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Macroeconomic Forecast Pfizer, Inc. Abstract This paper is a Macroeconomic Forecast Outline of Pfizer, Inc. This outline will identify main economic indicators for Pfizer as a business entity and as a representative of pharmaceutical industry. This paper will identify sources of various data collected based on economical activity and relationships between different economical indicators. Main Economic Indicators The purpose of economic indicators is to provide for researchers and analysts the ability to interpreter economic data. Economic indicators are the main source of prediction of market behavior. They are also detailed explanations of how to analyze various changes over a business cycle. There are very many different economic indicators that are used to analyze economic activity of a company, industry, country, or region. There are three different general trends (directions for prices or rates) in the economy. "Those with predictive value are leading indicators; those occurring at the same time as the related economic activity are coincident indicators; and those that only become apparent after the activity are lagging indicators. Examples are unemployment, housing starts, Consumer Price Index, industrial production, bankruptcies, GDP, stock market prices, money supply changes, and housing starts also called business indicators." (http://www.investorwords.com/1643/economic_indicator.html) This paper analyzes the main economic indicators related specifically to one of the largest pharmaceutical company Pfizer, Inc such as overall performance, revenue, net income, research and development, cost and expenses. There are certain economic indicators that do not apply to individual companies, but influence their economical forecasts. Such factors as inflation and unemployment rate pertain to an industry or region and such factors as political instability or any force major conditions will affect the market analyses even they are not an economic indicators. There are many more factors that affect economic predictions and their detailed analyses are presented in http://www.economic-indicators.com, web site for tracking US economy. Overall performance is always one of the most important indicators of economic activity and every financial report starts with results of annual performance. Performance is "The results of activities of an organization or investment over a given period of time. " (http://www.investorwords.com/3665/performance.html) The performance usually includes the information for a current period as well as comparisons with other similar periods. Pfizer's 2004 financial report include the following highlights: Total revenues increased 17% to $52.5 billion in 2004 and39% to $44.7 billion in 2003, primarily due to the acquisition of Pharmacia Corporation (Pharmacia) on April 16, 2003, the impact of foreign exchange and strong product performance Net income increased to $11.
Smith & Brown currently use Budgets and review meetings to measure performance and short-term financial targets to drive performance. Budgets use conventional performance measures which are focused on financial aspects where it seeks to explain the financial consequences of actions and decisions through the use of variance analysis, but it can not identify the causes or the source of bad financial performance. However, non-financial information has proven to address this problem, and has been incorporated in the balanced scorecard to help businesses measure its performance more effectively by providing management with information about what could be causing inefficiency in the production cycle and what could be the source of bad performance
There are many ways to analyze the performance of a company, some more popular than others. According to the Barney text the accounting method is the most popular way of measuring a firm's performance (Barney, 2002). Some of the reasons for the popularity could include the fact that accounting measures of performance are publicly available on many firms and they communicate a great deal of information about a firm's operations. Other methods of performance analysis include firm survival and the multiple stakeholder approach.
Tapinos, E., Dyson, R.G. & Meadows, M. (2005). The impact of performance measurement in strategic planning. International Journal of Productivity and Performance Management, 54(5/6), 370-384.
An Analysis of GlaxoSmithKline The business that I have done research into is GlaxoSmithKline. This company is a globalised research-based pharmaceutical public limited company. Its ownership structure has changed a great deal since the original company was first established in 1715. Originally a pharmacy, the company has expanded, merged with and taken over other companies over the decades.
The economic forces affecting the company include inflation and fluctuations in interest and currency exchange rates. Additional challenges include technological advances and Johnson & Johnson’s competition and patents attained by com...
Organizational performance results: How the organization performs in all key business areas, including customer satisfaction, financial performance, human resources, partner performance, operational performance, governance and social responsibility. (ASQ, n.d.)
When a drug does make it to market and is successful, companies need to make up for the money spent in development as well as the cost of drugs which did not make it to market. After all investments are taken care of, there is still the need for profit. Some are concerned that if the United States government implements control over prescription drug costs, then private firms will be less motivated to invest in pharmaceutical development, fearing they will not make their investment back. This would supply pharmaceutical companies with less finances for the research and development process. According to the information collected by Abbott and Vernon, a drop in the price of pharmaceuticals would result in significant loss in investment in research and development (Abbott and Vernon).
Maris, D. (2012) ‘What’s Really Driving the Pharma M&A Frenzy’, Forbes, 27 April [Online]. Available at: http://www.forbes.com/sites/davidmaris/2012/04/27/pharma-feeding-frenzy/ (Accessed at: 15 December 2013)
“Macroeconomic indicators include economy-wide phenomena such as unemployment rates, national income, rates of growth, gross domestic product, inflation, and price levels” (Page & Stevens, 2005).
10. Collis, David, and Troy Smith. "Strategy in the Twenty-First Century Pharmaceutical Industry:Merck&Co. and Pfizer Inc." Harvard Business School, 2007: 8-12.
In the Market Performance chart, it is broken into two categories which are Earnings per Share and Price Earnings Ratio. As with any market it is important to understand and gauge key performance indicators and evaluate these goals as it establishes the execution for the future. In the Market performance chart EPS; it measures the firm’s performance, and provides to the shareholder an amount of earnings available. Both Google Inc. (GOOG) and Yahoo! Inc. (YHOO) since 2008 continue to increase in a 5 year review as GOOG in 2012 established an 85% increase while YHOO merged to a staggering 1080%.
In order to assess the current state of the economy, the examination of important economic indicators or variables has always played a vital role in the understanding of the complex economic systems we live in. The analysis of these economic variables studied by many, not only has served as a tool to evaluate the current economic performance of a country, but also has allowed experts to envisage and continue the pavement of an economy's road. Currently, some economic variables have had favorable improvements indicating a general good outlook for the economy for the following months, requiring a further individual analysis and comparisons in order to foresee crisis or successes.
Performance is how well an individual completes a given task by taking into considerations items such as accuracy, timing, attitude, and completeness. In an organization, the manager should want the employees to be performing at a high level in order for the individual to meet or exceed the company expectations, but without a performance management system, the management would not be able to accurately make that distinction. With that being said, a manager cannot determine an individual’s level of performance without utilizing some type of performance management system. Performance management is a continuous process of identifying, measuring, and developing the performance of employees and analyzing the performance in relation to the overall
Performance management is a process that guarantees an organisation and all of its available resources are working collectively and effectively towards achieving the organisation’s mission or goal. Performance management affords an understanding of what drives an individuals, and even organisations, performance at all levels. An understanding of performance management allows for the identification and minimisation of unproductive areas of an organisation, as well as an ability to predict future performance. It is a powerful tool that can be used by managers at all levels of an organisation to help improve a company’s productivity.
There are several reasons organizations initiate performance evaluations, however the standard purpose for performance evaluations is to discuss performance expectations; not only from the employers perspective but to engage in a formal collaboration where the employee and the manager are both able to provide feedback in a formal discourse. There are many different processes an organization should follow when developing its performance evaluation tool; in addition essential characteristics that must accompany an effective performance appraisal process. I will discuss in detail the intent of a performance evaluation, the process an organization should follow in using its performance evaluation tool, along with the characteristics of an effective