MNG3701
JUN/JULY 2021 FINAL EXAM
GUIDELINES
1|Page
,QUESTION 1
Strategic Map for Eli Lilly and Company
NOTES:
Your strategy map should look like this.
The left column represents Kaplan and Norton’s BSC 4 dimensions. DO NOT change those.
You can only change any or all of the items in circles, where you feel necessary. These
represent Eli Lilly’s strategic objectives as given by the case study, per BSC dimension.
N.B: The case study does not give Eli Lilly’s strategic objectives explicitly. You have to
come up with these from their vision and mission if you feel you need to add to the ones
already on the given map.
QUESTION 2
The concept of a learning organisation entails the ability to think continually about strategy &
to create synergy by sharing knowledge and ideas, and by generating actions that will
contribute positively to the whole organisation. Organisational learning takes place as
information is shared and meaning is created by means of interactions between individuals,
technology and processes. The process starts with individuals learning, then learning is
2|Page
,shared in the organisation until it becomes commonly accepted practice or knowledge. The
process is complete when the learning is applied to strategic decisions and management
practices in the organisation so much that it starts becoming an organisational capability.
Eli Lilly can do the following to benefit from the learning process.
1. Individual Learning: Involve employees at all levels to create and develop the mission
and vision of the organization. Training makes a big portion of this phase. Here, leaders
encourage critical thinking, questioning people's assumptions, and endorsing new
strategies and techniques for problem-solving.
2. Transference of knowledge: Promote an environment of sharing new knowledge and
skills to make a difference to the workplace through innovative HR management. By
stimulating subordinates' views with group perspectives, Eli Lilly’s leaders will be able to
integrate individual learning into organizational learning.
3. Application: Empower employees through decision‐making responsibilities, encouraging
effective leadership.
Through the three phases of the organisational learning process, Eli Lilly will be able to adapt
more quickly to environmental changes through more flexible and agile strategic responses.
They will also benefit from opportunities and sensing and reacting to threats earlier than the
generic pharmaceutical competitors, leading to superior performance. By being able to apply
newly acquired knowledge to business problems and opportunities through phase 3, Eli Lilly
will achieve their strategy of encouraging faster, less expensive innovation to beat their
generic pharmaceuticals competition.
QUESTION 3
Absorptive capacity refers to the ability of an organisation to recognise the value of new,
external information, to assimilate it and to use it to address business problems. Absorptive
capacity is a strategic capability, and as with all resources and capabilities, it differs from
organisation to organisation, so that some have a higher absorptive capacity that others, and
would accordingly be able to learn much faster and to adapt more quickly to their
environments, or to innovate.
There are four dimensions that determine the absorptive capacity of an organisation. These
are:
3|Page
, 1. Acquisition of external information
This refers to the ability of the organisation to acquire relevant information from its external
environment. However, there seems to be a problem of dominant management logic at Eli
Lilly, as also evidenced by their densely populated top management Level N-1 on their
organogram. This compromises quality of the information and the time it takes to obtained it.
2. Assimilation of acquired information
This refers to the ability to analyse and make sense of the acquired information. Eli Lilly has
a very good capability when it comes to interpreting and understanding the implications and
the ability to share the information. This is evidenced by the way they managed to articulate
one of their biggest challenges – generic pharmaceuticals. According to the case study, Eli
Lilly appreciates that generic manufacturers generally invest far less than them in research
and development and can thus price their products much lower than Eli Lilly’s branded
products, which means they will face intense price competition from these generic forms of
the product.
3. Transformation of knowledge
This refers to the abilities of the organisation to combine new knowledge with existing
knowledge and to develop new insights. Eli Lilly have this dimensional capability since after
assimilating and acquiring the information as discussed above, they managed to develop new
insights. According to the case study, Lilly needs to grow its drug pipeline by encouraging
faster, less expensive innovation.
4. Applying new knowledge
The real benefit of absorptive capacity occurs when the transformed knowledge and new
insights improve business operations and develop new innovations and ventures. This is
evidenced in the case study by Eli Lilly’s involvement as one of the major role players in the
development of a COVID-19 vaccine and a monoclonal antibody that prevents infections.
The company planned to provide a million doses of the antibody by the end of 2020, and
increase its capacity in 2021, which should contribute tremendously to its revenue and profits.
Ultimately, organisations with a high level of absorptive capacity will be able to develop
competitive advantage, as they will be able to be more dynamic within their context. Eli Lilly
has a fair absorptive capacity as they excel in most of the dimensions as discussed above.
