth trend for Allergan South Africa s Merger Contextual Leadership Sustaining Culture.

• It is important for Allergan South Africa s Merger Contextual Leadership Sustaining Culture to analyze the pressure groups, and social environment activists. The company can make close collaborations with these groups to achieve company goals (Wang, Wang, & Shi, 2022).

• High restrictions on trade and high levels of taxes can contribute to the complex business environment for Allergan South Africa s Merger Contextual Leadership Sustaining Culture by impacting imports and exports.

Economic

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can benefit from wide-range opportunities in business growth by operating in developing economies (Munro, 2017).

• High GDP can determine the long-term growth strategies of Allergan South Africa s Merger Contextual Leadership Sustaining Culture, signaling the ability of consumers to spend on more products.

• Higher rates of interests can provide Allergan South Africa s Merger Contextual Leadership Sustaining Culture with more investment opportunities.

• The flexibility in the labor market allows Allergan South Africa s Merger Contextual Leadership Sustaining Culture to take advantage of higher workforce productivity.

Social

• The selection of appropriate demographic segments has allowed Allergan South Africa s Merger Contextual Leadership Sustaining Culture to select the right segments of the market that have high growth potential.

• The research on gender roles has helped Allergan South Africa s Merger Contextual Leadership Sustaining Culture to develop and align communication as well as marketing strategies accordingly.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been successful in understanding the norms and cultures of different countries by developing local teams and partnerships (Hueske, Endrikat, & Guenther, 2015).

Technological

• The adoption of innovative marketing techniques that involves communication technologies has allowed Allergan South Africa s Merger Contextual Leadership Sustaining Culture to collaborate successfully with consumers.

• The company has stayed ahead in the market, and can significantly increase its market share by placing its major focus on emerging technologies (Akpoviroro & Owotutu, 2018).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should maximize its profits by investing in disruptive technologies.

Environmental

• It is crucial for Allergan South Africa s Merger Contextual Leadership Sustaining Culture to adopt effective waste management practices to reduce environmental pollution (J. K, W. J, & D., 2016).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should adopt eco-friendly products to establish better relationships with the stakeholders.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can take advantage of subsidies offered in renewable technologies to achieve the long-term goal of sustainability.

Legal

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should follow proper laws concerning employee health and safety, and anti-discrimination laws to effectively develop HRM.

• Consumer protection laws are also important for Allergan South Africa s Merger Contextual Leadership Sustaining Culture as it involves the consumer protection from fraudulent marketing (S. Samusenko, S. Plaskova, & A. Prodanova, 2020).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can gain a competitive advantage, and can position itself strongly in the market by protecting intellectual property laws.

Porter’s Five Forces Analysis

Threat of New Entrants

• It is difficult to achieve economies of scale in Allergan South Africa s Merger Contextual Leadership Sustaining Culture’s industry, making it a weaker force for new entrants.

• There are high capital requirements in the industry. This makes it difficult for new businesses to set up their companies, and compete against Allergan South Africa s Merger Contextual Leadership Sustaining Culture.

• The industry has a strong product differentiation, and heavy investment is needed for customer acquisition. Thus, Allergan South Africa s Merger Contextual Leadership Sustaining Culture can focus on innovation to differentiate itself from its competitors (H. Th. Bruijl, 2018).

• There are strict legal requirements to join the industry in which Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates, making it difficult for new entrants to enter the market.

Bargaining Power of Suppliers

• The bargaining power of suppliers in the industry is weak.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates in an industry with a higher number of suppliers. This means that suppliers do not have much control over their prices.

• Standardized products that have low switching costs are provided by suppliers allowing buyers like Allergan South Africa s Merger Contextual Leadership Sustaining Culture to easily switch their suppliers (Fabbri & F.Klapper, 2016).

• Raw materials can be purchased at lower prices by Allergan South Africa s Merger Contextual Leadership Sustaining Culture. The company can also switch suppliers for more reasonable pricing.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can benefit from a variety of suppliers as it can have multiple suppliers for its various geographical areas (Cho, Ke, & Han, 2019).

Bargaining Power of Buyers

• The bargaining power of buyers in the Allergan South Africa s Merger Contextual Leadership Sustaining Culture industry is weak.

• There is a high product differentiation in the industry, making it difficult for buyers to switch to alternative firms.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can come with differentiated and innovative products to attract more buyers of the industry (Zhao, Zuo, & Wu, 2016).

• Buyers of this industry has low incomes. This means they prefer to purchase items at lower prices, making them more price sensitive. Organizations like Allergan South Africa s Merger Contextual Leadership Sustaining Culture can offer lower prices to attract customers.

