An Empirical Study on Organizational Efficiency of Drug Review lnstitutions

Wu Dongming,Jia Zheng,Wang Lifei,Xing Hua

(1. School of Business Administration, Shenyang Pharmaceutical University, Shenyang 110016, China;2. School of Business Administration , Tangshan Vocational & Technical College, Tangshan 063000, China)

Abstract Objective To construct the influencing factor model of organizational efficiency by using structural equation model,and to put forward some suggestions for drug review institutions to their management mode.Methods The model hypothesis affecting organizational efficiency was proposed by literature analysis,and a questionnaire was designed.Then,the questionnaires returned were analyzed to investigate the relationship among the factors affecting organizational efficiency with the structural equation models.Results and Conclusion The direct effect of communication on organizational efficiency was 0.83,that of system construction was 0.60,talents cultivation was 0.25,and task management was 0.38.The model results basically fitting met the various statistical indicators,with statistical significance thresholds.Talents cultivation and task management have little effect on organizational efficiency,while system construction and communication have great effect on organizational efficiency.However,due to the correlation between organizational systems,the influencing factors should be considered in a balanced manner,so as to put forward reasonable suggestions.

Keywords: organizational efficiency;structural equation model;influencing factor

1 Proposal of questions

At present,with China’s macro-pharmaceutical policies gradually encouraging new drug innovation,optimizing the review and approval system will create the sustainable development the pharmaceutical industry.Meanwhile,with the continuous improvement of research and development innovation capacity of pharmaceutical enterprises,how to maintain the drug review efficiency with the growth rate of industry and accelerate the review and approval of clinically urgent drugs has become the focus.This article explores the influencing factors of the organizational efficiency of drug review institutions.Since the institutions are mainly responsible for the review of relevant drug marketing,clinical trial applications,etc.[1],this paper selects them as the research object.

Firstly,from the perspective of market,most drugs are necessary products in the market,and their prices are basically not affected by the demand of consumers to a certain extent.Therefore,to simplify the model,the demand curve of drugs is assumed to be a vertical straight line,and their demand is a fixed value A.The supply curve is determined by the market that is a curve S from the top right.The model is shown as Fig.1.

Fig.1 Supply demand model

From Fig.1,it can be seen that the drug market is a supply-led market.If the supply of the original curve S becomes larger,that is,the curve S moves to the right to S1,the product price in the market will decrease from the original price P to P1.Similarly,if the supply is reduced,the supply curve shifts to the left,and the product price will increase from the original price P to P2.From the perspective of market economy law,if the price of a drug is in P2 for a long time,the high profit will attract a large number of enterprises to enter the market,resulting in a right shift of the supply curve.Similarly,if the price of a drug is in P1 for a long time,due to the low profit margin,some enterprises are forced to withdraw from the market,resulting in a left shift of the supply curve.Therefore,the supply and price of drugs will eventually tend to be stable under the influence of free competition in the market.

Based on the free competition in the above markets,if the review cycle of products is lengthy and the review backlog is heavy,it will cause serious shortage of market supply,which can lead to the increase of product price and shifting the supply curve to the left.At the same time,there will be a phenomenon of expensive medication.Similarly,if the review standards are loose and the review quality is low,it will cause excessive supply in the market that can shift the supply curve to the right.Although the product price decreases,its quality cannot be effectively guaranteed,and many ineffective drugs will appear in the market.

Therefore,based on market self-regulation,drug review assists the “invisible hand” of the market,and its review efficiency,standards and quality account for a guiding position in the market.Before studying the market factors,drug review should be analyzed to explore the factors affecting the organizational efficiency of drug review institutions and improve the review-led supervision process,so as to enhance the review quality and efficiency.

2 Organizational efficiency measurement model based on structural equation model

2.1 Variable design

This paper makes an empirical analysis of the work efficiency of drug evaluation institutions by using structural equation model based on the basic theory of administrative organizations.

2.1.1 Variable design based on system construction level

Scholars from home and abroad have carried out relevant research on organizational efficiency from the perspective of system construction.Among them,Taylor,the father of scientific management theory,believes that organizational efficiency depends on whether there is a perfect organizational system,emphasizing that the improvement of organizational efficiency relies not only on human factors,but also on organizational management system[2].In addition,Henri Fayol,the father of modern management,proposed that management is composed of many aspects,and it is necessary to make all aspects to assume the corresponding responsibilities,and clarify the system to improve organizational efficiency and make management activities effective[3].

