Case Analysis - Amgen Inc.

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Case Analysis - Amgen Inc.: Planning the unplannable The biotech firm Amgen Inc. gives much attention and time to the planning process. Because the outcomes for a company like Amgen are often very unsure and many employees are quite sceptical about the use of such a planning, the main issue can be described as follows: What is the added value of planning for a fast-growing company in an uncertain and dynamic environment? To address this issue, an analysis will follow based on the following elements: Responsibility structure Amgen Inc. is a biotech company. The responsibilities of the Product Development Teams (PDT’s) can be described as “discretionary cost centres”. The output of a PDT is therefore difficult to relate to its…show more content…
Advantages: - By bottom-up and interactive planning the top management gains a better picture of what is happening in the company. Even more important is that the leaders of the various product teams can estimate better how far they are from a breakthrough, which pitfalls have to be avoided and what can be expected in terms of sales and turnover. - The biotech industry is a very uncertain environment top operate in. Giving a quantative planning can create a false sense of accuracy. That way a planning can lose much of it’s added value and confidence in planning might even disappear altogether. Strong points in Amgen’s planning is that the company focuses mainly on qualitative aspects. It should be remarked however that Amgen is in the luxurious situation that because of two very successful products she is not (totally) dependent on external investments. - Because many qualitative aspects are used, the planning can be used as direction instrument. The qualitative aspects indicate into which direction de company wants to develop. By not linking this directly to quantative goals, the company avoids that the planning causes to much inflexibility. This might cause a lack of time and space to make the necessary scientific discoveries. And of course discoveries cannot be planned! - Even if the actual situation in the coming years deviates strongly from the planning, the planning process still has added value in itself. It is
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