Threat of Substitute Products or Services

• There are few substitute products available in the industry in which Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates.

• Expensive substitutes are available in the industry of Allergan South Africa s Merger Contextual Leadership Sustaining Culture, making it difficult for buyers to switch to those substitutes (Aithal, 2016).

Rivalry Among Existing Firms

• The rivalry among existing firms is moderate to weak.

• There are few competitors in the industry in which Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates.

• A large market share is enjoyed by fewer firms in the industry. This means that more competitive actions will be made to become leaders in the market (Seema, 2016).

• The industry in which Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates has highly differentiated products, making it difficult for companies to win each other customers.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can focus on making more differentiated products to gain a strong competitive edge in the market (Zhao, Zuo, & Wu, 2016).

Internal Environmental Analysis

Allergan South Africa s Merger Contextual Leadership Sustaining Culture can use internal environmental analysis to identify and evaluate the competitive positioning of a company in the business environment. This involves conducting a SWOT Analysis that can help Allergan South Africa s Merger Contextual Leadership Sustaining Culture to identify the company’s internal strengths, weaknesses, opportunities, and threats (Halmaghi, Iancue, & Băcilă, 2017).

SWOT Analysis

Strengths

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has a strong distribution network that has allowed it to make its products available to large customers within the given timeframe.

• A strong presence on social media platforms has allowed Allergan South Africa s Merger Contextual Leadership Sustaining Culture to have a high level of customer engagement (Rizaldi, 2015).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been successful in building a large product portfolio, so unique and distinctive products can be offered to consumers.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has a strong brand image in the market.

• A low-cost structure of Allergan South Africa s Merger Contextual Leadership Sustaining Culture has allowed it to manufacture products at lower costs, so they become affordable for consumers to purchase.

• The financial position of Allergan South Africa s Merger Contextual Leadership Sustaining Culture is strong as the company has generated higher profits over the past years (Phadermrod, M.Crowder, & B.Wills, 2019).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has invested in the training and development of its employees to keep them motivates, leading to higher efficiency and productivity.

Weaknesses

• The expenditure of Allergan South Africa s Merger Contextual Leadership Sustaining Culture on its research and development is comparatively less to other competitors of the market.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture uses a centralized decision-making process that takes time and reduces operational efficiency (Ahmadi, Dileepan, & K. Wheatley, 2016).

• There are high rental costs because Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates on more of the rental properties rather than purchasing them.

• There is no workforce diversification in Allergan South Africa s Merger Contextual Leadership Sustaining Culture. This makes it difficult for the employees to adjust with the different workers who belong to different backgrounds.

Opportunities

• Since the online shopping has increased significantly, Allergan South Africa s Merger Contextual Leadership Sustaining Culture can take it as an opportunity to expand its online presence.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can make use of social media platforms to market its products, with more customers interactions.

• Due to more technological developments, Allergan South Africa s Merger Contextual Leadership Sustaining Culture can make its operations more automated so that overall company costs can be reduced (Ahmadi, Dileepan, & K. Wheatley, 2016).

• Globalization provides an opportunity to Allergan South Africa s Merger Contextual Leadership Sustaining Culture to expand its operations in multiple countries.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can enter in a niche market and sell distinctive products to gain a competitive advantage.

• The increase in the demand of environmentally friendly goods, Allergan South Africa s Merger Contextual Leadership Sustaining Culture, can place its major focus on making such products (E.Quezada, A.Reinao, & I.Palominos, 2019).

Threats

• In recent times, there has been an increase in the bargaining power of suppliers, making it difficult for Allergan South Africa s Merger Contextual Leadership Sustaining Culture to buy raw materials at lower costs.

• Numerous players are entering the industry, posing a major threat to Allergan South Africa s Merger Contextual Leadership Sustaining Culture.

• There has been constant pressure on Allergan South Africa s Merger Contextual Leadership Sustaining Culture to conduct frequent research to understand the changing customer tastes and preferences (Kolbina, 2015).

• Technological advancements require workforce training. This adds to the costs of Allergan South Africa s Merger Contextual Leadership Sustaining Culture.

VRIO Analysis

Allergan South Africa s Merger Contextual Leadership Sustaining Culture uses VRIO Analysis to assess and evaluate the company resources to determine the competitiveness, and strategic advantage.

Valuable

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has a strong brand image and engages in corporate social responsibility.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has a high brand recognition because of the quality of products it offers to its customers (Ariyani & Daryanto, 2018).

