This report is written for outcome 2 of Global Organization, it will identify a companiy and the structure. Johnson & Johnson is famous company in the world,and this report is introducing the structure of Johnson & Johnson Company and use the theory of Global business organizations.
2.Produces:
The data for this report were gathered from Dec 1th to 9th 2010 and sourced from internet and library.
3.Findings:
3.1 Explain how global business organizations use research, development and innovation in order to integrate their various production locations.
In order to integrate their various production locations, Johnson & Johnson use the contract manufacture especially the model of Original Equipment Manufacture (OEM). Many contract manufacturers are in Asia.
In the report about the OEM list from the Johnson & Johnson include: 93 India manufactures, 73 Thailand manufactures, 35 South Korea manufactures and 34 Vietnam besides there are also some manufactures in South America, Australia, Canada, Italy, Mexico and Turkey.
The OEM will benefit Johnson & Johnson after it gets into the international market. The low raw material and workforce will let Johnson & Johnson reduce the production cost and easy to transport the production from the manufacture to the whole world. And OEM also will help the Johnson & Johnson focus on the product design which is the most important element for the Sports ware company.
3.2 Describe the most critical stages in the development of new products and services
There are 8 in the development of new products,.they are:
idea generation2.idea screening,3.concept development and
testing4.marketing strategy and development5.business analysis6.product development7.testing marking8.commorcinlization
Johnson ＆ Johnson it also has the department of product development.And every year it has the new product to meet the market.For example at the year 1920 the Johnson & Johnson develop a new product called the wound sticks,at the first johnson & Johnson get a idea,when people get hurt What can prevent from a wound infection ,so they developed a wound sticks.Then they testing new product.Then Johnson & Johnson used the Marketing Strategy Development to know the target market, product positioning, and sales, share, and profit goals for the first few years. Long-run sales and profit goals and the marketing mix strategy. Through the marketing analysis, Johnson & Johnson Company will analysis Sales, cost, and profit projections. Than next stage is prototype development and testing.
And Johnoson & Johnoson Company will take a test marketing including Standard test markets Controlled test markets, simulated test markets, finally Johnoson & Johnoson Company will put the new product into the market
3.3 Describe the criteria that influence the global business organisation to change products and services to adapt their products to local market conditions
There are have many criteria that infuluence the global business organsisation to change products and services to adapt their products to local market conditions.For Johnson & Johnson, the Customer expectations and taste is very important.For example in the china the people the skin different the American.So the Johnson & Johnson need to change the raw material to meet the china market.And the Safety and legal standards are also very important to the company.As we know every country have different safety and legal standards,So the Johnson & Johnson should change their product to meet the other market.
3.4 Evaluate the importance of international logistics to the production strategy.
There are many factors that influence international pricing, Logistics is vital for business. It is in the chain of suppliers, manufacturers and customers. Logistics should be operate at the right time, right quantities and right place.So it will help the organization save time and money and increase profits.
For Johnson & Johnson the inflation is the major facts of pricing strategy. The inflation would decrease the real price of all the goods and services. The price of the product will increase by the influences of inflation. Because the price of raw material and the cost of transport will increase under the influences of inflation. For example in 2007 the price of Johnson & Johnson skin care article is 200 RMB and by the influences of inflation the price increase to 300 in 2009. Competition is also a major factor of pricing strategy. The Johnson & Johnson faces the oligopolistic market that Nike has the ability to impact the pricing in the market. And Johnson & Johnson Company also need to attention to his biggest rival Adidas Company. So Johnson & Johnson’s pricing strategy will consider both the factors from the market and the factor from their rival others.
For Johnson & Johnson Company the buying customs of customers is the major facts of distribution strategy. The Johnson & Johnson has many sign sports superstar. Those role model make there fans will buy their product. So Johnson & Johnson Company will consider the customs of customers to planning their distribution strategy. The location and density of customers is also a major factor of distribution strategy. The location and density of customers will impact the distribution channel. If the location of the customers is concentrated the distribution channel will be consummate. If the location of the customers is dispersible the distribution channel will be complex.
The role of international logistics in product strategy is the most important. The international logistics is the process that manages the product from the product out of the manufactory to put the product to the store. The international
logistics make the product be packaged and transport the product to Johnson & Johnson store all over the world.
3.5 The communication strategies used by the Company to promote their products and services in different international markets
The Johnson & Johnson is use the Promtional mix to sell their product.Promotional mix is Specific combination of promotional methods such as print or broadcast advertising, direct marketing, personal selling, point of sale display, merchandising, etc., used for one product or a family of products.We usually on the TV can see Johnson & Johnson advertising \"Give baby the best,From the first to the last\Johnson & Johnson and they will use the Johnson & Johnson product.
Johnson & Johnson sponsor at least 20 famous basketball club and 13 countries’ sport team. And that will improve Johnson & Johnson’s brand awareness also will increase the potential customers. Johnson & Johnson also like use the advertising as their promotion acts. There advertising is in everywhere. Such as the sports game live, website, sports magazine
The Johnson & Johnson is also use the used the organic growth strategy to sell their product.Organic growth is growth that comes from a company's existing businesses, as opposed to growth that comes from buying new businesses. It may be negative.Between the local customers and the organizations, Johnson & Johnson builds a branch to provide more convenience. The branch will also let the
organizations react to the local changes faster. Better decision under the local situations will be made in local branches of the organizations.
4. conclusion:
This reports shows the company choose the organisation structures is very important.The major factors that influence international pricing and distribution strategies, and the importance of international logistics to the production strategy. The criteria that influence the global business organization to change products and services to adapt their products to local market conditions.
5.0 References:
1. Business culture and strategy: An introduction. Scottish qualifications authority.
2. The information about Johnson ＆ Johnson organization structure
3. Handy, C(1990) inside organization:21 Ideas for manages,London:BBC Books
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