Johnson & Johnson is an USA based pharmacological and customer packaged goods manufacturing company. The company was initiated in 1886. The company is headquartered in New Brunswick, New Jersey, and the customer division of the company is located in Skillman, New Jersey. The Johnson & Johnson embraces some 250 holding corporations with procedures in 60 nations and sell merchandises over 175 nations. During the year 2015, Johnson & Johnson sold product worth $70.1 billion around the globe.
This study will present the business context and background of Johnson & Johnson including its market conditions, customer segment, founder’s background, etc. The study will outline the comprehensive description of the business which will include the products and services that the corporations make available to its consumers. In addition to this, it will also outline the evaluation of the strategy and future prospects of the organisation by applying SWOT analysis. At last, the study will demonstrate the summary of the points discussed in the study which will include a business model that will be significant for the stated organisation success.
Johnson & Johnson is an USA based pharmaceutical and consumer packaged goods manufacturing company. The company was created in 1886. The company is headquartered in New Brunswick, New Jersey, and the customer department of the company is situated in Skillman, New Jersey. The Johnson & Johnson includes some 250 subsidiary corporations with operations in 60 countries and sell products over 175 countries (Adis, 2014). During the year 2015, Johnson & Johnson sold product worth $70.1 billion around the globe. Johnson & Johnson has its operations to over 250 corporations and it is labelled as Johnson & Johnson family of corporations. It operates in three broad separations namely, medical devices, pharmaceuticals and consumer healthcare (Bolger, 2015). The company was founded by Joseph Lister and Robert Wood Junior and was joined by his brothers James Wood Johnson and Edward Mead Johnson. The corporation created its first merchandises in 1886 and was assimilated in 1887.
Robert Wood Junior served the company as its first president which was later take-over by his brother James Woof Johnson after his death. The company embrace in innovation, bringing ideas, products and services to life and development to health and well-being of the people across the globe. The corporation have faith in association which has led the company to build medical devices to simple consumer products to make everyday a little better (“2013 Citizenship & Sustainability Report”, 2013). Johnson & Johnson has over 125,000 workers in 60 nations and all are united to a common mission of helping people in living longer, healthier and happier.
The customer segment of Johnson & Johnson is focused on baby care, oral care, skin care and other customer products. This segment contributes to company’s 20% revenue. Every product of the company is targeted towards a specific group of people and all the products of the company are situated in a method which is associated to that precise group (Bolger, 2015). As for illustration, Johnson’s baby powder is targeted in the direction of a collection of new parents and new born baby.
Competition in health and care industry usually lies on the specific markets. It is evident that tablets of diabetes will have no effect on a cholesterol tablet, no matter how successful it is. Johnson’s & Johnson’s deliver wide range of products and in different segments of the industry, and thus have to compete hundreds of companies in distinctive marketplace (Borkowski, Welsh & Wentzel, 2009). Johnson’s & Johnson’s major participants include Merck and Novartis. In the sector of medical strategies, its participants comprise Boston Scientific and Medtronic.
A business model is described as a plan for the effective operations of a business by recognizing the foundations of revenue, recognising the consumer base, merchandises and the details of financing. It is the way through which a corporation generates revenue and makes income for the company processes. Usually specialists use the metric gross profit in order to associate the efficiency of a firm’s commercial model (“Johnson & Johnson”, 2011). Johnson & Johnson’s, which is a worldwide healthcare corporation grows and markets human health and well-being merchandises. One of the most noticeable aspects in the stated company is its collaboration with the other companies. It has more than 250 corporations which are located in 60 nations.
For its Pharmaceutical product business model, Johnson & Johnson use both direct and indirect channels to impact the doctors for prescribing new medications to prevailing and new patients, getting new patients for prevailing drugs by building them aware about the disease, and by promoting new indications for existing drugs (“Johnson & Johnson”, 2015). J&J mainly sells its products to drug vendors and retailers, hospitals, government assistances and health organisations. Below is the diagram on how J&J generates revenue in the pharmaceutical sector.
For its medical devices, J&J operates with payers to get the procedure approval. J&J also provides amenities around the targeted therapy areas such as patient and provider education, disease management amenities and healthcare technology services (“Johnson & Johnson”, 2017). Here is the diagram that shows the business model for medical devices of J&J:
For consumer business model, J&J proposals customer health care products usually used in the baby care, oral acre, skin care, women’s health and wound care markers. These merchandises are sold both to retail channels and suppliers across the world. OTC merchandises of the company are sold to customers through retail drugstores without any prescription (Quelch & Knoop, 2014). Here is the diagram that illustrates how the currency flows in the company from the dissimilar customer divisions.
One of the major strength of the company is its listing in Fortune 500 companies and it works efficiently in all aspects including customer, medical devises, diagnostics and pharmaceuticals. The company has diversity of products. Another major advantage of the company is its production i.e. oncology, which is approached by very few companies. The marketing frame expertise on the adjustment of entrepreneurship to remain in competition with other rivals (Rumelt, 2017).The company is financially very high-lifted in compare to other companies. It follows specific designs to absorb and tackle the problems, which challenges the marketplace and its associated growth.
One of the weaknesses of J&J is its coming under pressure of other pharmaceutical companies for reducing drugs prices. Theft from drug storage of drugs by the workers is another reason of concern for this global health care products provider. It also faces variations in the market sells due to other branded products (Sengupta & Sengupta, 2013).
