The following assessment will discuss and analyse the various ways and purpose of organisations as per their formation. The legal structure of “GlaxoSmithKline” will be discussed along with its evaluation and functionalities. The following section will analyse the impact of external factors on the organisation and also the way analysis can change the course of action.

2.0 Section 1

2.1 Explanation of different types and purposes of organisation including public, private, and voluntary

The purpose of various organisations can be defined by the people who are associated with their formation. Public companies it is the government, for private companies it is investors or entrepreneurs while third sector organisations can be attributed to both the public or private companies. While the purpose of public organisations is affiliated with economics, administration and also the healthcare and judiciary. These purposes are common across the world irrespective of the political inclination of the companies as well as the level of involvement from the administrative departments. (Startups.co.uk, 2020)

2.1.1 Examination of different legal structures of private sectors

The formation of private sectors is a result of the economic drive. It serves mostly monetary purposes, but in order to justify its existence, a company needs to enlist itself under provided criterion by the state government. In countries like the UK, the government specification might look like the following-

Sole Proprietor
Limited Companies
Partnership
Cooperatives
Franchise
Charities

The legal structure of these companies is formed under the “Companies Act 2006”.

2.1.2 Identification of the legal structure of the chosen organisation

The legal structure of “GlaxoSmithKline” follows a dropdown structure with departments operating under the Board of Directors. The CEO and the Departmental Chairmen constructs the leadership of the organisation. Executive directors and Commission & administration function under the board of directors.

Figure 1: The legal structure of “GlaxoSmithKlin”

(Source: https://pk.gsk.com/media/128708/governance-chart-01.jpg)

2.2 Evaluation of organisational structure of the chosen company, and how its size and scope aligns with business objectives

The organisation of “GlaxoSmithKline” generally has two divisions pertaining to pharmaceuticals and consumer healthcare. This profile essentially deals with 85% of the organisational pharmaceutical products and its sales. For instance, the largest selling GSK or “GlaxoSmithKline” product being Seretide/Advair for asthma patients and people suffering from obstructive pulmonary issues. Apart from the same, the organisation also deals with Paxil/Seroxat looking after people with depressive disorders.

The key objective of the organisation is to form GPPI’s or globally formed public-private initiatives and addressing health issues in poor and neglected nations (Weyzig, 2020). The organisation of “GlaxoSmithKline” is directly involved with the GPPI’s by participation with the research and development units to expedite the drug-making process. This generally accelerates the process of drug making, especially around diseases that torment underdeveloped countries. That can be seen in the form of tuberculosis and malaria or rotavirus. The company also tries to produce proper vaccines for viruses through a couple of pricing frameworks. These can be seen around the accelerating access initiatives and the global alliance for vaccines and immunisation (Weyzig, 2020).

The organisational structure is controlled by CEO and director of the company Emma Walmsley. While the board of directors are updated by Chairman Jonathan Symonds. Together they look after the management of ‘ViiV healthcare’, ‘Consumer healthcare’, and ‘scientific research or research and development production (Weyzig, 2020). This division is the key component of the structure as the governance of the same ensures that drug production goes smoothly and reaches consumers on time. In this way, the objective of the business is generally achieved (The Official Board, 2020).

2.3 Critical analysis of complexities in business structures and the interrelationship of different organisational functions

The relevant departments and their interrelationships within the structure of “GlaxoSmithKline” can be classified under the following.

Research and Development: The organisation of “GlaxoSmithKline” is quite focused on patient focused research, especially around the therapeutic areas. For instance, the research is more driven towards developing medications that respond to respiratory, anti-viral, nervous system breakdown, and metabolic cancers. Normally the department spends over £300,000 for researching medicines and treatments (Uk.gsk.com, 2020). It is a responsibility of Patrick Vallance the R&D head to communicate with Meredith Hermann for understanding new developments in medicine. However, the pricing of medicines becomes another significant challenge to fulfil for the company. With Covid-19 vaccines in development with partnered firm Sanofi providing 60 million doses soon (Gsk.com, 2020).

Sales and Marketing department: While a common objective of the “GlaxoSmithKline” sales and marketing department in the UK is to derive value to the patients. It also intends to improve the business process by putting patient interests as the first priority (Uk.gsk.com, 2020). For instance, the company has merged with the organisation of Pfizer. In order to make oral health, including curing allergy products, and overall cold and flu treatments and dermatology medications more patient intrinsic. The unification of ideas from the PR leader Meredith Hermann and design head Andrew Barraclough becomes important under the context (McCarthy, 2020).

