Background
Management at Dexcom can undertake a situational study of their company using SWOT analysis, an essential strategic planning tool. Dexcom faces a lot of criticism in the present business climate, which can be summed up as strengths, weaknesses, opportunities, and threats. It has maintained a strong market position due to its thorough SWOT analysis and inspection. The SWOT analysis is a highly participatory process that needs strong communication across different departments within the firm, involving marketing, finance, operations, MSIS, and strategic planning.
Strength
To succeed in today’s competitive business environment, Dexcom enjoys many advantages as a leading company in its field. It can expand into new markets and maintain its market share in existing ones because of these advantages. According to Falcone (2020), Dexcom can invest in new projects while maintaining its current operations. The company has also formed a strong dealer community that focuses on promoting its products and invests in training its sales staff to explain to customers how to get the most out of their purchases. Because of its excellent education and training initiatives, it has a well-trained workforce. Additionally, substantial brand equity among future customers, thanks to the company’s specialized customer relationship management department, has resulted in a high level of customer satisfaction and significant brand equity. Dexcom has generally successfully executed new projects and has created lucrative returns on capital expenditure by establishing new income streams.
Weakness
Compared to other fast-growing corporations, the company’s R&D spending is significantly lower. As a result of its investment in research and development, Dexcom has been unable to compete with the most innovative companies in the field. The information available in Bakiny (2022) suggests that the company’s financial filings show that it has no chance to make better use of its capital. Much more might have been done better in product marketing and advertising. As a result, the product is vulnerable to attacks from competitors because its positioning and unique selling proposition are not adequately defined. Also, a small fraction of the company’s market share was lost due to the challenges presented by new competitors. This weakness means that Dexcom’s profitability ratio and Net Contribution percentage are lower than the industry average. Consequently, newcomers to the market may be able to establish themselves swiftly.
Opportunity
Dexcom has a unique chance in the new market because of the latest technology. Thus, the company will retain current consumers while also attracting new ones by providing services focused on delivering value. Dexcom’s clients will see reduced interest rates due to the decreased inflation rate because of the increased stability in the market (Renauer, 2022). Therefore, state and federal government contractors can now purchase Dexcom products as part of the government’s green initiative. A steady free cash flow stream makes it simple to branch out into other product areas. Investment in new technology and product lines will assist the industry when the company has more money to invest in these new ventures. It is possible that a drop in shipping costs for Dexcom would result in higher profit margins or that the savings will be passed on to customers to win market share. The company will be able to take advantage of this potential within the next few years by using big data analytics to understand better and meet its customers’ needs.
Threat
Dexcom could face a wide range of lawsuits if the liability standards in various nations alter in the future. Legal action against the company is possible in many markets because of the different legislation and the regular shifts in product standards (Pierrotti, 2021). Thus, the company’s new product supply is erratic, resulting in fluctuating sales numbers over months or years. The corporation is vulnerable to currency swings due to its global reach and political unrest in some locations. If an unanticipated event occurs during the peak season, it could have an immediate or long-term impact on its profitability, based on the circumstances. In the end, the company’s profitability could be threatened by an increase in raw material costs.
Various Levels and Types of Strategies the Firm May Use to Maximize Its Competitiveness and Profitability.
To get a competitive advantage over the competition, Michael Porter recommends three primary forms of approach. Differentiation, market segmentation, and market segmentation are the three most significant tactics for achieving cost leadership (University of Cambridge, n.d.). Thus, Dexcom can use scale economies, and the application to create vast volumes of items at low prices are at the heart of cost leadership. Revenue streams can be generated even with reduced profit margins. An important aspect of differentiation is the capacity to differentiate one’s service or product offerings. Dexcom creating a unique product or service that is difficult to duplicate is closely linked to its reputation and brand. It focuses on a smaller portion of the market, which means it has a smaller audience. Cost leadership and differentiation can be combined into a single strategic advantage because the market is broad enough to accommodate both. Therefore, Dexcom should focus on a single area of expertise rather than try and be everything to everyone.
Communications Plan, the Dexcom Company, Could Use to Make the Strategies to All Stakeholders.
Dexcom project’s specifics must be explained in detail and in a concise manner. The better its stakeholders understand the company’s goals, their position, and how they could influence them, the more information it provides them in an honest, factual, and understanding manner. A better approach is to adjust communication with stakeholders to their needs rather than the other way around. Remain aware that every individual and community is different and use the most appropriate communication method to fulfill their needs: email, online platforms, or social media.
The company should keep an open mind to the history and issues of the people involved in its project, and the team will be more successful. An open and curious approach will help both sides find creative solutions to problems while also harmonizing their beliefs and interests along the way. Dexcom needs to make sure stakeholders get a chance to voice their opinions on the approaches being taken to address their concerns. Keeping track of what has been promised is essential for the project team to arrange talks, share information, assign tasks, and follow up as planned and expected.
No matter how brief or infrequent Dexcom communicates with stakeholders, it should always retain a record for them. This information includes anything from meetings to phone calls to emails to verbal agreements. If it can display the history of all communication with the stakeholders, it can avoid misunderstandings and delays. This is particularly difficult to execute in multi-year ventures where project representatives change over time.
Efforts by This Corporation to Be a Responsible (Ethical) Corporate and the Impact They Have on The Company’s Bottom Line.
Dexcom’s corporate social responsibility (CSR) strategies and initiatives are described and publicized in their annual reports and on their websites. This effort ensures that the corporation promotes its CSR efforts to shape public opinion, recruit consumers, and cultivate goodwill among stakeholders in its sector. An example is when evaluating Dexcom’s progress in corporate social responsibility (CSR), competitors or other organizations can be used as benchmarks. It is crucial to assess the level of executive involvement, the influence of execution, and the CSR outcomes about the objectives.
References
Bakiny, P. J. (2022). Want $1 million in retirement? Invest $250,000 in these 3 stocks and wait a decade. The Motley Fool. Web.
Falcone, R. (2020). DexCom, Inc.: A fantastic company, but too expensive (NASDAQ:DXCM). SeekingAlpha. Web.
Pierrotti, A. (2021). Device used by many diabetics at center of wrongful death lawsuit in Georgia. Web.
Renauer, C. (2022). Here’s Why Insulet Stock Is Jumping Higher on Friday. Nasdaq. Web.
University of Cambridge. (n.d.). Porter’s generic competitive strategies (ways of competing). Institute for Manufacturing (IfM). Web.