Strategic Plan 2010 - 2013

STRATEGIC PLAN 2009

GUFIC BIOSCIENCES LIMITED

Prepare for : Jayeshbhai Choksi

Prepare by : Dharmeshkumar Patel

Date :

Strategic Management

Graduation Diploma in Business

Contents1. Executive summary.............................................................................................................................................3

2. Acknowledgment................................................................................................................................................4

3. Report findings...................................................................................................................................................5

3.1. Industry overview.......................................................................................................................................5

3.1.2. Gufic Biosciences Limited business history.........................................................................................6

3.1.3. Strategic Posture.................................................................................................................................7

3.2. Internal environment..................................................................................................................................8

3.2.1. Human resources................................................................................................................................8

3.2.2. Financial resources..............................................................................................................................9

3.2.3 Company Location..............................................................................................................................9

3.2.4. Facility...............................................................................................................................................10

3.2.5. Company image................................................................................................................................10

3.2.6 Operation..........................................................................................................................................11

3.2.7. Suppliers...........................................................................................................................................12

3.2.8. Product cycle.....................................................................................................................................13

3.3 External environment...............................................................................................................................14

3.3.1. Remote environment........................................................................................................................14

3.3.2. Internal environment........................................................................................................................19

3.3.3. Operational environment.................................................................................................................21

3.4. Industrial analysis and strategic objectives...............................................................................................23

3.4.1. Internal analysis................................................................................................................................23

3.4.2. Strategic Objective............................................................................................................................24

3.5. Short term action palns.............................................................................................................................25

3.6. Functional tactics......................................................................................................................................28

3.6.1. Project Schedule...............................................................................................................................28

3.6.2. Project budget..................................................................................................................................32

3.6.3. Project manage and delegation authority.........................................................................................33

3.6.4. How will success be measured?........................................................................................................33

3.7. Operational...............................................................................................................................................34

4. Conclusion........................................................................................................................................................35

Appendix...................................................................................................................................................................37

References............................................................................................................................................................37

1. Executive summary

This report is put in place a strategic plan for Gufic Biosciences Limited for the year of 2010 – 2013.in this plan firstly analysis the business environment how the business environment have huge effect on the business. The report then describes the objectives, action plan and tactics to use in the course of implementing the plan. This report closes by recommending Gufic Biosciences Limited to follow the implementing schedule implementing the chosen technology and setting the market targets for new product.

This system being implemented so that business can compete with its competitors in the war of price and capture the market share

2. Acknowledgment

I would like to acknowledge the assistance given to me by all who aided in the development of this assignment.

I would especially like to thanks my stakeholder, Mr. Jayeshbhai Choksi of Gufic Biosciences Limited for allowing me to use their business as a basis for this report .the amount of time that the couple devoted to helping me was immense.

I would also like to thank Dr.Albert van Aardt for his help in the course of this assignment.

3. Report findings

3.1. Industry overview

Indian Pharmaceutical Industry is one of the fastest growing sector in Indian economy. The first pharmaceutical industry established id Bengal chemicals and chemical works in the year of 1930 at Calcutta. Up to the year 1970 most of pharmaceuticals imported from the overseas and only cheap drugs are manufactured by state owned company. After that government aimed to became self dependent on pharmaceuticals and Indian government introduce the product patent act 1970 which create entry barrier for foreign pharmaceutical company and it provides Indian Pharmaceutical Industry the opportunity to gain necessary experience and organizes resource to enter and grow in the export market.

Now Indian Pharmaceutical Industry is number fourth in world to produce pharmaceutical. Its estimate worth US $ 6 billion. These industries grow up at a rate around 13% per year. This industry is the one of the biggest producer of API (Active Pharmaceuticals Ingredient) in the world. Form its production around 40% pharmaceutical export and it total share in global generic drugs in about 20% to 24%.this industry is science based industry in the country.

(http://www.dbresearch.com/PROD/DBR_INTERNET_EN-PROD/PROD0000000000224095.pdf )

At the present Indian pharmaceutical growth is assumed to be US $ 20 billion industry by the year 2015 and also expected that it become top ten pharma based market in the world. The sales of the Indian pharmaceutical industry going to US $ 43 billion in next decade.

3.1.2. Gufic Biosciences Limited business history

Gufic Biosciences Limited is started its activity in 1970 at national highway no.8,Gujarat – India with selective bulk drugs. In the starting it is private company. In the year of 1975, formulation were introduce manufacturing of freeze dried injectable was especially of company. In 1980 company start its pharmaceutical production. Company has mainly two departments one is bulk drugs and other is pharmaceutical. Both departments working separately with separate R & D, quality assurance and common quality control lab. From the starting of the business firm has register more than 60 products in bulk drugs and pharmaceuticals. Bulk Drugs like Lidocaine, Lidocaine hydrochloride, Diethyl Carbamazine Citrate, Econazole Nitrate, Ketoconazole, Miconazole, Miconazole nitrate, Isoconazole, Prilocaine etc…... were developed by R & D and introduced in market successfully. In formulation Amoxicillin Sodium injection (freeze-dried), Amoxycillin Capsules, Dispersible Kid Tab, Amoxycillin Syrup, Miconazole Ointment, Ayurvedic tablet and other such specialty products were introduced and these products enjoyed top rank for years in Indian Market.

Few years ago firm turn in to Limited Liability Company. This firm has another one pharmaceutical unit at Belgaum – Maharashtra. In this firm more that 500 people working. And this firm yearly turn over around 150 – 160 billion rupees. In this bulk drug unit turn over around 30 – 40 billion rupees.

In bulk drug unit firm has four plants.