For Johnson and Johnson, there are huge opportunities. The stated company has opportunity in trying innovation in monoclonal antibodies and protein therapies. J&J has wide variety of possible cross-selling occasions. The company is in situation to deliberately progress a countless of cross selling prospects. It could also enhance its balance between its three different sectors which could improve the company’s revenue. The company has great potential to exploit biologics market. Addition of some new biologics could help to expand the company’s portfolio (Sturchio & Goel, 2012).As the literacy rate of world is increasing; there will be more need of branded medical products. Thus, there is great opportunity for the company to expand its medical products.
Threats are the areas which J&J have to focus and try to solve the issues. The main concern for the company is the fight against harmful ingredients. It has been found many times that the company’s product is carcinogens. It also affects the company’s brand image. Another threat to the company is the negative impact of product recalls. Recalling medicines can make a hit to company’s reputation, integrity and competence. Intense rivalry is another threat for the company. The presence of strong competitors makes a very challenging business environment for J&J.
The SWOT analysis clearly showed that the pressure within the pharmaceutical markets is increasing, so it is important for J&J to reduce the prices of its products with medical budgets. The company should make some new developments in the pharmaceutical products which would provide the company an opportunity to enhance the product’s portfolio (Willis, Bishop & Leatherman, 2015). For future strategy, J&J must also promote cooperation and cultural exchange within the company which is very significant for the global spread out of the company. It will also provide opportunity to J&J to improve its cultural considerations.
Conclusion
From the above discussion, it could be found that for its pharmaceutical product business model, Johnson & Johnson use both direct and indirect channels to impact the doctors for prescribing new medications to existing and new patients, getting new patients for existing drugs by compelling awareness about the disease, and by promoting new indications for existing drugs. One of the most important business models for the company is its pharmaceutical business model. It is the most important segment for the company as it contributes in more than 45% of the J&J total revenue. During the year 2016, the stated segment contributed revenue of $33.5 billion. J&J operational performance over the oncology department is the actual offset for its competitors.
References
2013 Citizenship & Sustainability Report. (2013). https://www.tcyh.org. Retrieved 31 July 2017, from https://www.csringreece.gr/files/reports/en/2013/2013-JNJ-Citizenship-Sustainability-Report-FINAL061914.pdf
Adis, W. (2014). McNeil, a Johnson & Johnson Subsidiary FDA Case Study. Communications Of The IIMA, 14(3). Retrieved from https://scholarworks.lib.csusb.edu/ciima/vol14/iss3/2
Bolger, J. (2015). Johnson & Johnson Innovation. Retrieved from https://vitaltransformation.com/wp-content/uploads/2015/12/Jeanne-Bolger.pdf
Borkowski, S., Welsh, M., & Wentzel, K. (2009). Johnson & Johnson; A Case Study on Sustainability Reporting. SSRN Electronic Journal. https://dx.doi.org/10.2139/ssrn.1435030
Johnson & Johnson. (2011). Johnson & Johnson Highlights Strategies For Growth Through Differentiated Medicines, Transformational Pipeline And Global Product Launches. Retrieved from https://files.shareholder.com/downloads/JNJ/0x0x471325/4f885d88-5b41-4d0b-b0aa-d22a80a5f82d/JNJ_News_2011_5_26_Financial_Releases.pdf
Johnson & Johnson. (2015). Institute For Health And Productivity Studies, Johns Hopkins University. Retrieved from https://www.jhsph.edu/research/centers-and-institutes/institute-for-health-and-productivity-studies/_docs/promoting-healthy-workplaces/JNJ.pdf
Johnson & Johnson. (2017). Retrieved from https://www.jnj.com/_document?id=00000159-6a8c-dba3-afdb-7aefbd110000
Quelch, J., & Knoop, C. (2014). Johnson & Johnson: The Promotion of Wellness. Harvard Business School.
Rumelt, R. (2017). THE EVALUATION OF BUSINESS STRATEGY. Retrieved from https://teaching.up.edu/bus580/bps/Rumelt,%20evaluation%20of%20a%20business%20strategy.PDF
Sengupta, N., & Sengupta, M. (2013). Johnson & Johnson: Caring for People, Worldwide. CASES IN MANAGEMENT, 45-83.
Sturchio, J., & Goel, A. (2012). The Private Sector Role in Public Health. Centre Of Strategic & International Studies. Retrieved from https://csis-prod.s3.amazonaws.com/s3fs-public/legacy_files/files/publication/120131_Sturchio_PrivateSectorRole_Web.pdf
Willis, L., Bishop, R., & Leatherman, J. (2015). The Importance of the Health Care Sector to the Economy of Johnson County. Kansas Hospital Association.
Essay Writing Service Features
Our Experience
No matter how complex your assignment is, we can find the right professional for your specific task. Contact Essay is an essay writing company that hires only the smartest minds to help you with your projects. Our expertise allows us to provide students with high-quality academic writing, editing & proofreading services.
Free Features
Free revision policy
$10Free bibliography & reference
$8Free title page
$8Free formatting
$8How Our Essay Writing Service Works
First, you will need to complete an order form. It's not difficult but, in case there is anything you find not to be clear, you may always call us so that we can guide you through it. On the order form, you will need to include some basic information concerning your order: subject, topic, number of pages, etc. We also encourage our clients to upload any relevant information or sources that will help.
Complete the order form
Once we have all the information and instructions that we need, we select the most suitable writer for your assignment. While everything seems to be clear, the writer, who has complete knowledge of the subject, may need clarification from you. It is at that point that you would receive a call or email from us.
Writer’s assignment
As soon as the writer has finished, it will be delivered both to the website and to your email address so that you will not miss it. If your deadline is close at hand, we will place a call to you to make sure that you receive the paper on time.
Completing the order and download