• The distribution system of Allergan South Africa s Merger Contextual Leadership Sustaining Culture is valued all round the world. The company has been able to successfully establish strong relationships with its suppliers.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture focuses on continuous innovation in its business. The company has expanded this innovation in its multiple functional areas.

• There are potential growth opportunities in the market, and Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been able to penetrate the market through its ability to raise large funds.

Rare

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates globally. This global presence has allowed the company to increase its customer base (Miethlich & G. Oldenburg, 2019).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has an organizational culture that promotes more teamwork, innovation, and creativity among its employees, that leads to a competitive advantage.

• Since Allergan South Africa s Merger Contextual Leadership Sustaining Culture has a global presence, it allows the company to easily adapt to different cultures, norms and values.

• The risk-taking ability of Allergan South Africa s Merger Contextual Leadership Sustaining Culture is strong. This provides more opportunities to the company to penetrate different markets.

Inimitable

• The inimitable resource for Allergan South Africa s Merger Contextual Leadership Sustaining Culture is its high-quality products. These products have allowed consumers to make repeat purchases.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture operates through multiple locations of stores in different companies, allowing easy access to products.

• Strong marketing communications have been used by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to attract more customers.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been using integrated technology that has allowed it to offer competitive pricing to its customers (Ariwibowo, Saputro, & Haryanto, 2021).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture maintains an excellent customer service that has enabled it to have a high brand engagement.

Organization

• Strong financial position has allowed Allergan South Africa s Merger Contextual Leadership Sustaining Culture to explore more product development opportunities.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture is successfully maintaining the efficiency and effectiveness of its business operations with the help of more integrated and advanced technology.

• Employees are given both in-house and off-the-job training opportunities by Allergan South Africa s Merger Contextual Leadership Sustaining Culture that allow more skills development (Adnan, Abdulhamid, & Sohail, 2018).

• The strong value chain and distribution network has enabled Allergan South Africa s Merger Contextual Leadership Sustaining Culture to increase its revenue through the sale of its products.

Marketing Mix

Marketing Mix is needed by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to formulate effective strategies to achieve the company objectives.

Product

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has five product categories. Each of these categories has a product line that involves more variety of products (Išoraitė, 2016).

• Highly differentiated products are offered by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to its customers. These distinctive products are not easily available at competitors.

• The products of Allergan South Africa s Merger Contextual Leadership Sustaining Culture are of higher quality, and thus, customers pay more prices for these products.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture designs products with traditional designs giving customers more product variety.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture offers multiple sizes for its every product to make it easy for its customers to select the right product.

• Warranty and same-day delivery option if also provided by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to its customers.

Price

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture follows a competitive pricing strategy.

• To attract more customers, bundle pricing has also been used by the company.

• Little higher prices are charged for products that are sold online because of the delivery costs (Thabit & Raewf, 2018).

• Optional product pricing strategy is also adopted by Allergan South Africa s Merger Contextual Leadership Sustaining Culture for some of its products, such as a base product is offered for a certain price, and there are separate prices for its accessories.

• Regular promotional prices are also offered by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to its customers.

Place

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture uses two channels for its product distribution. This includes online selling and through own stores.

• There are more than multiple stores owned by Allergan South Africa s Merger Contextual Leadership Sustaining Culture globally. This ensures easy product availability to customers (Pogorelova, Yakhneeva, & Agafonova, 2016).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has partnered with delivery service companies to distribute its products effectively to consumers.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has also adopted an omni-channel distribution system.

Promotion

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture uses a traditional promotional strategy that involves TV advertisements (Fan, Y.K.Lau, & Zhao, 2015).

• Social media advertisements are also adopted by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to increase brand awareness.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture takes part in various events and exhibitions as a way of promoting its products.

• Large sales force is used to provide the customers with a more personal experience.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture also makes use of influencer marketing to increase the demand for its products.

• Regular content and deals are posted on the social media pages of Allergan South Africa s Merger Contextual Leadership Sustaining Culture to attract and retain customers.

Value Chain Analysis

Allergan South Africa s Merger Contextual Leadership Sustaining Culture can use Value Chain Analysis to identify and assess inter-relationships as well as interdependencies.

Primary Activities

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture’s primary activities involves the production and selling of products to the final consumers (Mintz, J.Gilbride, & Lenk, 2021).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has a strong relationship with the suppliers. This ensures that the product is received, stored, and distributed in a timely manner.

• Operational activities of Allergan South Africa s Merger Contextual Leadership Sustaining Culture are effectively aligned.

• For inbound logistics, after the arrival of raw material, the company processes it to manufacture the final product (Hasan, Nekmahmud, & Yajuan, 2019).

