Carl H. Tong, Lee‐Ing Tong and James E. Tong
This paper aims to offer a succinct description of the Vioxx recall in 2004 and discuss the fundamental reasons why Merck got into this trouble.
Abstract
Purpose
This paper aims to offer a succinct description of the Vioxx recall in 2004 and discuss the fundamental reasons why Merck got into this trouble.
Design/methodology/approach
A review of literature has been conducted to provide key facts about the Vioxx disaster and to shed light on the operations of its maker Merck. The Vioxx recall case is analyzed from a perspective including both company profits and public interest.
Findings
Merck aggressively marketed an unsafe drug, under the brand name Vioxx, without properly disclosing its serious side effects to consumers. After the facts were revealed, the company faced costly lawsuits, angry investors and falling profits. This case clearly shows how a disaster can occur when a company becomes greedy and seeks undeserved profits at the expense of ethics and social responsibility.
Practical implications
Building a successful and competitive business requires managers to make decisions that balance profit and social responsibility. When business managers run their business solely for profit, problems will almost certainly occur. Such problems can cause severe damage not only to the company's customers but also to the company itself.
Originality/value
Vioxx is one of the biggest marketing mistakes in recent business history. This paper provides valuable learning insights and should be useful to corporate executives, government regulators and business scholars.
Details
Keywords
Isabel Estrada, Florian Noseleit and Killian McCarthy
Alliances often turn into acquisitions (i.e., one alliance partner is acquired by the other). In these transitional governance trajectories, geography-related factors can play a…
Abstract
Alliances often turn into acquisitions (i.e., one alliance partner is acquired by the other). In these transitional governance trajectories, geography-related factors can play a crucial role. Factors like location and distance can notably influence the decision to acquire the alliance partner, as well as the performance implications of such a transition. However, existing studies on transitional governance tend to underemphasize the geographic dimension of the phenomenon. In this chapter, we take a first step toward connecting the field of transitional governance and the discipline of economic geography, which does emphasize location and distance as critical determinants of economic activities. We discuss how economic geography can inform the field of transitional governance and propose some promising avenues for future studies linking organization, place, and space in transitional governance trajectories.
Details
Keywords
Yong Li, Barclay E. James, Ravi Madhavan and Joseph T. Mahoney
We discuss recent developments in real options theory and its applications to strategic management research, examine the potential difficulties in implementing real options in…
Abstract
We discuss recent developments in real options theory and its applications to strategic management research, examine the potential difficulties in implementing real options in theory and practice, and propose several areas for future research. Our review shows that real options theory has provided substantial insights into investment and exit decisions as well as into the choice of investment modes. In addition, extant research studies have contributed significantly to our understanding of whether and how organizations can benefit from real options. Future research that addresses difficulties in applications will further advance both real options theory and practice in strategic management. We call for future generations of research to enhance the impact of real options as an emerging dominant conceptual lens in strategic management.
Ilya R.P. Cuypers and Xavier Martin
We provide a comprehensive synthesis and extension of the real option (RO) literature on joint ventures (JVs), contributing in three main areas. First, we examine major…
Abstract
We provide a comprehensive synthesis and extension of the real option (RO) literature on joint ventures (JVs), contributing in three main areas. First, we examine major alternative theoretical perspectives on JVs – learning, bargaining, transaction cost and agency theory – to elaborate how they complement or contradict RO predictions. Second, we compare arguments and variables used to explain different JV stages – initial RO explicitness and equity shares, JV stability, and performance consequences – and highlight research opportunities. Third, we discuss and extend research about behavioral aspects of making RO (JV) investments. Overall, we offer new predictions and suggestions for a better integration within the RO literature, and between RO and related literatures on JVs.
The Presidential Address to the Liverpool Engineering Society by Mr. Farthing (the salient points of which are reproduced in this issue) has particular bearing upon lubrication…
Abstract
The Presidential Address to the Liverpool Engineering Society by Mr. Farthing (the salient points of which are reproduced in this issue) has particular bearing upon lubrication and especially on young lubrication engineers. Mr. Farthing stressed the very wide field open to young engineers and the difficulties associated with training in order to cover as wide a field as may be necessary. It is usually so important to gain a wide knowledge before one can specialise and this is certainly the case with lubrication engineers. One cannot begin to fully appreciate the intricacies of a lubrication system with all its accessory components lubricating and guarding, for example, a large motive power plant or rolling mill, until one has more than a mere working knowledge of the plant itself, the duties it must perform, how it performs them and the snags that arise which might be overcome by correct lubrication. In view of the fact that lubrication systems are just as important in a textile mill as in a power station or a large brick works, the almost impossible‐to‐achieve‐range of knowledge that would simplify the work of a lubrication engineer is very obvious. Fortunately, lubricating principles apply to most cases and knowing how to apply one's knowledge from basic principles is the key to success in this difficult profession.
Tony W. Tong and Jeffrey J. Reuer
Real options theory begins by drawing an analogy between real options and financial options. A financial option is a derivative security whose value is derived from the worth and…
Abstract
Real options theory begins by drawing an analogy between real options and financial options. A financial option is a derivative security whose value is derived from the worth and characteristics of another financial security, or the so-called underlying asset. By definition, a financial option gives its holder the right, but not the obligation, to buy or sell the underlying asset at a specified price (i.e., the exercise price) on or before a given date (i.e., the expiration date). Financial economists Black and Scholes (1973) and Merton (1973) pioneered a formula for the valuation of a financial option, and their methodology has opened up the subsequent research on the pricing of financial assets and paved the way for the development of real options theory.
The librarian and researcher have to be able to uncover specific articles in their areas of interest. This Bibliography is designed to help. Volume IV, like Volume III, contains…
Abstract
The librarian and researcher have to be able to uncover specific articles in their areas of interest. This Bibliography is designed to help. Volume IV, like Volume III, contains features to help the reader to retrieve relevant literature from MCB University Press' considerable output. Each entry within has been indexed according to author(s) and the Fifth Edition of the SCIMP/SCAMP Thesaurus. The latter thus provides a full subject index to facilitate rapid retrieval. Each article or book is assigned its own unique number and this is used in both the subject and author index. This Volume indexes 29 journals indicating the depth, coverage and expansion of MCB's portfolio.
Details
Keywords
Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some…
Abstract
Aim of the present monograph is the economic analysis of the role of MNEs regarding globalisation and digital economy and in parallel there is a reference and examination of some legal aspects concerning MNEs, cyberspace and e‐commerce as the means of expression of the digital economy. The whole effort of the author is focused on the examination of various aspects of MNEs and their impact upon globalisation and vice versa and how and if we are moving towards a global digital economy.