1. Ck plant ,2. Mico plant3. Lido plant4. Schedule – M – Plant

In CK plant firm mainly manufacture Crude imidazole for manufacturing intermediate Crude Miconazole.

In Mico plant firm manufacture Crude Econazole and Crude Miconazole are main intermediates for the production Econazole Nitrate, Miconazole and Miconzole Nitrate.

In lido plant firm manufacture Lidocaine in Toluene which is main intermediates for the production of Lidocaine & Lidocaine Hydrochloride.

In schedule m plant they manufacture finished product like Ketoconazole, Isoconazole Nitrate, Di Ethyl Carbamizene Citrate, Prilocaine, Econazole Nitrate from Crude Econazole, Miconazole & Miconazole nitrate form Crude Miconazole and Lidocaine and Lidocaine Hydrochloride from intermediate Lidocaine in Toluene.

Firm mission is “High Quality of product with Lower Cost”. Following this mission firm always improve their process to reduce cost of product without affecting the quality of product. And they provide product to their customer at lower cost than other.

3.1.3. Strategic Posture

Gufic Biosciences LIMITED‘S goal in business to produce high quality product with lower cost this has business continuous growing since it established.

From the last decade the pharmaceutical market in India & worldwide is increase and due to Indian this Indian pharmaceutical industry growing at rate of 13% per year and in coming next year they growing at a same rate.

Gufic Biosciences Limited has two section one is pharmaceutical and other is bulk drug unit. In this firm i worked for two years from 1st January 2007 to 28th February 2009 and during my job in this firm i observed that firm’s bulk drugs unit may be work more effectively and earn good profit if they introduce new technology and make aggressive marketing for their running product and new developed product because firm manufacture product s and its substitutes as well. So they can capture good market share for their product and earn good profit selling more their product. Due to that i inspire to prepare strategic plan on bulk drug department of the firm.

This business growing rapidly over next few year with help of new technology and aggressive marketing that this plan to aim.

3.2. Internal environment

3.2.1. Human resources

Firstly there is Mr. J.P.Chokshi, he is president & chief managing director .he has been handling Gufic Biosciences Limited all units since 12 years. He is master in pharmaceutical so he has good knowledge about the buisness.he mainly involved with management and finance

Secondly, there is Dr M.G.Dhapalapur, he is counsel director of bulk drug unit. He has wide experience in the field of R & D and Marketing. He mainly involved with new products development in R &D, marketing, recruitment of employees and handling of foreign company audit. And another Miss.Manisha, she is HR Manager of organisation. She joined the organisation 2 years ago. She mainly involved with requirement of employees at production level and administration level, salary increment, look after employees & worker union and government work related HR.

Thirdly in management team there is Mr.swamy. Mr. Swami is works manager. He has nine year experience of production related activities. He is newly joined the company. He mainly involved with new product development, production activity, handling of foreign and domestic company audit, new technology development, maintenance and FDA work and environment related government work.

.

Workers

President & Chief Managing Director

Mr. J.P.Chokshi

Consul. Director Operation

Dr M.G.Dhapalapur

HR Manager

Miss. Manisha

Works Manager

Mr Swamy

Executive Production

Sr. Officer/Production Officer

3.2.2. Financial resources

The business is good financial condition. This company is fully self funded and has no shareholder other then Mr.Chokshi’s family member. At the present company has turnover around 15 billion rupees and in that 2.0 – 2.5 billion rupees turnover of bulk drugs unit.

First the company set up as a private unit. After the development of company it turns in to Limited Liability Company.

The change in the interest rate will affected the competition because Gufic Biosciences Limited takes many loan from the bank and almost every year interest rate change in India. Also the fluctuation rate of US dollar and crude oil rate affect the competition. In bulk drugs company 90% product exported in overseas and all export business doing in US dollar, so sometimes if dollar is weak then company get less profit and if strong then company get good profit. Same as with crude oil rate because many raw material use company in their bulk drug production are petrochemical product so the higher rate of crude oil increase the production cost that means low profit.

3.2.3 Company Location

The company is located on National Highway No. 8, Near Grid, At & PO. Kabilpore 396 424

Dist. Navsari.Gujarat. (INDIA)

The business contact by following method:

Tel.: 02637-239946, 309424

Fax: 02637-239946

3.2.4. Facility

When the company started at that time company has no R & D for new product development, no more equipment for production, no more equipment in quality control, no safety equipment in sufficient quantity like fire extinguisher, solvent detector, respiratory equipment and transport facility for their staff and director.

But now company is well developed and company has two R & D, one for bulk drug and one for pharmaceutical with high tech equipment in that company has developed many products. Also in production Site Company has many new and Morden equipment .in their quality control department company installed new and high-tech equipments for accurate analysis of product and company provide personnel car to their manager and director for transportation.

Company very conscious regarding fire and safety. they put lots of fire extinguishers, sand bucket ,fire alarm system inside and outside all department and they check & refill on time of interval, also all department has fire water pipe line .also company provide many equipment for safety like gas mask, hand gloves, respirator, safety gogals,solvent detector to all employees and department of production. Company provide life insurance and health package to its all employees.

Company pay salary monthly but if any employees need money before the salary at that time company provide money and deduct that money from the salary. Company also run one small fund organisation in that employees put some money every month and they can take loan form that fund organisation and repay the loan in instalment.

Company provide travelling allowance to their employees if any employee goes outside the company for company work.

3.2.5. Company image

Company has good image for its good quality of product and facility for production.

Company produce the good quality of product with lower cost. Now company has state GMP Certificate (Requirement Food & Drugs Association for to produce drug) which describe that company has good production facility with good fire and safety equipment & without the contamination and they follow all the rules of FDA. If company has no state GMP certificate then company their product in foreign market and domestic market they have to sell under the neutral label also government can’t give permission for manufacturing of new product.

