Introduction
Ten years ago, you established a privately owned small company called Shefa’a, which makes highly effective and potent prescription herbal painkillers – Herball. All Shefa’a products are licensed in its operating markets and protected by US patent laws. Since its launch, the company has enjoyed good success and created a strong customer base around the world, particularly in the GCC Region. Shefa’a has 50 dedicated scientists and employees, most of them have been with the company since launch. Each Shefa’a employee has been loyal and dedicated to you and the company’s values, product focus, and corporate strategy. The company’s strategy has been based on Porter’s Generic Strategy of “differentiation focus”. When you established Shefa’a, you have made a philanthropic pledge that if you ever discover a cure for a chronic disease, then it will be made available to everyone who needs it regardless of their economic situation. The company has a small and dedicated board that has supported you since the start, but has grown sceptical over the past few years about company’s finances and the new products Shefa’a has been pursuing.
Herball
Two years ago, you and the Chief Chemist observed something unusual with one of the new painkiller called “herball”. During clinical trials, herball shrunk one type of cancer of a lab rat by 75%. Having made this amazing discovery, you allocated more resources to refine the new drug and make it more effective to target organ cancers. The shift in resource allocation has been devastating to the main product line. As a result, your company is almost bankrupt. You have spent all your savings and the company is in debt almost 10 million Dirhams. There is a lot of resentment among some of the employees and board of directors about the new drug and the direction you have led the company.
Last month, you have made a breakthrough. Results on lab rats showed that the drug is working, it completely cured the liver cancer of one of the lab rats. Now, you are ready to try it on human subjects.
A major hospital in the US heard about the breakthrough and has contacted you and wants to sign with you to begin the human trials.
Simultaneously, some major pharmaceutical companies are contacting you and are willing to buy the technology from you. If the human trials work, this would be a disruptive drug that is going to shake the industry.
Yesterday, your business development director secured a letter of intent from a group of investors who are willing to finance the project. They have pledged $2 Billion as an initial investment for a majority stake in the company.
All of this happened so fast. There is a lot of pressure on you to make a decision about what route the company should take. The situation is further complicated by your desire to fulfil your philanthropic pledge you have made. However, this represents a once in a lifetime opportunity to financially benefit from your invention, pay your debts, and continue with your research to cure other chronic diseases, such as Diabetes, Alzheimer’s, and AIDS.
Introduction and summary
Also include resources and capabilities
Selection of one of the five strategies
Justification for the strategy selected
(Convince the board and Employees) Herball
Include The industry life cycle (Starting from the creation of the company [10 years ago] to the start of the decline [ 2 years ago] until the present)
Advantages, Disadvantages, Potential risks, etc.
(In light of related theoretical concepts, models, and theories)
PESTEL ANALYSIS
SWOT ANALYSIS – one paragraph
PORTERS 5 FORCES – one paragraph
VRIO Analysis – one paragraph (inludes explanation and evaluation)
Benchmarking
Gaps Analysis – Refer to chapter 12
Recommendations fo future strategy
Revenues must include two points:-
Equation of profit.
Sources of revenues (revenue stream)
b.1) Main source:
b.2) Other sources (either announced OR research from similar industry / benchmarking).
b.3) Mechanism (business model).
Outline of the argument (including financial argumentation) to convince the board members and employees of Shefa’a
Conclusion
After conclusion, it is required to include below table summarizing your strategy which shows different strategy options as below: (Rank them according to your analysis)y you ranked the options accordingly and mention if there is any flexibility to choose another option.
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