Share
Explore BrainMass

Merck and Vioxx

Case Write up on Merck and Vioxx

Using Porter's five forces and SWOT identify the decisions and strategic issues. What needs to be decided? What are the basic alternatives? What are the time, money, people and political constraints?

Please use current Merck information.

Case information is attached

Attachments

Solution Preview

The response addresses the queries posted in 1614 words with references.
// Porter's Five Force Model is a powerful tool that helps in analyzing with whom the power lies in a business situation. This helps to understand the present competitive position of a business as well as the strength of the expected position in the future//

This model helps to understand the position of power giving an advantage into a strong situation, correcting the situation of negativity or weakness, thus wrong steps can be avoided. Through this tool, it is identified if the new business or product is potentially profitable or not. This model comprises of five forces, which determine the competitiveness of power in a given situation. These five forces are:

Supplier Power: This relates to the power of the suppliers to move up the prices, depending upon the number of suppliers available for each input, the differentiation of their product, their strength and control, and the cost of switching from one supplier to other. If the number of suppliers is less, the need for them will increase and so will be their power.

Buyer Power: Here, we analyze the power of the buyers to lower down the prices, which depends upon the availability of buyers and their importance in the business, the costs that will be incurred by them, if they switch from one company's product to the other. The lesser number of buyers, the more powerful they will be in their control.

Competitive Rivalry: This relates to the availability and capability of the competitors. If same kind of products is offered by the rivals then there is less chance for power to remain in one hand. If the buyers and sellers are not satisfied, then they will go somewhere else but if no one else offers the same product then the strength remains in one hand.

Threat of Substitution: This is a threat faced when customer finds other ways of doing things. As there are other alternatives available.

Threat of New Entry: The more people will enter the market, the less power will sustain. If there are few economies of scale and it costs little time and money to enter the market, the new competitors will enter the market and power will be substituted. If on the other hand there are barriers to entry of new firms, then a favorable position and advantage will sustain.

// Giving a Brief Description about the company and its existence, will help in getting a proper knowledge of the company, its customers, competitors and the strategies adopted by it//

Merck $ Co. is a public sector firm dealing in ...

Solution Summary

The response addresses the queries posted in 1614 words with references.

$2.19