Art of Strtegical Thinking
Essay by Zhanna Vishnyakova • April 27, 2016 • Book/Movie Report • 670 Words (3 Pages) • 1,352 Views
- Distinctive elements of the Pierre Fabre group’s history that shaped its corporate culture
Beyond any doubt, Pierre Fabre’s group is culturally remarkable. The group manufacture Dermo-cosmetics, which is based on benefitial properties of natural extracts of plants and themal water of Southern France. Corporate culture of the company is based on the following Visions of product’s success
- Natural components. Creation of cosmetics based on thermal water and plant extractions. Partnership with farmers who supply ingridients. Strong story for partners and clents
- Commitment to certain region –Southern France and local culture . preferred over the advantages in infrastructure and logistics. Being ‘local’ allowed to guarantee the regional success. Feeling of ‘belonging’ to the region. Geographical, aestethically positioned as a South-French cosmetics and impacts the values and behaviors both employees and customers.
- Employees are well treated, thus strong sence of community results in greater commitment, sacrifice and availability
- Recognition as a medical treatment dermo-cosmetics. Building of medical reputation of dermo-costetics brand to justify premium pricing
- Distribution in pharmacies. Client-prescriber(doctor/medician) and pharmacist.
2. The company’s values are the core of its culture. : regional belonging, medical selective treatements, employee integrity greatly contribute to build a competitive advantage over competitors. Strong corporate culture helps to orient customers, suppliers, and other stakeholders. The fact that company uses natural components from plants and thermal water gives a foundational component of success.
3. Personal and regional ties to the region may be harmful when going International. Managers should seek to reduce the costs (through localization of components, logistic considerations).
Strong corporate culture may become a weakness when going International when it keeps initial belonging to one place, or when it doesn’t want to adapt to local conditions, preferences and legal regulations.
Eventhough having built a strong and stable employees commitment, managerial and employee resources should be internationalized. Local subsidiaries must preserve excellence of French dermo-cosmetics but also set objectives to penetrate local medical and cosmetics markets in order to become attractive place for work and attractive partner in mutual R&D projects
4. Strategy of PFP constitutes:
- Companies continued independence
- Diversity of its actions
- Regional implantation
It is clear that having a strong corporate culture means to be easily recognizable on the market. What is also important, it’s to be the pioneer in your industry, and this is especially true in case of Pierre Fabre Foundation. Company strategy might be changed in terms of dependence on local production. It’s quite difficult to change corporate’s strategy of a firm with tough dependence on corporate culture, but possible by applying corporate culture to every strategy the firm has.
Distribution breadth is the single most important marketing mix instrument. Positively effects on growth and market potential (according to studies Ataman, M. B., Mela, C. F., & van Heerde, H. J. (2008). Building Brands. Marketing Science, 27(6), 1036–1054.)
Strength:
| Weaknesses: Selective cosmetics, medical treatment Tight dependence on local ingridients |
Opportunities: Bigger push into organic cosmetics, sustainable development and green production Conslidation with other firms when going International Diversification of activities Regional implantation Internationalizations of managers | Threats: Selective distribution, exclusively in pharmacies Changes in the health care regulatory environment. Retail pharmacy reimbursement pressure from third-party or public payers. L’oreal and other competitors are attacking the market of biopharmaceuticals |
5. Internationaliazation challenges:
...
...