For J&J, Mergers and acquisition has also played a vital role in 19th century but if we look to the next decade there will be more competition, more rivals and more substitutes which lead to less profits and revenue. So they can face a major challenge in growth of their businesses as with less profit in their pockets they will not be able to expand their business. In 21st century acquisition can give J&J a short term revenue boost but not a long term profit.
If we use porter force model considering J&J we can get to a conclusion that there are many advantages which J&J is enjoying but about pharmaceutical sector of J&J is a little bit immune by the threats of the new entrants. Initial investment of moving into business is quite high. But the rivalry among the different companies within this sector is quite high and there is a competition for market share and for the research talent.
Decentralization as an approach of running the businesses can be a factor which can affect J&J in the future decade. It has been strength of J&J from the past but in the new era Weldon is trying to adopt the strategy of synergy by doing the job with getting business together which can be act as a competitive advantage. But this should work in a systematic way so that the management can understand the difference between encouraging the executives and encroaching with the executive’s territorial domain.
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