TERM PAPER

ON

GlaxoSmithKline Bangladesh Limited

CHAPTER 01

INTRODUCTION

1.1 INTRODUCTION

Bangladesh, after achieving birth in 1971 had become a fascinating body by the Multinational Companies. As capitalization is going on through the world the MNCs are given an unwritten license to expand their business

1 | P a g e

over the world. In this sequel action American Life Insurance Company ltd. Launched in Bangladesh as a first ever MNC. Since then to today around 100 MNC have been competing in Bangladesh.

Pharmaceutical Industry is one of the highly sophisticated industries in Bangladesh which has been uncovered to rapid change and made a revolution in Bangladesh by maintaining high technology and a world class standard in quality. These industries have a major commitment to the society than any other industries as it is involved with the manufacturing of life saving drugs.

GlaxoSmithKline Bangladesh Limited is a fast growing, trusted, and emerging pharmaceutical that develops, manufacture, markets and distributes quality assured best in class pharmaceutical products in Bangladesh. GSK try to be improving the quality of human life by enabling people to do more, feel better, live longer. The company’s principal activities include secondary manufacture of pharmaceutical products and marketing of vaccines, pharmaceutical healthcare products and health food drinks.

GlaxoSmithKline is one of the leading multinational companies in the world. Their marketing and promotional activities are different from others. Stiefel, a GSK company, have prescription and non-prescription products. However, GSK trying to make different promotional activities to make the consumer more aware about the non-prescription skin products. Their promotional activities spread on three categories, For Doctor, Chemist and for final consumer. GSK taken different policy for consumer awareness.

1.2 Scope & Objectives Of The Study

My broad objective is to know the multinational companies internal and

external communication process in both home and host country. What is

the marketing policy that they apply for success in the host country? How

a multinational company adapt in the host country culture.

The scope of this term research paper is to present the text contents from

different source rather than fully textual basis. The company’s website,

company profile by employees are found to complete this term research

2 | P a g e

paper. The scope of arranging the term research paper is condensed that

the scope is only limited to secondary source of cyber information.

1.3 Methodology of the Study

As I mentioned earlier, that the prime source for the term research paper

content is the secondary source called internet. It is really not easy to find

the ultimate information from internet. The searching criteria must be

different. There are various types of PDF and document files which contain

only the text I have typed in the search box but the rest of the file is

totally useless for the term research paper. The search for Power Point

Slides also helps to understand the main points and probable information

which I need to present on the term research paper. The PowerPoint also

helps to get the graphs and statistics in an easy way.

1.4 Limitation of the Study

There were many limitations in preparing the term research paper. The

PDF files, websites, PowerPoint presentation, various document files are

gathered from the foremost source, Internet. The time limitation was the

big issue. The final examinations of the semester were there that it

impeded the arrangement of the term research paper information in

various ways. Study took almost all portion of time that’s why the term

research paper was made in significantly short time.

3 | P a g e

CHAPTER 02

DISCUSSION : AN OVERVIEW

OF GLAXOSMITHLINE

2.1 An Overview GlaxoSmithKline Global

4 | P a g e

GlaxoSmithKline (GSK) is a world’s leading research-based pharmaceutical

company, along with in the area of Health care with a powerful

combination of skills and resources that provides a platform for delivering

strong growth in today’s rapidly changing healthcare environment.

GlaxoSmithKline A subsidiary of GlaxoSmithKline (GSK) is one of the

world’s largest research based pharmaceutical and healthcare companies

GSK, continues to be committed to improving the quality of human life by

enabling people to do more, feel better and live longer. The Company’s

principle activities include secondary manufacture of pharmaceutical

products and marketing of vaccines, pharmaceutical and healthcare

products.

GSK has leadership in four major therapeutic areas- anti invectives,

central nervous system

(CNS) and respiratory & gastro- intestinal/ metabolic. In addition it is a

leader in the important areas of vaccines and has growing portfolio of

oncology product. With the pharmaceutical products, GSK produces a lot

of health care products including the renowned brands such as Horlicks,

Boost, Viva, Glaxose, Maltova, Eno, Sensodyne. GSK supplies products to

140 global markets and has over 100,000 employees worldwide. GSK has

180 manufacturing site in 41 countries.

2.1.1 History of GlaxoSmithKline

Henry Wellcome and Silas Burroughs founded Glaxo in 1880. Glaxo

established medicine research centre around the world. In the Thirties,

GSK introduced improved technology to the business. The business grew

and new ventures were bought in UK. Glaxo Wellcome and SmithKline

Beecham announced their intention to merge on 17 January 2000. The

merger was completed in December that year, forming GlaxoSmithKline

(GSK). Companies were competing for the same raw materials, both were

involved in large-scale marketing of medicine produce and both used

5 | P a g e

similar distribution channels. Between them, they had operations in over

76 countries.

