"Figure: Rothaermel (2012) p. 5In this model, resources are given the prime importance in assisting the companies inaccomplishing competitive advantage or higher organisational performance. GSK has tangibleresources such as equipments, manpower, plants, and intangible asset such as patents, brandreputation and intellectual property. The challenge is that GSK resources are homogenous forgeneric medicines and offers no competitive advantage to the firm. But for patented medicines,GSK resources are heterogeneous and immobile ie other rival companies cannot replicate orimplement the same strategy. Strategy BMT7026 Page 13 VRIO (Valuable, Rare, Imitate, and Organised to capture value) indicates that patentedmedicines are valuable, rare, cannot be imitated and organised to capture value. Competitive AdvantageFollowing are the competitive advantage extracted from above tools: One of the competitive advantages lies in GSK capacity to spend heavily on R & D. Thecompany R & D budget increased from USD 4.87 billion in 2014 to USD 5.61 billion in 2015(Fierce, 2015). The high investment in R & D gives company an opportunity to research new andefficient treatment to address cancer, HIV, respiratory illness, and infections. In UK, GSK holdssecond position in spending R & D (Statista, 2014). The new ways of curing illness bringscompetitive advantage to the company. There are some patented drugs invented by GSK such as Nexavar to cure breast cancer, NV-10vaccine to cure pneumcoccal diseases, H-B10 vaccine to cure hepatitis B (GSK h, 2015) Thepatented formula brings competitive advantage to the company. GSK make use of its brand name which is worth USD 2.8 billion (Brand Directory, 2015) to reapthe cream out of the markets. GSK has established its name in multiple nations and with its wellpositioning strategies it secured safe position. Big brand name is value, rare, difficult to imitateand therefore brings competitive advantage to the company. GSK has most powerful distribution network followed by economies of scale & diverseoperations. This powerful distribution network not only attracts small companies but alsofascinates but also large companies who joined hands with GSK for its marketing power. Strategy BMT7026 Page 14 The low cost products are one of the competitive advantages. GSK executes cost savinginitiatives that has helped company to save GBP 3.05 billion and improved productivity andmitigated pricing pressure in Europe (Morning Star, 2015). Lowering the operations cost givescompetitive advantage to the company as it can offer products at lower price thereby gaining costleadership. Strategic RecommendationsFollowing are the recommendations to reinvent or develop competitive advantage & shieldagainst threats:Buy Sick In order to add new competitive advantage, it is recommended to buy sick unit ofUnitAlliance Healthcare who is the manufacturing of pharmaceutical products and has contract tosupply Phoenix and AAH (Financial Times, 2015). Buying out will give GSK monopoly tosupply to contracted counterparties and will expose to their technical expertise giving them newFollowcompetitive advantage. competitorThe competitor Novartis entered an emerging market “India” one of the world’s biggest marketin 2012 and launched corporate social responsibility campaign providing free health check upand free treatment to poor people in order to win Indian public attention (Novataris, 2015). It isrecommended to launch free campaigns in one of the world’s biggest market to reap publicattention. NewOpportunityAn opportunity exists in neuroscience stream to cure psychiatric and neurologic diseases. Therehas been multiple companies such as Activa, Novartis, Pfizer working on this but haven’t arrivedStrategy BMT7026 Page 15 with breakthrough to cure such diseases. GSK with ability to fund for R & D and expertise teamof scientist can explore the Neuroscience stream to cure Schiophrenia, Parkinson, Alheimer,Sensorineural hearing damage, and autism. The unique solution to cure these diseases will givecompany an competitive advantage against rival companies. StrategicAllianceNHS, UK is inviting applications in health service & industry to realise their ideas and convertthem into clinical practice & exploit new prospects in multiple nations (NHS, 2015). It isrecommended to form strategic alliance with NHS to supply innovative healthcare products suchas “compression bandaging for chronic oedema”, Proteus digital health, a device whenswallowed pass on info to person phone about intake schedule & how drug is causing affect topatient’s body. Using the leverage power of NHS brand, GSK can gain competitive advantage insupplying unique healthcare products to NHS.Alternatives& ControlTo overcome the weakness (GSK alleged for using cardiovascular drug called Rosiglitazonecausing diabetes to patience’s. (New York Times, 2012)) spotted in SWOT analysis, it isrecommended to use alternative of Rosiglitazone which is Amoxicillan having no contents ofPyridoxine which was the cause of diabetes. It is also suggested that GSK must ensure stringentcontrol to evade any adulterering of drugs and suppliers raw ingredients are thoroughly checkedrather than just sample check. If setting up of the plants to produce vaccine is capital intensive, itis advisable to seek out dead or sick units. This will ensure enough production at low investment.The ban on use of Lamivudine and Nevirapine in drugs or health care products in UK can beStrategy BMT7026 Page 16 "