The Structural Frame for Merck & Co., Inc.

In 1994, Merck & Co., Inc. hired Ray Gilmore as CEO to help survive the turmoil of the pharmaceutical industry. Gilmore followed a structural frame capitalize on the strong technical tradition of Merck & Co., Inc. who attained a powerful scientific engine.While Vagelos acted as CEO, Merck maintained a strong structure frame finished the domination of the corporations senior Research and Development (R&D) scientists with strong support from play along CEO. When Gilmartin became Mercks CEO, he replaced the two executive vice president positions with a larger forethought Committee (MC). MC was directed to improve the companys demarcation processes to build cross-functional skills rather than restructure company organization. Gilmartin expressed his structural frame through the redefinition of employees roles and relations to give up the company of its functional and divisional barriers.Gilmartins structural face could besides be seen in his creation of Worldwide Business Strategy Teams (WBSTs) to expand individual managers thinking, prep and actions beyond existing functional areas. The teams were composed of members from all different functional divisions of the company.Gilmartins structural frame activities improved Mercks planning and resource allocation through cross-functional business processes.The Human Resource Frame for Merck & Co., Inc.The human resource frame is evident in Merck tradition of high ethical standards since many of the company employees had a higher(prenominal) purpose to save lives. The company CEO proclaimed We try never to forget that medicine is for the people. It is not the profits. The profits follow, and if we have remembered that, they never failed to appear.1 The company also maintained a cultural image in parallel with its academic image. Company scientists and clinicians were addressed as Doctor.Gilmartin created his symbolic frame by interviewing employees across the company about their views on major issues facing Merck . He cleared the confusion and ambiguity concerning the lack of strategic thinking and clear vision. He further compound employee communication by the initiation of a comprehensive internal review of the issues facing the company by interviewing 800 employees across Mercks functional areas.Gilmartin activities of human resource created a very positive view of Mercks strategy among company employees. One manager said We have a clear direction now. Employees made much attainment on management and leadership development.Stakeholders of rofecoxibA estimate of stakeholders were involved in the Vioxx medicine recalling incident of Merck & Co., Inc. in 2004. Internal stakeholders were Merck & Co., Inc. Company employees and Merck & Co., Inc. company shareholders. External stakeholders were the patients who took the medicine, and the United States Health Department.Negative Impact of the recall of the Vioxx drug to StockholdersThe Merck & Co., Inc. stock was considered dead money in 2004 in expectation to the number of lawsuits filed against the company over safety concerns of the drug. If Merck & Co., Inc. loses the cases, it faces a potentially huge cost from the reimbursements to patients as well as payments for ongoing medical monitoring of people who took Vioxx.The recalling of Vioxx caused an annual decrease income of $2.5 billion. Following the of the announcement of the recall, investors dumped Merck & Co., Inc. shares causing a 30% decrease to reach the lowest closing price in more than eight years. The recall would cut the $1.52 annual dividend and shave at least 50 cents a share, or 16%, off the $3.14 share analysts expected the company to crystallize in 2004.Recommendation to Mitigate the Recall of VioxxMerck & Co., Inc. should seek the intersection and marketing of innovative products to increase its sales in response to the decrease caused by the recall of Vioxx. In an attempt to improve its public image and ethical stance, Merck & Co., Inc. should relieve some of its senior management who might have been responsible for production of Vioxx. The within punishment of its own top management would convince the public of the commitment to higher ethical standards. 1 George W. Merck, the son of the companys U.S. founder quoted in Merck Sharp & Dohame, A brief history, Merck & Co., Inc,. 1992, p. 18.