Manufacturing and supply department: The manufacturing teams at “GlaxoSmithKline” work with around 27,000 people aiding to produce around 4 billion medication packs. While 900 billion orders flourished through the UK manufacturing divisions are mostly of vaccines (Uk.gsk.com, 2020). When the rest 18 billion is related to consumer healthcare products. However, in the leading years, the company has closed down many manufacturing hubs, especially around Plymouth and Devon (Pharmaceuticalonline.com, 2020). This was to improve its business, due to which a coordinating solution was presented by Tim Tyson president of the manufacturing department. That allows it to open division through convenient network strategies with other departments like marketing and R&D.

Complexities around business structures that can affect GlaxoSmithKline

Firstly, the organisations at many times are confronted by uncertain events that include virus outbreaks, technical issues, and others. In such cases, the organisations adopt a resilience capacity for reacting properly to unexpected events (Duchek, 2019). These organisations generally try to capitalise on the events that threaten their survival through related constructs of flexibility, robustness, and agility. However, organisational resilience is dependent on coordination and democratic leadership freedoms within the firm.

Secondly, a leader’s behavioural exertions depend on their transactional nature with employees to perform during operational crises. This encourages workers to jointly participate in the operational capacities of the organisation (Ufua et al. 2020). While leaders depend on positive recognition to influence below the standard performance of employees.

3.0 Section 2:

3. 1 Evaluation of chosen business through PESTEL analysis for macro-environmental

The pestle analysis for the organisation of “GlaxoSmithKline” based in the UK, can be analysed through the below table-

Political	❖ An impact of no-deal Brexit is enforcing a company like “GlaxoSmithKline” towards establishing brand new laboratories for testing parallel products. This is shifting their license policies for ensuring the product is solely sold through the EU or European Union. ❖ A no-deal Brexit is bound to increase the trade tariff costs for the organisation. This could range from £50 to £60 million (Kollewe and Scruton, 2020). ❖ The company reported a 2 per cent drop in profits since 2016. After the Brexit vote and the reforms in taxation across the US that affected trade. This also led to a revaluation imminent competition with regards to Asthma treatment medicine Adair (PharmaTimes, 2020).
Economic	❖ As per the office of Health Economics, the company of “GlaxoSmithKline” alongside other pharma groups contribute around £1.3 billion to the trade balance of the country (PharmaTimes, 2020). ❖ The UK GDP has grown from 0.2% to annual growth of 2% since the last few years. This is mainly due to an increase in vaccine growth by 19% that took the earning per share capacity of the organisation to between 5% to 10% (Haill, 2020).
Social	❖ While most of the population in the UK, between an age group of 18-55 have become health conscious after covid-19. This has resulted in almost 34% of the people requiring over the counter pills, while most resort to vitamin consumption for boosting immune systems (Gsk.com, 2020). ❖ The company has also added diversity in its advertisement campaigns. Its new ‘ice-cold faces’ featuring LGBTQ classes. This was mainly to promote sports like boxing, cycling, and rowing through ‘Voltarol’ pain relief medication (Bulik, 2020).
Technological	❖ The company looks towards a £56 million investment towards an innovation centre. This centre will be based in Renfrewshire in Scotland and will follow a continuous manufacturing process for making medicines (ManuPharma 2020). ❖ This organisation relies upon a database strategy for production by relying on virtual reality for simulating the manufacturing process.
Environmental	❖ The organisation of “GlaxoSmithKline” have implemented a brand new environmental plan. That intends to eliminate its impact on nature by 2030. ❖ With reduced carbon emissions by 34% and water curtailment by 31%, the company has pledged a zero-emission capacity by 2025 (Bulik, 2020).
Legal	❖ The organisation of GlaxoSmithKline generally tries to eradicate bribery issues under the bribery act and corrupt practices act.

Pros and Cons of the Pestel

Pros

A better opportunity for the organisation of “GlaxoSmithKline” in Europe due to no-deal Brexit.
The company tries to promote diversity around its pain relief products.
This organisation has reduced its carbon emissions by a considerable per cent and has good intentions till 2025.