SmithKline Beecham grew through mergers with other medicine

companies in the 1920s. In a history that now crosses three centuries,

GSK's success has been influenced by the major events of the day –

economic boom, depression, world wars, changing consumer lifestyles

and advances in technology. And throughout they've created 5 products

that help people get more out of life – Health Food Drinks, Oral Care,

Vitamins Minerals Supplement and Instant Powder Drink. Through this

timeline you'll see how GSK brand portfolio has evolved. At the beginning

of the 21st century, path to Growth strategy focused us on global high-

potential brands and Vitality mission is taking us into a new phase of

development. More than ever, how brands are helping people 'Do More

Feel Better Live Longer' – a slogan that is visible to the main street of

Bunny Thorpe that is over a hundred years ago.

Timeline

In 1830 : John K Smith opens a Drugstore in Philadelphia.

In 1842: Thomas Beecham launches Beecham’s pills in England.

In 1880: Burroughs Wellcome & Company was founded.

In 1891: SmithKline & Co. acquires French, Richards & Company.

In 1906: Glaxos registered by Joseph Nathan & Company as a trademark

for dried milk.

In 1935: The importance of the pharmaceutical market was soon realized

and in 1935, Glaxo Laboratories Limited was founded with its

headquarters at Greenford, Middlesex and London for the production and

marketing of foods and pharmaceuticals.

In 1947: After the 2nd world war, Glaxo developed rapidly. Glaxo

Laboratories Limited absorbed its parent Joseph Nathan & Company, and

became a public company in 1947.

6 | P a g e

In 1963: Edinburgh Pharmaceutical Industries Limited, which owned

Duncan, Flockhart and Company Limited and MAC Farlane Smith Limited,

joined Glaxo.

In 1995: Glaxo acquired 100% share, of Wellcomes PLC on May 01, 1995

and formed GlaxoWellcome PLC.

In 2000: GlaxoWellcome and SmithKline Beecham merged to form

GlaxoSmithKline; a worldwide research based pharmaceutical company.

2.1.2 Ownership structure

GlaxoSmithKline is a public limited company. Ordinary shares are traded

on the London Stock Exchange (ticker symbol GSK). American Depositary

Shares (ADSs), representing two ordinary shares, are traded on the New

York Stock Exchange (ticker symbol GSK).

Some shareholders favour a pro-active company approach towards health

problems in developing countries. The Pharmaceutical Shareholders

Group, a London-based group of large institutional investors that hold

shares of pharmaceutical companies, studied the business rationale for

addressing the issue and assessed how well companies are managing

this. In a recently published a report, it recommends companies to

7 | P a g e

develop a pro-active, comprehensive and consistent approach to address

these problems and identifies best practices. GSK was identified as one of

the leading companies, but the report also mentioned that all companies

could still improve their approach.

The California Public Employees Retirement System (Calpers) is estimated

to hold over 700 million US$ of GlaxoSmithKline stock (less than 1%). In

April 2003, Calpers used this position to call upon GSK to make its

HIV/AIDS available in the developing world at lower prices.

2.1.3 Business profile

GlaxoSmithKline (GSK) is one of the world’s largest research-based

pharmaceutical companies that that discovers, develops, manufactures

and markets human health products. It is an innovative company that

produces branded products only, which it has developed itself.

The company has two main divisions, pharmaceuticals and consumer

healthcare. The consumer healthcare businesses of GSK consist of over-

the-counter (OTC) medicines, oral care products, such as the toothpaste

brands Aquafresh, Macleans and Sensodyne, and nutritional healthcare

drinks. The pharmaceuticals division is the largest part of GSK’s

businesses and can be divided into prescription drugs and vaccines. This

report deals with the pharmaceuticals division only. The headquarters of

GSK are located in the UK, with additional operational headquarters in the

USA. The company operates in some 160 national markets, the major

ones being the USA, Japan, France, Germany, the UK and Italy.

GSK conducts R&D at more than 20 sites and employs 15,000 employees

in R&D.

The principal facilities are located in UK, USA, Japan, Italy and Belgium,

and minor R&D sites are located in Canada, France and Spain. All R&D for

vaccines is carried out in Belgium. GSK is involved in many different R&D

partnerships with academic institutions, biotechnology companies and

8 | P a g e

other pharmaceutical companies. The company has a leading position in

genetics and in new drug discovery technologies. The manufacture and

supply system of GSK operates as a single global network. The company

has 87 manufacturing sites and employs around 32,000 employees in

production. It has two types of manufacturing sites. Primary

manufacturing sites produce the active compounds used in the drugs.

There are twelve of these sites, located in the UK, Ireland, the USA,

Singapore and Australia. Secondary manufacturing sites convert the

active compounds into finished products. There are 15 of these sites in

Europe, 6 in North America, 5 in Latin America, 5 in the Middle East and

Africa, 15 in the Asia/Pacific/Australia Region, 4 in China, and 1 in Japan.

Vaccine manufacturing is primarily located at two sites in Belgium. GSK

employs 44,000 people in sales and has the largest sales force in the

pharmaceutical industry. It has various co-marketing and co-promotion

agreements with other pharmaceutical companies.

