Friday, November 6, 2015

Triangle Relationship

In most business transactions between large corporations, there will be individuals that are agents of both the supplier and the producer. One prime example of the principal-agent triangle that comes to mind is the role of the salespeople of a pharmaceutical company. In our country, the dynamic between the doctors, the medicine companies and the customer are vastly divergent to the dynamics here in the United States.

In our country, the salespeople of the company are the middlemen of the transactions taking place between the doctor/prescriber and the company itself. Ensuring that the company profits is merely a half of the full operation. The salespeople are also responsible for convincing the doctors that their medicine is better, more effective, or safer than the competitions'. Here, the agent, or salesperson must decide on whether to target the success of the company or the benefit that may come to the public by the advertisement of the product and the prescriptions from the doctor including that medicine. In the case that the medicine may not be as effective as its competitors, either option by the salespeople may result in the company perceiving them as having poor performance or the doctor being opposed to prescribing the medicine.

In most situations, however, the company receives feedback on the performance of the medicine and may try to improve its function.

The above was taken from my observations during a thorough tour of one of the larger Pharmaceutical companies in the area.