CVS Health operates in four segments, namely corporate, health care benefits, pharmacy, and retail. It deals with cosmetics, drugs, seasonal merchandise, and convenience foods. The company received the best employer award for promoting a healthy lifestyle in 2015 from the National Business Group on innovation. As noted in image 1 below, the company has been recognized for enhancing workforce well-being and received the Gold Award following the success of its WellRewards program. It has almost 1,000 walk-in medical clinics, about 7,800 retail pharmacies, specialty pharmacy services, and at least 70 million plan members (Langley, 2018). Employee dress code is comfortable black shoes, khaki or black pants, and blue shirts. English is the official language for the company though it encourages the use of others based on the targeted market.
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In 2020, it won 3 awards for the best company for women, work-life balance, and best culture. In 2021, it won 4 awards for the best career growth, outlook, the best place to work, and the best company for women (Comparably, 2021). It has been conducting free series of events involving health screening. It has offices in Northbrook, Scottsdale, Irving, Woonsocket, and Pittsburgh in the U.S. The company has invested in high-tech equipment and technologies to meet its market demand.
Walgreens’ Dominant Physical Artifacts
Walgreens’ support office is located in Deerfield, IL, and the old post office is in downtown Chicago. The company has won many awards, including the 2020 Citizens Award, following its effective collaboration with the UN Foundation, which enabled the immunization of 60 million vulnerable populations (Canady, 2019). It has invested in modern equipment and technologies to meet the rising demand for quality health care and patients’ expectations. English is the official language since it is an American company. Its newsroom provides a site for music, audio, decorations, photos, press releases, press kits, as well as contact information. The company expects pharmacists and members of store leadership to wear dress pants or solid black colored business casual or closed-toe dress or at least knee-length skirts. Direct hitters and cashiers are required to wear long or short-sleeved light blue polo shirts with black shoes and pants.
SWOT analysis is a tool used by CVS and Walgreens organizations to conduct situational analysis to map out their business environment. It helps explain both the internal and external business components since they are both necessary for their success. It presents an interactive approach necessitating effective coordination among departments, including strategic planning, management information systems, marketing, finance, as well as operations (Gelfand et al., 2017). The two companies strive to maintain their leading position in the industry by reviewing and analyzing their SWOT. As a leading firm, CVS Health has various strengths enabling it to penetrate and perform well in the market. It helps the company maintain its market share and remain focused on its expansion strategies.
CVS Health SWOT Analysis
- Good returns on capital expenditure since the company has been successfully executing its projects. It has established a new revenue stream through the generation of massive returns on investment
- Strong dealer community since it has developed an effective culture among dealers and distributors where they both invest and promote the company products (Langley, 2018)
- Automation of activities has promoted the consistent quality of its products, making it possible to respond to the market demand
- Successful track of records enabling the integration of complementary forms through acquisitions and mergers
- High level of customer satisfaction through its determined relationship management department
- Reliable suppliers for raw materials eliminating supply chain challenges (Langley, 2018)
- Strong free cash flow offering resources to start new projects
- Creativity and strong product innovation
- Limited success outside core business and facing difficulties when attempting to move to other product segments
- Poor forecasting of product demand resulting in missed opportunities
- Difficulties addressing issues caused by new entrants
- High attrition rate, particularly in the workforce
- Poor and inefficient financial planning
- New technology can enable the business to attain a differentiated pricing strategy
- Emerging consumer trends can create new markets
- New taxation policies can bring opportunities and improve the way of doing business
- Online channels present new customers
- Stable free cash flow support investment in adjacent product segments
- Government agreements can open up new markets
- Emerging and expanding new local distributors
- Inconsistent supply of innovative products
- Increasing product imitation and availability of counterfeit products
- Changing buying behaviors
- Rising pay level
Walgreens Health SWOT Analysis
- Strong distribution network
- Strong brand portfolio
- Integrating complementary successfully in both acquisitions and mergers (Canady, 2019)
- Effective development of new products
- Reliable suppliers
- Strong dealer community
- Automation of operations
- Poor marketing of its products
- Poor investment in research and development
- Inadequate investment in new technologies
- Poor integration of firms based on the work culture
- New technology can support a differentiated pricing strategy
- New environmental policies and market development can boost the company’s competitiveness (Canady, 2019)
- Reduced inflation rates can boost stability in the market
- Stable cash flow can support investment in new product segments and emerging technologies
- Rising customer spending and steady economic growth can boost the market share and attract new customers
- The availability of low quality and counterfeit products
- Growing strengths of other players and local distributors
- Rising trend towards isolationism
- Liability laws
Hofstede’s Cultural Dimensions Analysis
CVS Health used Hofstede’s cultural dimensions model shown below in its internationalization and expansion processes. This has seen the company improve its marketing campaigns and strategies to satisfy the local values and cultural standards (Nelson & Quick, 2018). It has maintained the broader global and overarching strategy while ensuring that its culture is practiced in all its offices and locations. The company has a reduced power distance culture and a flatter organizational hierarchy. This improves access to management by employees and promotes a sense of belonging (Beugelsdijk & Welzel, 2018). Organizational decisions are more centralized, and compensations bands are placed close to each other. The culture has a low power distance, and a charismatic leadership style is applied.
Walgreens has an effective organizational culture marked with pre-defined policies offering a sense of direction and guidance to employees. It comprises shared values, beliefs, assumptions and determines the behaviors of employees. The company’s artifacts are visible and tangible, and they include the official dress code, open-door policy as well as office layout. Core values are standards, principles, and shared goals, and they promote passion, collaboration, diversity, and accountability (Beugelsdijk & Welzel, 2018). Walgreens ensures that workers embrace integrated and ethical ways for achieving the set goals. The culture is complex and broad, and it is inaccessible based on a few dimensions. There are no behaviors that appear incongruent in the two companies since dominant cultural beliefs are emphasized.
Beugelsdijk, S., & Welzel, C. (2018). Dimensions and dynamics of national culture: Synthesizing Hofstede with Inglehart. Journal of Cross-Cultural Psychology, 49(10), 1469-1505. Web.
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Canady, V. A. (2019). National Council, Walgreens join forces to train pharmacists. Mental Health Weekly, 29(18), 6. Web.
Comparably. (2021). CVS Health. Web.
Corporate Finance Institute. (2021). Hofstede’s Cultural Dimensions Theory. CFI Education Inc. Web.
Gelfand, M. J., Aycan, Z., Erez, M., & Leung, K. (2017). Cross-cultural industrial-organizational psychology and organizational behavior: A hundred-year journey. Journal of Applied Psychology, 102(3), 514–529. Web.
Langley, P. C. (2018). CVS Health and the imaginary worlds of the Institute for Clinical and Economic Review (ICER). Innovations in Pharmacy, 9(4). Web.
Nelson, D., & Quick, J. (2018). Organizational behavior: Science, the real world, and you. 6th ed. Cengage Learning, Inc.