Business Strategy

The Five Forces

Force	Example	Force Strength	Response
Bargaining power of customers	Verzenio (abemaciclib) tablets for cancer treatment	Low	Customer needs this specific treatment that they can’t go buy anywhere.
Threat of substitutions	Generic Drugs	Medium	Customers can go to companies that sell generic drug at a lower cost.
Bargaining power of suppliers	Supplier with a unique material wants to raise their price.	Medium	Try to bargain a lower price or maybe find a new supplier for that specific material.
Threat of new entrants	New Pharmaceutical company	Low	Eli Lilly has a built trusted reputation for many years.
Rivalry	Reputable companies like Bristol Myers Squibb, Pfizer and Merck & Co.	High	Some of these big companies share similar treatments giving Eli Lilly competition.

The competitive strategy that Eli Lilly and Co. follows is differentiation. In the textbook it states that differentiation is, “Better product/service across the industry.” In Eli Lilly and Co. website they express their purpose of business, “to create medicines that make life better. We’re committed to expanding equitable access to medicines for more people around the world, and we are working to improve public health for vulnerable people living in areas with limited resources.” 

Eli Lilly primary business processes are research & development, manufacturing of prescription medication, marketing and sales. The primary activities start at: 

• research & development with the discovery of potential treatment, 
• meets required criteria for further development to be considered a candidate drug, 
• pre-clinical trials, 
• multiple phases of clinical trials, 
• regulatory approval, 
• manufacturing, 
• sales & marketing, 
• distribution.

Eli Lilly needs to respond to both domestic and global demands. Like many other pharmaceutical firms Lilly operates using extended value chains as a global strategy. Historically, the company value chain strategy has been a fully integrated pharmaceutical/biopharmaceutical company model (FIPCO/FIBCO), but recently the company has adopted a fully integrated pharmaceutical network model (FIPNET). One way the company does this is by having a partnering strategy and creating external relationships. Not only has the company acquired other companies but also established alliances as a strategic decision for its future growth. These partnerships play a role of upstream and downstream processes that enhance the extended value chains and allows the company to share the risk with partner companies. Additionally, this allows Lilly to control their product development and still designates at which point the company contributes to the extended value chain. 

Focusing on manufacturing and with federal and international regulations in mind multiple MISs are put in place to show compliance and proper flow of the medication’s life stages. Not only do these MIS’s store data but also serve as a visualization tool for quick access, transparency and other critical purposes. In order to achieve and maintain product safety for their patients the company utilizes multiple MISs for decision-making, product analysis, intercompany / intracompany coordination, quality control and quality assurance, recording keeping, employee training, and both employee and patient safety. Listed below are some of the MIS’s and a brief summary of their main purposes that managers use at the site. 

Workday – Human Capital Management tool. (Organizational Chart, Time and Attendance, Payroll, Onboarding, Talent Management, Workforce Management, Employee Performance, Benefits Administration, and many other Employee Resource and HR Solutions) 

Trackwise – Enterprise quality management solution (EQMS) software designed to organize and track quality, compliance, and safety. Some data Trackwise manages deals with process deviations, nonconformities (NCRs), equipment release, corrective and preventive actions (CAPAs), and change controls. 

VMware – Desktop software that provides a physical server based virtualized format for authorized personnel to view and/or operate equipment virtually. This software is beneficial when automation is present on equipment allowing for multiple virtual machines (VMs) to be viewed and operated on the same server. 

Tableau – A data visualization that provides visual analytics by having multiple user interface interactive dashboards in order to simplify data making the data understandable and easy to read. Among other functions Tableau has the ability to connect to other databases to source data. Most managers mainly utilize Tableau for searching, reporting and tracking employee training.

SAP Success Factor – Human Capital Management and Compliance Management tool in organizing multiple facets of employee development. This tool provides the company with a user interface training application for completing employee compliance training. Similar to Tableau, Success factor can search, report and track past and future required employee training. 

SAP Graphical User Interface (GUI) – SAP is Enterprise Resource Planning (ERP) system tool for integrating multiple aspects of the company’s business functions. SAP GUI does this by interacting and communicating with other multi-tiered layered SAP applications. Having multiple SAP applications SAP GUI provides Transmission Control Protocol (TCP) to distinguish the different connections and to determine the appropriate application server for the host user. 

Syncade MES – Syncade MES provides and integrates multiple software systems in specific manufacturing operations. One major function of Syncade MES is incorporating databases for information integration of manufacturing operations. Whereby user interface modules can be created to simplify, modernize, and centralize manufacturing management. One way the company uses Syncade is to transform paper procedures documents and Batch Production Records (BPR) into electronic procedure and Electronic Batch Production Records called eBPR. 

Eli Lilly created an app called Lilly together, the purpose of this app is to make sure that you are comfortable with managing your treatment. Some other benefits that this has for customers of Eli Lilly is by putting you in control of tracking your progress, and also it can help you understand your progress as well. While this app has all the needs of a patient/customer of Eli Lilly to make sure that their treatment is on track, it also has a tab that talks about savings. This can put them up against competitors because that app will break it down for the customer to understand. This will have the customer/patient saving money building that alliance/loyalty between them and the organization. You can also resupply and schedule meetings through the app, which when we look at the figure it sets them up to be locked in buyer, safer and quicker access. Creating their own app gives Eli Lilly the ability to keep up with the market and also have a connection with their patients/customers so that they can prove they’re above the competition.

Some of these app improvements today: 

• Logbook Chart Views – switch between weekly & monthly chart views.
• Treatment Map – see key steps in your treatment journey.
• Logbook Report – create reports that can be saved outside of the app & shared with your Health Care Provider.
• Study Info – share your Lilly Together™ data by entering your study code in Settings.