Globalization of pharmaceutical R&D. Pharmaceutical R&D governance forms in People's Republic of China

Yrityksen selviytyminen ja menestyminen ovat riippuvaisia sen kyvyst�� innovoida, luoda tietoa ja hy��dynt���� tiet��myst�� ja keksint��j�� (Dunk ja Kilgore 2001). Yrityksen menestyminen erityisesti korkean teknologian alalla on siten suoraan riippuvainen sen T&T:st��, johon tehdyt investoinnit tuovat merkitt��vi�� taloudellisia etuja yritykselle uusien tuotteiden, palveluiden ja prosessien muodossa (McEvily ja Chakravarthy 1999). Teknologinen etumatka ja sen tuotteistaminen innovatiivisiksi tarjoamiksi mahdollistaa monopolististen etujen saavuttamisen yrityksen kansainv��lisess�� kilpailussa (Lall 1977). T��m�� kaltainen kilpailuetu voidaan saavuttaa yrityksen kyvyll�� yhdist���� maantieteellisesti hajautettu T&T:ns�� tehokkaaksi verkostoksi (Porter 1986). Boehen (2008) mukaan T&T:n globalisoitumista voidaan johtaa eri hallint��muodoilla: T&T:n kansainv��listymisell��, T&T:n ulkomaille sijoittamisella ja T&T ulkomaille ulkoistamisella. T&T:n globalisoituminen on osa 2000-luvun taloudellista muutosta, ja sille on esitetty useita vaikuttavia tekij��it��, kuten kustannuserot, ty��voimaresurssit, erityisosaamiskeskukset, paikallinen teknologia osaaminen ja kohdemarkkinoiden potentiaali (bardhan 2006; Norwood, ym. 2006; von Zedtwitz ja Gassmann 2002). Tutkimuksen on osoitettu eroavan tuotekehityksest�� ja eri tekij��iden on osoitettu vaikuttavan niihin (von Zedtwitz ja Gassmann 2002; Leifer ja Triscari 1987). Samoin T&T on osoitettu olevan jatkumo perustavanlaatuisesta soveltavaan ja l����kekehityksen muodostavan vastaavan T&T jatkumon (Lall 1980; Iansiti 1993), jonka yksitt��iset osat vaikuttavat sen hallintomuotoon. Tutkimus esitt���� eri tekij��it�� voivan hy��dynt���� hallintomuodosta riippuen. T��t�� tutkimusta varten tutkija haastatteli l����keteollisuuden johtajia Kiinassa vahvistaakseen tai hyl��t��kseen eri tekij��it�� ja niiden suhdetta l����keteollisen T&T:n hallintomuotoihin. Markkinoiden todettiin olevan ensisijainen tekij�� mutta my��s kustannuserojen, insentiivien, ty��voimaresurssien ja erityisosaamiskeskusten merkitys T&T:n globalisoitumiseen vaikuttavina tekij��in�� vahvistettiin yhdess�� perusvaatimusten ja riskitekij��iden kanssa. Tutkimuksessa vahvistetaan my��s l����keteollisen T&T-jatkumon vaikutus ja esitet����n viitekehys hallintomuodoille.

Globalization of pharmaceutical R&D Pharmaceutical R&D governance forms in People's Republic of China

Firm's survival and success, which are dependent on its ability to innovate, to create knowledge and to capitalize on inventions and know-how, is in essence directly linked to its R&D process (Dunk and Kilgore 2001). Especially in technology driven industries, such as the pharmaceuticals, there are signi���cant positive returns to R&D investments through introduction of new or improved products and services (McEvily and Chakravarthy 1999). Technological lead and its transformation to innovative products as fruits of corporate R&D can be seen as monopolistic advantage that helps enterprises to compete in today���s market (Lall 1977). This competitive advantage can be derived from corporation's ability to integrate its activities across geographic locations (Porter 1986). According to Boehe (2008) globalization of R&D can executed with different governance forms: R&D internationalization, R&D offshoring or R&D offshore outsourcing. Globalization of R&D is intervened with the changes in global economy of the 21st century. Some studies argue for its influencing factors to be access to vast skilled labor pools and centers of excellence (Bardhan 2006). Other studies indicate the R&D cost differentials between countries to be the major expected benefit (Norwood et al. 2006). Von Zedtwitz and Gassmann (2002) presented benefits as divided to accessing markets and customers or to accessing local science and technology. This study proposes that based on governance form distinct factor derived benefits can be capitalized. To corroborate or refute factors and their relations on R&D globalization governance forms, an empirical study based on expert interviews of pharmaceutical directors was conducted in the People's Republic of China. The market was found to be the major influencing factor. Local requirements and adaptation were corroborated as factors connected with markets. Furthermore, influencing factors, such as labour, centers of excellence, cost, financial incentives were corroborated together with conditional and risk factors. Furthermore this research argues that the globalization of pharmaceutical R&D is dependent on the financial, scientific and operational requirements of the drug discovery stage. And thus establishes the influence of drug discovery's stages continuum on pharmaceutical R&D globalization. Finally, a R&D globalization governance form decision framework is proposed based on the frameworks presented in literature and author's corroborated empirical findings.

Offshoring and outsourcing under demand uncertainty -a supply chain management analysis

Outsourcing and offshoring or any combinations of these have not just become a popular phenomenon, but are viewed as one of the most important management strategies due to the new possibilities from globalization. They have been seen as a possibility to save costs and improve customer service. Executing offshoring and offshore outsourcing successfully can be more complex than initially expected. Potential cost savings resulting from of offshoring and offshore outsourcing are often based on lower manufacturing costs. However, these benefits might be conflicted by a more complex supply chain with service level challenges that can respectively increase costs. Therefore analyzing the total cost effects of offshoring and outsourcing is necessary. The aim of this Master��s Thesis was to to construct a total cost model using academic literature to calculate the total costs and analyze the reasonability of offshoring and offshore outsourcing production of a case company compared to insourcing production. The research data was mainly quantitative and collected mainly from the case company past sales and production records. In addition management level interviews from the case company were conducted. The information from these interviews was used for the qualification of the necessary quantitative data and adding supportive information that could not be gathered from the quantitative data. Both data collection and analysis were guided by a theoretical frame of reference that was based on academic literature concerning offshoring and outsourcing, statistical calculation of demand and total costs. The results confirm the theories that offshoring and offshore outsourcing would reduce total costs as both offshoring and offshore outsourcing options result in lower total annual costs than insourcing mainly due to lower manufacturing costs. However, increased demand uncertainty would make the alternative of offshore outsourcing more risky and difficult to manage. Therefore when assessing the overall impact of the alternatives, offshoring is the most preferable option. As the main cost savings in offshore outsourcing came from lower manufacturing costs, more specifically labour costs, the logistics costs in this case company did not have an essential effect in total costs. The management should therefore pay attention initially to manufacturing costs and then logistics costs when choosing the best production sourcing option for the company.