Now company apply for WHO certificate which describe to its foreign client that company has good facility of production and they have good hygiene system and they use their different equipment in

different product to avoid contamination. It also saws that they give proper training to their employees regarding production,cleaning,operation and hygine.also their worker has good health no one can suffer TB ,cancer and other diseases which cause contamination in product.

3.2.6 Operation

Gufic Biosciences Limited has operates simply in this top management to production level work together.

Typical operation can be put into following diagram:

Client approach Gufic Biosciences Limited. directly, through web query or through the reference of company suppliers for buying product.

Client approach Gufic Biosciences Limited.

Website query

Meeting or telephonic talk for costing & quantity of product ,packing types, testing result

Through supplier reference

Discus with works manger and then set delivery date

Inform the production department & production start

Changes are made on requirement of client

Delivered the finished product

And feed back is obtained

Marketing department of company arrange meeting or telephonic talk for discuss the product cost, its quantity, types of packing and types of testing results. Also they discuss about the other costing like transportation, shipping and extra costing of changing packing once final packing done.

After that marketing department discuss with the works manager of production department of the company and for the tentative date of delivry.once the marketing department confirm the delivery date with works manager then they contact client and set up the date of delivery.

After that marketing department send order copy of product with all details to the production department. And production department start the production of product if quantity is large or product not available in stock.

Change made by company on the requirement of client in packing of material, testing result. Sometimes if client change the product at that time company can do that for client if it is regular.

Company deliver the product to the client and feedbacks obtain from the client.

3.2.7. Suppliers

There many suppliers of company who supply their material to the company.

Some of the supplier and contractor below:

1. Deepak Nitrite Ltd,Mumbai2. Shah Agency,Navsari 3. Deedy Chemicals (P) Ltd, Ahemdabad4. Jiangsu Guotai International Group, China5. Pioneer Chemicals Industries, Mumbai6. Alkyl Amines Chemical Ltd,Mumbai

These suppliers are provide chemical raw material like 2:6 Xylidine,Sodium Bi Carbonate,HCl,2:4 Di Chloro Benzylchloride,1:3 Di Chlorobenzene,1:H Imidazole,Toluene,Methanol,Acetone and other chemicals for production.

Milgil hardware store – Navsari and Jagmani metals - Mumbai provide electric items, nut bolts, packing sheet, Ms and GI pipeline, valve and other accessories which are use in maintenance of plant.

NH Engineers,Naranlala Metal works and Investa Pumps provides equipments like Reactors, Pumps, Dryers, Centrifuges, Condensers and Cooling Towers to company

Vashu Construction provides the construction facility to company and Gandhi Agency provide labour for production in company.

3.2.8. Product cycle

Product life cycle is that all product, brands and industries move through identifiable phase from introduction through to maturity and decline. It is associate with each phase will be change in the unit margine,the gross margin and product or brand strategy.(Clive Reading,2005)

Here is the product life cycle diagram.

Presently Gufic Biosciences Limited. Growth stage mark with star on diagram below.

Introduction Growth Maturity Decline

Sales

Time

Introduction Growth Maturity Decline

Sales

Time

3.3 External environment

The factor beyond the control of the firm that influence its choice of direction and action organisation structure and internal processes (Pearce & Robinson, 2007). Gufic Biosciences Limited doing their business internationally and domestically but some big events like American economy clash and 26/11 terrorist attack Indian will still affect the business.

3.3.1. Remote environment

3.3.1.1. Economic factor

Economic factor affect lot to the firm because the firm operate on the nature and direction of economy. So the every firm must consider economic trend not nationally but also internationally that affect its industry.

Gufic Biosciences Limited. Export its 80% production of product in international market. So the Currency movement affect very much to the business. Before the American economy clash the Indian rupees become stronger against US dollar. It become 1 US dollar = around 38 rupees from 49 rupees. This things effect lot to the company because all international business doing in US dollar. So when the Indian rupees become stronger at that time company earn less profit on their product and they didn’t increase the price of the product because the Can lose their customer. Loosing customer means losing the business.

(Indian rupees v/s US dollar http://www.blonnet.com/forex/usd.htm)

Increase oil price and their effect on the petroleum product in India will effect the business Because 1.5 year ago crude price goes up to around US $144 per barrel and in Gufic Biosciences Limited use many raw materials which are petrochemical product so the supplier increase the price of the that raw material which increase the production cost of the product and decrease the profit.

(Crude oil price graph: http://www.wtrg.com/daily/clfclose.gif )

Interest rate of bank loan is also effect the Gufic Biosciences Limited because company took billion rupees loan for development and every year interest rate are increase presently interest rate around 10.5 – 11 %.so company has spend lots of money for repayment of bank loan.

3.3.1.2. Political factor

Any firm has to operate in the boundary of legal and regulatory parameters which are define by the political factor.

Gufic Biosciences Limited will need to monitor the political and legal environment very closely they operate closely.

Now days in India parliament election held so company has to monitor the affect of this election on their business. If the government change then they may be change in the benefit which is given to pharmaceutical industry by previous government in budget.

There are other many law which are affecting the pharmaceutical industry. Presently Indian pharmaceutical industry manufacturing, sales, import, export and clinical research of drugs and cosmetics governed by the following law:

1. The Drug and Cosmetic Act,19402. The Pharmacy Act,19483. The Drugs and Magic remedies (objectionable advertisement ) Act,19544. The Narcotic Drugs and Psychotropic substance Act,19855. The Medicinal and Toilet preparation ( excise duties) Act,19566. The Drugs (prices control)order 1995 ( under the essential commodities Act

Among these law The Drugs and Cosmetic Act, 1940 affect the industry. This act brought to protect consumer interest. Under this act include punishment & finer for misbranding drugs, confiscating of

such drug, prevention of the import of such drugs, it prohibits the sales of such drugs. This act also provided the setting up of central drugs laboratory for testing batches of drugs and the manufacture and importers have to followed the strict standard of drugs which are prescribe by the act.

