139(6). Write 750 words (3 pages double space) case analysis.

Read the instruction, answer each section and fill in the given template. 5pages(1250words). Please read the requirement very carefully. Thank you!
case_analyses.docx

robotech_case.pdf

Don't use plagiarized sources. Get Your Custom Essay on
139(6). Write 750 words (3 pages double space) case analysis.
Just from $13/Page
Order Essay

Unformatted Attachment Preview

Case Analyses (I need only a total of 1000 words.)
Case Analysis Paper Format
Each case analysis paper submitted should include five sections: (try to keep the word
counts in each section the same!!!!!!)
1. What is the key problem or challenge facing the firm that you will try to resolve
2. Your external analysis (the industry and economic environment) check the sample
if you’re not sure.
Do not copy and paste, or simply summarize up the whole information into
paragraphs. I need personal thoughts, also critical thinking
Making anaylsis by using one of the below models
PESTLE analysis
To check how it works – https://www.nibusinessinfo.co.uk/content/pestle-analysisexample
Porter’s five forces analysis
To check how it works https://en.wikipedia.org/wiki/Porter%27s_five_forces_analysis
Example:
3. Your internal analysis (the firm’s internal resources and capabilities using model)
Do not copy and paste, or simply summarize up the whole information into
paragraphs. I need personal thoughts, also critical thinking
VRIO framework
VRIO framework is a theoretical framework that explains and predicts firm-level
competitive advantage. According to this model, a firm can gain and sustain a
competitive advantage only when it has resources that satisfy all of the VRIO criteria.
Keep in mind that resources in the VRIO framework are broadly defined to include any
assets as well as any capabilities and competencies that a firm can draw upon when
formulating and implementing strategy. So to some degree, this presentation of the
VRIO model summarizes all of our discussion in the chapter so far.
4. Two mutually exclusive alternatives that solve the problem
A) list out the two mutually exclusive alternatives
B) list out the pro and cons for each
C) financial and operational implications considered
example:
5. Your recommended chosen alternative course of action and justification for the
alternative you have chosen
A) What you recommend
B) The limitations of your recommend alternative
C) How to overcome these limitation
D) Implications considered
Please check this before you write the essay. I will double check this after receiving
your work, if one of them is missing there is the possibility I will need revision. So
kindly make sure you do cover all sections in the initial work. Also, 1000 words is
enough, there is no need to do extra work.
A guideline for case analysis is provided separate to this syllabus will be available on
the first day Blackboard is opened. Case analysis can be no longer than two- to two-
and-a-half pages (single-sided, single spaced, 12-point Times New Roman, 1”
margins throughout). Use the five headings above (those in bold!) for your case
submissions. Up to two additional Appendix pages can be used for supporting
information, references, tables or figures. Each case should be submitted to
SafeAssign on Blackboard and should be submitted in WORD. Please note that I
want you to only refer to the case when completing a case analysis and write-up. Do
NOT use any other external references for ANY case analysis.
For the exclusive use of S. Bai, 2018.
9 – 9 1 8 – 50 1
SEPTEMBER 12, 2017
CHRISTOPHER A. BARTLETT
RACHEL GORDON
JOHN J. LAFKAS
RoboTech: Storming into the U.S. Market
In early 2017, Pat Chen was in her office in the heart of Singapore’s Science Park, working past
midnight again. Her company, RoboTech, had just closed the books on its third successful year in the
United States, selling an innovative robotic device for spinal surgery. As the dominant player in its
segment, RoboTech had again exceeded its sales and profit budget.
Despite the positive financial results, Chen was concerned. Her management team had told her that
to protect RoboTech’s strong position, the company needed to make major investments that could
again plunge it into a loss situation. Reflecting on her 18 years as RoboTech’s CEO, Chen knew she had
met many big challenges—engineering a turnaround, tackling a slumping business segment, and
implementing a major diversification. However, deciding what to do right now felt like the most
important strategic decision of her career.
Company and Product Background
In 1999, financed by her family and a bank, Chen took over a small, struggling industrial robotics
company. It was a big risk for a 29-year-old mechanical engineer who had only seven years’ work
experience in the semiconductor industry and an MBA she had earned at night. But as a hardworking,
competitive risk taker, Chen believed she could turn RoboTech around.
The Company: From Operational Turnaround to Strategic Transformation
Chen’s first move was to focus on developing specialty robotic devices. Linking RoboTech’s
