During the twentieth century, the pharmaceutical industry experienced a series of dramatic changes as developments in science and technology generated new opportunities for innovation. Each of these transitions forced existing firms to develop new capabilities. The authors examine the most recent such transition, the shift to molecular genetics and recombinant DNA technology (1970 to the present), and explain how and why this transformation differed from the previous ones in pharmaceuticals. Small biotech startups played an important role in this transition, and the large pharmaceutical firms that began to enter the field had to develop new strategies for innovation. Two major strategies were adopted by the early movers, all of which created various kinds of alliances with the small biotech businesses. By the mid-1990s, the leading pharmaceutical manufacturers had established significant capabilities in the new field, but they were continuing to work with specialized biotechs in order to innovate across a broad range of therapeutic categories.

Almost unnoticed in the midst of revisionist attacks on progressive history and the rise of the New Left, an organizational synthesis has been emerging which offers much to the student of modern America. Professor Galambos presents a historiographical survey of this synthesis and concludes that its chief strength is a mode of analysis blending the traditional tools of historical thought with ideas from the behavioral sciences.

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In this suggestive essay, Professor Galambos surveys the large number of books and articles, published since 1970, that together point toward a new “organizational synthesis” in American history. Expanding upon an earlier, more tentative essay on the same subject published in the Autumn 1970 issue of the Business History Review, he contrasts the widely disparate postures adopted in recent years by historians studying organizational behavior. His survey reveals a rich diversity of opinion, less reliant than was previous scholarship upon abstractions drawn from the social sciences. This diversity of opinion, Galambos concludes, provides the organizational synthesis with much of its continued vitality, and makes possible “the kind of moral judgments that have always characterized the best historical scholarship.”

Two major forces have been remaking the organizational setting of the United States in the recent past. The third industrial revolution and globalization are having a dramatic impact on the structure and process of American economic institutions and on the nation's political process. This third version of the organizational synthesis probes, with varying degrees of success, the vast literature that has accumulated around these two themes in the years since 1983, when theBusiness History Reviewpublished the second version of the paradigm. While much has changed in the nation's history and its historiography, bureaucratic institutions continue to dominate the society's organizational landscape. Pressed to change, to adapt to the need for greater efficiency and innovative capability, the surviving bureaucracies and the professionals who people them have experienced wrenching changes in recent years. To date, this “American solution” to global competition and technical transformation has been expensive in human terms but an overwhelming economic success for America.