Three are some other laws which are effect on manufacturing of drugs, its sales and distribution in Indian.

1. The Industries (Development and Regulation ) Act ,19512. The Trade and Merchandise Market Act,19583. The Indian Patent and Design act ,19704. The Factories Act

The Indian Patent Act effect national pharmaceutical industry lot because it help to industry grow at double digit pace. It provide the deleting product patenting ,introduction of licences of right ,liberal compulsory licences provision, reduction of patent protection period from 14 years to 7 years and 5 year from the date of sealing.

3.3.1.3. Technological factor

Technology environment is essential in the era of globalisation. Technology is the part of today’s competitive environment. Something change in the world technology can alter the company’s competitive environment. So the firm has to familiar with the technology changes which are influence the industry.

Innovation of new technology helps the firm in development of new product or improvement of existing product, in its manufacturing and marketing. It is also help the firm to improve and protect its profitability.

Adopting the new technology firm can reduce its production cost, improve the quality of product, and increase the production, also providing the safe working atmosphere to its employees.

Now day’s living standard of people improves and they become more conscious about their health. Same as the government also more conscious about their public health. So the every year many new drugs are introduce in the market for various diseases with effective result and less side effect. Also every year in pharmaceutical industry testing methods are change and new tests are added in the testing of product to get accurate result of product and for this thing it necessary to introduce new technology for stay in the competitive environment.

From the late decade great innovation came in the communication and information system which helping lot to the business grow. Advance in the internet, e – mail and wireless communication have made the business easier and quicker. Now days many people and organisation use internet for getting information and communication & It is easily available to the normal human being.

Gufic Biosciences Limited widely use e –mail, internet and wireless communication for the marketing of their product.

3.3.1.4. Ecological factor

In the 21th century firm has not doing their business financially and socially but they have also doing their business ecologically. Every firm has to follow the follow which made by government to protect the environment.

Gufic Biosciences Limited has to familiars with the environment laws like

1. Water (Prevention and Control of Pollution) Cess Act, 19772. Air (Prevention and Control of Pollution) Act, 19813. Environment (Protection) Act, 1986 (EPA)4. Hazardous Wastes (Management and Handling) Rules, 1989

5. Factories Act, 1948 and its Amendment in 19876. Public Liability Insurance Act (PLIA), 1991

Which are made by Indian government to protect water, air, land and people from the pollution which hare created by the any organisation

Gufic Biosciences Limited is pharmaceutical industry which uses many hazardous chemical in their process to produce product. So they have to look after that when they produce the product there is no hazardous gas release in the atmosphere and if they have to improve their system to minimise the effect of that gas on environment.

Also there many effluent comes from the process in effluent treatment plant when they release this effluent in to drainage at that time they have to must check that the effluent meet with government standard otherwise it contaminate the river or sea water and that create huge problem for public health and aquaculture and that create negative image in regard to environment.

Gufic Biosciences Limited obey the government environment law for that environment can not harm by their activity.

3.3.1.5. Social factor

The social factor which affect a firm involve the belief, value, attitudes, opinions and life style of person in the firm’s external environment as develop from cultural, ecological, demographic, religious and ethnic conditioning.(Pearce & robinson,2007)

Population of India and rest of world are increasing and with that demand of pharmaceutical product also increase. Due to the globalisation people are earn good money and their life style improve also they become more conscious. So this opens a huge market for lifestyle drugs.

Now days many people are avoiding to take allopathic medicine when they become ill and they like to take ayurvedic medicine because it less side reactive. From this trend Gufic Biosciences Limited found new market and they start the production of herbal syrups for cold, cough and stomach upset, heart burn which are successfully run in the market.

Presently Indian pharmaceutical industry growing rate in domestic market is around 20%.

3.3.2. Internal environment

Gufic Biosciences Limited has four plants in bulk drug division. In that plant they produce many products. Firm operating system is very complex. They have many suppliers, contactor and sub contractor for raw material, packing material, equipment and maintenance and labour.

Micheal porters five force model for Gufic Biosciences Limited.

Threat of New Entrance

Gufic Biosciences Limited has threat of some new entrance in the industry like Bicon, Glaxosmith, Johnson & Johnson, Tricon and Nicolas piramal.

There is lots of entry barrier to enter in this industry because you have need large capital investment, government law, Schedule – M –Plant facility for production which is approved by FDA, R&D, Product Licences from FDA with some research documents related production process, Testing method and Stability data, Minimum state GMP certificate for facility.

But if there is any firm already in pharmaceutical industry and they have all production facility & requirement for production. Once if they get product detail then they easily get licences for production of product and if company is well known like Glaxosmith, Johnson & Johnson, Cipla then there is a problem for Gufic Biosciences Ltd because they have proven market for their product and their product has brand value so they can easily get some market share of the firm.

New Entrance

Suppliers New Entrance

Industrial competitor

Intensity of Rivalry

Substitutes

Threat of New entrance

Threat of substitutes

Bargaining power of buyers

Bargaining power of buyers

Supplier bargaining power

Gufic Biosciences Limited has many suppliers for different items. Sometimes supplier raising price of the product or reduce the quality of product.