2.1.4 Business strategy

GSK’s business goal is to be a world leader in pharmaceutical industry. In

order to achieve this, the company seeks to improve its R&D pipeline,

using a focused drug portfolio strategy and selective in-licensing

agreements for the external contracting of R&D. The company links R&D

closely to commercial operations to maximize the value of its R&D

portfolio. Furthermore, GSK seeks to increase brand name recognition

among customers and to develop improved versions of older products, on

which new patents can be obtained. It is a common strategy of branded

drug producers to develop improved versions or more convenient

formulations of drugs on which the patents have expired, and to persuade

doctors and patients to use the enhanced version. Direct-to-consumer

(DTC) advertising is an important element of GSK’s marketing strategy in

the US. Consumers that receive information through DTC advertising tend

to request specific brand name medicines to their physicians. The

company is implementing a ‘sales force excellence’ initiative to improve

the already good reputation of GSK sales representatives among

helathcare professionals. It has also started a ‘marketing excellence’

9 | P a g e

initiative to reduce the number of patients that do not seek the help of a

doctor and remain undiagnosed, and the number of diagnosed patients

that remain untreated.

2.1.5 Marketing Strategy

GlaxoSmithKline marketing strategy is directly linked to its corporate

strategy. The following points illustrate GlaxoSmithKline official strategic

priorities as mentioned in company website and corresponding points in

marketing strategy of the company:

a)      Growing diversified global businesses: In other words,

GlaxoSmithKline product differentiation and market expansion plays an

integral role within the corporate strategy. This specific corporate strategy

finds its echo within GlaxoSmithKline strategic marketing through

positioning the company as the largest drug manufacturer with the widest

ranges of products in emerging markets such as China, Turkey and India.

b)      Delivering more products of value: This specific strategy can be

interpreted as achieving an effective combination of quality and price for

GlaxoSmithKline products. This strategy has been linked to

GlaxoSmithKline marketing strategy through communicating the massage

about effective combination of quality and price for

GlaxoSmithKline products with the use of various marketing

communication channels in an integrated manner.

c)      Simplifying the company’s operational model: To be constantly

aiming for high level of efficiency in various organizational processes.

GlaxoSmithKline’s reliance on digital marketing for a range of products

such as Oral Care due to the high level of efficiency of this marketing

platform highlights the link between the company’s strategic marketing

and corporate strategy.

10 | P a g e

2.1.6 PESTEL Analysis

The level of implementation of GlaxoSmithKline (GSK) marketing strategy

is subject to a range of external and internal factors that shape overall

marketing environment for the business. PESTEL strategic analytical tool

can be used to study the impacts of external factors to the business

where the abbreviation stands for political, economic, social,

technological, ecological, and legal factors.

Political factors affecting the implementation of GSK marketing strategy

include possible changes in international trade regulation and competitive

regulation likely to be introduced by the governments of China and India.

Economic factors impacting GSK marketing strategy include high rate of

economic growth in China and India. Moreover, current economic

uncertainties associated with European markets might have negative

implications on the marketing strategy

Social factors with potential implications on GSK marketing strategy are

changes in consumer lifestyles, shifts in consumer attitudes and opinions

etc. However, Cameron (2012) specifies increasing level of customer

resentment towards large amounts of profits made by pharmaceutical

companies and sliding images of large pharmaceutical companies as the

most significant social factor in the current environment.

Technological factors include breakthroughs in pharmaceutical industry,

issues associated with licensing and patenting drug manufacturing

technology, as well as, the level of development of industry technology.

Ecological factors also have specific implications on GSK marketing

strategy that include problems related to global warming, and impact to

the environment of GSK activities, and the reaction of stakeholders to this

impact.

11 | P a g e

Legal factors as one of the most important factors involve rules and

regulations directly and indirectly related to GSK operations in local

markets, as well as, European law and international trade rules,

regulations and agreements.

2.1.7 SWOT Analysis

SWOT stands for strengths, weaknesses, opportunities, and threats

associated with a business and it is an effective strategic analytical tool

used to assess businesses.  The following table illustrates GlaxoSmithKline

SWOT Analysis:

Strengths

Increased level of R&D potential

Strong financial position

Global coverage with presence in more than 100 countries

Weaknesses

Considerable damage made to brand image because of Avandia

drug scandal

Ineffective online presence

Low level of flexibility due to the large size of the company

Opportunities

Increasing the level of presence in China and India

Following diversification strategy

Improving the level of online presence

Threats

Lawsuits to damage the brand image

12 | P a g e

New competitors joining the market

Worsening of economic situation in Europe

2.1.8 Culture and Behavior

GSK’s mission is to improve the standard of human living by enabling the

people to do more, feel better and live long.

Culture and behavior of organization play a vital role in the prosperity of

the organization which that is going to be expected with its staff’s is also

expected from their staff that they must be from the point of Culture

Dedicated to their job/company.

Be focused on patient.

Integrity with job.

According to Behavior

Market Leadership

Innovative thinking

Quality of as a team member

2.1.9 Communication

GlaxoSmithKline has a challenging and inspiring mission to improve the

quality of human life by enabling people to do more, feel better and live

longer. The end objective of GlaxoSmithKline’s communication is to

transmit the information on company’s identity conveyed in the mission

statement and Spirit of GSK values of ‘respect for people, patient focus,

integrity, and transparency to create and maintain positive image of the

business counterbalancing common unfavorable perceptions of the

company.

