Research Paper on "Business Sustainability"

Research Paper 14 pages (3768 words) Sources: 1+ Style: Harvard

[EXCERPT] . . . .

Education

Health education through the Arogya Parivar model is conducted right from the grassroots levels. The focus of the program is the building of local healthcare capacities and patient education. This is aimed at ensuring that the success attained is long-term. Educators are mainly women drawn from the local community; these educators focus on preventive health as well as diseases. Other people assisting are health supervisors, whose role is mainly ensuring that the medicine is widely distributed. Trust develops between the members of the community and the educators. In a meeting addressed by the volunteers, anywhere between 200-2000 locals may attend it, making it a mass outreach program (Chamania, 2010). With Cures' past license distribution model, education on the product and the disease was exclusively reliant on the distributor. Unfortunately, the distributor also disseminated a plethora of medical products that were not related to Cure. As well, due to the high volume of products the distributor was responsible for selling, there was very little emphasis placed on educating the community. Indeed, community education was clearly outside the scope of the distributor's core competency.

Accessibility

The Arogya Parivar partners recognized at the outset that the view of most locals is that medicine is costly. The organizations worked to change this mindset. Partnerships were made with local medical professionals, and medicine was made available to the local population at prices they could easily afford. This initiative made use of generic medicines, in collaboration with local manufacturers. At times, medicines given to the villagers would not even carry the Novartis brand. As well, other participants in this endeavor included various health camps and NGOs. In contrast, the past distribution model used by Cure had a retail price for medications set by the distributor; this pricing was not only inconsistent in adjacent geographic areas, but also Cure's product was cost prohibitive for the intended patients.

Sustainability

Arogya Parivar has proven that its model is sustainable, while Cure's license distribution model was ineffective in penetrating the market and sales are virtually stagnant. Meanwhile the Arogya Parivar model break-even was achieved, much earlier than the projected sixty month period, at thirty months. From the year 2007, the sales of the enterprise have grown twenty-five-fold. Because of the success of the Arogya Parivar model in India, it has been implemented by Novartis in Vietnam and Kenya. Spurred by the local initiative success, Novartis has also launched a similar social marketing drive in Kenya and Nigeria (Center for Health Market Innovations, 2007).

Scope

The Arogya Parivar program can be found in at least ten Indian States. The program offers close to eighty over-the-counter (OTC), pharmaceutical, and generic products (including vaccines) for treatment and/or prevention of several conditions like colds, pain, diabetes, and tuberculosis. For products to be added to the portfolio, they have to be customized to specific local needs, have affordable costs, and be distributed through a reliable, sustainable delivery and retail outlet channel with the active help of healthcare personnel (Center for Health Market Innovations, 2007).

Pharmaceutical supply approaches can be defined with regards to private and public roles in wholesale distribution, retail distribution, and financing as Figure 1 summarizes (Pharmaceutical Supply Strategies, 2012). A multilateral partnership like the Arogya Parivar model encompasses this approach, which is utilized for greater outreach into the market through government hospitals, clinics, private healthcare clinics, NGO's and a combination of educational outreach programs (Ionescu-Somers, 2015). The Cure license distribution model was not able to take advantage of each vertical due at least in part to the myopic approach employed by the distributor.

Figure 1: Supply Chain Management Framework (Pharmaceutical Supply Strategies, 2012)

2.3 Stakeholders and Community Interests

Engaging with stakeholders is crucial to identifying their concerns, needs, and expectations. By integrating stakeholder feedback into company strategy and daily business, through an approach like the Arogya Parivar Scheme, members can address common issues, in addition to developing long-standing solutions. Constructive, open dialogue is believed to be crucial in improving the ability to build sustainable growth and value (Stakeholder Engagement, 2014). In Cures license distribution model in Ghana, effective communication and open dialogue was hampered by the lack of cultural understanding, including points of differentiation in the geographic region. The reliance on the distributor to facilitate an accurate and open dialogue in communicating with stakeholders failed due to their lack of vested interest in the project. In contrast, the Arogya Parivar Scheme placed emphasis on transparency within the partnership, and subsequently utilized their partner's commitment to the success of the project as a catalyst.

