Management practices and strategies to accelerate the innovation cycle in the biotechnology industry

This paper examines management practices and strategies that are critical to successful commercialisation in the biomedical sector and how these practices and strategies impact upon performance innovation. The paper also details emerging issues and challenges for the biotechnology industry including human resource issues, access to venture capital, the development of basic business capabilities, and efficient and stable supply chain linkages.The research findings are based on data obtained from an action research methodology where 14 representatives of the biomedical sector were active participants. The qualitative data was analysed using a multiple cross-case analysis technique that explores the underpinning determinants of performance innovation in the industry. The research study identifies high-performance work practices and critical success factors to accelerate the ‘Innovation Cycle’ from idea to market. The paper concludes that managers in the biomedical industry need to acquire new business acumen skills to maintain a competitive advantage in a fiercely competitive global market. Organisations are recognising that knowledge workers with the requisite skills and expertise are critical to improving innovation performance.     

Collective strategies for improving environmental performance: A case study of the biotechnology industry

This paper examines the potential contributions of institutional theory and the collective strategies framework to assist managers in emerging industries in developing better means of addressing societal concerns. Lack of understanding and difficulties in communication between companies in the forefront of new technology developments and a society that is concerned about the environment have led to many of the problems facing the biotechnology industry. Measures intended to protect the environment from potential adverse effects have frequently restricted activities in the new biotechnology field, even though scientists are themselves convinced of the safety and control they exert over their new technologies. Collective strategies can be instrumental in stabilising certain aspects of the environment. Proper selection of issues and coordinated action can be helpful to all industry participants by informing public perceptions and government regulations and help insure that major environmental trends will evolve in a manner beneficial to all concerned.     

An integrated innovation process model based on practices of Australian biotechnology firms

An integrated approach to managing the innovation process is attractive for organizations for many reasons. However, there is a relative paucity of models that describe this approach. In this paper, an attempt is made to produce one such model. Based on a multiple case study design involving nine biotechnology companies and one peak industry body from Australia, a conceptual model is proposed that has the linear stage process model as the backbone. The twin mechanisms of market pull and technology push are incorporated within the model, with a set of key organizational constructs (management, communication, structure and control) embedded within these mechanisms. Overall, the results of this study improve our understanding of the innovation process by building a more comprehensive and integrated conceptual model.     

Nonparametric analysis of returns to scale in the US hospital industry

This paper presents new estimates of scale economies for US hospitals. We show that the common translog specification of hospital costs is a misspecification, and employ nonparametric, local linear estimation with both continuous and discrete covariates. A bootstrap method is used to provide inferences regarding ray scale economies and expansion path scale economies for a large sample of hospitals covering 1984–1996. We find evidence of changes in the structure of hospital costs over the sample period, as well as evidence of locally optimal hospital sizes. Copyright © 2004 John Wiley & Sons, Ltd.     

Labor unions and productivity: An empirical analysis using Japanese firm-level data

This paper empirically analyzes the relationship between labor union and firm performance in areas such as productivity and profitability by using data on more than 4000 Japanese firms, ranging from listed large firms to unlisted SMEs, in both the manufacturing and non-manufacturing sector. The presence of labor unions has statistically and economically significant positive effects on firm productivity. Unions' effects on wages are also positive, their magnitude being slightly larger than those on productivity. The decrease in the number of employees is greater at unionized firms than at non-unionized firms. The difference in employment growth is mainly attributable to the change in the number of part-time workers. In order to enhance productivity, close cooperation between management and unions is essential.     

Ranking industry performance in the US

In recent decades, rankings of states on virtually every basis have proliferated. Prominent among these rankings have been those that attempt to measure the economic/business environment of states. These rankings tend to be an indexing based on many types of sometimes unrelated data rendering the rankings of questionable meaning. This paper uses Data Envelopment Analysis (DEA) to provide rankings of state economic performance. By using DEA, we develop rankings that are systematic and have a meaningful interpretation.     

The biotechnology industry and strategies of biodiversity conservation: The influence of managerial interpretations and risk propensity

This article presents the results of a questionnaire‐based mail survey which was conducted to examine the influence of managerial cognitions on the strategies for biodiversity conservation undertaken by individual companies in the North American biotechnology industry. The study confirmed that managerial issue interpretations and risk propensities were significant influences on organisational actions for biodiversity preservation. More specifically, the biodiversity conservation strategies undertaken by individual companies were influenced by whether or not the managers of these companies interpreted biodiversity conservation as an opportunity or a threat as well as the propensity of these managers to undertake risk on behalf of their companies. This article concludes that opportunity interpretations of biodiversity conservation by managers of biotechnology companies will be translated into proactive environmental responsiveness strategies in uncertain environments only if these managers also exhibit a high risk propensity. Copyright © 1999 John Wiley & Sons, Ltd and ERP Environment.     

