SAN DIEGO–(Business Wire)–
The College of Business Administration at San Diego State University (SDSU)
announced today that research findings of SDSU management professors indicated
the current business model for most San Diego life sciences companies is not
sustainable and models with more employee ownership may have a positive effect
on these organizations. The research was published in the current issue of
Compensation & Benefits Review.
Drs. Gangaram Singh and Lynn Shore, both management professors at SDSU`s College
of Business Administration built on previous research which indicated that 70
percent of executives from venture capital-funded biotech organizations say
“that the current business [model] is not a viable business option for the
future.” Over 100 top executives of the local life sciences industry were
surveyed on the usage of company ownership through stock distribution,
profit/gain sharing and 401 (k). Singh and Shore concluded that employee
ownership opportunities were predominantly used to attract, motivate and retain
talented employees. Ownership options such as employee stock ownership plans and
investment in company stocks as part of the 401 (k) plan were less commonly
used.
“When employees make the choice to invest their financial resources in the
company, then the process of building an alternative model will take a
foothold,” reported Shore and Singh. “Otherwise employee ownership in its
current form will serve as a transactional mechanism to hire, retain and
motivate employees until an exit strategy is executed, such as partnering with a
big pharmaceutical company. Employee ownership, in short, can provide a vehicle
to effectuate the change in the business model, which is important for the
long-term viability of the life sciences industry.”
“The biosciences industry is critical to San Diego, both in terms of their
life-saving science and their impact on the local economy,” said Mary Ann
Beyster, president of the Foundation for Enterprise Development, who funded the
research. “It is imperative that the industry adopt a business model that
attracts and retains talent in order to continue to meet both their scientific
and business objectives. It is this research that can provide executives with
some of the pieces to the puzzle in how to make that a reality.”
The Foundation for Enterprise Development was established by Dr. J.R. Beyster,
founder of Scientific Applications International Corporation (SAIC) for the
purpose of promoting business principles and practices that encourage free
enterprise and advance science and technology innovations with impact on
nationally important interests.
About the College of Business Administration
With over 5,000 students, SDSU`s College of Business Administration is one of
the largest business schools in the U.S. Its programs have been ranked among the
top programs in the country by U.S. News & World Report and the Princeton
Review. For more information, visit www.sdsu.edu/business.
About SDSU
San Diego State University is the oldest and largest higher education
institution in the San Diego region. Since it was founded in 1897, the
university has grown to offer bachelor`s degrees in 84 areas, master`s degrees
in 76 areas and doctorates in 16 areas. SDSU`s more than 30,000 students
participate in academic curriculum distinguished by direct contact with faculty
and an increasing international emphasis that prepares them for a global future.
For more information, visit www.sdsu.edu.
SDSU College of Business Administration
Suzanne Finch
Chief Communications Officer
(619) 594-0206
sfinch@mail.sdsu.edu
Copyright Business Wire 2010