Last year crude oil price gone up at that time some suppliers which supplied petrochemical product they take high price for the product more than limit and it necessary for the firm to pay them that prices also when down the prices of crude oil by government but they didn’t reduce the price of material with government. They took old prices for times and told the buyer that they manufacture that lot from the old crude oil lot which they buy at high rate.

Sometimes they don’t raise the price but reduce the quality of product to earn higher profit. Gufic Biosciences Ltd buy packing material like fiber drum for final packing of product but in drum supplier use lower quality ring of metal in lead and bottom of drum or lower quality material in the manufacture and that ring get corrosion after few days or damage during transportation. When that drum received buy customer of firm sometimes they complain about the quality of drum because there may be a chance of contamination or return the lot of order.

Buyers bargaining power

In era of globalisation customer is god. They have strong bargaining power because if customer not buying your product then how firm can survive. buyer always required high quality of product at lower price.

Gufic biosciences have many powerful buyers like Johnson & Johnson, Glaxosmith, Cipla and Tricon they buying product in tonnes and they pay lots of money for that. Sometime they reduce the price of product which cost fixed by company. if company can’t reduce the price then they search for alternative and there are many company which produce same product which manufacture by the firm. So for that firm has compulsory reduced the price for product for their business. Also when the crude oil price going up at that time company increase the price of product but some buyers are not happy for that price and for continue the business with that buyer company has to sell its product with lower profit margin.

Substitute

Substitute products up grades the quality of product or differentiate but it will create problem for industry in earning and company can’t get possible growth. (Pears & Robinson, 2007)

Gufic Biosciences Limited has many products in bulk drugs division like Lidocaine, Lidocaine Hydrochloride, Miconazole, Miconazole nitrate, Econazole Nitrate, Isoconazole Nitrate, Ketoconazole, Diethyl Carbamiazene Citrate and Castrol oil. There are many substitutes for that product like Lidocaine, Lidocaine Hydrochloride are widely used as local anaesthetics and their substitute product is prilocaine

and prilocaine hydrochloride. Now a day’s prilocaine and prilocaine hydrochloride are use with Lidocaine, Lidocaine Hydrochloride to make effective anaesthetics. But prilocaine is very costly ,its cost around 18,000 rupees per kg. So it use in small quantity.

Also Miconazole, Miconazole Nitrate, Econazole Nitrate, Isoconazole Nitrate, Ketoconazole, Diethyl Carbamiazene Citrate are used as a antifungal and their substitute are Clotrimazole, flucanazole, Traconazole, Setraconazole, Terbinafine and they use for same purpose if some drugs has lower cost and it

Give same result which given by the firms product then it is difficult for firm to sell their antifungal product. There may be chance to lose business by firm.

3.3.3. Operational environment

Competitors

Indian pharmaceutical industry is very big industry. So there are many manufactures which are manufacturing same product. Due to that competitive environment created between them to capture market share, attract customer by producing and selling their product to buyer at lower cost than their competitors.

Gufic Biosciences Limited has main domestic competitors as below:

1. Mahrshree laboratories (p) ltd2. Hemdeep organic (p) ltd.3. Venus chemicals ltd4. Hindustan chemical and pharmaceuticals

5. Intra labs India pvt ltd6. Neptune chemicals7. Mesha pharma (p) ltd.8. Mahendra chemicals (p) ltd.

Firm has direct competion with above companies. The first company manufacture the antifungal which manufacture by the firm and its substitute which are not manufacture by the firm. Last two firms manufacture anaesthetics which manufacture by the firms.

Here some manufacturers are threatening for Gufic Biosciences Limited business.

1. Glaxosmith2. Cipla3. Tricon 4. Johnson & Johnson

There are lots of entry barrier to enter in pharmaceuticals industry but if firms are already in pharmaceutical industry then firm has just require product manufacturing process and license from FDA

to produce that product. Above all company has all facility and requirement for product remaining product process and licences of product but they can easily employee and person form the company which ahs full knowledge of product like manufacturing process, testing methods. They are biggest threaten to firm because every month they buy different product in tonnes. So if they produce these products by their own then they decrease the prices of product in which they use these product. And successfully compete with their competitor and capture the market share.

Creditors and suppliers

Gufic Biosciences Limited has many creditors. Firms mostly purchase items like raw material, packing material, equipment and maintenance items on credit.For raw material, packing material and maintenance item most of supplier give credit for one month and it very on the quantity of items. If the purchasing items are in large quantity then it may be very from one month to five or sixth month depends on the relation between firm and suppliers.Small suppliers give credit up to 15 days or maximum one month because they have limitation in terms of finance for operates their business.Firms have to pay 40 % or 50% advance to equipment suppliers. After that firm can pay other amount on instalment per month. Sometimes they give credit to firm up to 1 year but it also depends on the prices of equipment.

Customers

Gufic Biosciences Limited main customers are pharmaceutical industry which manufacture anaesthetics injection from lidocaine and lidocaine hydrochloride, antifungal cream and powder from Miconazole, Miconazole nitrate, Econazole Nitrate, Isoconazole Nitrate, Ketoconazole. And anthalmintic and cathartic product manufacturer.

Labour

There are around 80 labour works in Gufic Biosciences Limited Five manufacturing plant. From them 15 labours are company employees and salary paid them by company and other remaining labour works on contract basis and they get salary from their contractor. Both labour has their own unions. Those union put works demand against the company management regarding their rights, about salary and working hours.

But firm has to look at workers demand to make their production department strong.

