Introduction
Setting policies, processes, and priorities in order to increase a business’s or organization’s competitiveness is the practice of strategic management. Strategic management often focuses on efficiently allocating personnel and assets to accomplish these objectives. Strategic management in the realm of administration includes the development and execution of the main objectives and initiatives undertaken by the executives. It is recommended that the Cochlear company adopts a product development approach as its development strategy since the firm can continue upgrading and modifying its current versions of devices.
Historic Strategic Performance of Cochlear
In terms of historic strategic organizational performance, it is reasonable to start by reviewing the company’s key notions, goals, and distinctive features. The Nucleus cochlear device, the Dual electro-acoustic capsule, and the Baha bone conduction augmentation are all produced by the medical equipment business Cochlear (Cochlear, 2022). Cochlear is an innovator in implantable hearing devices that assist individuals in regaining their hearing and reconnecting them to the realm of sounds (Hubbard et al., 2015). The company, being the industry pioneer in implantable auditory systems, has implanted more than 600,000 units, more than any other organization, enabling individuals of all age categories to reap the benefits of chances in life (Cochlear, 2022). Cochlear’s purpose is to enable people to interact with others and lead full lives while additionally assisting in the transformation of how hearing loss is perceived and handled (Cochlear, 2022). Moreover, Cochlear’s vision is to continuously innovate and commercialize a variety of implanted hearing technologies that provide lifelong hearing benefits (Cochlear, 2022). The firm recommends that individuals consult with medical specialists regarding hearing loss solutions since results may vary and healthcare professionals may provide information on influencing variables.
Concerning the field of operations management performance and its historical perspective, it is feasible to underline the type of operational processes that the firm preferred due to the changing external circumstances. Cochlear started utilizing lean manufacturing principles, and the company’s production methodology became customer-oriented (Hubbard et al., 2015). In other terms, the executives of Cochlear decided to create a system in which each implant was designed and assembled personally by an individual and passed from person to person (Hubbard et al., 2015). Referring to the environmental and corporate social results, Cochlear established the Cochlear Foundation to promote community fundraising initiatives, research and development, and treatment education for individuals with hearing impairment (Hubbard et al., 2015). Considering the Cochlear firm’s strategy in research and development, the business was capable of introducing innovative solutions for parts of its systems annually; six separate Nucleus implant models were successfully launched (Hubbard et al., 2015). Furthermore, to diversify its product line, Cochlear designed three different implant devices that were aimed at working with various types of hearing loss (Hubbard et al., 2015). Cochlear was concentrated on adapting to the challenges that occurred in the market.
Regarding the way changing circumstances have affected the organizational objectives of Cochlear, it can be stated that a specific focus is currently devoted to quality control, hygiene, as well as research and development activities. Biofilms are frequently connected to refractory systemic infection of implanted medical equipment (Turnbull et al., 2021). Hence, reducing infection probability in individuals with implanted medical equipment might considerably lower overall morbidity (Turnbull et al., 2021). Both bacterium adhesion testing and inspection of explanted gadgets were used to identify characteristics linked to the growth of microorganisms on the Cochlear Nucleus version of cochlear implants (Turnbull et al., 2021). In this scenario, Cochlear was driven to elaborate concrete measures and goals to address the issue of a potential infection spread on their devices. In addition, the company was able to adapt to the rapidly changing market conditions that impacted the organization’s objectives and vision. For instance, a major factor of influence was that the market was shifting from single implants to double implants; thus, frequent technological replacements and upgrades were obligatory (Hubbard et al., 2015). In conclusion, ethical dilemmas and market alterations substantially affected Cochlear.
Cochlear Business Evaluation
Internal Environment
In particular, it is feasible to state that the internal environment of the Cochlear organization is mostly linked to corporate social responsibility and personnel development activities. The firm completed a number of internal learning and training workshops, and corporate standards acknowledgment processes were created and set in place. Similarly, the business promoted career pathways to students by conducting special visits to the Macquarie University location of the Cochlear worldwide offices (Cochlear, 2022). With the launch of new programs where leaders may exchange ideas and learn from one another, the Cochlear Corporation focuses on executive coaching and growth strategic planning. Through the competence framework, it seeks to maintain and implement measures that represent the objectives of the company in the future. Cochlear is dedicated to offering a diverse, inclusive environment that is indicative of its clients and surrounding areas (Cochlear, 2022). The inclusivity strategy is in line with the business plan and is created to make it practicable and promote the execution of the principal goals and projects of the organization. Therefore, Cochlear recognizes the need for its internal environment to adhere to the present organizational behavior standards.