Cons

An increase in trade tariff costs due to no-deal Brexit.
Negligible growth with regards to its gross domestic product.
Higher investments towards deploying better innovative practices.

3.2 Analysis of strengths and weakness of your organisation by SWOT/TOWS model

Strengths

With better investment towards research and development, the company continues to expand its product portfolio.
The company has amassed around £33.8 billion in pharma sales (Gsk.com, 2020).
A vaccine deal by the company with its counterpart Sanofi will help the firm to produce 60 million doses (BBC News, 2020).

Weakness

The goodwill of the company “GlaxoSmithKline” has been ruptured due to corruption in the last few years (BBC News, 2020).
The diabetes prescriptions made by the company have affected over 12,263 people with heart problems (GILL, 2020).

Opportunities

An additional £275 million investment in new manufacturing hubs based in Durham and Montrose provides better opportunities (Gsk.com, 2020).
With demands for its vaccines improving, the company of “GSK” can grow its earnings per share by 5.8 pence (Gsk.com, 2020).

Threats

Intense competition by cheaper organisations for older drugs has reduced the share of the company by 3% (Gsk.com, 2020).
As the pharma market sees a steep rise in the use of vaccines due to covid-19, prices are bound to soar in the near future.

3.2.1 Evaluation of its interrelationship with external factors

The evaluation of the SWOT model has quite a bit of significance from the above concluded external factors analysis on “GlaxoSmithKline”.

Firstly, With the impact of covid-19 increasing pharma and vaccine demands around the world. The cheaper organisations are taking over, the older drug market, thereby reducing the scope of company growth.

Secondly, As the company looks to build around its manufacturing hubs, it could provide economic benefits to the organisation due to its location.

Thirdly, The company can use the continuous manufacturing process for making medicines, thereby reducing heart issues from further medicine usage.

Fourthly, The organisation can control prices of pharma products by properly promoting the product, especially around the LGBTQ classes.

3.3 Suggestion and evaluation for the course of action for the chosen organisation

There are various ways in which “GlaxoSmithKline” can gain a better understanding of its future operations and objectives from the above assessments.

The organisation needs to invest more resources in its approach towards its brand management. The instances of false medical treatment and drug abuses have been very disruptive for the whole industry as a whole.
Along with that, they will also need to form a strong connection with the national context in which they are currently operating. Allowing better adaptability with national regulations and economic guidelines is one of the ways in which the pharmaceutical companies like “GlaxoSmithKline” can redeem itself.
Cooperation and industrial R&D is the new big wave to stay significant and relevant in recent days.

4.0 Conclusion

The assessment has implemented various analytical tools to describe the external and internal operations and processes of “GlaxoSmithKline”. The structure and its legality help guide services, and it is seen to be the case for “GlaxoSmithKline”.

Reference List

Journals

Duchek, S., 2019. Organisational resilience: a capability-based conceptualisation. Business Research, [online] 13(1), pp.215-246. Available at: <https://link.springer.com/article/10.1007/s40685-019-0085-7> [Accessed 2 November 2020].

Ufua, D., Salau, O., Ikpefan, O., Dirisu, J. and Okoh, E., 2020. Addressing operational complexities through re-inventing leadership style: A systemic leadership intervention. Heliyon, [online] 6(7), p.e04270. Available at: <https://reader.elsevier.com/reader/sd/pii/S2405844020311142?token=A9757DF3CFE4DAFAFEF7CEB39C4367FCC60D9CA9089EEBD4E06FB3533D8A0E063493CDDA2C26BEFF430A3581CE35A36D> [Accessed 2 November 2020].

Online Articles

Weyzig, F., 2020. Glaxosmithkline Company Profile. [online] Amsterdam: Somo ONCDO, pp.1-50. Available at: <https://www.somo.nl/wp-content/uploads/2004/10/Company-profile-GlaxoSmithKline.pdf> [Accessed 2 November 2020].

Websites

BBC News, 2020. Coronavirus Vaccine: UK Signs Deal With GSK And Sanofi. [online] BBC News. Available at: <https://www.bbc.com/news/business-53577637> [Accessed 9 November 2020].

BBC News, 2020. UK Drug Company Glaxo ‘Paid Bribes To Polish Doctors’. [online] BBC News. Available at: <https://www.bbc.com/news/business-26970873> [Accessed 9 November 2020].

