Global Markets Social Enterprise Policies

Question: Discuss about the Global Markets for Social Enterprise Policies. Answer: Introduction The Australian Pharmaceuticals market is the largest in terms of volume and products. The Australian Pharmaceuticals industry is a major high tech industry which exports $ 3.89 billion products in 2012-2013 (www.drug-dev.com, 2016). It has been observed that the industry is currently employed 15, 463 people in the manufacturing sector (Akomea and Yeboah, 2011). The Australian market has spent $404 million on the production and RD department in 2011-2012. According to the opinion of Basta (2011), the pharmaceuticals industry has received $7.1 billion from the Pharmaceuticals Benefits Scheme (PBS) sales. As per the latest survey report, the pharmaceuticals sector of Australia is valued at $22.7 billion in 2013. In the opinion of Demirel and Mazzucato (2010), it is expected that the growth rate of the pharmaceuticals industry would increase at a compound annual growth rate (CAGR) of 5.1% to $ 32.1 billion by the year of 2020. It is estimated that the countrys medical device market would be reached to $10.4 billion by the end of the projected period. Considering the opinion of Kyle (2006), the Pharmaceuticals Benefits Scheme (PBS) component of the Australian market provides access to a cost-effective prescription medicine. One of the major factors driving growth in Australia pharmaceuticals market includes the increasing elderly population and the related disease burden. Supporting this, Fails (2014) added that the rising predominance, defined the regulatory guidelines and the non-communicable disease are the other factors for the fastest development of the Australian pharmaceuticals industry. The current study attempts to analyse the current proposition of an Australian Pharmaceutical firm named, Mayne Pharma Group Limited (Mayne Pharma) which is going to penetrate into the market of South Africa and China to expand the global market presence. Background of the Company The Australian healthcare market is driving to grow at an impressive rate by 42.5 billion by the year of 2020 (www.industry.gov.au, 2016). According to the research and survey report from GlobalData, the Australian Pharmaceuticals industry has good access to provide widespread healthcare coverage and the other services such as government-subsidized medicines. The chosen firm, Mayne Pharma Group Limited (Mayne Pharma) is an ASX listed pharmaceuticals firm in Australia. The company is focused on its frug delivery process to the expertise of commercial brands and the other generic pharmaceuticals (Friedrich, 2007). The company, Mayne Pharma was initially traced to FH Faulding and Co, for several years. It is one of the most famous public companies headquartered in South Australia (www.maynepharma.com, 2016). The facility of 12,000m2 in Salisbury, South Australia has assisted the firm to develop the products with appropriate clinical trial stages and final formulation (www.maynepharma.co m, 2016). In the addition, the chosen firm Mayne Pharma is a technology driven company having a significant product portfolio and pipeline. As per the view of Lund (2006), the business of the firm is supported by almost 600 staffs globally and more than 180 scientists have employed also. Currently, the company has more than 125 clients worldwide. The suitable validation, registering process and the proper packaging of goods through the right commercial scale has enhanced laboratory efficacy. Furthermore, the firm has almost 30-year track record of product innovation and best formulation development process to establish sustainable market position globally. Analysis of risks and challenges Evaluation of Commercial Risks India is one of the largest export marketers of Australia for gold, copper, ores, etc. It has been observed that Indian investment in Australia is growing in terms of every business domain. Thus, it could be stated that the commercial relationship between these two countries is favourable for an Australian company to expand the business structure in India. On the other, the Brazilian has a large choice of trustworthy and qualified sales agents, although, the agents are not seeking to find new exporters for developing the market presence. Adding to this, the special focus on earning maximum US dollars have minimised the chances of other countries investments in Brazil market (Ma and Pope, 2008). However, China and Australia are the largest trading partners for each other. Thus, the Australian company could easily grab the market of China. In a case of Russian countries, it has been found that the Australia and Russia are already engaged in some international dealings. The students from both the countries can apply in different universities of those countries. In this present scenario, it can be cited that Russia has the optimum opportunities to attract the foreign investors. However, Sobolev and Harvey (2016) argued that the regulations implemented in Russia and the pre-existing barriers for the foreign countries business expansion could be a challenging situation for the Australian firm. Evaluation of Currency (Financial) Risks It has been observed that Brazil is more concerned about earning more US dollars through the business of imports and exports. Therefore, this country would not be interested in making any currency trade agreement with Australia (Akomea and Yeboah, 2011). Additionally, Russia is one of the giant countries across the world in terms of power, people and financial stability. Recently it has been identified that Australian dollars have been dropped in Russia and India. In the current scenario, Friedrich (2007) mentioned that penetration in the Russian and Indian market would not be beneficial enough for Mayne Pharma in this specific situation. On the other hand, China has made a currency trade agreement with Australia to increase the economic engagement. Demirel and Mazzucato (2010) argued that low currency value can be the obstruction for Australian company while expanding the business in China. Since the growing exchange between Chian and Australia can be helpful for Australian firm to minimise the currency issues while operating in China Evaluation of Country Risks It has been observed that the harmful and unstable political system of Brazil can be one of the major threats for the Australian Pharmaceutical firm while expounding the business in the specific country. According to the view of Fails (2014), the inadequate and underdeveloped legal system of India can be the problem for Australian business firm. In this context, corruption and the other unethical blunders could be raised issues for the foreign