French Pharmaceutical Strategic Clusters: A Hybrid Inducto‐deductive Framework for Visual Analysis of Competitive Spaces

• DOI: http://doi.org/10.1002/jsc.2067
• Date: 01 July 2016
• Author: Philippe Rebière,Hareesh Mavoori
• Published date: 01 July 2016

RESEARCH ARTICLE

Strat. Change 25: 343–360 (2016)

Published online in Wiley Online Library

(wileyonlinelibrary.com) DOI: 10.1002/jsc.2067

Copyright © 2016 John Wiley & Sons, Ltd.

Strategic Change: Briengs in Entrepreneurial Finance

Strategic Change

DOI: 10.1002/jsc.2067

French Pharmaceutical Strategic Clusters: A Hybrid

Inducto‐deductive Framework for Visual Analysis of

Competitive Spaces1

Philippe Rebière

ICN Business School, Nancy, France2

Hareesh Mavoori

ICN Business School, Nancy, France

A

hybrid visualization framework combining multiple approaches offers cross‐

validated insights into complex competitive and strategic dynamics of markets

forinsiders as well as policy‐makers and is transferable across industries.

Research on strategic groups has occupied a central place in the strategic manage-

ment literature. Strategic groups, dened by Porter (1980) as ‘groups of rms

within an industry following the same or similar strategy along strategic dimen-

sions,’ provide a means of classifying rms by dening groups based on their

choice of strategies and business models within a given industry. e concept of

strategic groups recognizes the existence of similarities and dierences amongst

industrial rms.

Recent theoretical developments in the domain of strategic groups – speci-

cally those oriented toward cognitive groups and strategic group identity – suggest

on the one hand that strategic group membership appears to be stable over time,

and on the other hand that the rms in a strategic group evolve.

e ensemble of mental managerial processes related to the function of com-

petitive intelligence could lead to the formation of strategic groups (McNamara

et al., 2003). To maintain protable growth, enterprises invest millions in com-

munication expenses and adopt dierent strategic choices to build a competitive

advantage.

Our proposal is to develop comprehension of strategic groups through the

application of a hybrid methodology combining inductive (explorative without

1 JEL classication codes: C8, C18, D22, I11.

2 e authors thank IMS Health – La Défense for their assistance in this research,

contributing the data for production of this article and, in particular, the help of

Stephane Sclison, Director of Strategy of IMS France, without whose assistance

thisresearch would not have been possible. ey are also grateful to the editor,

CarloMilana, for his suggestions and encouragement.

Strategic and competitive forces

cause companies within an

industry to form clusters both for

synergistic coopetition and mutual

protection of market share.

Visualizing the logic of such

clusters offers a concise overview

of the market dynamics, aiding

managers in their strategic/

competitive positioning and

policy‐makers in industry

monitoring and regulation.

A synergistic combination of

inductive, deductive, quantitative,

and qualitative approaches is

needed to ensure cross‐veried

(triangulated) comprehension of

the complex interplay of market

forces without oversimplication.

344 Philippe Rebière and Hareesh Mavoori

Copyright © 2016 John Wiley & Sons, Ltd. Strategic Change

DOI: 10.1002/jsc

apriori expectations) and deductive (using pre‐existent

theory) approaches via clustering (Ketchen and Shook,

1996), development of a novel market conquest frame-

work, and application of the Miles–Snow (1978) strate-

gic orientation framework. e methodology leverages

both quantitative and qualitative data, as well as corre-

spondence analysis to bridge the inductive and deductive

ndings.

e primary contribution of this research is to ll the

gap in the literature on detailed strategic structural studies

focusing on the French pharmaceutical industry by creat-

ing an empirical, inductive, typological grid to analyze,

understand, and visualize the strategic competitive space

of a given industry, and apply it to the specic case of the

French pharmaceutical markets in combination with

other deductive frameworks.

e objectives of this research article are threefold:

1. To delineate the contours of strategic clusters by

utilizing a quantitative approach that draws upon

two key strategic dimensions – diversication and

marketing. ese are superimposed with a third

dimension on therapeutic leadership.

2. To utilize a qualitative approach to rene and deepen

the scope of the investigation.

3. To apply a deductive/typological approach to under-

stand the strategic orientations (grid of strategic

types; Miles and Snow, 1978).

is article commences with a brief overview of the

theory of strategic groups applied to the pharmaceutical

industry to serve as the basis on which a strategic mapping

will then be developed.

Strategic group theory in the context

of the pharmaceutical industry

e theory of strategic groups was established to furnish

a base for testing if, on the one hand, a strategic game is more

ecient than another, and, on the other hand, to analyze

and represent graphically the competitive dynamics of an

industry (Barney and Hoskisson, 1990). e delineation

of strategic dimensions or key decision variables is, in fact,

one of the most discussed terms in strategic group litera-

ture (Rumelt, 1984; Cool and Schendel, 1987; Fiegen-

baum and omas, 1990; Mas‐Ruiz et al., 2005).

In this article, we explore the existence of strategic

groups, the relationships between them, and the critical

dimensions of market conquest and strategic orientation

in the French pharmaceutical industry. Studies on strate-

gic groups led us to focus on major emergent themes in

the literature: intergroup performance dierences, emer-

gence of strategic groups, intragroup rivalry, research

studies, and their methodologies.

Performance differences between strategic groups

Research on the explanation of performance has empha-

sized the determinants at three principal levels of analysis:

(1) the rm, (2) the strategic group, and (3) the industry

(McGee and omas, 1986; Short et al., 2007). e lack

of conclusive empirical support for the relationship

between membership in a group and the group perfor-

mance casts doubt on the very foundations of the underly-

ing theory of strategic groups (Pandian et al., 2006).

Twotypes of eect merit analysis (Short et al., 2007).

First eect: eects of the rm on performance

e resource‐based view highlights the idea that resource

attributes and capacities are the driving forces of perfor-

mance. is view demonstrates that resources could explain

the results of the rm’s performance. In the pharmaceutical

industry, competitive advantage is dependent on:

1. sales and technological forces;

2. possession of a superior and unique product.

It is widely recognized that the success of a new

product is tied to the quality of the research eort. Yeoh

and Roth (1999) tested a model of the relationship

between resources, capacities, and competitive advantage