Executive Summary

This report focuses on the current dilemma in Crescordia Company in terms of adopting resorbable fixative devices. For the past two decades, the medical industry has been searching for a product that can be used to replace the existing non-disposable steel and titanium fixative devices. Though companies such as Innostat have developed such gadgets, Cresecordia has not adopted the equipment. Nonetheless, the market is moving towards emerging technology. Consequently, the company change its corporate culture to influence managers and employees to accept new technology.

Introduction

Crescordia Company is currently facing a dilemma in terms of embracing resorbable plates. Failure to offer resorbable devices is drastically eroding the company’s market share as the leading manufacturer and distributor of fixative devices. Resultantly, the company’s decision in terms of adopting resorbable plates will have a short and long-term impact on Crescordia’s product line as well as the company’s well-being.

Industry Dynamics

Currently, the fixation device industry is shifting towards the resorbable plates. Notably, the pediatric sector has been ignored by most company’s venturing in the resorbable product line (Gourville, 2005). However, all stakeholders in the industry including practitioners and child patients highly value disposable fixation devices. Customers in the sector are already pressuring manufacturers such as Crescordia to produce such devices. Nonetheless, the demand for disposable devices in the pediatric industry has not yet been met, thus creating an opportunity for the firm (Gourville, 2005). Therefore, provide products that are in line with current demand and to obtain high returns, Crescordia must focus on venturing in the resorbable fixation device product line.

Crescordia’s Situational Analysis

To survive and succeed in the current business landscape organizations must conduct a situational analysis of the internal and external environment. The SWOT (Strength-Weakness-Opportunity-Threat) is one of the situational analysis tools that can be used to examine the domestic business environment of an organization. Based on the tool strengths and weaknesses focus on the internal capability of a company including human resource and financial power, among others. For example, the presence of a competent and well-equipped talent pool is one of Crescordia’s main strengths (Gourville, 2005). Through the team, the company has developed other forces including developing quality medical products that are used globally. However, the company’s, main weakness is the failure to include disposable fixation devices in its product line (Gourville, 2005). Despite a strong talent pool, the internal business environment is preventing the company from staying afloat in the current highly competitive business environment.

Conversely, the SWOT tool identifies opportunities and threats as external factors that affect the internal opportunities of a company. Cresordia, for instance, can capitalize on emerging technology to adopt disposable fixative devices in the pediatric sector, and thus provide equipment that is user-friendly to practitioners and offers long-lasting solutions for patients. However, the company faces the threat of incumbents and new entrants seeking to develop similar products as witnessed in the case of Innostat (Gourville, 2005). Overall, as demonstrated through the SWOT analysis tool Crescordia is affected by the internal business environment the company can stay afloat and minimize the threat of competitors by embracing the new technology.

Organizations do not operate in a vacuum; hence, their operations are affected by external factors that are beyond their control. The PESTLE (Political-Economic-Social-Technological-Legal-Environment) analysis tool is one situational analysis instruments used to analyze the external factors that affect the business operation of an organization. Unlike Porter’s five force model that often focuses on competition among industries, the PESTLE tool examines all external factors that influence the activity of a company. For example, the US government maintains that medical equipment must meet the highest standard to safeguard the wellbeing of users including physicians and patients. In terms of legal factors, the government ensures that all technological development is protected using patent rights. Therefore, to operate effectively in the US, Crescordia must analyse all the elements depicted in the PESTLE analysis tool.

Specific opportunities available or penalties if the problem continues

Critical Evaluation of Options and Ramifications of the Choices

The company has several options including launching or failing to develop resorbable offering and providing customer centric rather than transaction focused products. Establishing resorbable plates will give the company the first mover advantage. In turn, the company will obtain a competitive advantage including super profits and market dominance. Equally, from the RBV (Resource-Based-View) perspective, the company can get an SCA (Sustainable-Competitive-Advantage) by ensuring that resorbable are rare, valuable, non-imitable and non-substitutable. Being a first mover in the technology is likely to motivate other incumbents and new entrants to develop the technology. Though the firm can establish patent rights, competitors can build their technology faster and thus make the protection insignificant. However, late entrants can learn to produce resorbable at a lower cost rate than the first movers. Accordingly, failure to launch resorbable before rivals may enable the company to minimize the cost of launching the product as a late entrant. Moreover, developing the product as late entrant will allow the company to learn the new technology faster and overcome the advantage held by first movers. Generally, developing resorbable plates will be the most reasonable option for the company.

Providing customer centred rather transaction based products must be the focus of each organization. Customer-centric products prioritize the needs of customers including quality and create a long-lasting relationship with clients, minimizing litigations and increase the market share of a company. On the contrary, transaction-based products prioritize profits maximization and thus are likely to result in the development of substandard products. In turn, customers are likely to boycott such products and the company may be involved in numerous lawsuits.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            Therefore, the company must concentrate on developing customer-centric rather than transaction focused products.

Recommendations Addressing Both Tactical and Strategic

The tactical and strategic implementations must focus on embracing resorbable technology. Notably, the company should begin by aligning internal stakeholders including the executives and subordinates towards embracing the disruptive technology. Accordingly, the existing corporate culture of the company should be changed to focus on disposable plates as the main product line. Moreover, the company should focus on introducing and R&D (Research and Development) department that concentrates mainly on disposable devices. The department needs to be supported by a highly skilled pool of talent that will prioritize the disruptive technology. Moreover, to obtain a competitive edge in the new market, the company must dedicate a sizeable amount of its funds towards the development of resorbable devices. In the long-term, the company should focus on developing a new research facility dedicated to disposable fixative devices. Resultantly, the company will facilitate creativity and innovation and minimize interference from other departments focusing on other products.

Additionally, the company should consider using other subjects such as guinea pigs to determine the effectiveness of the new offering in the market. Quality is a critical issue in medical products. Resultantly management approaches such as TQM (Total-Quality-Management) and six sigma, among others must be used. For instance, through TQM, the firm ought to total member involvement at all the stages of development, introduction and use of the product. For example, medical practitioners from recognized institutions should be engaged at all stages of the product development including the research phase.

Conclusion

Crescordia must adopt resorbable fixative devices to survive and succeed in a highly competitive market. Embracing the technology will enhance the provision of medical services in the pediatric department that is currently demanding for such devices. In turn, the company will maintain its market position as a leader in the manufacture and distribution of medical equipment, obtain a competitive edge over competitors and provide intelligent solutions to customers.

Reference

Gourville, J. T. (2005). Holding fast. Harvard business review, 83(6), 35-8.

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