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Friday 22 August 2014

The less the cost the more the value

The drug company Novartis works very closely with interested governments and complementary businesses and agencies to provide 'at cost' anti-malarial drugs to regions of Africa that urgently need them. This saves lives and helps Novartis gain credibility and soft power from the conscience capital it builds up through its involvement in the project. 

Novartis keeps its 'at cost' figures low by leveraging the economies of scale such a large project makes possible. If, as seems likely, Novartis is able to achieve these low cost figures for not only the anti-malaria project but also other areas of its business, it can use the freed-up capital to fund additional, potentially life saving research and product development.

Ensuring minimum cost to customers (many of whom are also collaborators, for example governments and public health services) enhances overall value for Novartis, certainly in terms of reputation and conscience capital, and probably in terms enhanced business efficiency, capacity and productivity.

To see the full post click Here.

For more about collaboration go to: Sleeping-with-the-Enemy-Achieving-Collaborative-Success-2nd-Edition 

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