expertise in motors, motion control, and sensors with recent advances in miniaturization, she led the
company to develop an expertise in miniature robotic devices that were small, precise, and extremely
strong. Over several years, its capabilities in fine welding applications requiring accuracy to 10 microns
helped RoboTech become the leading supplier of aircraft-welding robots.
Eventually, competitors caught up with its technology, and particularly during the financial crisis
in 2008 and 2009, once-lucrative contracts became unprofitable. Chen’s experience of price wars in the
semiconductor market led her to consider diverting funds from current operations to new applications.
________________________________________________________________________________________________________________
HBS Professor Emeritus Christopher A. Bartlett, writer Rachel Gordon, and HBSP Senior Editor John J. Lafkas prepared this case solely as a basis
for class discussion and not as an endorsement, a source of primary data, or an illustration of effective or ineffective management. Although based
on real events and despite occasional references to actual companies, this case is fictitious and any resemblance to actual persons or entities is
coincidental.
Copyright © 2017 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685,
write Harvard Business Publishing, Boston, MA 02163, or go to http://www.hbsp.harvard.edu. This publication may not be digitized,
photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School.
This document is authorized for use only by Shiwen Bai in WPC 480 Capstone 2 Spring taught by Roland Burgman, Arizona State University from March 2018 to May 2018.
For the exclusive use of S. Bai, 2018.
918-501 | RoboTech: Storming into the U.S. Market
After much research, she focused on robot-assisted surgery. Noting that orthopedic surgery demanded
extreme accuracy, Chen decided to focus on spinal surgery, a field in which robotic surgical devices
had not yet been developed.
Due to the complex nature of spinal anatomy, surgical precision for it was even more essential than
it was for knee replacements, where surgical robots were already effective. Unlike surgeons performing
knee replacements, spinal surgeons often could not see the body parts on which they operated. Chen
saw parallels with RoboTech’s aircraft-welding robots’ ability to make accurate placements in sites not
visible to the operator.
The Innovation: Leveraging Capabilities, Developing Partnerships
While Chen felt RoboTech had the technological capability to develop the surgical arm that guided
the tools and implants, she knew it would need help with the software controlling the device’s delicate
movements. After months of searching, she connected with an old mentor from Singapore University,
who introduced her to a team working on 3-D imaging software for advanced medical robotics. Chen
described the groundbreaking nature of the innovation they called the Kinetics System:
Before spinal orthopedic surgery, orthopedic surgeons use pre-operative imaging to
familiarize themselves with the patient’s anatomy. During surgery, visibility is often poor, so
they constantly update the imaging. But the Kinetics System’s preoperative software allows the
surgeon to create an exact map, eliminating the need to adjust or update it during surgery. Its
mechanical guidance system enables him to direct drills and implants to their exact planned
location within 1.5 mm of accuracy. It’s a huge breakthrough!
In exchange for developing the Kinetics software and for providing ongoing updates and support,
the Singapore University team received a fee of $5 million, plus 10% of the sales price for each machine
sold. RoboTech capitalized the acquisition fee and planned to expense it over five years.
But to achieve the desired performance, the Kinetics System also required a range of analytical tools,
data sources, guidance systems, tracking tools, and verification technologies that were well beyond
RoboTech’s capabilities. For example, one piece of software displayed a catalog of surgical instruments
and implants, presented virtual views of the chosen implant from various positions, and through
computer-generated simulation, allowed the surgeon to design and practice the surgical technique
before performing the actual procedure. This was just one of the specialized components supplied by
RoboTech’s partners, whose products represented almost half of the prototype’s cost of goods sold.
As Chen signed contracts with each of these partners, she recognized that while outsourcing
reduced the company’s investment needs, it left it vulnerable to its suppliers, particularly on price.
Meanwhile, RoboTech’s development of the core surgical machine turned out to be a $45 million “bet
your company” R&D investment that required it to tap its entire cash flow and appreciably increase its
debt. Even though the company planned to write off that investment over five years, the elevated R&D
expenses led to reported losses, something that Chen’s conservative family investors particularly