• In terms of outbound logistics, Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been able to set up optimal costs as well as efficient delivery processes to deliver the product on time.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture invests in its sales and marketing activities to build relationships with customers.

• Marketing funnel approach is used by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to effectively devise and build sales and marketing activities.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture offers both pre-sale and post-sales services to its customers.

Secondary Activities

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has an effective infrastructure that has allowed the company to successfully optimize its value chain.

• The competitive pressure in terms of employee skill development, motivation, and commitment is reduced as Allergan South Africa s Merger Contextual Leadership Sustaining Culture has developed a strong HRM (Linkov, Carluccio, Pritchard, & Bhreasail, 2020).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture uses a cost minimization approach to reduce its costs by analyzing the costs associated with training and hiring the employees.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture has been using integrated technology in its value chain activities. This includes technological customer support, research and data analytics concerning product design, and automated software.

• The procurement activities of Allergan South Africa s Merger Contextual Leadership Sustaining Culture are effectively optimized with its inbound, outbound, and operational activities (Maheswari, Yudoko, & Adhiutama, 2019).

Market Penetration Strategies

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can increase the capacity of its production so it can reach more of the customers in its existing market.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can focus on controlling the overhead costs so that it can offer competitive pricing that can attract customers of the market (Dawes, 2018).

• Investments can be made by Allergan South Africa s Merger Contextual Leadership Sustaining Culture in marketing and sales activities to increase the chances of successful market penetration.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can design and develop a content that increases customer engagement within a particular marketplace.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can assess and identify more enhanced distribution networks (Radpour, Mondal, & Kumar, 2017).

• Improved distribution systems and supply chains can improve the product accessibility for the customers, making it easier for Allergan South Africa s Merger Contextual Leadership Sustaining Culture to penetrate the market.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can adopt price cuts in its products to compete in the market. This will give a company a competitive edge over its competitors.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can plan strategies where it can focus on acquiring the leading players of the market. Such acquisitions will give the company an opportunity to reach more customer segments.

• Strategic partnerships and joint ventures agreements can be signed by Allergan South Africa s Merger Contextual Leadership Sustaining Culture to mitigate the risk factors, and to gain customer groups of the market.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can come up with new and innovative features in its already existing product for the market (Daouda, Barth, & T. M. Ingenbleek, 2019).

Market Development Strategies

• It is important for Allergan South Africa s Merger Contextual Leadership Sustaining Culture to invest in the research and development department so potential markets can be identified (Hilman, Bohari, & Abdullah, 2018).

• Regional expansion strategy can be used by Allergan South Africa s Merger Contextual Leadership Sustaining Culture for growth purposes. This will also take into consideration the cultural differences.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should also consider to expand its business operations in the international market. This will allow access to a larger customer base.

• New customer groups and segments should be explored by Allergan South Africa s Merger Contextual Leadership Sustaining Culture.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should also invest in brand-building activities as it will give an opportunity to reach more potential customers (C. Koks & M. Kilika, 2016).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should consider the market education in terms of its product. The company can significantly increase its sales by giving product awareness to new segments.

Product Development Strategies

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can come up with new improvements and modifications in the existing products to attract the market.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture should undergo the NPD process, so the company is able to assess and identify new points for its customers.

• Regular investments in the research and development will help Allergan South Africa s Merger Contextual Leadership Sustaining Culture to develop something new and innovative that can give a competitive advantage (Kalogiannidis & Mavratzas, 2020).

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can develop new products by getting into more strategic partnerships.

Diversification Strategies

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can adopt vertical diversification to develop business. This can be done by adding more products to the existing portfolio (Kalogiannidis & Mavratzas, 2020).

• Horizontal integration can also be adopted by Allergan South Africa s Merger Contextual Leadership Sustaining Culture, where the company can enter into a completely new product development phase that does not exist in the current product line.

• Allergan South Africa s Merger Contextual Leadership Sustaining Culture can also consider to conglomerate by starting a different business.

Conclusion

Based on all the models and frameworks discussed above, it is concluded that Allergan South Africa s Merger Contextual Leadership Sustaining Culture should focus on widening the existing product portfolio. Moreover, the psychological pricing strategy can be adopted. Allergan South Africa s Merger Contextual Leadership Sustaining Culture should also maintain close relationships with its suppliers to benefit from lower prices. Similarly, Allergan South Africa s Merger Contextual Leadership Sustaining Culture should develop more integrated outbound logistics for its perishable items. It is also important to continue producing quality and innovative products, so Allergan South Africa s Merger Contextual Leadership Sustaining Culture is less affected by the new emerging competition in the industry.

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