Simultaneous communication goals include generating product

awareness, informing the stakeholders on company’s financial tenure, and

developing brand and corporate image to generate sales. Considering the

13 | P a g e

nature of GSK’s business and heavy regulatory burden significant part of

the product communication is devoted to the informative imperative.

Internal-Operational Communication: GSK has an internal

communication system which holds the employee communicates each

other on the platform of GSK.

There are so many platforms to communicate like as:

CEO engages a plat form from all over the world of 250 top people

from different sections of the company to help the strategic change

in different sectors of the company.

A CEO advisory board which helps the CEO from their ideas from

across the world is also established.

The online version of magazine is published on the 100% recycled

paper.

An online access on GSK TV to download the views and progress

inside the company.

GSK has also an internal business communication system via

intranet through that the messages, meeting across worldwide be

conducted.

External-Operational Communication: To communicate the

values constituting the center of company’s identity to key audiences in

distinctive manner, however maintaining overall integrity of the

communicate GlaxoSmithKline divides the function into operational units

overseen by the Board, reflecting key stakeholder groups.

The media unit is responsible for crisis management. Additionally, the

company devotes one division to managing dissemination of information

on CSR activities, which suggests company’s realization of the social

responsibility’s potential to add value to the business’s reputation.

14 | P a g e

Website Prominence of consumers actively searching information online

on products and ethical standards of their providers enables GSK to use

the website to disseminate favorable message in a fully controlled

environment.

Press releases are applied to communicate with media journalists and

investors, serving the purpose of quick dissemination of vital positive

information, or rapid response to issues and crises arising

Direct-to-consumer advertising GSK extensively applies direct-to-

consumer advertising within the US market, taking the lead among Big

Pharmas in marketing expenditure.

GSK as a buyer of the raw materials, manufactured goods and services

around the world has a better relationship according to the human rights

commission.

GSK aims to have a good relationship with the local communities.

GSK publish information on all our work with patient groups, including

details of the funding received.

2.2 An Overview GlaxoSmithKline Bangladesh LTD.

GlaxoSmithKline(GSK) Bangladesh Limited carries with it an enviable

image and reputation for the past 6 decades. A subsidiary of

GlaxoSmithKline plc- one of the world's leading research-based

pharmaceutical and healthcare companies GSK Bangladesh, continues to

be committed to improving the quality of human life by enabling people to

do more, feel better and live longer. The Company’s principle activities

include secondary manufacture of pharmaceutical products and

15 | P a g e

marketing of vaccines, pharmaceutical healthcare products and health

food drinks.

2.2.1 History of GlaxoSmithKline Bangladesh LTD.

GlaxoSmithKline is the leading and largest pharmaceutical company in

Bangladesh. After independence of Bangladesh, it was a Glaxo subsidiary

and in 1974 Glaxo Bangladesh limited was established as a Company. In

1969 a supporting factory of Glaxo Laboratories (Pakistan) Ltd. was

formed in Chittagong.

In the year 1951, Glaxo Laboratories (Pakistan) Ltd. started its sales office

at Chittagong. Later on Branch sales office were started in Dhaka and

Khulna respectively.

The construction of Chittagong Factory Building was started in 1958 and

completed in 1965. Factory started its production in 1967 with foods and

pharmaceuticals.

The factory of the company is situated at Chittagong and its marketing

Directorate is based in the capital city of Dhaka.

At the beginning of the factory there were around 250 workers /

employees in the company. At present the employee strength of the

company is about 800. It has 12 sales deports in different district towns of

the country covering most of the areas of the country. It facilitated the

customers to get the company products as their premises within shortest

possible time at the company cost.

GSK Bd. Ltd. produces baby foods, Glucose, Antibiotics and

pharmaceuticals. It has 67 items.

In 1996 it has been incorporated as GlaxoWellcome Bangladesh Limited

and in October 2002 it has been incorporated as GlaxoSmithKline

Bangladesh Limited. The corporate office and Marketing division shifted to

Dhaka in 1998. The factory is in a two storied building on 67000 sq. meter

of land. 82% of its share belongs to group and the remaining 18% belong

to the Bangladeshi companies and various individuals.

16 | P a g e

2.2.2 Business profile

GlaxoSmithKline Bangladesh Limited is managed by the Board of Directors

and the Company Executive Committee (CEC).

The Board of Directors is ultimately accountable for the Company's

activities, strategy and financial performance.

Board of Directors

Company Executive Committee

Board of Directors:

Chairman

Managing Director

Directors – 2 non-Executive Directors & 2 Executive Directors

Functions and Responsibility of Directors:

Production Director:  To meet the Target production Quantity

Marketing Director: To monitor the Market demand and ensure the supply

appropriately.

Finance Director: To look after the financial position of the company.

Quality Assurance Director: To assurance quality.