3.4. Industrial analysis and strategic objectives

3.4.1. Internal analysis

For the internal analysis of Gufic Biosciences Limited use the swot analysis to identifies the strength and weakness of the firm and the environmental opportunity and strength facing by firm ( Pearce & robinson,2007)

Strength

Proven product Well established business from 38 years Skill employees

Weakness Old technology Limited product Poor marketing & communication

Opportunities Growing pharmaceutical industry Demand of pharmaceuticals Strength of US dollar

Threats New entrants Unsatisfied employees

To take the advantage of strengths and opportunities of situation, firm has to support an aggressive strategy. In that strategy firm has to increase their production of products and develop new product because pharmaceutical industry growing and in few years many drugs are going to become off patent in Europe and US so they can capture also the firm 80% product are export and US dollar become stronger so company can take advantage of these opportunities.

For weakness and oppurtunities, firm has to support turnaround oriented strategy. In these strategy firm has to introduce new technology increase the production and reduce the production cost. Also to take advantage of growing pharmaceutical industry firm has to develop substitutes of their product, and better communication for running firm success fully. firm manufacture Prilocaine and anybody don’t know about that and he search on web that how many manufacture in India which manufacture Prilocaine then one name come is Tricon not the firm name so firm has to improve their marketing to

put their product in good for sell and capture the new market because Prilocaine and other Isoconazole Nitrate are new drug in pharmaceutical industry.

For weakness and threats, firm has to support defensive strategy. In this strategy firm has to produce good quality of product with reduce production cost to compete with competitors and new entrants. Also they have to communicate with employees of the firm regarding their problem & facility. Pay them salary regularly on time so employees work with enthusiastically and honestly. And this thing helps firm lot in product because if employees get their salary on time then they give proper attention in process of manufacturing and other activity related firm.

For strengths and weakness, firm has to support a diversification strategy. In this strategy firm has to pay good salary to their employees or pay them on their work basis. Provide them facilities like transportation, bonus. So the skill employees don’t leave the company and that cause barrier for new entrants

3.4.2. Strategic Objective

From the internal analysis following evaluations leads to the choice of grand stategies ,long term onjectives and then on to short term actions ( pearce & robinson,2007). In the internal analysis there major four strategies and from thoes strategies agraasive stratgy is most favourable for the buisness having many strengths and oppurtunities and less threat and weakness.

This buisness have been growth since it established as a private firm and after that it become a limited liability company with the oppurtunity and strength in the present the buisness will be grow more in the next coming year.

The long term objective associated with internal analysis are.

Firm has to innovation new technology like Agitated Nutch Filter Dryer (ANFd) and Rotocon dryer.for their increase production of product to meet market requirment and use this technology they can reduce their production cost by reducing process time cycle , labour hours and increase the recovery of solvent.

Make effective marketiing for their new product like prilocaine & isoconazole nitrate .because these are new product in pharmaceutical market so there are very few manufacturer of this product and due to that they can eearn more profit on thoseproduct and capture the market.

3.5. Short term action palns

When the strategy have been decided and long term objective formulated then short term objective and action plans implemented by connectine long term objective in short term action and target . In this stage measurable outcomes acheivable or intended to be acheived in one year or less and the words becomes actions and actual doing of strategic managment begins (Pearce & Robinson,2007).

In this long term objective mark short term by cutting long portion of strategy in to small portion.

The short term objective associate with these long objectives are:

To improve in current system with introduce new technology like Agitated Nutch Filter Dryer and Rotary Vaccume Dryer and capturer market for new product like prilocaine and Isoconazole nitrate which are place in the buisness. This include the staff system. production site , marketing staff and client system by the end of the year 2010 – 2011 financial year.associate with this to get feed back on system that have been put in place and change if necesary .

This short term objective will involved conducting gap analysis on the situation. This system will be revewed every four month of the year.

This system that need to focus on :

1. Staff system2. Production site3. Marketing staff4. Client system

When the director and managment are satishfied with their addition and changes these should brought to the staff and they can get feed back and suggestion from them and they can feel that they are being included in the design of the system within the buisness.

Record the system is very importan task because if anything worst occures the buisness and which can quickly conducted as soon as possible so the something worst occures to the buisness can still operate smoothly.

Implemented new technology like Agitated Nutch Filter Dryer (ANFd) and Rotary Vacuum Dryer and capture market for their new product like Prilocaine & Isoconazole Nitrate also current running product for the 2010 – 2011 financial year.

The implementation of new technology and aggrassive marketing of their current running product and new product will bring a change in the way that buisness deals with their present situation and market position.

New technology are available from N.H.Engineers – vapi,gujarat – india.due to this technology they can reduce the time cycle of the product process with increase the solvent recovery also reduce in the labour hours and power consumption which decrease the product manufacturing cost with zero contamination. Also agressive marketing for their present product and new product through wed, giving add in news paper , pharmaceutical magazine & yellow page also display their product in science fair and pharmaceutical fair.

The new technologys are require short time for implementation like 10 day for errection and 15 days for training of production staff and workers regarding the operation of technology for using these technology effectively.

Firm has to put their target first for the year of 2010 – 2011 to be revise and added for every four month of the year .

Each year their production target and marketing target should be set for the next year .and firm has to looking their buisness environment to see if they have been correct in predicting the coming years and then add to the predection to one more year.

Firm has to need aet their target in the starting of yaer 2010. For the 2011 -2012 and 2012 – 2013 financial years as well as design a target for the year 2010 – 2011.

Firm has to set target as below:

2010 – 2011 financial year

Firm has to increase their up to 15 % of all present running product with increase solvent recovery up to 20 – 25 % also reducing labour force up to 20% and decrase production cost 10% and selling their new product like prilocaine 500 kga and isoconazole Nitrate 1000 kgs.

