Nasty, Brutish, and Short: Embeddedness Failure in the Pharmaceutical Industry
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Author(s)
Azoulay, Pierre
Repenning, Nelson
Zuckerman Sivan, Ezra W.
Date Issued
September 2010
Journal
Administrative Science Quarterly
Publisher
Samuel Curtis Johnson Graduate School of Management, Cornell University
Citation
Azoulay, Peirre, Nelson P. Repenning, Ezra W. Zuckerman. "Nasty, Brutish, and Short: Embeddedness Failure in the Pharmaceutical Industry." Administrative Science Quarterly, 55.3, Sept. 2010. p. 472-507. © 2010 Johnson Graduate School, Cornell University.
Version
Final published version
Abstract
Since the early 1990s, U.S. pharmaceutical firms have
partially outsourced the coordination of the clinical trials
they sponsor to specialized firms called contract research
organizations. Although these exchanges appeared ripe
for the development of close, “embedded” ties, they were
in fact “nasty, brutish, and short”—i.e., marked by ill-will
and a bias toward replacing current exchange partners
due to perceptions of underperformance. Drawing on
in-depth field work, we use causal loop diagrams to
capture this puzzle and to help explain it. Our analysis
suggests that attempts to build embedded relations will
fail if the parties do not recognize the limitations of the
commitments they can credibly make. More generally,
when managers misdiagnose as failure what is in fact a
trade-off inherent in the design of their organizations, they
risk engendering even worse outcomes than those they
would otherwise attain.
MIT Department
Sloan School of Management
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Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use.
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DOI of Published Version
http://dx.doi.org/10.2189/asqu.2010.55.3.472
https://doi.org/10.2189/asqu.2010.55.3.472