The Company’s philosophy of Corporate Governance is aimed at assisting

the management of the Company in the efficient conduct of its business

and in meeting its obligations to stakeholders, and is guided by a strong

emphasis on transparency, accountability and integrity. For several years,

the Company has adopted a codified Corporate Governance Charter,

which is in line with the best practice, as well as meets all the relevant

17 | P a g e

legal and regulatory requirements. All employees are bound by Codes of

Conduct that sets forth the Company’s policies on all important issues.

2.2.3 Business strategy

a. Functional level strategies: GlaxoSmithKline Bangladesh Ltd follows

different functional level strategies to gain competitive advantages and

sustain it in the long run in the matured industries. They increase their

efficiency through exploiting economies of scale and learning effects. For

Example: Invested £3.4 billion in 2013 in our search to develop new

medicines, vaccines and consumer products. They carry out extensive

research to innovate new products and modify the existing products to

better satisfy the consumers.

b. Business-Level Strategies: GlaxoSmithKline strategic managers

adopt different business level strategies to use the company’s resources

and distinctive competencies to gain competitive advantage over its

rivals. These are:

They follow cost-leadership strategy as they have intermittent over

capacity and the ability to gain economies of scale. This way they

can produce cost effective products and yet be profitable.

They also target different market segments with different products

to have broad product line. By product proliferation they reduce the

threat of entry and expand the range of products they make to fill a

wide variety of niches.

c. Strategy in the Global Environment: GlaxoSmithKline Bangladesh

Ltd. is registered under GlaxoSmithKline plc. As a part of a global

company it follows some generalized strategies and principals of

GlaxoSmithKline. However, they also modify different strategies based on

the national conditions. The different strategies that they follow in the

global environment are stated below:

They import the raw materials from the places where it is less

costly, thus achieve

18 | P a g e

location economy.

GSK follows a multi domestic strategy where the companies

extensively customize both their product offering and marketing

strategy to different national conditions.

d. Corporate strategy: GSK carries out the following corporate level

strategies:

They have a diversified business. GSK has reflected the changing

market dynamics there and to prepare for the launch of multiple

new products. GSK are restructuring to improve efficiency and focus

resources to growth opportunities in what continues to be a

challenging market environment.

GSK have changed the traditional R&D so that it is better able to

sustain a pipeline of products that offer valuable improvements in

treatment for patients and healthcare providers.

As business continues to change shape, GSK is transforming so that

it can reduce

complexity and become more efficient.

2.2.4 Marketing Strategy

The pharmaceutical industry has limited field of marketing. Yet in an age

high competition like todays, firms are heavily spending and effectively

practicing marketing. GSK believe that through their business they make a

valuable contribution to society by developing and marketing medicines

which improve people’s lives. Their philosophy is to target support to

selected programs that are innovative, sustainable and which produce

tangible results. GSK’s tagline in Bangladesh is “Do more, feel better, live

longer”. Before selling its product GSK makes sure that all its products are

registered with drug registration according to the Drug Control Ordinance.

GSK sells its product through its own sales offices. It has its own

distribution network with 12 departments and a field force consisting of

19 | P a g e

125 medical representatives. The summary of marketing functions is

given below:

Designing and implementing sales strategies.

Controlling and updating distribution network.

Designing and carrying out promotional programs.

Providing marketing information services.

Carrying out different awareness programs.

Controlling international trades.

Keeping records of data regarding marketing activities.

Building up public communication network.

Looking after all the brands and patents.

Conducting marketing surveys as needed.

2.2.5 PESTEL Analysis

PESTEL analysis provides a framework to examine the external

environment of a company. PESTEL stands for political, economical, social,

technological, environmental and legal factors. PESTEL analysis helps a

company to categorize the relevant issues in its environment, so that it

can assess its relative importance and develop an appropriate strategy.

The following sections provides an overview of the currently affecting the

GlaxoSmithKline in Bangladesh.

Political factors: Experienced international businesses engage in

political risk assessment, a systematic analysis of the political risks they

face in foreign countries and any changes in the political environment that

may adversely affect the value of a company’s business activities.

Politically Bangladesh is now a stable country after decades of instability

20 | P a g e

and coups. Bangladesh government regards the pharmaceutical industry

as one of the key sector for foreign investment in the country. With strong

government support Bangladesh is developing a robust manufacturing

and technically experienced industrial base for this sector. General strikes

by opposite political parties those caused huge loss to the businesses and

industries were a regular part of political life in Bangladesh. Companies

are still facing some corruption and bureaucracy issues when to do

business in Bangladesh. Despite some bureaucratic problems in overall

the current political environment of Bangladesh is business-friendly for

GlaxoSmithKline.

Economic factors: When a company wants to do business in

another country, it should have good knowledge on growth rate, inflation,

unemployment, wages, income, stability, poverty and the like of that

country. The economy of Bangladesh has grown 5-6% per year since 1996

despite many internal problems like political instability, poor

infrastructure, corruption, and insufficient power supplies and its growth

was resilient during the 2008-09 global financial crisis and recession.

Inflation rate is a measure of the increase in the cost of living that

influence on many parts of the economic confidence, and the stability.