disliked. But by early 2011, RoboTech had a working spinal surgery robot.
The Industry and Competition
Due to growth in the elderly population, there was a rapid increase in demand for orthopedic
surgery, including osteoporosis, arthritis, and degenerative disc disease. Within that market, spinal
surgery seemed a promising niche.
2
BRIEFCASES | HARVARD BUSINESS SCHOOL
This document is authorized for use only by Shiwen Bai in WPC 480 Capstone 2 Spring taught by Roland Burgman, Arizona State University from March 2018 to May 2018.
For the exclusive use of S. Bai, 2018.
RoboTech: Storming into the U.S. Market | 918-501
The Orthopedic Spinal Device Business
Spinal surgeries sought to decompress a pinched nerve root or stabilize a joint by implanting
screws, rods, or wires or by inserting bone grafts, spacers, or bone cement to provide relief from pain.
Because accurate and safe placement of the implants in hard-to-reach target areas was so challenging,
traditional spinal surgery had a high failure rate. Although surgeons defined success as whether the
spine fused or the disc was removed, and so reported success rates as high as 98%, studies tracking
reduction in patients’ pain reported far less positive outcomes. One widely cited study suggested that
two years after spinal surgery, about a quarter of patients were dissatisfied with the results.1
Worldwide, of the 78 million people who suffered from untreated back pain—11 million in the
United States alone—many were candidates for back surgery. In 2012, the global market for orthopedic
medical devices was $34.5 billion, with spine devices accounting for about 20% of the total.2 In the
United States, 451,000 spinal fusions were performed in 2012, making it the fifth most commonly
performed procedure.3
Competitors in the Orthopedic Device Space
A few large players dominated the spinal device business, offering surgical tools and implants used
in traditional surgery. Medtronic led the segment with a 41.7% share, followed by DePuy Synthes
( Johnson & Johnson’s orthopedics organization) with 24.3%, and Stryker with 10.1%.4
Several factors had kept these companies from developing orthopedic robots: the robots’ high cost,
the lack of clinical evidence proving their superiority, and the long learning curves needed for surgeons
to master the new techniques. But many industry experts believed as the technology improved and
surgeons became more comfortable using it, hospitals would invest in it.
Two small companies had already launched robotic orthopedic devices. Mako Surgical, founded in
2004, had launched a knee replacement system in 2006. It cost $750,000, not including implants or
service.5 After going public in 2008, Mako immediately launched a successful hip replacement robot.
In 2012, NavioPFS received FDA approval for its knee implant device, which was priced at $450,000.6
Unlike Mako, this system let surgeons use implants of their own choosing.
RoboTech’s Decision: Assessing Potential, Developing Strategy
In 2012, after two years of clinical trials, RoboTech’s device was approved in Singapore. Chen now
wanted to quickly leverage RoboTech’s first-mover advantage in robotics for spinal surgery, and this
meant entering the U.S. market, which accounted for more than a third of the global potential.
The U.S. Market
Chen created a team to evaluate the U.S. opportunity. It found that about 360,000 thoracic or lumbar
procedures—the Kinetic System’s focus areas—were completed annually in the United States.
Surgeons performed these operations in facilities ranging from small surgery centers to giant teaching
hospitals. The team estimated 1,000 to 1,500 of these institutions could afford the proposed system price
of $869,000, an annual four-year service contract at $55,000 after year one, and disposables at $1,800 per
procedure. It also estimated that each hospital would perform between 75 and 85 procedures annually.
While the initial projected gross margin for machine sales was only 45%, primarily due to
RoboTech’s heavy reliance on outsourced components, service contracts and disposables would be
more lucrative. With estimated gross profit margins of 70% and 60%, respectively, overall profitability
HARVARD BUSINESS SCHOOL | BRIEFCASES
3
This document is authorized for use only by Shiwen Bai in WPC 480 Capstone 2 Spring taught by Roland Burgman, Arizona State University from March 2018 to May 2018.
For the exclusive use of S. Bai, 2018.
918-501 | RoboTech: Storming into the U.S. Market
was expected to rise as the installed base grew. This assessment was speculative, however, especially
because of the major systemwide changes unleashed by recent U.S. health-care legislation.
The U.S. Regulatory Environment
In 2010, the U.S. Congress had passed the Patient Protection and Affordable Care Act (soon dubbed
“Obamacare”) to offer health-care access to all citizens. Leveraging the private insurance market, the
act required everyone to purchase coverage on health insurance exchanges, guaranteeing no one could
