Mckesson Corporation: Competitive Environment Trends and Business Model Assessment

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McKesson Corporation: Competitive Environment Trends and Business Model Assessment U07a1, DB8004 - Strategic Thinking and Innovation, Section 01

McKesson Corp: Competitive Environment Trends and Business Model Assessment McKesson Corporation is largest health-care provider in the United States; as of 2011 it ranked as the third largest company in the state of California; where the company is headquartered. On the Fortune 500 list McKesson is ranked 15 (“Fortune 500,” 2011), McKesson consisted of several Strategic Business Units (SBUs). McKesson’s SBUs are divided into two primary categories: Distribution Solutions and Technology Solutions. The Distribution Solutions service all 50 states and deliver pharmaceuticals to institutional providers such as hospitals and health care systems; and also distributes to retail pharmacies; physician offices, surgery centers, long-term care facilities, and home care businesses. McKesson Canada, which is a part of McKesson, is a leading distributor in Mexico via its equity holding in Nadro. McKesson Distribution Solutions consist of the following SBUs (McKesson, n.d.): •McKesson Medical-Surgical

McKesson Patient Relationship Solutions
McKesson Pharmaceutical
McKesson Pharmacy Systems
McKesson Specialty Care Solutions
Moore Medical
Plasma and BioLogics
Zee Medical
McKesson Technology Solutions consists of software, services and consulting to hospitals, automation, imaging centers, physician offices, home health care agencies, and payors. The Technology-Solutions of McKesson Provide an avenue to improve health care safety, manage revenue streams and resources, and reduce the cost and variability of health care. . McKesson Technology Solutions consist of the following SBUs (McKesson, n.d.): •McKesson Automation

McKesson Health Solutions
McKesson Provider Technologies
RelayHealth
McKesson is one of the most successful companies in its industry in the United States. From a strategic management and planning perspective McKesson believe in unity within its divisions. Although the businesses are separate entities, there are some similarities in reference to management and interface with the parent company. The focus on this paper will be on McKesson Medical-Surgical, which is a SBU of McKesson Distribution Solutions; and the interface with the parent company; McKesson Corporation. McKesson Medical-Surgical Interface with McKesson Company

McKesson as a company believe in unity; especially from a management perspective. This company has consistently acquired other companies; and has successfully managed to bring unity within each SBU based on the management goals of the parent company. According to Raynor, (2007), “ McKesson has acquired approximately 75 companies since 1995 that have been aligned with or assimilated into our assorted business units. Our size and breadth of products and services fostered variability in HR practices that diluted our efforts to become a more seamless “One McKesson.” Accordingly McKesson embarked on a series of initiatives to standardize, improve and automate, where possible, its HR processes. Human Resources and Organization Management Team

McKesson created a team of Human Resource and Organizational Effectiveness (OE) professionals in 2004. The focus of this team was to develop best practices and improved quality via a buy-in from all the business units. If a consensus is not met after voting on an issue, an 80 percent majority vote is required to move on (Raynor, 2007). Performance Management Team

McKesson has created a weekly meeting for over a year for the Performance Management Design Team, which met virtually via conference call or web meeting. This team was also designed to focus on more unity within the company. The team was responsible for creating roles and responsibilities for performance management; with emphasis on employee involvement. New competency model was developed to...
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