Higher inflation rate raises the cost of living and historically annual

inflation rates of 10 to 30 percent, erodes confidence in a country’s

currency and spurs people to search for better ways to store value. Lower

inflation is a good indicator for GlaxoSmithKline’s Bangladesh

marketplace. The proportion of unemployed workers in a country shows

how well a country productively uses its human resources. In Bangladesh

unemployed workers do not get any benefits or allowances from the

government. The larger the total debt becomes, the more uncertain a

country’s economy becomes. The resulting pressure to revise government

policies, in the face of growing internal debt, can create economic

uncertainties for investors and companies. For the pharmaceutical

industry, the cost of labour is one of the key elements of total production

21 | P a g e

costs. This is accounted for Bangladesh’s highly competitive labour and

energy costs.

Socio-cultural factors: A company should identify key cultural

differences in the country where it is doing or intended to do business and

then it must need to alter its customary practices to succeed there. There

is a long tradition of self-medication in Bangladesh as many of its

population cannot afford to see health professionals when they fall ill.

According to the World Factbook (2010), 89.5% of the population in

Bangladesh is Muslim. The religious belief and practices have influence

and impact on national/international business that is seen in a culture’s

values and attributes toward entrepreneurship, consumption and social

organization. Many Muslim workers require extra time break for daily

prayer. Muslims are forbidden from the consumption of pork and alcohol.

Bangladesh tops South Asia with its average life expectancy of 61 years

though per capita consumption of medication is one of the lowest in the

region.

Technological factors: Technological environment is another

important dimension of a country and the foundation of its resource base.

Foreign direct investment has brought about the globalization of

production, but this has not led to the globalization of technological

innovation in Bangladesh. Bangladeshi pharmaceutical firms target mainly

lower-end branded generics. Around 80% of Bangladesh’s total need of

Active Pharmaceutical Ingredient (API) is being met through imports (UKTI,

2010). To meet the API demand locally the Bangladesh government is

developing an API park, that is due to open in 2011 to meet at least 70%

of country’s API supplies and it will develop the infrastructure with state-

of-the-art facilities including a central effluent treatment plant and

incinerator for solid and liquid waste-management (BOI, 2010b). Novartis

and other pharmaceutical companies in Bangladesh will be benefited from

this park to minimize their production cost by using locally produced APIs.   

22 | P a g e

Environmental factors: Couple of key environmental factors

discussed in following sections those significant for Novartis operation in

Bangladesh. Bangladesh is now widely recognized to be one of the

countries which are most vulnerable to climate change as a result of

global warming. Natural hazards that come from increased rainfall, rising

sea levels, and tropical cyclones are expected to increase as climate

change, each seriously affecting agriculture, water & food security, human

health and shelter.

Legal factors: Every company in every country must comply with

local legal system and regulations regarding operations. The legal

environment has a great impact on doing business in any country.

According to the World Bank (2009) reports Bangladesh is ranked 119 out

of 183 economies on ease of doing business whereas India ranked 133 .

2.2.6 SWOT Analysis

Strengths:

1. Reputation management on RD and Production only.

2. Sound capital base.

3. Good infrastructure.

4. Large market share.

5. Large highly skilled work force.

6. Wide range of products and mix edge drugs down to toothpaste.

7. Globally positioned in the pharmaceutical industry.

Weaknesses:

1. Low market dominance.

2. No online presence.

3. Inconsistency of attractive promotions.

4. Patent expiry for a number of bulk-buster products.

23 | P a g e

Opportunities:

1. Emerging markets and expansion abroad.

2. Developing vaccines for persistent diseases.

3. Global penetration through mergers and acquisitions.

4. Strategic agreements with other pharmaceutical companies and

organizations to boost its research.

Threats:

1. Lower cost competitors or imports.

2. Counterfeit drugs being sold in competition with legitimate products.

3. Political pressure to sell at prices that fail to pay for the development of

new drugs or to recover past development costs.

4. Patent expiry on drugs that generate strong income.

5. Increasing cost of drug trials (research) and ever higher standards

imposed by national drug approvals bodies.

6. Economic slowdown in European markets.

2.2.7 Culture and Behavior

Bangladesh, as well as the US and UK, is a masculine culture, so it fits

Hofstede’s profile when it comes to behavior and promotion of respect in

the workplace, as it is a feminine trait to be tender and nurturing, not a

masculine one. As for Hall’s insider/outsider-dimension, low context

cultures do not distinguish closely between insiders and outsiders, and

therefore people of all backgrounds and levels have the possibility of

being respected in the same way.

According to Greet Hofstede, Bangladesh scores high on power distance,

it’s about 80, which means that people accept a hierarchical order in

which everybody has a place and which needs no further justification.

Hierarchy in an organization is seen as reflecting inherent inequalities,

24 | P a g e

centralization is popular, subordinates expect to be told what to do and

the ideal boss is a benevolent autocrat.

In case of individualism, Bangladesh scores about 20 which are

considered a collectivistic society.

