Home > Free Essays > Business > Company Analysis > McKesson Company: Strategy Innovations in Pharmaceutics
Cite this

McKesson Company: Strategy Innovations in Pharmaceutics Essay

McKesson: History and Background


With the recent technological breakthrough and the reinforcement of the R&D-related processes, the pharmaceutical industry has been witnessing a consistent improvement.

Furthermore, it should be borne in mind that the lack of certainty, which has invaded the global market, in general, and the pharmaceutical industry, in particular, since recently, shows that investors must not view the entire industry as the means of assessing their chances for success. Instead, every single company must be evaluated separately and on its own merits. Even though the progress of the industry, in general, matters when considering the investment options, the assets of the company are not to be underrated, either.

As the 2016 statistics show, the total value of the global pharmaceutical industry has made $1,072,000,000,000 so far (Statistics and facts about the pharmaceutical industry worldwide, 2014). It should be borne in mind, though, that most of the shares owned by the companies belonging to the target area are located in North America. In other words, the U.S. pharmaceutical organizations can be deemed as the most successful ones. Indeed, the revenue of the U.S. pharmaceutical organizations made a total of 48.7% of the global market (Statistics and facts about the pharmaceutical industry worldwide, 2014). Detailing the essential characteristics of the industry, one must bring up the fact that the oncology department thereof is currently at the helm, its total sales have made $79,800,000,000 in 2014 (Statistics and facts about the pharmaceutical industry worldwide, 2014).

In other words, the realm of pharmacology can be viewed as rather profitable and, therefore, promising for the organizations operating in the healthcare domain.


As far as the type of the company is concerned, it can be viewed as the C-corporation. Indeed, given the size of the firm and the effect that it has on the target market, it can be assumed that McKesson can be positioned as an independent taxpayer. It should be noted that the organization lands at the 11th spot in Fortune’s list of 500 world’s largest companies.

According to the existing records, entrepreneurship has an annual revenue of $179,000,000,000 (Our history, 2016). Therefore, McKesson clearly is a very large firm that needs to reconsider its current position of taking a specific niche in the target environment and, instead, focus on developing the strategy that will allow it to be at the helm of the industry. It is suggested that the application of the latest technological advances as the means of improving the global supply chain of McKesson and its communication process should be considered.

Indeed, with the growth of the organization, the connection between its members is likely to grow weaker. As long as the number of company members is comparatively small, it is possible to maintain a consistent communication process; however, as soon as the firm starts expanding, the threat of losing touch with some of its employees grows exponentially. Therefore, given the current size of the organization, it is advisable that its leaders should rethink the approach used to gather feedback from the staff. Furthermore, innovative tools that will permit a gradual improvement in the feedback collection and analysis will have to be introduced to McKesson’s framework.

More importantly, the information management strategy, in general, will have to be redesigned along with the company’s infrastructure. Even though McKesson’s approach toward data management seems quite legitimate at present, it will need to be updated in the nearest future so that the firm could maintain a continuous analysis of the external and internal factors affecting its performance.


McKesson has quite a few locations in the United States (i. e, California, Connecticut, Massachusetts, New Jersey, Virginia, Arizona, Georgia, Michigan, Pennsylvania, and Texas), as well as in the United Kingdom, Canada, Ireland, Israel, and New Zealand (Locations, 2016). According to the data represented at the official site of the company, the organization operates successfully in the specified areas and is represented by at least one office in them. Furthermore, McKesson is going to expand further, offering its services in other markets. As Table 1 shows, McKesson has a huge potential, yet it needs to explore its options in Europe, Asia, Australia, and Oceania further.

Table 1. McKesson: Global Locations (Locations, 2016).

Area Canada Ireland Israel New Zealand United Kingdom
Name McKesson Canada; McKesson Imaging & Workflow Solutions McKesson New Zealand
Address 4705 Dobrin Street
Saint-Laurent, Québec, Canada, H4R 2P7 ;
#130-10711 Cambie Road
Richmond, BC, Canada, V6X 3G5
Woodford Business Park, Turnapin Lane
Dublin, Ireland, 17
Azrieli Center 1, Building A, 3rd Floor, 26 HaRokmim St.
Holon, Israel, 5885849
245 St Asaph Street
Christchurch, New Zealand, 8013
Block 3, The Exchange, Brent Cross
London, England, NW4 3RJ
Phone number 514-745-2100;
+353 (0) 1 438 7600 +972 3 769-8000 +64 3 379 6662
+64 3 379 6664
+44 (0) 208 457 6007
Email [email protected] [email protected]
Site www.mckesson.ca;
www.mckessonimaging.ie McKesson.com/capacity/ www.mckessonimaging.co.uk