External Environment
Considering the external environment of the Cochlear organization, a particular amount of attention is devoted to outside stakeholders. As the industry-leading organization, Cochlear is committed to altering the manner people perceive and manage relatively severe to extreme hearing loss via accessibility and awareness initiatives (Cochlear, 2022). The business retains its position of spending funds to broaden the scope of its initiatives for the category of adult individuals and seniors (Cochlear, 2022). Direct-to-consumer advertising and marketing campaigns and the development of hearing aid channel recommendations from the cochlear implant are among the external activities. Moreover, it is feasible to emphasize the quality control of care projects designed to provide a standardized treatment pathway for individuals with moderate to substantial hearing problems.
In this case, Cochlear is concerned with the issue of monitoring its external projects related to the connection between medical specialists, patients, and Cochlear employees. The Cochlear Provider Framework is expanding and educating cochlear implant audiologists in the United States of America on the applications and advantages of assistive devices (Cochlear, 2022). This clarification aids the firm in offering a referral route to cochlear implant doctors; thus, Cochlear improves external environment communication and avoids misinterpretation.
Customer Needs
Referring to customer needs, since the organization provides constant advancements as per technological progress, customer needs tend to rise proportionally with an expectation of greater customer experience. The Cochlear Corporation works to implement strategies that will enhance the customer experience, for instance, by elaborating on Cochlear family memberships (Cochlear, 2022). Due to the growth needs of the business over the time period, provoked by changing customer needs, the organization was required to adapt to the rapidly changing environment. For instance, one of the indicators of increased customer needs and quality control is linked to the transformation of working conditions for the employees.
In fact, the appearance of a customer experience center shows the necessity of establishing a clear communication channel with the clients to comprehend their desires. In terms of employee conditions, new and modern offices were designed that included training and conference rooms, a customer experience and suggestions center, a fitness center and a café (Cochlear, 2022). Furthermore, to ensure a steady supply of items to clients, the company makes an effort to maintain acceptable levels of stocks for the majority of elements and regulates distribution in accordance with the demand.
Opportunities
It is possible to determine several external environment opportunities for the Cochlear organization associated with customer needs, financial benefits, and technological developments. For instance, in the area of macroeconomics, the government authorities’ green or eco-friendly sustainability initiatives may present a chance for state and federal government agencies to purchase Cochlear Limited goods. In addition, an input that might reopen certain distribution networks for Cochlear Limited is represented by prospective customers from digital platforms. The business may take advantage of this opportunity by leveraging big data analytics to properly identify its customers’ interests. Moreover, Cochlear Limited has the chance to use a differentiated pricing approach in the niche venture due to the newly developed technological innovations or solutions (Hubbard et al., 2015). Hence, it will allow the business to attract new clients with various value-oriented offerings while retaining its existing ones with excellent service. Ultimately, Cochlear Limited might have the chance to access a new, developing market due to the acceptance of new technological standards and partnerships. Alternatives to investing in related product sectors and new technology can be obtained when financial conditions are consistent and the free cash flow rate is high.
Threats
Regarding the probable threats that can arise for the Cochlear organization, it is crucial to focus on competitiveness difficulties, legal issues, and technological deficiencies. Additionally, due to a potential lack of options and opportunities, which can occur, there might be drawbacks in the firm’s product line, which might allow a new rival to establish a position in the market. The product’s positioning strategy and distinctive selling proposition are to be well-defined, despite major sales successes being frequent (Hubbard et al., 2015). Cochlear may have unfavorable repercussions, including competitive challenges in this market area if it ceases providing its brand image and distinctive market propositions with greater recognition. Furthermore, Cochlear Limited’s capacity to remain profitable may be threatened by rising costs for raw materials and important components.
Underlining financial aspects, sales numbers may fluctuate greatly over time due to a lack of a consistent supply of creative items. Generally, in some locations, the competition is compensating local distributors’ larger budgets, which is a challenge given the local dealers’ potential increasing strength. Due to the diverse regulations and ongoing changes in the markets’ product requirements, the corporation may be sued in a number of jurisdictions. Consequently, due to the varying liability regulations in various nations, Cochlear Limited may be subject to a variety of damage claims when the markets’ rules alter.
Strategic Way Forward
Concerning the development of a strategic way forward for the company Cochlear Limited as per its internal and external environments, customer needs, and opportunities, it is reasonable to suggest highlighting the necessity of marketing advancement. The research’s authors emphasize the applicability and possible significant effect of using practical organizational resources and online competencies in impacting foreign market choices (Katsikeas et al., 2019). Moreover, businesses should evaluate entrance decisions and foreign marketing plan choices, execution, and control using digitalization methodologies (Katsikeas et al., 2019). The scholars, in fact, were able to illustrate that adequately using digital technology may assist an organization in selecting an appropriate foreign market and implementing successful marketing and networking strategies (Katsikeas et al., 2019). Additionally, the company’s present social media marketing initiatives provide insight into the acceptance of digital technologies in a manner that will allow it to execute and manage its worldwide marketing plan more efficiently (Katsikeas et al., 2019). In this situation, the strategic way forward should be dedicated to transferring digital marketing activities from the operational to the strategical managerial layer in order to elaborate marketing automatization and development approaches for attracting customers.