Bangladesh scores 55 on masculinity and can be considered a masculine

society. In masculine countries people “live in order to work”,

managers are expected to be influential and assertive, the emphasis is on

equity, competition and performance and conflicts are resolved by

fighting them out.

Bangladesh scores 60 on uncertainty avoidance and thus has a high

preference for avoiding uncertainty.

In long term orientation, Bangladesh scores 40, in this dimension which

reflects it a short term orientation culture.

Societies with a short-term orientation generally show great respect for

traditions, a relatively small propensity to save, strong social pressure to

“keep up with the Joneses”, impatience for achieving quick results,

and a strong concern with establishing the Truth.

In Bangladesh, GSK has adopted a four step approach towards the

initiation of cultural change. This change process has been slightly

modified from the force field analysis proposed by (Lewin 1951) to fit the

change situation of GSK. The steps that were undertaken by the company

can be summarized in the form of following diagram:

These four steps cover the following four points:

25 | P a g e

1. Make sure that the R&D department and people understand the

pressure of change – why do we need to change?

2. Develop and share a clear vision about where the organization

and department is headed – where are we going?

3. Put in place the individual, departmental and organizational

capabilities for change – what do we need to make the change?

4. Have a plan of action that outlines what has to be done to get it all

started – what do we have to do tomorrow when we come to

work?

In terms of recruitment process, GSK use the common form such as

application forms, phone interview, and on-site interviews. GSK

Bangladesh do not employ recent graduates, only qualified and skilled

employees. In Bangladesh, GSK gives preference to both internal and

external sources for recruiting managers and specialists. GSK Bangladesh

uses Pay for Performance, where an employee’s wage is gradually

increased when his team or organization as a whole achieves certain

goals. This means that the pay increase in Bangladesh is dependent on

that of a group, rather than individual performance.

In addition to national culture, there are also other things like economic

systems, legal frameworks, human capital, and social environment that

influence HR management practices. In Bangladesh, investment is

allocated by a fixed rate of 20 per cent of Bangladesh’ profits in the

healthcare infrastructure, regardless of ROI level. Bangladesh’s focus on

scaling down prices for years to come - knowing that this will lead to lower

levels of sales volume (as it did, based on the annual report) – is

contradictory to Hofstede’s short term orientation because of the focus on

the future.

One of the main reason for the successful adaptation in Bangladesh of

GSK because GSK BD believes in recruitment from the Bangladesh. A

large number of employee has been recruited from the local market. More

26 | P a g e

over GSK Bangladesh has a huge participation in different national social

work.

The communication styles of Bangladeshi people are indirect or implicit.

They usually take longtime to know each other; they love to use rich and

contextualized words. If someone take short time or direct approach in

introduction, they considered as rude. Personal space is not a huge factor

in Bangladeshi culture, they tend to stand or close (2-3 feet) when taking.

Touch of same gender is common in Bangladesh usually in female. All of

the friends and family members take along conversation period in

meeting each other or taking via network; this approach happened

because Bangladeshi believes in collectivism approach.

2.2.8 Communication

Communication is a very important thing for a company like GSK BD. The

headquarter of the company situated in Gulshan, Dhaka whereas all the

other twelve District Marketing Offices (DMO) situated throughout the

Country and These are divided in five zones by which GSK’s products are

sold. So to communicate with each other they need some advance

technology and easy communication process.

Internal-Operational Communication: Internal-Operational

Communication are those which is used in conducting work within a

business. That is the communication among the business employee’s that

is done to create, implement and track the success of the business’s

operating plan. Now-a-days technology plays a very important role in

internal-operational communication.

There are so many platforms to communicate like as:

Board of Directors holds periodic meetings to resolve issue of

policies and strategies, recording minutes/decisions for

implementation by the Executive Management.

The Managing Director heads the Executive Management, the Chief

Executive Officer (CEO) who has been delegated necessary and

27 | P a g e

adequate authority by the Board of Directors. The Executive

Management operates through further delegations of authority at

every echelon of the line management.

There are five major departments and each departments and each

departments of GSK operates in different aspects but they are

interrelated as well as complement to each other.

HR department of GSK administrate smooth workflow in the

organization and manages the demands of the labors in the factory.

Because of the advancement of the technology now-a-days any kind

of communication can be made through land phone or cellular

phone.

For any kind of brief information employees can use electronic mail

or even fax.

Employees can use their own web portal for many important things.

GlaxoSmithKline encourage open network communication usually. In this

communication network employees can frequently communicate their

views and perception without so much formal network.

External-Operational Communication: External-operational

communication is work-related communication with people outside the

business such as personal selling, telephoning, advertising and writing

message. For meeting up with the necessary information to the market

GSK BD has medical promotion officer. Their main duties are as follows :

Meet and approach customers actively and energetically.

Get the job done with professional standard.

Seek, share and adopt successful practices in the team.

Meet commitment and deliver results on time and travel

extensively.

GSK as a buyer of the raw materials, manufactured goods and services

around the world has a better relationship according to the human rights

28 | P a g e

commission. GSK aims to have a good relationship with the local

communities. GSK wants to minimize the influence on the local

communities and aim to prosperity of the area.

