Discuss about the Indian Economy for Performance and Policies.
This essay-outline deals with the purchasing department of an organization namely procurement of raw material, acquisitions, merger in short all the purchasing operations related to an organization ensuring best use of material available with focus on reliability, profitability, quality, timeliness, cost-effectiveness, availability, sustainability, toxicity etc. With so many factors on which it depends some of the major ones listed and some not listed became prominent for one kind of organization and it becomes dormant for the other organization and some of them loose importance in the markets which are distinguished from one-another on cultural-values, language, ethnicity, food, dressing etc. while at the same other gains importance. (Purchasing Manager Job Description, Human Resource Center)
Glaxo-Smith-Kline (GSK) is one of the leading pharmaceutical companies of the world and its pan presence in different parts of world from less to more known positions has grown due to continuous innovation based on research and its laboratories which has allowed the organization to grow prolifically in the past. It’s investment into the pharmaceutical drug, vaccine and consumer healthcare products with focus on healthy life can be said to be a major goal which has allowed it to extend its facilities deep into the developing countries by collaborating with the local players or extending its arms through acquisition and merger. It has established its labs at various places in the world which has allowed it to fulfill its objective of supplying low cost, comparatively, drugs to various parts of world. Much of its competitors are spread around the world and with its major marked in developing countries it has allowed itself to grow throughout with increased laboratories and vendors with more than 200 products (Our Value Chain Approach). With employee strength worth one lakh and revenue over 25 billion pounds the British company is one of the leading pharmaceutical company of the world.
If we see the policies and its way to work GSK uses its suppliers with following points in mind:
To create better ways of manufacturing with reduction in carbon emissions
By allowing enhancing research it has several times since its establishment diverted funds to allow research to reach its peak level.
With concentration on vaccine development and considerable investment of the order of 500 million pound in it GSK has allowed itself to develop innovative medicines with advanced immunization program
With Global vaccine action plan (GVAP) it is poised to fight the menace of tuberculosis, malaria, dengue fever and HIV (GSK and the Decade of vaccines, 2011)
Around 16000 scientists around the world working on company’s vaccination program to allow immunization to spread to different parts of the world.
It has time and again entered into merger and acquisitions to allow itself to grow both horizontally as well as vertically
It is based on knowledge expertise which it gets through its various channels of recruitment process as well as it caters them through research to allow innovative drugs to be injected into the market
Its policy to get itself engaged with local vendor, government bodies and has allowed it to extend its reach to poorest of the countries
If we see supplier of the company GSK can be an institution which provides it with the manpower and knowledge expertise. It can be chemical factories like BASF or others which will provide with high quality chemical-agents which will allow it to develop its product smoothly and fluently. Thirdly it can be builders who will help it in establishment of high net-worth laboratories laced with all the equipment which will help him raise the quality standard of its products. (GSK Annual Report 2015)
Recommendations for the selection of the suppliers and decisions hence required for supplier selection:
To engage with only those suppliers which are accredited with certified bodies in toxic management, pollution levels and green-house gases emissions so that it is able to fulfill its objectives of attaining lower carbon emissions. Particularly it has an objective to decrease the levels of particulate material which is possible through the use of raw materials which in this case are chemicals which are non-toxic in nature.
To set parameters for recruitment of scientist from the local area so that it leads to removal of poverty as well as allows development of the area by giving employment in the concerned area.
To establish world class laboratories with high-tech infrastructure and quality material so that it achieves best design and research which leads to quality products in the area. It allows laboratories to function well in the area.
To use disposable-syringes which are self-destructive after first use so that spread of diseases through blood, transfusion and injectable decreases.
Toxic substances should be reduced in usage by processes which also in addition to removal of toxic substances make them as a biodegradable so that when they are disposed of both from laboratories or after usage.
To use substances from quality accredited bodies only.
It should have a sound knowledge base by taking advice of research institutions as well as professional bodies so that more value based propositions are created and it leads to better opportunities.
Institutional set-up in the form of colleges, laboratories etc.
Development of product-based value supply chain and hiring up of special purchasing managers.
Information Communication and Technology can be a precursor for newer day technology and their dissemination to the common man both for the purpose of knowledge and usage of the given products of the company by the poorest of the person in the most suitable way so that to enable the motto of “Health for All” objective of the company. With today being the age of technology and everything going on internet with quick time access and whole process of supply to delivery taking lesser and lesser time with the speed increasing it is possible now to do the make-to-order in few minutes even in the industry of today. Especially in the food industry and medical industry we see there is very short time from the time-of-order to the delivery-of-order and with time there is an increase in such type of facilities to take route through various communication medium making distance look small. E-commerce has enabled to increase the reach as well as reduced the significant labor required to demonstrate the efficiency now in the supply chain leading to increase in speed from order-to-delivery. This being external to the institution and considering inside the institution we can see various communication devices and software like ERP taking the place of manual ledgers and registers. Software’s like ERP has allowed the management of internal processes of the company to be maintained in better ways and has also reduced the burden on the office registers and racks with all things available at the finger tips through the software. It has helped in not only in easing out the maintenance of the software of the company but also has allowed in exploring new business opportunities quickly and all are now more penetrative. So ERP simplifies exchange, holding, processing, dissemination, processing, supporting and based on the past to reevaluate stand of business and to look for the newer business opportunities. (Chemicals and Raw Materials)
In the same manner it is also true that in now-a-days ICT can revolutionize the development of pharmaceutical products and GSK has realized it quite in time. Automation is the newer buzzword that is coming out in the field of ICT and for every manual work machines are being deployed which has increased the accuracy and reliability (ICT in Supply Chain).