Scholars discuss the relationship between system and efficiency from the perspective of theory and practice,respectively.From the above research point of view,it can be concluded that the management system has a direct impact on the work efficiency of the organization,and a perfect system is needed to improve the work efficiency of the organization.Therefore,the author puts forward the following hypotheses: System construction at the structural level has a direct impact on organizational efficiency;Questionnaire design should be made from the rationality of the system,construction process and revision at the measurement level.

2.1.2 Variable design based on personnel training level

Scholars from home and abroad have carried out relevant research on the work efficiency of administrative organizations from the perspective of personnel training.German sociologist Max Weber’s bureaucratic organizational theory,which clarifies the significant role of organizational members and the close connection of various aspects of the organization,explains that members must complete their own tasks to achieve efficiency improvement[4].Gu[5]emphasized that improving the comprehensive quality of administrative office personnel and management personnel and perfecting their evaluation system could improve administrative efficiency.

Based on the above research results,it can be concluded that the ability and quality of organizational members is one of the key factors affecting organizational efficiency.Therefore,organizational work efficiency can be improved by strengthening personnel training and reasonable talent allocation.The author puts forward the following hypotheses based on the research of the above scholars: Personnel training at the structural level has a direct impact on organizational efficiency;Importance should be attached to questionnaire design from the aspects of human resource allocation and talent training at the measurement level.

2.1.3 Variable design based on communication level

Most scholars in China have conducted related research on the relationship between communication and work efficiency in the organization.Ma[6]pointed out that effective communication could strengthen the relationship between leaders and ordinary employees.He emphasized that by strengthening the information communication mechanism,smoothing the government information artery,and establishing an ecological form of communication and interaction to eliminate institutionalized obstacles and reduce the impact of administrative system on the communication between leaders and subordinates,we can improve organizational efficiency.Huang[7]believed that the communication and exchange in the organization had the effects of strengthening the unity and correctness of administrative organization activities,overcoming bureaucracy in administrative organizations,and improving administrative efficiency.Therefore,he proposed that administrative communication barriers could be eliminated and the work efficiency of administrative organizations could be improved by using a variety of communication and exchange forms,strengthening communication skills,improving information transmission mechanisms and other measures.

According to the viewpoints of the above scholars,strengthening the communication in the organization is one of the important measures to overcome the obstacles of institutionalization and improve the work efficiency of the organization.Therefore,the author puts forward the following hypotheses based on the research of the above scholars: Communication at the structural level has a direct impact on organizational work efficiency;Questionnaire design should be made from three dimensions: Communication mechanism,frequency,and form at the measurement level.

2.1.4 Variable design based on task management level

In his theory of division of labor,Adam Smith explained that division of labor was conducive to the improvement of labor productivity,and professional experience was conducive to employee learning that could improve output[8].How to correctly divide tasks and reasonably arrange them has become one of the issues that administrative departments must concern.Wang Hui explained in his study that specialization tasks were more efficient than diversity tasks in the short term,while diversity tasks had advantages over specialization tasks in the long term.Therefore,reasonable assignment of tasks and workload can improve the efficiency of employees in duty cycles of different lengths[9].

Based on the above research scholars’ views,it can be concluded that reasonable task allocation and workload have a certain impact on organizational efficiency.Strengthening the initiative and innovation of organizational members is one of the effective ways to improve the work efficiency of organizations.Therefore,based on the views of the above scholars,the author puts forward the following hypotheses:The management of tasks at the structural level have a direct impact on organizational efficiency;Questionnaire design is carried out from the task volume distribution saturation,work initiative,and work innovation at the measurement level.

2.2 Research hypotheses

Based on the above analysis,a questionnaire is designed from four aspects: System construction (A),personnel training (B),communication (C) and task management (D),and the results are assessed by using a Likert scale.The conceptual model and research hypothesis of the above four dimensions are shown in Fig.2.

Fig.2 Conceptual model and research hypothesis

Hypothesis 1: There is a positive relationship between system construction and organizational efficiency.

Hypothesis 2: There is a positive relationship between personnel training and organizational efficiency.

Hypothesis 3: There is a positive relationship between communication and organizational efficiency.

Hypothesis 4: There is a positive relationship between task management and organizational efficiency.