2.2.9 Communication Networks

There are two complex network of information in virtually any

organization. One of them is formal and the other one is informal. The

formal network consists of the official, more stable lines of

communication. Each company has its preferred communication forms or

genres, for conducting its business. The formal network of GSK BD is

mentioned in the below figure:

29 | P a g e

On the other hand the informal network, consisting largely of personal

communications, is highly complex and ever changing.

30 | P a g e

CHAPTER 03

EVALUATION

&

CONCLUSION

3.1 Evaluation

The only introduction of an effective communication system within the

organizational system cannot bring the efficient results for the

organization. For the achievement of the success of a communication

planning within the organization, the following steps or measures will be

counted:

31 | P a g e

For the first time the organization will implement the planning within

the organizational system.

At this stage the organization will collect the feedbacks of the

application of the new plan of communication.

To generate the valid information regarding the effectiveness of the

process will be assessed here.

Now the information generated from feedback of the application of

communication planning will be evaluated through the comparison

of the result with the standard result wanted.

From the analysis, the pitfalls of the planning will be identified and

will be rectified to establish the proper control on the success of the

communication process.

Feedback system of GSK Bangladesh Limited follows smart techniques.

Those are given below :

GKS global intranet site provides news and updates and a Q&A

section where employees can put questions directly to the CEO and

other senior executives. Up to 100 questions are answered each

month.

During the year, supervisor provides performance feedback to the

employee. Directors and above have to pass under 360 degree

feedback systems.360 Degree

Feedback is a system or process in which employees receive

confidential, anonymous feedback from the people who work around

them. This typically includes the employee's manager, peers, and

direct reports.

A mixture of about eight to twelve people fill out an anonymous

online feedback form that asks questions covering a broad range of

workplace competencies. The feedback forms include questions that

are measured on a rating scale and also ask raters to provide

written comments. The person receiving feedback also fills out a

self-rating survey that includes the same survey questions that

others receive in their forms.

32 | P a g e

Managers and leaders of GSK Bangladesh use 360 feedback surveys

to get a better understanding of their strengths and weaknesses.

The 360 feedback system automatically tabulates the results and

presents those in a format that helps the feedback recipient create

a development plan.

Townhall sessions for employees at all levels of the company,

hosted by senior management including the CEO. Employees have

the opportunity to discuss the progress of the business, raise

questions and give feedback.

Employee surveys are carried out regularly throughout the

organization to enable staff to give feedback. A global survey of

managers is carried out every two years.

Confidential feedback mechanisms enable employees to raise

concerns. These include our integrity helpline.

3.2 Conclusion

GlaxoSmithKline is one of the most prominent multinational

Pharmaceuticals Company in Bangladesh was established to provides a

good and sound health protection medicine to our people. Being a

multinational company it faces some restrictions by local drug

administration, as there is a bar to produce some costly but profitable

products that are produced by local companies. Moreover, its standard

operating procedures products manufacturer it is always concerned about

the highest quality of its products. Now it is not utilizing its full production

capacity. Because of its firm attitude toward quality, its production cost is

increased and hence it is becoming in competitive in the market for some

products. It can regain it market share if it can procure raw materials at

lower cost. Moreover, it needs to take aggressive sales promotion

program to increase sales.

Communication management is an important area of business

management. While selecting any system or procedure of communication

management must consider its users and many cross cultural differences

33 | P a g e

of information. An effective communication is free from different

communication noise. So an effective communication can bring

organizational success and increase positive motivation in workplace. So

communication strategy should be made with due concentration on

internal and external facts and forces.

In time, it can be said that GlaxoSmithKline Bangladesh Limited has

created leadership position in pharmaceutical field through its high quality

products, services, and research and development programs. However, it

should maintain its existing goodwill as well as improve its market share

to survive.

References

www.gsk.com.bd

34 | P a g e

www.gsk.com

Armstrong, M. Baron. A, Managing Performance, Performance

Management in Action, P23-40

Zaman, L. Case Study on GlaxoSmithKline Bangladesh Limited; Vol.

1, No, 1; September 11

Employee Guide to Business Conduct; Ninth Edition. P32-35

GSK Corporate Responsibility Report; 2004; 12-16

Vanguard University; Performance Management Process; P2-10

http://www.businessballs.com/performanceappraisals.htm

http://www.performance-appraisal.com/intro.htm

http://en.wikipedia.org/wiki/Performance_appraisal

http://www.managementstudyguide.com/performance-appraisal-

tools.htm

http://www.scribd.com/doc/30633194/PROS-and-CONS-

Managements-by-Objectives

Gary Dessler, eleventh edition, Human Resource Management,

Prentice Hall of India

GlaxoSmithKline, Bangladesh, Limited Annual report-2011

Appendices

Appendix A

35 | P a g e

GSK- It is the short version or abbreviation of GlaxoSmithKline.

Appendix B

Annual report: An annual report is a comprehensive report on a

company's activities throughout the preceding year. Annual reports are

intended to give shareholders and other interested people information

about the company's activities and financial performance.

36 | P a g e