Measuring Competence? Exploring Firm Effects in Pharmaceutical Research

Abstract

Renewed interest in the resource‐based theory of the firm has focused attention on the role of heterogeneous organizational ‘competence’ in competition. This paper attempts to measure the importance of these effects in the context of pharmaceutical research. We distinguish between ‘component’ and ‘architectural’ competence, and using internal firm data at the program level from 10 major pharmaceutical companies show that together the two forms of competence appear to explain a significant fraction of the variance in research productivity across firms. Our results raise some intriguing questions about the nature of competencies and the ways in which they diffuse over time.

Human resources and the resource based view of the firm

“…Knowledge management requires that firms define knowledge, identify existing knowledge bases, and provide mechanisms to promote the creation, protection and transfer of knowledge (Argote & Ingram, 2000;Henderson & Cockburn, 1994;Leibeskind, 1996). While information systems provide a technological repository of knowledge, increasingly firms recognize that the key to successful knowledge management requires attending to the social and cultural systems of the organization (The Conference Board, 2000).…”

Vertical alliance networks: The case of university–biotechnology–pharmaceutical alliance chains

“…In their examination of a large sample of patents across a spectrum of technologies, Fleming and Sorenson (2003) argue that scientific understanding can be construed as a "map" that guides technological search toward fruitful areas or exploration. Specifically with regard to the drug discovery process, Henderson and Cockburn (1994) find that firms which had adopted "science-driven" research and development efforts enjoyed improved productivity. These findings about the volume and quality of technological outputs imply that firms with formal scientific access agreements with universities may have more and better intellectual property to broker to downstream partners.…”

In search of the drivers of high growth in manufacturing SMEs

“…Previous studies contend that capabilities are firm-specific and developed within the firm rather than acquired externally (Henderson and Cockburn, 1994;McGrath et al, 1995).…”

“…Specific examples of previous research include; the examination of capability development (Henderson and Cockburn, 1994;McGrath et al, 1995;Teece et al, 1997), and the use of capabilities to achieve cost reduction, higher quality and greater flexibility in manufacturing (Schroeder et al, 2002).…”