Creating Competitive Advantage for the Swedish Stem Cell Industry------The Role of Social Capital and Social Networks

Andrew Schenkel & Robin TeiglandStockholm School of EconomicsJune 2007

Today’s Agenda

• Researchers• Background - Creating Competitive Advantage for the Firm

• Our Study- Purpose

- Study Focus and Method

- Potential Outcomes

- Discussion and Next Steps

Who are we?

• Robin Teigland

- Associate Professor at SSE

- Conducts research on Uppsala biotech cluster

- Former consultant at McKinsey & Co.

• Andrew Schenkel

- Assistant Professor at SSE

- Industry 16 years of industry experience before receiving doctorate

• Extensive research experience in both networks and pharmaceutical and biotech industries

Background: Creating Competitive Advantage for the Firm

• Firm success is highly connected to networks “rich” in social capital – the ability of a firm to access resources through its networks

• A firm’s position in the network and how it accesses and uses available resources are critical to creating sustainable competitive advantage

• Networks and facilitating conditions can be designed

- Designing effective formal and informal, external and internal networks that support a firm’s strategy is a core organizational capability

- Creating the conditions for learning & knowledge dissemination throughout firm networks is a core organizational capability

The Stem Cell Network: Industry Level

Pharmaceutical/Biotech/ Marketing

Companies

STEM CELL

FIRMS

FinancialActors

Academiaand

Research Actors

Governmentand

Regulatory Bodies

Stem CellNetwork

Universities

FinancialActors

CROs

ProfessionalAssocs.

KOLs

AdvisoryBoards

PharmaFirms

BiotechFirms

Regulators

Government

ResearchInstitutes

ResearchArea 3

ResearchArea 2

Staff & Quality

Research Area 1

StakeholderRelations

Finance, Legal, IT

STEM CELLFIRM

MediaChemical

Example of a Firm’s Internal Network with Rich Linkages

Note: Nodes represent individuals in departments.Nodes of same color are in same department.Line represents one tie between individuals.

Final Outcomes•Stem cell

competence•Intellectual

capitalInternal Networks

Broadly shared learning across project

activities and functions

External Networks

Resources such as knowledge, info

about indications, competitors, etc.

Our Research Model

Learning Mechanisms

•Facilitators•Barriers

Purpose of Study

• To investigate how the patterns of a firm’s external and internal networks as well as formal and informal networks impact the following:

- Development of competencies

- Competitive advantage over time

Study Focus and Method

• Study Focus

- The network of people in the firm who are directly or indirectly involved in stem cell research as well as the network of people/organizations supporting the stem cell firm

• Focus on key managers, research scientists, and technical experts in order to map and understand internal & external, formal and informal links

- Firm’s learning mechanisms, e.g., organizational, personnel, to ensure development of necessary competencies

• Method

- Longitudinal study over three years

- Short interviews or surveys that require no more than 90 minutes during initial interview and thereafter 45 minutes every 9 months or as per agreement

- Network analysis of externally available data, e.g., publications, patents, etc.

Potential Outcomes

• Improved Understanding of Networks for Firm & Individual

- Longitudinal baseline data on internal & external networks

- Individual level: Personal reflection gained through interviews

- Organizational level: Perceived vs. actual networks through feedback

• Enhanced Knowledge Base

- Improved knowledge sharing and creation for accelerated learning and competence development in stem cells

- Understanding of potential areas for expansion

• Enhanced Performance

- Improved quality of projects and time to delivery

- Potential for new drugs and new intellectual property

- Potential positive effect on competitive position

Discussion and Next Steps