Bulik, B., 2020. GSK Consumer Partners With Gay Times For LGBTQ+ Inclusive Ad Campaigns. [online] FiercePharma. Available at: <https://www.fiercepharma.com/marketing/gsk-consumer-partners-gay-times-for-lgbtq-inclusive-ad-campaigns-aims-for-more-future> [Accessed 9 November 2020].
Bulik, B., 2020. GSK Pledges Renewed Environmental Commitment With Aggressive Climate Change And Nature Targets. [online] FiercePharma. Available at: <https://www.fiercepharma.com/marketing/gsk-pledges-renewed-commitment-to-environment-aggressive-climate-change-and-nature> [Accessed 9 November 2020].

GILL, V., 2020. GSK Drug’s Safety Questioned. [online] Chemistry World. Available at: <https://www.chemistryworld.com/news/gsk-drugs-safety-questioned/3001892.article> [Accessed 10 November 2020].

Gsk.com, 2020. COVID-19 Prompts Increased Focus On Self-Care, With Europeans Taking Their Health More Seriously To Relieve Pressure On Healthcare Systems | GSK. [online] Gsk.com. Available at: <https://www.gsk.com/en-gb/media/press-releases/covid-19-prompts-increased-focus-on-self-care-with-europeans-taking-their-health-more-seriously-to-relieve-pressure-on-healthcare-systems/> [Accessed 9 November 2020].

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Gsk.com, 2020. GSK Delivers 2019 Sales Of £33.8 Billion +10% AER, +8% CER (Pro-Forma +4% CER*) | GSK. [online] Gsk.com. Available at: <https://www.gsk.com/en-gb/media/press-releases/gsk-delivers-2019-sales-of-338-billion-plus10-aer-plus8-cer-pro-forma-plus4-cerstar/#:~:text=GSK%20delivers%202019%20sales%20of,%2B4%25%20CER*)%20%7C%20GSK&text=COVID%2D19%20Created%20with%20Sketch,COVID%2D19%20Created%20with%20Sketch.&text=Behind%20the%20science%20Created%20with%20Sketch.> [Accessed 9 November 2020].

Gsk.com, 2020. Sanofi And GSK Agree With The UK Government To Supply Up To 60 Million Doses Of COVID-19 Vaccine | GSK. [online] Gsk.com. Available at: <https://www.gsk.com/en-gb/media/press-releases/sanofi-and-gsk-agree-with-the-uk-government-to-supply-up-to-60-million-doses-of-covid-19-vaccine/> [Accessed 9 November 2020].

Haill, O., 2020. Wednesday Preview: GSK, ITV Results In Focus Ahead Of GDP Growth Figure. [online] BOLSAMANIA. Available at: <https://www.sharecast.com/news/company-news-preview/wednesday-preview-gsk-itv-results-in-focus-ahead-of-gdp-growth-figure–2785214.html> [Accessed 9 November 2020].

Kollewe, J. and Scruton, P., 2020. What Are Brexit Contingency Plans For Pharmaceutical Industry?. [online] the Guardian. Available at: <https://www.theguardian.com/politics/2019/feb/19/what-are-brexit-contingency-plans-for-pharmaceutical-industry> [Accessed 9 November 2020].

ManuPharma 2020, 2020. GSK Is Launching A New Innovation Centre For Pharma Manufacturing. [online] ManuPharma 2020. Available at: <https://manupharma.wbresearch.com/blog/glaxosmithkline-is-launching-a-new-innovation-centre-for-pharmaceutical-manufacturing> [Accessed 10 November 2020].

Pharmaceuticalonline.com, 2020. Glaxosmithkline Announces Proposals For UK Pharmaceutical Manufacturing Operations. [online] Pharmaceuticalonline.com. Available at: <https://www.pharmaceuticalonline.com/doc/glaxosmithkline-announces-proposals-for-uk-ph-0001> [Accessed 9 November 2020].

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McCarthy, J., 2020. Glaxosmithkline Begins Marketing Overhaul Amid Pfizer Merger. [online] The Drum. Available at: <https://www.thedrum.com/news/2019/06/25/GlaxoSmithKline-marketing-overhaul-Pfizer-merger> [Accessed 9 November 2020].

BUSINESS AND THE BUSINESS ENVIRONMENT

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1.0 Introduction