Real option as strategic technology uncertainty reduction mechanism: inter-firm investment strategy by pharmaceuticals

Whether pharmaceutical firms use the real option (RO) mechanism for strategic technology uncertainty reduction and whether the role of RO decreases when industrial technology progresses from research and development (R&D) to commercial activities in a product life cycle is discussed. The evidence confirms that pharmaceutical firms enter different in the external technology sourcing. Moreover, RO-based entry coefficients differ in sizes at different levels in the industrial value chain. The R&D entry stage is relatively greater than the clinical trials entry stage. However, contrary to the proposition that the commercial entry coefficient will be relatively lower; the results indicate that the commercial RO-entry stage appears to be relatively greater than both the R&D entry stage and the clinical trials entry stage. The overall RO-based entry in external technology sourcing appears to be a U-shaped curve along the product life cycle. The article highlights some theoretical and practical implications of these findings.     

Vertical alliance and vertical integration for the inflow of technology and new product development in the pharmaceutical industry

Pharmaceutical firms are increasingly seeking vertical alliance (licensing and joint venture) or bridges and vertical integration (merger and acquisition, M&A) or buffers. However, the question remains whether alliance and integration modes of organisation contribute to the clinical trials activities for a new product development. Using data on 250 pharmaceutical firms, this study examines the linkage between the external technology-sourcing modes and an increase in clinical trials activities, advancing new product development. The findings indicate that licensing mode may not be an effective in comparison to joint ventures and M&A modes of the organisation. Comparing the two modes – vertical joint venture (bridges) and vertical integration (buffer) – the former appears to be effective than the latter (M&A) in sourcing external technology acquisition in the pharmaceutical industry. Implications of these findings are addressed in terms of strategy and structure in a broader context.     

Optimal environmental regulation based on more than just emissions

I develop a principal-agent model of environmental regulation in which the regulator can acquire two costly signals of the firm’s abatement effort. Acquisition of the second signal is conditioned on the observed value of the first, emissions signal. The optimal contract takes the form of an emissions standard when only the emissions signal is acquired, and a set of contingent emissions standards when both signals are acquired; the standards are coupled with uniform, maximal penalties for noncompliance. Acquisition of the second signal may be optimal when intermediate values of the first signal are observed but not when extreme values are observed.      

Learning organization and work engagement: the mediating role of employee resilience

Abstract

As automation and structural transformations mark the new digital realities of the twenty first century, contemporary organizations demand a highly resilient and engaged workforce to sustain their competitive edge. Despite an eminent literature revolving around learning organization in the management discourse, there is a lack of research investigating the effect of learning organization on employee resilience and work engagement. With this precept in mind, this study developed and tested a mediation model linking learning organization to employee resilience and work engagement. The present study draws on the tenets of Fredrickson’s broaden-and-build theory and conservation of resource theory for supporting the study results. This study used cross sectional surveys of 300 IT professionals in India. Structural equation modeling was used for empirically testing the study hypotheses. Additionally, the study utilized Preacher and Hayes mediation analyses to investigate the mediating effect of employee resilience on the relationship between learning organization and work engagement. The results revealed significant relationship between variables of the study and shows that learning organization positively effect employee resilience and work engagement. The findings suggest that employee resilience partially mediate the effect of learning organization on work engagement. This study offers concrete insights to HR managers for fostering employee resilience which in turn can play a key role in building a highly engaged workforce. Future implications for theory and HRM practitioners are discussed.     

Japan's fifth generation computer project

The Japanese Fifth Generation project is aimed at increasing computing power by around three orders of magnitude over 15 years. Motives are political and social as well as commercial. The Japanese have sought international cooperation in this attempt to beat IBM (in particular) by ignoring compatibility with existing systems. Although there is not even an embryonic Vth generation system yet, final success looks likely. One goal is to be able to process knowledge (rather than data), in a user-friendly manner.     

A comparison of conventional versus Islamic banking customers attitudes and judgment

This investigates the impact of customer attitude and judgment regarding conventional and Islamic banking system in Pakistan. This study attempts to find out, how the customers of Islamic banks perceive about Islamic banking practices in terms of Shariah compliance and conventional banking system regarding earning more profits. This study consists on primary data through a well design questionnaire. Four hundred and thirty (430) questionnaires were distributed among different customers of all three types of banking, such as Islamic, conventional and stand-alone branches in order to investigate customer’s attitude and judgment toward banking system. The findings indicate that overall 28% of Islamic banking customers don’t know the essential concept of Islamic financial institution’s in Pakistan. Furthermore, 54% customers of conventional banking show their interest to convert their accounts toward Islamic banks.

     

Note on positive lower bound of capital in the stochastic growth model

In the context of the classical stochastic growth model, we provide a simple proof that the optimal capital sequence is strictly bounded away from zero whenever the initial capital is strictly positive. We assume that the utility function is bounded below and the shocks affecting output are bounded. However, the proof does not require an interval shock space, thus, admitting both discrete and continuous shocks. Further, we allow for finite marginal product at zero capital. Finally, we use our result to show that any optimal capital sequence converges globally to a unique invariant distribution, which is bounded away from zero.     

A resource orchestration view of supply chain traceability and transparency bundles for competitive advantage

The literature has mostly examined supply chain (SC) traceability and SC transparency separately, ignoring the mutually constitutive relationship of these two related constructs. We draw on the resource orchestration theory and the causal complexity perspective to conceptualize and validate SC traceability and SC transparency as interrelated organizational capabilities that may mutually enhance or compensate each other for competitive advantage. We constructed an original sample from two sources to empirically test this conceptualization using fuzzy set qualitative comparative analysis (fsQCA). Our empirical results reveal that the ability of firms to leverage SC traceability for a high financial performance is contingent upon creating a transparency perception of SC with a wide range of stakeholders. Our results also identified the firm size and its international presence, as having a significant bearing on the ability of firms to leverage SC traceability and SC transparency capabilities for a competitive advantage.     

Legal Treatment of Abuse of Dominance in Indian Competition Law: Adopting an Effects-Based Approach

Review of Industrial Organization - Abuse of dominance investigations around the world are often form-based, primarily centred on the pre-requisite of dominance. This may lead to false positives or...     

Operational complexity of foreign innovation projects and the inter-organisational alliance in the biopharmaceutical industry in China

Contrary to the perceived assumption that operational complexity of innovation projects predicts operations inside the organisation, we propose the opposite argument that operational complexity of foreign innovation projects increases the inter-organisational alliance formation. The evidence from the clinical trials innovation projects in the biopharmaceutical sector supports the operational complexity-alliance (OCA) proposition in China at three levels: institutional (legal and cultural), technological (purpose and methodology) and dispositional (organisation type and its experience). Institutional complexity shows that the legal difference between the home and host country positively predicts the inter-organisational alliance. Similarly, in national cultural differences, power distance, uncertainty and long-term orientation support the OCA proposition. Technological complexity reveals that explorative purpose and complex methodologies support the OCA proposition. The organisation’s disposition reveals that the industrial firm predicts the inter-organisational alliance more than the non-industrial organisation does. Concerning the organisation’s experience, it negatively predicts the inter-organisational alliance. Therefore, it appears that organisational discretion from the operational complexities leads to the structural change to reduce the cost of operations through externalisation rather than internalisation.