Danaka Corporation Healthcare Solutions Harvard Case Solution & Analysis

Danaka Corporation Healthcare Solutions Case Solution

Problem Diagnosis

One of the most significant barriers, which is faced by the large multinational corporations, is the inability to finance the growth initiatives of the business in many other areas of the business or in many other key business sectors. These initiatives are highly critical as a result of the low resource availability in the organization and also to win in the terms of the people and the dollars both.
The same challenge is being faced by the owners of the Danaka Corporation and its general manager, Gloria Manning. The management of Danaka Corporation was looking ahead to fund the growth of the 8 new initiative projects which were highly critical in order to achieve the growth plans of the company for the year 2012. However, the main issue was basically to fund all the new 8 projects by reducing the research and development expenditure from the current 32 projects of the company.
All the projects of the company had been divided into four subcategories, which were the lagging projects; fight the fade projects, share growth projects and the accelerated growth projects which were also more like the share growth projects. The main challenge which is being faced by the management of Danaka Corporation is to basically free up $ 300 million in funds from the existing projects of the company in order to fund the new 8 projects of the company and the main constraint of the company is to achieve this by still maintain a target revenue of $5b till the end of the year 2012.

Analysis

The optimal funding allocation decisions have been made by analyzing all the projects of the company and the products sold under each of the businesses of the company and then the optimization of the funding allocation has been performed in order to free up $ 300 million for funding the 8 new projects of the company. These 8 new projects would be not yielding any financial returns until the year 2012 and this is the reason that a constraint has been set by the management that the revenues from the existing businesses need to be at least equal to or higher than $ 5 billion.
The weighting scorecard has first been re-assessed and the weights and the scores for some of the projects have been changed looking at the growth prospects of that particular project category and the demand of the products in the market. Once this has been done, then the optimal allocation of the funds is performed to free up $ 300 million. After this objective has been achieved then the evaluation of the opportunity map has been performed and recommendations have been made to Gloria Manning.
Weights for Each Criteria & Initiative Portfolio Map

The excel spreadsheet shows all the weights which have been assigned by the team of Gloria Manning. First of all, if we look at the fight the fade project category and its products then the weightage for identifying the specific customer targets has been reduced to 2 and the reason for this is that this projects category just focuses on maintaining the current level of the business in the market. These have limited growth potential so identifying new specific customer targets is not relevant for this category.
The scores for the Drapes in this project category have been changed because the hand washes and the antiseptic wipes are the most effective of all the products in this category and as the total weighted score for drapes is lowest of all therefore, this had been chosen as the first choice for not funding and freeing up its research and development dollars. Similarly, for the projects based on the share growth criteria, securing the market share gain and the identifying the specific customer targets decision criteria have been increased to a weight of 4.....................

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