2.3 Data collection and pretreatment

The questionnaire survey method is used to collect the data.The selected respondents are the fulltime employees of the review institutions,mainly including the staff of review post,review support post and comprehensive management post.Through a field survey,120 questionnaires were distributed and 117 questionnaires were returned,with a recovery rate of 97.5%.A total of 102 valid questionnaires were obtained after screening,with an effective rate of 87.2%.

Based on the returned questionnaire data,the basic information of the survey sample personnel was statistically analyzed,as shown in Table 1.

Table 1 Basic information statistics of sample survey persons

The above analysis results reflect the distribution of the respondents.Among them,the proportion of males was 42.16% and the proportion of females was 57.84% in the gender survey results.Those aged between 26 and 35 years accounted for the largest proportion,63.73%.This was followed by the interval of 36–45 years,accounting for 28.43%.The proportion of 46-55 years old interval was 5.88%,and the proportion of the personnel under 26 years was 1.96%.In terms of working years,the number of the personnel with working years of 1-5 years was the most,reaching 43.14%,followed by the personnel with working years of 6-10 years,accounting for 23.53%.The proportion of personnel with 11-15 years of work was 17.65%,and 11.76% of those with more than 15 years of work.The proportion of work categories from high to low was comprehensive management,review support,and review,with a percent of 42.16%,29.41%,and 28.43%,respectively.The number of respondents with master degree in this survey was the most,accounting for 68.63%,followed by bachelor’s degrees,accounting for 13.73%,and the proportion of Ph.D.in school or graduation was 9.80%.Doctoral degree or above accounted for 7.84%.

2.3.1 Reliability analysis

This questionnaire design covers four dimensions:System construction (A),personnel training (B),communication (C),and task management (D).The reliability coefficient of the questionnaire was calculated using SPSS 20.0,as shown in Table 2.

Table 2 Reliability analysis results

According to the results of the reliability analysis,it can be concluded that the normalized clonal Bach coefficient of the questionnaire population is 0.755.The reliability coefficient is in the range of 0-1,and the figure closer to 1 is more reliable.Because this study is an exploratory analysis,it is generally believed that the reliability of exploratory study is acceptable if it reaches 0.70.The result of this analysis is 0.755,which is relatively good.Therefore,the questionnaire design is reasonable,which can truly reflect the actual situation.

2.3.2 Validity analysis

The validity analysis of this questionnaire is to realize the testing process through the exploratory factor analysis method of SPSS 20.0,as shown in Table 3.

Table 3 Validity analysis results

According to the results of the above exploratory factor analysis,the coefficient result of KMO (Kaiser-Meyer-Olkin) test is 0.724,and the coefficient value range of KMO test is between 0 and 1.The closer to 1,the better the validity of the questionnaire.It is generally believed that in the analysis,when the coefficient of KMO test is above 0.7,it is acceptable.Secondly,according to the significance of spherical test,it can also be seen that the significance of this test is infinitely close to 0,so the design of this questionnaire is reasonable that can reflect the actual situation.

2.4 Model estimation

2.4.1 Principal components analysis

Based on the above data preprocessing results,SPSS 20.0 was used to make factor analysis on the original data,and the principal components of the original questionnaire data were determined.A total of 8 principal components were obtained from the processing results finally,which did not meet the 4 principal components designed by the original hypothesis.From the above results,the principal components extraction results were not ideal.Therefore,the author eliminated some variables in the original questionnaire and performed principal component analysis again to obtain the data,as shown in Table 4.

Table 4 The revised principal component analysis results

It can be seen from Table 4 that there are a total of 4 factors with eigenvalues greater than 1 after principal components analysis,and the cumulative explained variance is 66.971%.It shows that the interpretation validity of the original data is ideal by extracting 4 factors from the 14 index topics selected after correction.When the eigenvalue of factor 1 is 3.975,the explanatory variance is 28.395%,the eigenvalue of factor 2 is 2.357,the explanatory variance is 16.833%,the eigenvalue of factor 3 is 1.603,the explanatory variance is 11.450%,the eigenvalue of factor 4 is 1.441,and the explanatory variance is 10.293%.Scree plot of principal component analysis results is shown in Fig.3.

Fig.3 Scree plot of principal component analysis results

According to Fig.3,the broken line tends to be flat after component 5,and drops sharply before,indicating that it is more appropriate to extract four common factors.Component matrix after rotation is shown in Table 5.