business organisation to enhance the market operation. Adding to this, it has been observed that the government intervention, legal barriers and protectionism of Russian countries can be the intimidation for the Australian pharmaceuticals firm to enlarge the foreign country operations (Akomea and Yeboah, 2011). However, the laws and regulations available in China could be friendlier for the foreign countries to expand the business unit in China. Hence, it could be inferred that the political mismanagement can be the main pressure for the Austra lian pharmaceuticals company to increase the global business operations. Evaluation of Cross-Cultural Risks The cultural environment varies across the countries depending on the different values, ideas, symbols, attitudes and behaviours. In the opinion of Basta (2011), the issues of cross-cultural risks are very difficult to identify rather than the political, economical and legal risks. In the context of cross-cultural norms the country Australia is individualistic and has a greater emphasis on the employees independence. However, the India and China follows the collectivistic process across the workplace. For an example, the seller of any products may not be successful while selling products in Australia by creating emotions and feelings for the families. However, the majority of the Chinese and Indians can be influenced by the sales boy if urging to buy gift for the families and relatives (Sobolev and Harvey, 2016). Adding to this, it has been expected that Australia has low context communication culture and has a direct and logical inference. On the other hand, Lund (2006) argued that Brazil has a high context communication culture and follows huge implications to understand anything. For an instance, Ma and Pope (2008) stated that the Australian people are very straightforward having self-expression and individual attitude on a piece of matter. Whereas, the Brazilians gave value to the collective face and avoid embarrassment. Furthermore, power distance culture between Australia and Russia is very much different from making a deal in conflicting situation. Thus, it could be deduced that the different cultural issues could be the primary reason for weakening the global business expansion. According to the opinion of Fails (2014), as every country has different ethnocentric orientation for judging and standardising, so that the chosen firm, Mayne Pharma can face the situation of business failure. Justification for the selected destination country The growth prospect of China The value of Chinas pharmaceutical market has been estimated to $83.3 billion in the year 2013, and the revenue margin is also expected to grow by 6.3% of CAGR by 2018 (www2.deloitte.com, 2016). The statistics of 2016 reflects that the value of pharma in China is more than that of Japan. Over the past 24 months, China has rapidly accelerated into the development of the life science and the health care segment. In the context of the above content, Adam and Johnson (2006) mentioned that the rising trend in the pharmaceutical industry is continuously growing due to the persistent support of the government in the health care supply and demand. As per the report of the GlobalData publications, the market value of the Chinas drugs will jump up to 650% by 2020. Cho and Kim (2013) figured out that in the previous year the market value of Chinas drugs was $48 billion, however, by 2020; the marketers are depicting the value to increase up to the range of $315 billion. The primary advantage of Myne Pharma is its diversified product ranges. Therefore, the products that receive the minimal recognition in the existing market would receive a huge exposure in the Chinese market. Davari et al. (2011) mentioned that there might be a possibility where the certain products might fail to tap into the market. In that case, the trading actions are considerably high in China. Therefore, the less demanded products can be easily exported to the prospective regions for further exposure. Growth prospect of South Africa In the framework of the present context, Hernandez (2015) determined that the pharmaceutical market in South Africa is the largest in the Sub-Saharan Africa. The market value of the present region has developed with all lucrative policies, which led the region of increase its margin up to $3.9 billion in 2013 (www.mckinsey.com, 2016). However, the present records signify that the revenue growth moved in the constrained motion due to the governmental price regulations policy, which reflected o n the slowing economic growth and the subsequent poor purchasing power of the population. Iizuka (2009) asserted that the trend is continuing from 2014 and is estimated to continue till 2018. The pharmaceutical market is anticipated to grow by an average of 6% in each year. The total value comes up to a figure of $5.1 billion. On the contrary, Lund (2006) mentioned that the growth rate is estimated to jump up to S66.5 billion by 2020. Figure 1: The estimate growth rate of South African pharmaceutical market (Source: bsdb) According to the report of the World Bank, between the period of 2005 to 2012, Africa has managed to capture 70,000 new hospital beds, a total number of 16,000 doctors and 60,000 nurses. The cumulative summation comes up to 1,050,000 beds, 1,250,000 nurses and 498,370 doctors (Rivera and Oh, 2013). The region has also expanded in its healthcare provision and managed to become more competent and flexible via the initiatives like the switch to expert nurse anaesthetists in Mozambique, the involvement of the anti-retroviral drug therapy in South Africa. Comparing the market scenario of China and South Africa, an inference can be drawn that the Chinese market is more prospective for Myne Pharma. The South African market is still on the verge of developing. Therefore, the brand might incur severe risk initiation within the region. Thus, the Chinese market would be the most suitable for the brand to penetrate. Discussion about the proposed entry, marketing and human resource strategy Joint research analytics with the players and the providers The management of Myne Pharma needs to take the initiatives of suggesting the idea of conducting a joint research analytics with the pharmaceutical leaders and the providers. In the initial stage, the enterprise would be a supporting entity that can assist with the adequate information regarding the pharmaceutical industry. In the circumstance of the above scenario Rudholm (2008) determined that the above action can lead the enterprise to pitch the individual product lines and the service criteria estimated towards the Chinese market. Lucrative through can help the organisation