Various ways in which ICT should be used by the GSK are:
Automation of machines in which chemical composition of the drugs are decided and made feasible for the product development. One way of development of suitable drugs can be through design of machines in which drugs with different chemical composition are generated and are tested on various organisms instead a simulation program is designed which absolves to test on live organisms and simulate the result based on the knowledge of the past tests and helps to attain exact new drugs and in the process it is quick, less labor required, quite accurate, better in functioning, lesser carbon outputs and since no real drug use lesser usage of specimen so less killer.
Automation would lead to reduction in the inventory maintenance which for any organization is a plus.
To create person-specific-drugs by making machines which are easily bought or are made in the hospitals in which the bio-details of the patient or the person are taken up and are fed into the system and according to it the drugs are designed for him by keeping in proportionate the exact chemical composition of the drugs required by him and given to him so that he is able to take it up and get cured. The idea being remove the mass drug approach and go with the technology and communication devices present go for the processing of it through designated machines and prepare the drug then and there to allow the patient to survive.
Purchase-designed-machines by measuring the requirement of the drugs and then according to the chemical composition decided preparing drugs for masses and it can be made out that the exact requirement of each person is different and now to take more on location-specific mass drugs and to keep purchase and setting up of laboratories specific for that area.
If we see pharmaceutical drugs sold under the brand which are earning huge amount of money as they have their vendors, suppliers, factories, manufacturers, staff all are aligned in line. So purchasing cost especially in GSK which has adopted value chain based approach which has on its base concept the idealization of the product being used. It has allowed in the growth of the organization both laterally as idealization-testing-retesting-failing then again till achievement of the targeted results are achieved which are first done in the controlled laboratory environment and then it is done in the open tested on live specimens and then it is tested on many more specimens till desired results achieved and then it is mass produced and through the supply chain it is certified and allowed by designated drug related body to circulate among the targeted audience.
Purchasing costs can be brought down by exploring raw material market over the globe and give the production which according to the Kotler depends on people, price, promotion, and place (Kotler, 2011). Outsourcing can be named as one of them in which laboratories can be set up near the place of raw material to maintain cost effectiveness. To keep purchasing managers at bay so as to make a procurement from the most suitable place it is necessary that they are well versed with the knowledge base as well as language proficiency both written as well as spoken allowing for the growth of industry by best and cost effective.
Like other pharmaceutical companies GSK is also moving by selling a patented product which has its own secret formula which it has prepared through deep research which it does through hired well prepared knowledge expertise which it gains by lateral as well as entry level hiring through institutes and other places by the help of its staffing department. Its materials which are required are chemicals which it takes from well-established tested laboratories which from time and again it have acquired through the joint ventures or through assistance of local bodies or authoritative bodies. With the objective of drugs for all, quality cost effective health products, vaccination programs and target of developing markets GSK has grown manifold over a century and its world class stature is just an example of it. To maintain a pipeline and alternate channels of delivery are some of the other products that is needed to be done to keep everything in the right state.
Conclusion
Pharmaceutical companies need to advertise their products, break new deals, add more customers, add more products and to stay in the market make more moves in the right direction in the direction of advertising, procurement for which they need able machines and software’s and to add to it better purchasing managers which are apt in this. In this report we have also gone through in detail use of ICT and its ramifications and some recommendations which are concerned with automation of the existing and development of better to help in quickness. With technology and gain of importance of E-Commerce it has led to a need to enhance supply chain and make it robust. Media and advertising has also gain importance and it is necessary to carry out the same in better ways. I will end this report by suggesting that Purchasing is the most integral part of any industry in general and in coming time especially in the sector we are discussing it will gain more importance. Managers are required to achieve quality of the order of six sigma and scientists are required to idealize and reinvent their activities. So value chain is the need of hour and experts of management as well as technology at various experience levels are required at various levels.
References:
Budnick, Frank S. 2010, Applied Mathematics For Business, Economics, And the Social Sciences, 4th Edition Tata McGraw Hill
Cooper, Donald R, Schindler, Pamela S 2009, Business Research Method, 9th Edition Tata McGraw Hill
Eco-desk, GSK CASE STUDY: Embedding sustainability into the business with eco-desk,
Retrieved from <https://www.ecodesk.com/media/blog/2014/09/30/gsk-case-study-embedding-sustainability-into-the-business-with-ecodesk/>
Falcota di Economia, ICT in Supply Chain Retrieved from,<https://www.economia.uniroma2.it/Public/YICGG/file/readinglist/7/ICT%20in%20supply%20chain.pdf>
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Kapila, Uma 2011, Indian Economy: Performance and Policies, 10th Edition Academic Foundation
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