Impact of policy distortions on firm-level innovation,productivity dynamics and TFP

A large literature emphasizes that distortions misallocate resources across firms and are a key source of productivity losses. This paper examines the dynamic effects of distortions when they affect not only the allocation of resources but also firm-level incentives to improve productivity. I consider a setting where firms spend on innovation and thereby influence the evolution of productivity. When distortions are tied to productivity, firm-level innovation falls and the distribution over productivity becomes right-skewed. Quantitatively, TFP and average output falls and is amplified through the innovation channel. When distortions are uniform across firms, instead of correlated with productivity, the effects on TFP and average output are dampened.     

The impacts of benefit plans on employee turnover: a firm-level analysis approach on Taiwanese manufacturing industry

Employee turnover is a serious problem and the question of how to retain highly talented and valued people is very important. Previous employee turnover studies were mostly focused on the individual level but rarely from the standpoint of the business or firm. This study examines the impacts of four kinds of benefit plans on firm-level employee turnover issues, namely, retirement fund, pension, severance pay and fringe benefit. The present study uses the Census Bureau Employment Movement Survey of the Directorate General of Budget, Accounting and Statistics in Taiwan. The two models used to examine the overall manufacturing industry were: (1) the inducement model which tests the ‘with or without’ effect; and (2) the investment model which tests the ‘the more the better’ effect. Results reveal that, with respect to the firm's employee turnover rate, retirement fund and fringe benefits are negative while severance plans are significantly positive. These results are consistent with the transaction costs theory that total expenditure on these plans to retain employees (bureaucratic cost) is less than the market arrangements (transaction cost). In addition, the impact of pension plans is negative in respect of employee turnover in larger or more highly educated firms, but positive in firms with a lower educational level. Moreover, the firm size is negative while the firm's average employees' educational level is positive with respect to the workforce leaving their jobs. These results are consistent with the perspective of resource-based theory and human capital theory. Incidentally, this study also reveals insignificant differences between the ‘with or without’ effect and the ‘the more the better’ effect existing as a sub-group industry rather than across the entire industry.     

Assessing efficiency and innovation in the 3PL industry: an empirical analysis

ABSTRACT

The Third-party Logistics (3PL) industry is facing both important growth rates and increasing competitive pressure. 3PL providers are required to continuously sustain a more and more competitive cost structure (i.e. efficiency) and develop capabilities to improve their services (i.e. innovation); hence, the evaluation of these key success factors is considered a key issue. This paper develops a quantitative analysis of 71 Italian 3PL providers by using Data Envelopment Analysis to jointly assess efficiency and innovation. Furthermore, through a case study research, it corroborates the quantitative results by investigating the strategies of best-in-class companies. Results allowed identifying 13 3PL providers as efficiency leaders and 6 as leaders from both the efficiency and the innovation side. Their input composition indicates a diversification of the business models. A breakdown of the analysis by size and industry focus, along with empirical evidence on the strategies enhancing efficiency and innovation, is also provided.     

Survivorship in the US hospital services industry

Over the last two decades, changing state and federal regulations and increased price competition have dramatically changed the environment in which hospitals compete. This paper uses observations drawn at 5‐year intervals from 1973 to 1993 for each of the 50 states to examine the specific effect of these factors on the size distribution of hospitals. It finds that Certificate of Need (CON) laws and rate review regulations have tended to favor large hospitals. The paper also finds that hospitals have responded to increased payer price sensitivity by seeking a medium bed‐size capacity. Copyright © 2000 John Wiley & Sons, Ltd.     

Productivity, returns to scale and product differentiation in the retail trade industry: an empirical analysis using Japanese firm-level data

This paper examines productivity and returns to scale under the assumption of monopolistic competition using Japanese firm-level data. Although differentiating products (services) is considered important in firms?? strategies and productivity growth, it has not been sufficiently investigated in previous studies. In this paper, we study this issue in two retail trade industries, department stores and supermarkets, applying the model of Melitz (2000). Our results indicate that the standard production function is not relevant to estimate productivity in imperfectly competitive markets. It also suggests that the market structure should be carefully considered in productivity analysis. In addition, product differentiation has a positive effect on firms?? revenue for the supermarkets. Furthermore, the retail trade industries possibly follow increasing returns to scale. Thus, policy measures that promote economies of scale and product differentiation should contribute to further growth in these industries. In addition, the results indicate that the regulatory reform of the retail trade industry in 2000 increased the gap between winners and losers in terms of productivity.     