to receive the joint venture proposals from the leading Giants (www.mckinsey.com, 2016). Moreover, the management can get sufficient networking with the service providers, which help the enterprise to increase its product availability in the Chinese market. Prioritising the sales with the digital selling team It is important for the pharmaceutical organisations to improve its product accessibility amongst t eh target audience (www.mckinsey.com, 2016). I n the majority of the times the customers are unaware of the products that are required to cure the disease. Therefore, Myne Pharma needs to create its individual application through which the customers can get find out the severity of the diseases and can receive the suggestions of the curable medicines (www2.deloitte.com, 2016). Therefore, particular sales representative needs to be placed in the digital division, where the executives can track the viewer's registration details that have immediately viewed the site. Based on which the salesperson can direct the victim towards the nearby physicians. The specific action can increase the brand exposure amongst the target audience and the pharmaceutical retailers. Personalising the communication patter to the physicians As per the opinion of States (2010), the one-size-fits-all approach hardly works for any of the industry. However, the specific communication pattern works for the physicians who prefer taking the face-to-face meetings and provide the inundated information. Therefore, the marketing unit of the enterprise requires being careful and productive with the choice of words. The proposal to the physicians needs to be productive, which ensures a quick recovery for the patients. According to Greenberg et al. (2013), the pharmaceutical market in China is highly driven to the health-centric actions. Therefore, the marketing executive needs to be complete product knowledge and its differentiation power from the other relative products. Such an action would help the enterprise to convince the physicians to have a direct tie-up. Training and development module for the employees The training and development would be highly required to spread the awareness regarding the Chinese culture amongst the internal employees. Considering the opinion of Cho and Kim (2013) inference can be drawn that the management requires appointing a training expert from China to understand the accurate service demands the population of China demands from the pharmaceutical enterprise. The existing employee might not be aware of the Chinese culture. Therefore, the operational style might contradict the demand service nature of the region. Therefore, effective training would be provided to the existing as well as the Chinese employees to increase the productivity. Moreover, Cho and Kim (2013) asserted that the Chinese culture highly emphasises on the flexible work culture and the employee's employee satisfaction. Therefore, the trainers require enlightening the management as well as the existing employees to increase the employee happy mode within the workplace to increase the employe e relaxation criteria. New compensation policy for the existing employees Certain numbers of the staffs need to be transferred to the Chinese branch in order t o proceed with the operation. Especially the back end team looks are the functional criteria. Therefore, it is necessary for the management to transfer certain back end experts to the Chinese branch. (Davari et al. 2011). Moreover, the compensation policy for the specific set of the internal members required being improved as a part of the motivation. The increment in the compensation margin would enact to be a motivation for the employees to sustain the overseas transfer (States, 2010). The employees working in the comfort area, therefore, a sudden change in the geographical areas often increase the job insecurities amongst the employees. This finally leads to the reluctant employee attitude. Therefore, improvement in the compensation policy often helps the employee to increase the enthusiasm and rise on the bar of responsibilities. Recruiting the sales force from the Chinese market Sales are equivalent to the communication methods. Therefore, it is highly essential for the enterprise to hire the Chinese candidate for the sales profile. According to Cho and Kim (2013), the sales executives require having fluent communication skills in the local language. Therefore, the particular approach would be an equal benefit to Myne Pharma to increase its revenue and sales figure. The Chinese sales representatives need to have a through products knowledge, and the rest of the actions like pitching the products to the pharmaceutical retailers and communication with the physician would be excessively easy (States, 2010). Moreover, the employees would be aware of the domestic culture, by which the product lines would be pitched before the target prospects. Drugs that are individually invented by enterprise needs to use price controls reach in the fewer markets. The strategy needs to introduce with longer delays than the product lines that originate in the regions without any price control. According to Cho and Kim (2013), companies have the tendency of delaying the launch into the price-controlled markets and are fewer likely to pioneer the products in new markets after its penetration with low prices. Therefore the control cost initiatives would be the best suitable proposed entry policy for Myne Pharma in the Chinese market. Conclusion The primary assertion of the study indicates that an Australian Company named Mayne Pharma is going to penetrate in the market of South Africa and China. While conducting the research, the risk and challenges like Commercial Risks, Currency (Financial) Risks, Country Risks and Cross-Cultural Risks have been critically analysed to justify the selected destination like South Africa and China for introducing the new business operation. It has been identified that Brazil, Russia and India have several challenging environments for attracting more foreign investors in the respective country. Furthermore, after analysing entire research, it could be inferred that China is the suitable market rather than the other countries for expanding the business unit of Mayne Pharma. Moreover, recruiting the sales force from the Chinese market and the joint research analytics with the players and the providers would be the best integral options for the chosen firm to grab the Chinese marketplace easily. References: Adam, S. and Johnson, T. (2006) Social enterprise: At the crossroads of market, public policies and civil society. Edited by Marthe Nyssens. 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