Question

What kinds of problems was Schering-Plough experiencing with its global strategy and structure? (3 paragraph)

Answer 1

Schering-Plough was indeed experiencing issues with its global strategy and structure. The major issue was a “multi-domestic global strategy” that was analysed to be “overwhelmingly decentralized”, representing a seemingly complete transfer of control from the centre or headquarter to the sub-centres of the main branch of the company.

More specifically, the heads of international units of Schering-Ploughs gained complete control of their operations. In other words, the management tiers present at the headquarters of Schering-Plough remained clueless about the operations taking place in the international units. Due to this scenario or the lack of central control over the activities of the international units, a major drug quality problem arose which was supposed to be rectified as per the demands of the Food and Drug Administration (FDA).

The address of this issue required dissemination of restrictions on and allotment of corporate power between the managers at the centre and those heading the international units. But the company failed at this dissemination. Another issue was related to the culture in regions outside the United States. For example, European managers did not give due importance to a potentially useful antibiotic called “Zyvox” owing to its origin in another country, that is, Kalamazoo, Michigan. It was later found that the Corporate Headquarters of Schering-Plough permitted the development of cultural and shared values influencing employee behaviour in the absence of rightful corporate knowledge and insight. These factors resulted in Schering-Plough losing competitive edge which is extremely vital for a company’s survival.