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How will the change in structure affect the relative power of the different functions? Give reasons How does the establishment of HMOS affect the resource dependence and power of Kanke Pharma? What can be done to manage this dependence?

How will the change in structure affect the relative power of the different functions? Give reasons How does the establishment of HMOS affect the resource dependence and power of Kanke Pharma? What can be done to manage this dependence?

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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Q2: Kanke Pharma, a large well-established pharmaceutical company, made its name by pioneering innovative new drugs. Intense competition from other companies in the pharmaceutical industry, plus increasing government pressure to reduce the price of drugs, has put pressure on the company to reduce costs and speed up product development. In addition, the emergence of large health maintenance organizations (HMOS) and other large buyers of drugs has made marketing drugs much more difficult. To respond to these pressures, the organization has decided to create cross-functional teams composed of people from R&D, marketing, finance, and top management to respond to the new situation. a. How will the change in structure affect the relative power of the different functions? Give reasons b. How does the establishment of HMOS affect the resource dependence and power of Kanke Pharma? What can be done to manage this dependence?
Transcribed Image Text:Q2: Kanke Pharma, a large well-established pharmaceutical company, made its name by pioneering innovative new drugs. Intense competition from other companies in the pharmaceutical industry, plus increasing government pressure to reduce the price of drugs, has put pressure on the company to reduce costs and speed up product development. In addition, the emergence of large health maintenance organizations (HMOS) and other large buyers of drugs has made marketing drugs much more difficult. To respond to these pressures, the organization has decided to create cross-functional teams composed of people from R&D, marketing, finance, and top management to respond to the new situation. a. How will the change in structure affect the relative power of the different functions? Give reasons b. How does the establishment of HMOS affect the resource dependence and power of Kanke Pharma? What can be done to manage this dependence?
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