A firm-level analysis of determinants of ICT adoption in Spain

The purpose of this paper is to analyse the role played by five groups of factors in ICT adoption: environment, firm structural characteristics, human capital, competitive strategy, and internal organization. In order to achieve this goal, the data collected in a survey with a sample of 337 Spanish workplaces are used. The paper overcomes some of the limitations found in the empirical literature since it examines several ICT infrastructure and usage indicators at the same time, using a sample of workplaces of different sizes in all activity sectors in a context of a developed country with a low rate of ICT incidence. Results highlight the need to study the different ICT separately as well as the importance of establishment size, multinational ownership, and high-skilled workforce in ICT adoption. Quality control systems and team-based organization of work also play a relevant role in the diffusion of certain elements of ICT within firms. The need of reviewing the traditional public support for ICT implementation on small workplaces arises, together with the existence of complementarities with policies aimed to attract foreign investments and to increase the workforce education level as a way to spread ICT implementation. Results also show that managers need to align ICT adoption and the strategic focus of the firm more consistently.     

The innovation decision: An economic analysis

Studies of the determinants and effects of innovation commonly make an assumption about the way in which firms make the decision to innovate, but rarely test this assumption. Using a panel of Irish manufacturing firms we test the performance of two alternative models of the innovation decision, and find that a two-stage model (the firm decides whether to innovate, then whether to perform product only, process only or both) outperforms a one-stage, simultaneous model. We also find that external knowledge sourcing affects the innovation decision and the type of innovation undertaken in a way not previously recognised in the literature.     

Structural ambidexterity in NPD processes: A firm-level assessment of the impact of differentiated structures on innovation performance

Based on a survey study of 155 U.S. firms, we conducted a firm-level assessment of the impact of different kinds of structures (i.e., functional versus cross-functional) in different kinds of new product development (NPD) processes (i.e., incremental versus radical) on different kinds of firm innovation performance (i.e., derivative versus breakthrough). We observe that most firms opt for similar structures for their incremental and radical NPD processes. At the same time, though, we find strong evidence that (1) firms that apply a cross-functional structure for the radical NPD process perform significantly better in terms of breakthrough innovation performance than firms that apply a functional structure for the radical NPD process and (2) firms that apply a functional structure for the incremental NPD process perform significantly better in terms of derivative innovation performance than firms that apply a cross-functional structure for the incremental NPD process. These latter findings point to the relevance of adopting structural ambidexterity, where firms make an explicit distinction between incremental and radical NPD processes and organize them in a different way.     

Bargaining power in alliance governance negotiations: evidence from the biotechnology industry

Alliance partners negotiate how they will govern their alliance. This study shows bargaining power, not just efficiency considerations, influences the outcome of this negotiation. Whereas previous research on this phenomenon associates bargaining power with firm size, this study employs more nuanced measures of bargaining power applicable to biotechnology firms while controlling both absolute and relative firm size. We find small biotechnology firms with partners that are over five times larger can still have the bargaining power to get their interests met when the two parties have opposing governance interests.     

Competition,innovation and regulation in the pharmaceutical industry

This article discusses the impact of regulation on competition and innovation in the pharmaceutical industry. Prompted by concern over attempts at regulating the industry on the European level, we discuss the two basic forms of regulation which we observe to be typical, quality regulation (licencing) and price regulation. In doing so, the analysis focuses on the research segment of the pharmaceutical industry and discusses forms of competition by innovation. Following a recent paper by Nelson, the specific characteristics of competition in the pharmaceutical industry are developed as well as their welfare implications. Regulatory behavior vis-á-vis the industry is analysed in terms of a behavioral model initially proposed by Stigler, and an attempt is made to incorporate into the analysis the experience of regulation in both Europe and the United States of America.     

Environmental strategies in the paint and coatings industry

In general, a proactive strategy entails an anticipatory approach to problems. It is also associated with taking the initiative and doing more than is strictly needed. The nature of proactivity that businesses may display with respect to the environment is considered and also its meaning in terms of strategic behaviour and technological development. A conceptual framework is developed that differentiates between types of proactive strategies. This framework is based on a study of the paint and coatings industry in Great Britain and the Netherlands and is applicable to both countries. Even though the big international paint companies play a decisive role in the development and introduction of cleaner technologies, it is argued that the small- and medium-sized paint companies deserve special attention. Not only is proactive behaviour by the big companies important, but also proactive strategies by the small- and medium-sized companies, even if they are limited in scope, because the latter determine at national and local levels the pace and nature of the transformation that has to take place to produce a sustainable economy. This process is crucial to ecological modernization if it is intended not only to get rid of old-fashioned ways, but also to create new opportunities for economic upgrading and rejuvenation.     

Safety process innovation in medical service industry

Safety issues are generally ignored in the innovation of services for internal and external customers. The purpose of this study is to provide a safety mechanism framework for process innovation in medical service industry. This study applies action research to develop a safety framework for process innovation. The practicality of the proposed method is demonstrated using a case study of Cesarean sections in Taiwan. The proposed step for safety process innovation and safety process innovation framework (SPIF) were verified by eight experts and tested with Delphi. The most important concept concerning SPIF is that it provides a clear framework for evaluating the risk of potential failure in each subsystem of process in innovation.