Recommendations for Cochlear
The first organizational development and business growth strategy that can be potentially proposed to Cochlear is market penetration. Market penetration is the proportion of an item or service’s predicted total market that consumers are actually utilizing. The development of tactics used to enhance the market position of a certain good or service may include the usage of market penetration. The prospective market’s size may be estimated using market penetration (Alkasim et al., 2018). If the sector’s overall market is substantial, entrants may be motivated by the possibility of gaining market share or a portion of the sector’s entire pool of prospective consumers. At the same time, market penetration can be ineffective unless the item is swiftly consumed, which is a shortcoming of the method; this approach is suitable for sectors that do not prioritize low prices (Alkasim et al., 2018). Hence, market penetration leads to entering new business segments, but this strategy is only applicable under specific conditions.
The second business advancement strategy that can be suggested to Cochlear is linked to diversification. When businesses decide to expand, they can use the diversification technique, which involves adding a new item to the distribution chain in an effort to boost earnings. These goods can represent a new sector of the market that the business currently serves, a strategy called business-level diversification (Shaturaev, 2022). Organizations can locate new markets to enter or goods to introduce using the diversification approach, which will enhance sales and income. In contrast, as a disadvantage of this approach, business returns can be more inclined to resemble the average market return as the degree of diversity rises, and the quality of the products may decline (Shaturaev, 2022). Consequently, a product diversification strategy can provide a wide range of offerings, but the return on investment and quality of goods can be diminished.
Finally, the third method that Cochlear can adopt in the company’s future growth is product development. A product design strategy is a method for introducing a new product into a potential market by doing extensive testing, ongoing market analysis, and rigorous product idea preparation (Alkasim et al., 2018). Product creation is frequently involving selecting an existing product, making a minor modification, and putting it on the market (Alkasim et al., 2018). Clients who may purchase a new item regardless if they already own the current edition will benefit from this added value. At the same time, as a shortcoming of the approach, developing a product strategy may be costly and risky, particularly if a business is comprehensive and spends in activities including research and marketing (Alkasim et al., 2018). Although a product development strategy can incorporate significant expenses and additional research, it is considered as a complex technique for advancing current product lines.
Concerning the three abovementioned organizational development strategies, it is feasible to emphasize that product development can be assessed as the preferable one. With the help of the product development approach, Cochlear will be able to integrate its technological innovations into existing implants and other products that will require upgrades during specific time periods. The practical improvements and solutions are to be discovered and elaborated by its research and development department and operational management groups. A product development plan assists the company in supporting the trends and attracting customers who become exhausted of purchasing identical products all the time. Referring to the change processes, it is possible to propose to clearly identify and summarizing the organization’s mission, vision, and value statements prior to the implementation of the strategy. Moreover, it is compulsory to adequately evaluate the business environment and determine strategic options. Finally, it is necessary to formulate operational-level objectives that will be strictly correlated with the previously set development strategy.
Conclusion
To summarize, Cochlear is a pioneer in implanted hearing technologies that help people virtually restore lost hearing and re-engage with the auditory world. Although Cochlear focused on responding to business issues, moral quandaries and market changes significantly impacted the company. It is reasonable to assume that corporate social responsibility and employee development initiatives play a major role in the Cochlear organization’s internal environment. Cochlear understands the need to maintain the current corporate behavior standards in its internal environment. It is possible to underline that product development might be viewed as preferable when it comes to the three organizational growth techniques stated above.
References
Alkasim, S. B., Hilman, H., Bohari, A. M. B., Abdullah, S. S., & Sallehddin, M. R. (2018). The mediating effect of cost leadership on the relationship between market penetration, market development, and firm performance. Journal of Business and Retail Management Research, 12(3).
Cochlear. (2022). About us. Home. Web.
Hubbard, G., Rice, J., & Galvin, P. (2015). Strategic management: Thinking, analysis and action (5th ed.). Pearson.
Katsikeas, C., Leonidou, L., & Zeriti, A. (2019). Revisiting international marketing strategy in a digital era: Opportunities, challenges, and research directions. International Marketing Review, 37(3), 405-424.
Shaturaev, J. (2022). Company modernization and diversification processes. ASEAN Journal of Economic and Economic Education, 1(1), 47-60. Web.
Turnbull, L., Leigh, R., Cavaliere, R., Osvath, S. R., Nolan, L. M., Smyth, D., Verhoeven, K., Chole, R.A, & Whitchurch, C. B. (2021). Device design modifications informed by in vitro testing of bacterial attachment reduce infection rates of cochlear implants in clinical practice. Microorganisms, 9(9), 1809.