2011 – 2012 finacial year

Increase the production of their product up to 20% with keeping solvent recovery ,labour force and prodcution cost same as financial year 2010 – 2011. And increase the selling of new product, prilocaine 750 kga and isoconazole Nitrate 1500 kgs.

2012 – 2013 financial year

Increase the production of their product up to 30% with decrese the total production cost 15% and labour force up to 25 – 30%. And increase the selling of new product prilocaine 1000 kga and isoconazole Nitrate 2000 kgs.

They have to implented new technology in the beginning of the year 2010 and after the implenetation of technology they can get back their money of technology in 1 – 1.5 year so they can buy same technology for their production. Also they have to start agressive marketing for their present running product and new product to take the advantage of growing pharmaceutical market world and current government favourable policy towards the pharmaceutical industry in india through through wed, giving

add in news paper , pharmaceutical magazine & yellow page also display their product in science fair and pharmaceutical fair.

Firm has to provide free sample of 5 – 10 gm with physical & effectiveness data of drugs and testing results and of their new product to their present existing client and new client which really help in the selling of new product.

Firm has to also see the legislation regarding Food & Drugs , Environment & safety and Labour related. And firm must have to change their facilities related to production and managment with changing goverment regulation and to meet the goverment requirment and create the good impression on their client that their facility is good for production quality of product.

3.6. Functional tactics

It is the detailed statment of the activity that will be used by company to acheive short term objective & established competative advatage. It support the buisness strategy and help to accomplised strategic objective. (Pearce & Robinson, 2007).

The buisness Gufic Biosciences Limited has many functional tactics that are associaated with short term objective.

The difference betwwen action plan and tactics is the fact that tactics are more in the depth with a horizon, specific details and they name the participant who developed them. It is very essential to implement the buisness strategy .this classified the buisness strategy ,giving specific ,short term guidance to operate manager and employees in the marketing ,operation and finance (Pearce & Robinson, 2007).

3.6.1. Project Schedule

Physical implementation of new technology and aggrassive marketing for present and new product it takes time because when they implemets the new technology they have to giving training to their production staff and workers who are affected by this new technology also when they have to start agrassive marketing it take time to creat web, giving add in news paper ,pharmaceutical magazine & yellow pages also sending free sample to client.

For the short term action plan of improving present production facility with introduction new technology and market position by upgradind effective marketing which are in place or need to introduce the buisness.. the following action plan need to put in place

Task Person responsibility Deadline / time

Review of present buisness position Mr.J.P.Chokshi July – august ,2009

Analysis the present production & marketing system

Dr.Dhapalpur & Mr.S.Swamy

August – september,2009

Accept the lacking of present system & system that need to do

Mr.J.P.Chokshi & Dr.Dhapalpur

November – december ,2009

Introducing new technology & agrassive marketing for the present & new product

Dr.Dhapalpur & Mr.S.Swamy

January ,2010

When the new technology implemented at that time it takes 10 days to errection and around 15 of traning to production staff and workes regarding the operation facility of new technology and new marketing way take aroung one month for agrassive marketing of new product and present running product.

To implementing new technology at the begining of the year 2010.

Task Person resposibility Deadline/time

Getting quotation from N.H. Engineers (P) Ltd

Mr.S.Swamy November ,2009

Confirm purchase of new technology with N.H. Engineers (P) Ltd

Mr.S.Swamy November - december ,2009

Implemetation of new technology N.H. Engineers (P) Ltd At the end of december - 2009

15 days training to production staff & workers

Mr.S.Swamy January - 2010

Continue training to new employess

Sr.Executive Production

When the new technology implementd buisness will grow by increase production with reducing the production cost also with reducing labour force & power consumption and they can easily meet the market requirment.

Form the begining of the year 2010 when the new technology implemented and the agrassive marketing with new way of marketing for their present & new product . the firm has to collect feed back about the plan for every four month so that the director and managment can get the feed back about the plan and they can make necessary change if the plan not working as per their prediction about the buisness.

Task Person resposibility Deadline/time

Review the present buisness position after implementation of plan

Mr.J.P.Chokshi May 2010

Interview with production staff and marketion staff who are affected by this plan

Dr.Dhapalpur & Mr.S.Swamy

Everymonth of year

Collection the production data of products and marketing sells data of product

Dr.Dhapalpur &Mr. S.Swamy

At the end of month april 2010

Action to change /added system to buisness

Mr.J.P.Chokshi & Dr.Dhapalpur May 2010

Also highlighted in internal analysis that firm employees are not satishfy with current managment system. so firm has to immidiatly arrange meeting with staff and solve their problen regarding salary, facility and other things before they left the firm and join their comptitor firm.

Task Person responsibility Deadline / time

Meeting with firm’s employees Miss. Manisha Immidiatly

Solving their problem Miss. Manisha Immidiatly

Regular salary Miss. Manisha In the first week of every month

3.6.2. Project budget

The budget of the plan revolve around the implementation of new technology and marketing with different way.

Implementation of new technology will not take long time but they have to confirm the purchase of new technology 6 week ago before the implementation.marketing with new way take around one month because contact web designer ,news paper ,pharmaceutical magazine and publisher take time.

The approximate costing of plan below as the buisness require for implement

Budget : strategic plan of Gufic Biosciences Limited

Items Cost ( in indian rupees)

1. New technology

Agitated nutch filter dryer12,00,000

Rotary vacuum dryer 8,00,000

2. Marketing

Advertisment in yellow page 10,000

Advertisment in news paper 15,000

Advertisment in pharmaceutical magazine 10,000

Free sample to client

Total project cost ( in indian rupees) 20,35,000

3.6.3. Project manage and delegation authority

When the plan implemente in Gufic Biosciemces Limited ,Mr.S.Swamy responsibility to look over the production of product and production related facility like new technology and other technology break down maintence and regular meeting with staff. Dr.Dhapalapur has also look over the production acitivity and collect data on the time of interval but he also responsible for the marketing of new product and present running product of the firm.

