ANNA AT AESCH AG: LATERAL CHANGE INITIATIVE Case Solution & Answer

Anna At Aesch AG: Lateral Change Initiative Case Study Analysis

Case Overview

Aesch AG is the larger provider of medical devices in the health care industry. Anna Frisch works as a marketing director whose responsibility is toidentify the major changes in the German health care industry, which have influenced Aesch AG to change its approach towards its customers. Instead of focusing on the particular requirements of specialists inthe clinics; Aesch ought to address the new chiefs: CIOs, CFOs, and CEOs of the healthcare centers, who have an alternate buying rationale. Anna Frisch wanted to persuade the head of the marketing department on the organization matrix, to change the business of different products. She easily convinced her colleagues and preferred C-level marketing in the organization. However, when the work wassupposed to begin; Anna realized that the responsibilities were not as strong as she expected them to be. After a few weeks, she was informed that there wouldn’t be any support for her.

Problem Statement

Anna Frisch wants to initiate a change in the organization, but there is a lack of support to her as the top management has decided to not introduce any change in the organization. This case study’sanalysis is based on Anna’s realization of failure in her initial change, and what plans should she make to possibly understand the area of improvement. And, also inquiring the reasons behind her plan’s failure. The problem statement is that why the change in theorganization is not impending and will that initiative be further processed or not and what would be Anna’s take on that.

Situation Analysis

German Health Care System

German health care industry is growing day by day, with generous economization. Germany’s estimated expenditure on its medical devices is $11.8 billion and it hasa share of 6% of the total world. Germany is the third-largest market for medical devices, with 400,000 products of various kinds. The German market is like a battlefield and all the business players havea strong position in the market, but the healthcare market is the most competitive market among all.

Many challenges arebeing faced by the German health care system. While the government pays for all of the medical services; the out-of-pocket cost of health care is significantly higher among lower-income households. The country’s monetary crisis has also impacted its healthcare budget. In addition, the lack of medical supplies has weakened the capacity of the public health system to provide basic health facilities. But in 2004, the government brought reforms tothe health care system, which createda strong impact on the overall German market. Previously, the clinicians were involved in the decision-making, as the purchase of equipment was initiated by them.

SWOT Analysis

Strengths

• The business has a strong history in the development and the German market is leading in the health care industry.
• It has a strong brand name and gives value to the customers. Customers haveagood brand perception in mind.
• The sales and profit margins of Aesch AG are growing positively every year.
• It has good distribution channels, and its relationship with the vendors is very strong.
• Invests highly in the marketing department and research and development.
• It has a strong history in the innovation of medical care products.

Weaknesses

• Aesch AG is lacking in communication between the heads of departments.
• Resistant towards the change and avoids taking suitable steps for the organizational development.
• Aesch AG has a lack of literal change based decision making, and middle VP’s has different perspectives on decision making.
• There is an intense competition in the market. The USA and Japan are leading the market, and Germany is considered as a battlefield in the healthcare market. Due to this, Aesch AG is facing an increased amount of external pressure to compete with them.

Opportunities

• Changing demands of the customers and market trends create an opportunity for Aesch AG to make its operations dynamic and to change its organization structure.
• New health care devices are demanded by the customers as health issues are increasing.
• Use of advanced technology in manufacturing the products.
• The organization has an opportunity to focus on the modification which was suggested by Anne Frisch.
• Adopt the change in the organizational culture to improve communication.

Threats

• Government regulations and new reforms in the German market canposea threat to the healthcare centers and health care devices’ manufacturers.
• Multiple competitors are entering the market with huge potential and competitive advantages.
• New strategies ofimitation in the organization can create new problems for the existing customers’ perceptions……………

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