Table 5 Component matrix after rotation

According to Table 5,the factor assignment of each subject can be determined by rotating the component matrix.Among them,four topics including A3,A4,A6,and A7 belong to factor 1,and the contents of each topic are related to system construction,so factor 1 is named system.While other four topics including C1,C2,C3,and C4 belong to factor 2,and the contents of each topic are related to communication,so factor 2 is named communication.Three topics including B4,B5,and B6 belong to factor 3,and the contents of each topic are related to personnel training,so factor 3 is named personnel.Three topics including D1,D3 and D4 belong to factor 4.The contents of each topic are related to the management of work task.Therefore,factor 4 is named as task.In summary,the latent variable and significant variable indicators in the adjusted structural equation model are shown in Table 6.

Table 6 Latent variables and explicit variable indicators in the adjusted structural equation model

2.4.2 Analysis of structural equation model

The model is calculated by Amos software,and the parameters are optimized according to the model fitting results to obtain the final model and standardized path coefficients,as shown in Fig.4.

Fig.4 Standardized path fitting results

The commonly used fitting indexes of this model and their evaluation results are shown in Table 7.Except normed fit index (NFI) 0.667 is less than 0.9,the other fitting indexes can meet the requirements,in which the ratio of chi-square to degree of freedom(CMIN/DF) is between 1 and 3,indicating that the modified model has good structural validity and adaptability.In this paper,although there are some gaps between the fitting indices and the ideal fitting index values,the fitting results of each factor are also acceptable according to the research hypothesis and theoretical practice.

Table 7 Calculation results of commonly used fitting indices

3 Results and recommendations

According to the above fitting results,the standardized path coefficients of communication to organizational efficiency are 0.83,respectively.It shows that when other conditions are unchanged,if the latent variable of communication is increased by one unit,the organizational efficiency will be increased by 0.83.The direct effect of training on organizational efficiency is 0.25,the direct effect of system construction on organizational efficiency is 0.60,and the direct effect of work task on organizational efficiency is 0.38.According to the results of model analysis,communication and system construction have a greater impact on organizational efficiency,while task management and personnel training have a smaller impact on organizational efficiency.However,as to improving organizational efficiency,there is a correlation between organizational systems,and each influencing factor must be considered in a balanced manner.

(1) As to communication,much attention should be paid to optimizing the communication mechanism in the work process.Besides,and the communication efficiency and timeliness should be improved by clarifying the communication time,adequate preparation for preliminary meeting,summary and feedback of pre-meeting problems and other means.Meanwhile,the openness of information should be ensured by urging publicity,detailed meeting minutes and communication process records to improve the quality and efficiency of communication.Lastly,communication barriers must be reduced to improve internal communication efficiency.By reducing the communication level and smoothing the transmission path of information,the superior leaders can understand the specific information more quickly.

(2) As to system construction,the current system construction should be improved in combination with the implementation of the newly issued “Provisions for Drug Registration” and the construction of “Electronic Common Technical Document (eCTD)”.The internal system should be improved and revised to clarify the review post responsibilities,unify the standard scale in professional review and optimize the scientific decision-making path.Then,the construction of the guidelines should be enhanced because they include various technical specifications and requirements related to drugs.In the process of drafting and revising the guidelines,the experiences of domestic and foreign experts should be drawn up to ensure the pertinence,operability and foresight of the guidelines.

(3) As to task management,reasonable allocation of work should be made according to unified basic objectives and standards.The scope of task allocation should be further expanded while ensuring the synchronous implementation of the management of all departments.To improve the initiative and innovation of organizational members,they should be encouraged to believe in themselves in the daily work.Continuous and frequent incentives can make organizational members feel affirmed and respected.Therefore,by creating an atmosphere of active share,willingness to give or change,the initiative and innovation of organizational members can be improved.

(4) As to personnel training,with the increase of personnel,the review institutions should scientifically and rationally carry out human resource allocation and management planning in combination with the actual situation,thus improving their work efficiency.First,an effective training mechanism should be established,and the training needs of organizations and member individuals must be taken into account.In addition,the training objectives of the organization should be reasonably planned.The training objectives should be put forward in line with the current development of organizational members through the judgment of organizational development and organizational ability.Finally,targeted training plan can formulated through the investigation of the training wishes of organizational members.