Novartis 2.0

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 NOVARTIS PHARMA

Section B | Group 215P067 ANISH BARJATYA | 15P083 HIANSH! JHAB

  15P070 S"YATA RAST"GI15P076 R"HAN #$SHPAN#$ | 15P06% A#ITYA BANSA&

15P120 'I(AS G!PTA

(Designing the internal organization: structural options

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Content

• Back ground

• Industry challenges

• New proposed structu

• Business Units (BUs)

• Advantage of BUs

• ules of the ga!e

• "i!itation of BUs

• #our $t test and desig

• eco!!endations

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Background -

Novartis AG

• %&'&&& e!ployees *usinesse• In +&&&' ,pun o- Agri*usine

!ove towards a pure healthcare• .rd largest phar!aceutical coworld

• /.0 of phar!aceutical revenue1 D

• 2roducts spanned a wide range

•  3op 4 selling drugs accounted f2har!a sales

• /. new products launched *y +• 2atent e6piry rate was /&0

and +&&. as co!pared withaverage +0

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 Industrychallenges

Downwardprice

pressure

86cessiveco!petitiv

e!arketingspending

ising costand

co!ple6ity

Ntech

cinno

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 NEW ProposedStructure

• 9hanged fro! 9ounty#unc

to Business Units

• #ocus on

8ntrepreneurshipAppropriataking

• ini;98?s in each country

• >oving towards *eing a pur

@ealthcare co!pany

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 Factors for selecting

Business Units

Degree ofspecialization

#ranchopportu

Distinctconsu!erseg!ent

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(B)usiness(U)nits

?ncology (U,)

 3ransplantation (Basel',witzerland)

?phthal!ology (Bulach',witzerland)

>ature 2roducts (Basel',witzerland)

2ri!ary 9are (Basel',witzerland)

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 Advantageof BU s

 3ake co!panycusto!

New positions toretain top

Delayered !astructure would e

growt

Better focus on

Better control oinvest!

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Rules of theGame

•

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Limitationof BUs

De*ate over

accounta*ility ande=ciency

Autonovs ,yne

 3i!ing ofthe

reorganisation 1

acCuisitionof talent

#rag!e1D e-

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Nine designtests for org. structure

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01

02

03

04 #easi*ility test

>arket advantagetest

2arenting advantagetest

2eople test

design direct sufficient manag

sources of competitive advant

>arket advantage test

design help the corporate pare

organization

2arenting advantage te

design reflect the strengths, w

motivations of people

2eople test

account of all the constraints t

implementation of design

#easi*ility test

Four fit test for Novartis

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“Good

Design”Tests

,pecialist 9ulture 3

Di=cult "inks 3est

edundant @ierarch 3est

Accounta*ility 3est

#le6i*ility 3est

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Recommendations

• #ocus on pro*le! solving an

innovations

• Delegation of !ore powers

• 9learly !apped ole 1 respeveryone

• 2ro!ote tea! goals *y ince

other way

• Integration of decision !aki

and BU

• Data sharing a!ong BUs( !

i!portantly 1D division)

• ,ynergies a!ong BUs *y reg

!eetings

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THANK YOU