Entrepreneurship has been doing comparatively well over the past few years. McKesson has been working in the pharmaceutical industry for quite a while, providing extensive services to the retailers that provide people with access to a variety of medicine. Even though the company may not be as well-known as the firms operating in the domains of IT and other relevant industries, McKesson remains a powerful organization that occupies an important position in the healthcare market, particularly, in its pharmacology niche. According to the existing record, the firm has not yet reached the stage of maturity and, therefore, can explore its potential (McKesson Corporation (MCK), 2016). Furthermore, The company has been witnessing an impressive increase in its stock price. According to the latest data, McKesson’s stock prices have been on the rise since 2009 and reached a striking $223.4 in January 2014 (McKesson Corporation (MCK), 2016). Despite the fact that the further progress of the firm has been rather shaky, McKesson has been delivering rather successful performance, with its current stock price amounting to a total of $141.18 (a 0.84 increase compared to the previous price) (McKesson Corporation (MCK), 2016).

Designing an Appropriate Strategy


When considering the ways in which McKesson’s performance could be improved, one should consider the concepts such as the Corporate Social Responsibility (Ali & Al-Aali, 2012), the Total Quality Management (Ahmed & Yusof, 2016), the principles of the Just-in-Time philosophy (Anand, Sharma, & Khanna, 2014), and the Six Sigma framework (Radhika, 2015).


Approaching the idea of performance enhancement, one may want to review the Theory of Comparative Advantage suggested by Porter. Suggesting that the available resources should be used intensively, it also needs to be combined with the sustainability theory so that the levels of waste products could be reduced (Trebilcock, Howse, ‎& Eliason, 2013).


The concept of consistent communication between the firm and its stakeholders must be viewed as the foundational one. Furthermore, the significance of data management, in general, must not be disregarded. Finally, quality management needs to be regarded as one of the crucial processes.

Strategy Planning Activities

Activity 1: Resource Analysis

While being very useful as a general way of pointing in the direction in which the company must develop, a resource analysis also implies a rather broad set of ideas that need to be adjusted to the needs of McKesson. Seeing that the organization currently dominates the wholesale distribution market in the pharmaceutical industry, it will be sensible to consider the use of the available information in a manner as carefully as possible. Particularly, it will be crucial for the organization to elaborate on the information management approach that will allow it to reinforce its Supply Management Chain and increase loyalty rates among customers by focusing on communication. Specifically, the collection of feedback and the change in the branding approach so that the brand image could appeal to as many organizations as possible needs to be considered.

However, it would be wrong to claim that the reconsideration of human resource usage is the only change that the company will require. To reduce waste and increase the profit margin, the company will need to explore its opportunities as far as the improvement in the use of all available resources is concerned. Particularly, better management of data and technology will have to be viewed as an option (Allen, 2015).

Activity 2: Value Chain Analysis

By examining the value chain of the company, the managers at McKesson will be able to define the possible hiccups in the internal firm activities. One might argue that the identified approach does not allow for a close examination of the external factors that affect the organization. While the said disadvantage of the Value Chain Analysis is true, it can easily be addressed by combining the identified tool with another framework that can be deemed as suitable for an external assessment. The Value Chain Analysis, in its turn, can be considered a perfect approach toward detecting possible quality issues.

However, to apply the principles of the Value Chain analysis to its framework, the organization will have to reconsider the current set of values by which it is guided. While the emphasis on the needs of customers, which McKesson follows at present, is important, it is also essential to make sure that the needs of all stakeholders are met. In other words, McKesson will need to introduce the approach that will allow the organization to cater to the needs of suppliers, intermediaries, investors, etc. Consequently, the application of the sustainability framework, which will create prerequisites for allocating the available resources in an appropriate manner and promoting the well-being of all parties involved, will have to be viewed as an option.

Activity 3: Life Cycle Analysis

The concept of a life cycle analysis is fairly simple. By definition, the subject matter is supposed to help assess the effects that a certain product has on the environment throughout its use and existence (Zamagni, 2012). For McKesson, the identified framework can be used to come up with the means of improving the quality of the services provided by the company. Particularly, the safety of the product and the careful transportation thereof to the end customer needs to be brought up as some of the effects of applying the specified strategy to the company’s design.