Understanding the interest of stakeholders as well as what drives and motivates them is necessary to ensure that prioritization and dissemination is effective. Understanding what motivates them will enable the consortium to be able to engage effectively with them. While there are certain differences between categories of stakeholders, many of their barriers and interests do overlap. This is not surprising as stakeholders do exists in an interactive ecosystem; therefore priorities and directives may reflect independent areas of interest and influence as recognized by the Arogya Parivar model. An engagement that seeks to be effective should strive to address the interests of each stakeholder, while also striving to rise above the barriers experienced (Wyatt, 2013).

3. Challenges for the Organization

The extent to which infrastructure problems interfere with growth could be underestimated, as Novartis Arogya Parivar realized in its initiative in India. The creation of awareness from the beginning is not easy. There had to be considerations concerning suitable media to be used for outreach. This was a stumbling block for Cure's license deal in Ghana as well. There was no clear plan for creating awareness of medical products availability. One of the first attempts at creating buzz for the Arogya Parviar model was using branded audio/visual vans (A/V). Poor roads raise the cost of transport and this has to be factored in (Wee, 2014). Institutionally, social issues have to be addressed to allow for the coordination of activities that overlap. There is reported mismanagement by the civil society, including private actors as well as the public actors. One particular problem is that drugs are being distributed illegally so that some can gain financially from the programs (Ngoasong, 2010).

Some other issues that can pose challenges include a lack of goodwill from the political elite. Without the goodwill, it is difficult for healthcare workers to bring forth the needed resources to help fight malaria and provide the human resources to ease the workload. The Arogya Parivar model incorporated a multitude of verticals within their partnerships that allowed for the sharing of resources among the partners. The alliance with the government was also crucial in creating political goodwill within the Arogya Parivar model. This type of resource sharing was not available in Cure's license distribution partnership in Ghana. Cure relied on the distributor to utilize its resources and contacts within the government.

3.1 Barriers and Opportunities

3.1.1 Barriers and Risks

With respect to Cure's past distribution partnership in Ghana, Cure rapidly recognized that the Governments, irrespective of their economic development levels, are bound by a common series of constraints, which include:

Inefficient service delivery that may be caused by a shortage of individual motivations for performing well, bureaucratic inflexibility on the part of business partners, political supporters, concerned parties or local community members, which may result in inequitable or inefficient public resource usage (Pharmaceutical Supply Strategies, 2012). This was a pertinent lesson in the company's collaboration in Nigeria. The proper multilateral partnership as demonstrated by the Arogya Parivar model that involves the government may be able help the officials create a more seamless process as it relates to regulatory and distribution.

Rather than rely solely on the government to distribute these medications, a multilateral partnership that includes community members in a cohesive effort with the government, may help to safeguard against lack of proper governance. The latter might reveal itself in corruption in awarding tenders, manipulation of medication selection processes (vested interest), theft of pharmaceuticals (abetted by or indulged in directly by staff), or nepotism in appointing key staff members.

Equity: as recognized by Novartis in its Arogya Parivar model, in light of the rather high medicine costs compared to incomes, medically needy and poor individuals may be deprived of access to lifesaving, essential medication, without involvement of the government (Pharmaceutical Supply Strategies, 2012).

3.1.2 Opportunities

A growing middle class in emerging countries is anticipated to fuel growth in the sector. Tapping into this market is one sure way to ensure Cure's growth. Another way is going to the poor and viewing them as customers, but serving them with appropriate, lower cost products as Novartis did in their Arogya Parivar model. There is need therefore for reorientation of the business model so that needs not already met are systematically uncovered. Modern medicine is increasingly being demanded in the emerging global markets and large pharmaceutical companies are eyeing this market. The predictions are that sales in this market would reach $400 billion by… READ MORE

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