be turned down for coverage. Subsidies were offered to low-income individuals and families. The U.S.
government estimated that by 2019, over 30 million previously uninsured people would be covered.7
The RoboTech team focused on how the legislation would affect reimbursement processes. The
existing fee-for-service model, which offered reimbursement to hospitals, physicians, and other care
providers for each intervention, had often resulted in fragmented care, with little incentive for cost
savings or cross-provider coordination. This model was being replaced by reimbursement based on
quality of care as measured by patient outcomes, improvements on specific metrics (e.g., reduced
hospital admissions), provision of preventive care, and use of health-care IT systems.
The government’s goal was to convert 30% of fee-for-service Medicare payments to value-based
payments by the end of 2016.8 Because 40% of patients undergoing spinal surgery were over 65 and
covered by the government’s universal aged care program, Medicare, RoboTech decided to work
within that payment paradigm. Furthermore, Medicare reimbursement coverage and levels were likely
to become the standard followed by most private insurance providers.
The current system assigned codes and set reimbursements for each medical condition. Doctors and
hospitals received payments based on the set rate, regardless of actual treatment costs. Reimbursement
for spinal surgery ranged from $40,000 to $60,000, depending on the procedure. But because there was
no reimbursement for capital costs such as the Kinetic System, RoboTech would have to prove its
device could improve operating time, patient recovery, or other quantifiable benefits that would repay
the initial equipment cost.
Launch Decision and Entry Strategy
Stalled industrial sales, falling prices, and R&D investment write-off had all taken a toll on
RoboTech’s earnings. With creditors becoming nervous and some family members inquiring if their
investments were secure, Chen was anxious to exploit the new opportunity.
When the market-entry team estimated that RoboTech U.S. could sell 25 units at $869,000 in its first
year, Chen decided to pursue FDA regulatory approval. Her U.S. regulatory consultant sought fasttrack consent for a device “substantially equivalent” to an existing approved device. Leveraging the
proven effectiveness of existing robotic surgery devices, as well as its own successful clinical trials,
RoboTech obtained marketing approval in eight months.
In September 2013, Chen established a subsidiary, RoboTech U.S. She set up a sales office in
Chicago, where she interviewed candidates for the U.S. Sales Director position. From a dozen finalists,
she chose Brian O’Hanlon, a regional sales manager with 20 years’ experience at orthopedic device
heavyweight Zimmer. Together, they developed a three-year U.S. sales strategy and budget. The 2014
plan targeted the entry team’s forecast of 25 units.
In January 2014, after hiring his team of six sales representatives, a service tech, and four staff in
office, training, and support roles, O’Hanlon began implementing a three-pronged strategy focused on
targeting key facilities, training orthopedic surgeons, and educating patients. He first planned to
4
BRIEFCASES | HARVARD BUSINESS SCHOOL
This document is authorized for use only by Shiwen Bai in WPC 480 Capstone 2 Spring taught by Roland Burgman, Arizona State University from March 2018 to May 2018.
For the exclusive use of S. Bai, 2018.
RoboTech: Storming into the U.S. Market | 918-501
contact top academic hospitals, not only because of their influence, but also because they were highly
competitive. O’Hanlon believed if he could get one or two to commit to the device, a domino effect
would bring the others along.
Meanwhile, the training manager opened a center to offer hands-on experience to leading surgeons,
who would in turn advocate for the system at their hospitals. In parallel, O’Hanlon contacted a public
relations company to present spinal surgery candidates with information about the new technology.
Lacking the funds to support a major marketing program, he also asked the PR firm to obtain press
coverage emphasizing this breakthrough innovation and patient success stories.
Implementing the Strategy: Early Wins, Emerging Worries
In early 2017, three years after its U.S. launch, Chen was pleased with RoboTech’s progress. (See
Exhibits 1a and 1b for RoboTech’s U.S. subsidiary and parent income statements and Exhibit 2 for
Robotech’s balance sheet.) But a few clouds were gathering on the horizon.
The First Year: Sales Success and Systems Stress
Following a strong launch, RoboTech shipped 24 systems in 2014. At the end of 2014, it had six more
on back order. Industry analysts were bullish about robotics implant surgery. One predicted it would
become the de facto standard in knee and hip surgery within five years and in spinal surg …
Purchase answer to see full
attachment

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency

Order your essay today and save 15% with the discount code DISCOUNT15