Activity 4: Porter’s Value Chain Analysis

Last but definitely not least, the tool suggested by Porter as the means of determining the company’s strategy in the environment of the global economy needs to be brought up. Despite being rather generic, the framework can be applied successfully to the context of any organization, and McKesson is not an exception. Particularly, it will be necessary to align the company’s infrastructure with the specifics of the global pharmaceutical market (Wilson, ‎Hill, ‎& Glazer, 2013).

At this point, one must mention that the company has been displaying an excellent grasp of the concept of infrastructure. According to the statement issued by the organization, innovative approaches are incorporated into the framework for decision-making as far as the infrastructure is concerned. As a result, the choices made by the managers reflect the current market situation and help avoid possible obstacles in delivering the products to the end customer (McKesson Corporation (MCK), 2016).

However, the current approach could be improved significantly. Particularly, the principles of the Just-in-Time philosophy could be incorporated into the set of principles by which the organization is guided. As a result, a significant number of costs for inventory, which are some of the greatest problems for the company, could be reduced significantly. Consequently, the firm would have an opportunity to provide more financial resources for the areas that require it most.

Conclusion: Exploring McKesson’s Potential

Operating in the environment of the global economy is a challenging task, especially from a pharmaceutical organization such as McKesson. The need to sustain the data management framework and make sure that the supply chain functions properly may finally lead to exhausting the company’s resources. However, with a positive resource management approach, the firm is likely to survive in the realm of the global market.


Ahmed, S. E. H., & Yusof, S. M. (2016). Ranking critical success factors for sustaining Total Quality Management implementation in engineering sector in Sudan. International Journal of Applied Engineering Research, 11(21), 10708-10715.

Ali, A. J., & Al-Aali, A. (2012). Corporate Social Responsibility in Saudi Arabia. Middle East Policy, 19(4), 40-53.

Allen, M. (2015). Strategic communication for sustainable organizations: Theory and practice. New York, NY: Springer.

Anand, D., Sharma, A., & Khanna, S. (2014). Green marketing – go green for the sustainable development of society-stepping Stones to reach go. World Journal of Pharmacy and Pharmaceutical Sciences, 3(4), 393-404.

Locations. (2016). Web.

(2016). Web.

(2016). Web.

Radhika, C. (2015). Current trends in implementing lean Six Sigma in Supply Chain Management. International Journal of Interdisciplinary Research Centre, 1(1), 1-9.

(2014). Web.

Trebilcock, M., Howse, R., ‎& Eliason, E. (2013). The regulation of international trade (4th ed.). New York, NY: Routledge.

Wilson, ‎R., Hill, A. V., ‎& Glazer, H. (2013). Tools and tactics for operations managers. New York, NY: FT Press.

Zamagni, A. (2012). Life cycle sustainability assessment. The International Journal of Life Cycle Assessment, 17(4), 373-376.

This essay on McKesson Company: Strategy Innovations in Pharmaceutics was written and submitted by your fellow student. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly.
Removal Request
If you are the copyright owner of this paper and no longer wish to have your work published on IvyPanda.
Request the removal

Need a custom Essay sample written from scratch by
professional specifically for you?

Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar
Writer online avatar

certified writers online

Cite This paper

Select a referencing style:


IvyPanda. (2020, November 24). McKesson Company: Strategy Innovations in Pharmaceutics. Retrieved from https://ivypanda.com/essays/mckesson-company-strategy-innovations-in-pharmaceutics/

Work Cited

"McKesson Company: Strategy Innovations in Pharmaceutics." IvyPanda, 24 Nov. 2020, ivypanda.com/essays/mckesson-company-strategy-innovations-in-pharmaceutics/.

1. IvyPanda. "McKesson Company: Strategy Innovations in Pharmaceutics." November 24, 2020. https://ivypanda.com/essays/mckesson-company-strategy-innovations-in-pharmaceutics/.


IvyPanda. "McKesson Company: Strategy Innovations in Pharmaceutics." November 24, 2020. https://ivypanda.com/essays/mckesson-company-strategy-innovations-in-pharmaceutics/.


IvyPanda. 2020. "McKesson Company: Strategy Innovations in Pharmaceutics." November 24, 2020. https://ivypanda.com/essays/mckesson-company-strategy-innovations-in-pharmaceutics/.


IvyPanda. (2020) 'McKesson Company: Strategy Innovations in Pharmaceutics'. 24 November.

More related papers
Pss... Stuck with your
assignment? 😱
Pss... Stuck with your assignment? 😱
Do you need an essay to be done?
What type of assignment 📝 do you need?
How many pages (words) do you need?
What’s your deadline? ⏰ Let's see if we can help you!