4|Page
JUN/JULY 2021 FINAL EXAM
GUIDELINES
1|Page
,QUESTION 1
Strategic Map for Eli Lilly and Company
NOTES:
Your strategy map should look like this.
The left column represents Kaplan and Norton’s BSC 4 dimensions. DO NOT change those.
You can only change any or all of the items in circles, where you feel necessary. These
represent Eli Lilly’s strategic objectives as given by the case study, per BSC dimension.
N.B: The case study does not give Eli Lilly’s strategic objectives explicitly. You have to
come up with these from their vision and mission if you feel you need to add to the ones
already on the given map.
QUESTION 2
The concept of a learning organisation entails the ability to think continually about strategy &
to create synergy by sharing knowledge and ideas, and by generating actions that will
contribute positively to the whole organisation. Organisational learning takes place as
information is shared and meaning is created by means of interactions between individuals,
technology and processes. The process starts with individuals learning, then learning is
2|Page
,shared in the organisation until it becomes commonly accepted practice or knowledge. The
process is complete when the learning is applied to strategic decisions and management
practices in the organisation so much that it starts becoming an organisational capability.
Eli Lilly can do the following to benefit from the learning process.
1. Individual Learning: Involve employees at all levels to create and develop the mission
and vision of the organization. Training makes a big portion of this phase. Here, leaders
encourage critical thinking, questioning people's assumptions, and endorsing new
strategies and techniques for problem-solving.
2. Transference of knowledge: Promote an environment of sharing new knowledge and
skills to make a difference to the workplace through innovative HR management. By
stimulating subordinates' views with group perspectives, Eli Lilly’s leaders will be able to
integrate individual learning into organizational learning.
3. Application: Empower employees through decision‐making responsibilities, encouraging
effective leadership.
Through the three phases of the organisational learning process, Eli Lilly will be able to adapt
more quickly to environmental changes through more flexible and agile strategic responses.
They will also benefit from opportunities and sensing and reacting to threats earlier than the
generic pharmaceutical competitors, leading to superior performance. By being able to apply
newly acquired knowledge to business problems and opportunities through phase 3, Eli Lilly
will achieve their strategy of encouraging faster, less expensive innovation to beat their
generic pharmaceuticals competition.
QUESTION 3
Absorptive capacity refers to the ability of an organisation to recognise the value of new,
external information, to assimilate it and to use it to address business problems. Absorptive
capacity is a strategic capability, and as with all resources and capabilities, it differs from
organisation to organisation, so that some have a higher absorptive capacity that others, and
would accordingly be able to learn much faster and to adapt more quickly to their
environments, or to innovate.
There are four dimensions that determine the absorptive capacity of an organisation. These
are:
3|Page
, 1. Acquisition of external information
This refers to the ability of the organisation to acquire relevant information from its external
environment. However, there seems to be a problem of dominant management logic at Eli
Lilly, as also evidenced by their densely populated top management Level N-1 on their
organogram. This compromises quality of the information and the time it takes to obtained it.
2. Assimilation of acquired information
This refers to the ability to analyse and make sense of the acquired information. Eli Lilly has
a very good capability when it comes to interpreting and understanding the implications and
the ability to share the information. This is evidenced by the way they managed to articulate
one of their biggest challenges – generic pharmaceuticals. According to the case study, Eli
Lilly appreciates that generic manufacturers generally invest far less than them in research
and development and can thus price their products much lower than Eli Lilly’s branded
products, which means they will face intense price competition from these generic forms of
the product.
3. Transformation of knowledge
This refers to the abilities of the organisation to combine new knowledge with existing
knowledge and to develop new insights. Eli Lilly have this dimensional capability since after
assimilating and acquiring the information as discussed above, they managed to develop new
insights. According to the case study, Lilly needs to grow its drug pipeline by encouraging
faster, less expensive innovation.
4. Applying new knowledge
The real benefit of absorptive capacity occurs when the transformed knowledge and new
insights improve business operations and develop new innovations and ventures. This is
evidenced in the case study by Eli Lilly’s involvement as one of the major role players in the
development of a COVID-19 vaccine and a monoclonal antibody that prevents infections.
The company planned to provide a million doses of the antibody by the end of 2020, and
increase its capacity in 2021, which should contribute tremendously to its revenue and profits.
Ultimately, organisations with a high level of absorptive capacity will be able to develop
competitive advantage, as they will be able to be more dynamic within their context. Eli Lilly
has a fair absorptive capacity as they excel in most of the dimensions as discussed above.
4|Page
