McKesson Case Solution & Answer

McKesson Case Solution

In this case, Rheumatologist’s average earnings are far higher as revenue and cost do not have much difference in percentage therefore, it is not easy for competitors to enter or they will be themselves reluctant.

Gastroenterologists’ cannotbe substituted easily whereas, Orthopaedics are similar to rheumatologists in terms of their type, as they do not possess any threat of entrance. It is expected that US government has establish a compensation policy and many other procedures in order to protect the patients therefore there are stringent policies from the US government which could be a significant barrier for the new entrants of

Threat of Substitutes

It is expected that Primary care could be substituted easily for their demand and speciality.

Rheumatologists’patientscan switch based on the technology they use and the availability.

The demand for Gastroenterologists is high however;there are no substitutecustomers and they cannot go to other specialists.Whereas,orthopaedics are of similar nature with rheumatologists being able to be substitutedhowever, over all there is a need of increase in performance and top of that as discussed earlier in the beginning, technology plays an important role in this industry, thus the threat of substitutes is high with respect to the Primary Care, Orthopedics, Rheumatologists and Gastroenterologists.

Swot Analysis

 

Strength	Importance	Rating	Relative/S
Brand image is thestrength as being a huge distributor of drugs therefore;this strength couldbe used in promotional material for Primary Care, Orthopedics, Rheumatology and Gastroenterology.	1	0.1	.1
It is expected that the percentage of revenue in Primary Care, Orthopedics, and Rheumatology and Gastroenterology segment is high which a great strength is also.	2	0.05	.15
Physicians of Primary Care, Orthopedics, Rheumatology and Gastroenterology could use Facebook and Twitter for recruitment process as social media is a good way of advertising.	3	0.01	.23
High liquidity is one of the strength and enables McKesson to support its existingPrimary Care, Orthopedics, Rheumatology and Gastroenterology opportunities with own resource.	4	0.01	.25

Weakness	Importance	Rating	Relative/S
·         Operating leverages is immense which is not good when the economic system is not strong which could be a significant weakness for Primary Care, Orthopedics, Rheumatology and Gastroenterology segments.	1	0.9	.19
·         IT plays an important role. Moreover, in this era of internet everything becoming electronic and automatic and those drug dealers who are using electronic resources are easily bypassing competitors and the physicians of Primary Care, Orthopedics, Rheumatology and Gastroenterology should play a special attention with this respect.	2	0.6	.25

Opportunity	Importance	Rating	Relative/S
·         Price is always great factorin terms of competition and McKesson can attract new customers by introducing some economical services with respect to Primary Care, Orthopedics, Rheumatology and Gastroenterology segments.	1	0.11	.11
·         Other governmental and non-governmental medical aidsarean opportunity to increase market share with respect to Primary Care, Orthopedics, Rheumatology and Gastroenterology.	2	0.1	.21
·         In the same way, other medical trusts which are based on their research expect that there is increase in medical patients every day	3	0.01	.25

Threat	Importance	Rating	Relative/S
·         Existing lawful problems are a major threat with respect toPrimary Care, Orthopedics, Rheumatology and Gastroenterology segments.	1	0.1	.1
·         Similarly coping to the dynamic nature of restrictions posed by governments this has led tohazards as well as sometimesexpenses increase.	2	0.1	.2

In light of these problems,it could be concluded that Primary Care, Orthopedics, Rheumatology and Gastroenterology segments have many strengths with some limitations and challenges…………….

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