3.6.4. How will success be measured?

When the plan implement ,it will be success if the buisness met the following criteria related to plan and facility.

Deadline of plan implement met Every four month get the feed back of the system and change can be made if necessary. Increase the production to meet the market requirment but also increase the marketing of

product to get more market Every month held meeting with production staff and marketing staff and discuss about their

current position and get idea from them Always looking over changing government legislation and make change related to that

legislation.

3.7. Operational

When the strategic plan implement at that time managment affected on major extent but staff not affected at major extent.this makes the operational side of this plan very short.

For the operation side,when the new technology introduce at that time staff require training to operate the technology so those can use that technology effectively for the production purpose.

Presently gudic biosciences limited has many problem in their production site and marketing site. Sometimes they can’t able to deliver the goods on the time of delivery or they can’t take more order for their product because of previous pending orderr and the firm has to loose it customer. Aslo firm’s marketing deparment is very poor ,they have new product which is recently introduc in the market so they can earn good profit on those product and capture market for those product because of there are on few manufacture of those product in market. So Dr.Dhapalpur and Mr.S.Swamy are resposible for the implementation of plan.

When the plan implemented, they should aim to keep within allocated time for each tactics and try to stay within the deadline because if they miss one tactics with distrub the other tactics and they can’t complete the plan on time. So whole team have to try complete plan on time and they can get the benefit of the plan.

The managment team will also have to held regular meeting withproduction and marketing staff and discuss about the plan and get idea from them related to plan which help them to make implemeted plan more effectively.

Throughout the implemetation of this plan managment has to collect data regarding plan at every four months of year and look over the plan it work smootly or not and their prediction going on right way or not. If necessry then they can make change in their prediction but they have to stay deadline of plan at the end of year.

4. Conclusion

Gufic Biosciences Limited is well established organisation. Presently firm operated as limited liability company from the private organisation. This firm mainly working with bulk drugs and pharmaceutical product.

This firm can grow rapidly in next few year as per the increaseing demand of pharmaceutical in indian domestic market and in international market. Also presently indian goverment support very much to indian pahrmaceutical industry to grow and resist the foreign company expansion in india.

The firm has good production facility for for all their product and they can manufacture those product with almost zero contamination. The firm has also high skill employees whi are working with firm from the many years whic hhelp the firm grow well in internal perspective.

The firm has good relation with creditors and suppliers and they have to maintaint that relation in futture for smooth operation of firm. Also firm must have to aware from the changing legsilation of goverment and from new entrance because they can harm firm lot.

Presently firm has good oppurtunity because firm manufacture products and subtitues also so firm can capture good market for its product as well as internal strength support the use of concentrated growth strategic grand strategy.

The long term objectives associated with grand strategy are:

Firm has to innovation new technology like Agitated Nutch Filter Dryer (ANFd) and Rotocon dryer.for their increase production of product to meet market requirment and use this technology they can reduce their production cost by reducing process time cycle , labour hours and increase the recovery of solvent.

Make effective marketiing for their new product like prilocaine & isoconazole nitrate .because these are new product in pharmaceutical market so there are very few manufacturer of this product and due to that they can earn more profit on those product and capture the market.

These will be implemente over the next one – three year.

The short terrm plan which are measureble outcomes acheivable or intended to be achieve in one year or less .in this firm has to simply increase the production and marketing for its products to capture market.

The function tactics associated with these plan shows who is resposible for what and when it is to be completed.

In implement of plan Mr.S.Swamy is responsible for look over the implementation of new technology, giving training related to new technology to production staff and regular meeting with staff..and Dr.Dhapalapur is responsible for agraasive marketing for firms new product and present running

product also he look over the production activity with new technology and collect data of it at every four month of year.

This plan implement at Gufic Biosciences Limited uses managment resource also production and marketing staff are affected littely regarding new technology and new way of marketing.

Appendix

References

1. Strategic plan (2006), Darrell Trigg Builders Ltd by Rachel Kemp2. Book: Strategic Management (2007) by Pearce & Robinson3. site master file (2008) – Gufic Biosciences Limited , India4. clivec reading ,20055. Information given regarding company products substitutes, company’s

competitors and new entrance by Mr.N.L.Mistry (Sr.Executive Production and R& D In charge) – Gufic Biosciences Limited , India

6. Discuss of assignment problem and guidance given by Dr. Albert van Aardt7. Growth of Indian pharmaceutical industry

http://www.dbresearch.com/PROD/DBR_INTERNET_EN-PROD/PROD0000000000224095.pdf

8. Graph of Indian Rupees v/s US dollar

http://www.blonnet.com/forex/usd.htm

9. Graph of crude oil prices from the year of 2008 to 2009

http://www.wtrg.com/daily/clfclose.gif

10.Indian government law regarding Indian pharmaceutical industry

http://sethassociates.com/food_and_drug_industry_in_india.php

11.Environment law for Indian industry made by Indian government http://envfor.nic.in/divisions/ic/wssd/doc2/ch2.html

12.Information of Indian pharmaceutical industryhttp://pharmainfo.net/namanm/role-pharmaceutical-industry-india.gdp http://www.medicalnewstoday.com/artocles/25348.phphttp://www.dbresearch.com/PROD/DBR_INTERNET_EN-PROD/PROD0000000000224095.pdf

13.Indian pharmaceutical industry swot analysis

http://equitymaster.com/DETAIL.ASP?Story=5&date=6/21/2004