Change through mirroring: Standardization of Chinese herb slice
between Traditional Chinese Medicine and Western Medicine
V2
ABSTRACT: We study the standard-setting activities of Chinese herb slice firms, at
the interface between two apparently competing logics: the Traditional Chinese
Medicine and Western Medicine logics. We find that the parallel competition of two
medical logics and orders of worth stimulates standardization. The organizations may
reinterpret one logic and orders of worth by referring to others, in a process of
mirroring, to achieve a better standardization in the context of a plurality of logics.
Keywords: institutional logic; order of worth; standardization; Chinese herb slice;
Traditional Chinese Medicine; institutional mirroring.
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Introduction
With the rising recognition and acknowledgement of standards, standardization often
faces the challenges of dealing with multiple standard-setting kernels (Oshri, de Vries,
& de Vries, 2010). Although the question of how to handle the different technologies
and related business strategies in industrial standardization has been widely discussed
in the literature (Hill, 1997; Windrum, 2004), how to conduct standardization, in the
context of plural institutional logics is less satisfactorily addressed.
Industrial Standard development issues need to be understood not only in
technological terms but also from an institutional perspective (Beck & Walgenbach,
2005; Bunduchi, Graham, Smart, & Williams, 2008). Particularly, when technological
processes are also embedded into institutions as is the case in TCM (Traditional
Chinese Medicine). Compared with Western Medicine, standardization in such a
context, faces multiple, often competing logics and orders of worth (Boltanski &
Thévenot, 2006; Patriotta, Gond, & Schultz, 2011). Standardization of products in
TCM may seem a straightforward, perhaps technological exercise. But in fact, it
brings to the fore both history and values to bear on both process and outcome. How
these forces interact to explain process and outcome is hard to study. The Chinese
situation, because it is dynamic and changing rather fast, is an opportunity that
explains this research.
In this study we investigate the standard-setting actions of Chinese herb slice firms.
Two questions are used as guides: (1) how do Chinese herb slice firms respond to and
cope with the needs of industrial standardization? (2) how do they deal with the TCM
and Western Medicine underlying logics and orders of worth?
Theoretical Review
Standard-setting & institutional logics
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Standards could be analyzed as a kind of institution that provides a framework within
which organizations operate (Garud, Jain, & Kumaraswamy, 2002). They are seen as
“governing conduct of people and institutions (including governments) within an
increasing number of domains of contemporary economies and societies” (Ponte,
Gibbon, & Vestergaard, 2011:1). The establishment and change of standards is often
accompanied with change of institutional arrangement among actors involved (Perry
& Nöelke, 2005), which implies the impact of different institutional logics.
As “the socially constructed, historical patterns of material practices, assumptions,
values beliefs, and rules by which individuals produce and reproduce their material
subsistence, organize time and space, and provide meaning to their social reality”
(Thornton & Ocasio, 2008:101), an institutional logic can provide a strong
justification for change of institutions such as standards through the triple mechanisms
of institutional entrepreneurs, structural overlap, and historical-event sequencing
(Thornton, Jones, & Kury, 2005).
While the co-existence of multiple institutional logics may implies the possibility of
institutional change, the dynamics of institutional logics interactions need closer
observation. Conflicts between institutional logics
generates pressures for
organizational change (Thornton, 2002), yet competing logics may also facilitate
resistance to institutional change (Marquis & Lounsbury, 2007). Therefore
understanding the nature of the
competing institutional logics involved may be
critical for a successful change (Hayes & Rajão, 2011).
But institutional logics may also coexist, especially in emerging fields,. It has been
observed that, within specific conditions, their concomitant existence may be
institutionalized through different diffusion mechanisms (Purdy & Gray, 2009; van
Gestel & Hillebrand, 2011). So the study of standardization in the presence of
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multiple logics requires an understanding of of both institutional logics nature and
fields characteristics.
Organization in multiple logics
Recognizing the significance of multiple logics in standardization, we also can’t
ignore the roles organizations play in the standardization that is conducted in the
presence of multiple logics. Organizations play an important role in transforming
institutional logics in the process of standardization. Especially, it has been argued
that leading organizations often facing the contradictions generated by multiple logics,
take pioneering action to resolve them in field standard-setting (Creed, DeJordy, &
Lok, 2010; Greenwood & Suddaby, 2006).
While an organization can get rewards by sponsoring standard-setting development
(Waguespack & Fleming, 2009), it can also face threats to its presents position from
its standard-setting behavior (Garud et al., 2002). Although firms in decentralized
institutions are more likely to accept standard certification (King, Lenox, & Terlaak,
2005), in the context of multiple logics their standard-setting action may also face
more challenges .
Standard-setting can be seen as an organizational response to conflicting institutional
demands, based on managers’ judgment about institutional demands and internal
representation (Pache & Santos, 2010). Multiple institutional logics may generate
heterogeneity of organizational responses (Greenwood, Díaz, Li, & Lorente, 2009),
where a single organization has to choose its own strategy to manage competing
logics(Reay & Hinings, 2009). In standardization it means that organization have a
diversity of choices f in both standard development (Bonaccorsi, Giannangeli, &
Rossi, 2006) and standard implementation (Boiral, 2007; Concepción LópezFernández & Serrano-Bedia, 2007).
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Although organizations could act to change institutions, organizational leaders are not
the only actors involved (Battilana, Leca, & Boxenbaum, 2009). Lower level actors
can also affect institutional change paradoxically through accommodating and
resisting the practice and the identity implications of new institutional logics (Lok,
2010), which highlights the collective impact of organizational member actions in
institutional change. But professions involved may have plural logics. These
supported by distinct groups and interests fluctuate over time and create dynamic
tensions on standards development (Dunn & Jones, 2010). Eventually complex social
processes in which different actors are led to cooperate can result into a co-existence
of several institutional logics (Styhre, 2011), which suggests the continuous and
dynamic effects of standards. It leaves space for institutional entrepreneur to deploy
pre-existing cultural logics to push forward their institutional projects (Rao & Giorgi,
2006).
Chinese Medicine vs. Western Medicine
Chinese herb slices are products that are produced according to TCM theory
processing (Pao Zhi) techniques. They are made from wild or agricultural herbs. They
can be prescribed directly by TCM doctors(Zhong Yi Sheng) to patients or can be used
as raw materials for producing Chinese compound medicine(Zhong Cheng Yao). The
whole industrial chain of TCM could be represented as in Figure 1.
-------------------------------------------------------Insert Figure 1 about here
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Chinese herb slice is regarded as one of the most important segments of the whole
TCM field. Particularly, the processing techniques are regarded as a historical treasure
of TCM and are protected by law. Foreign investors are barred from stepping into the
business of Chinese herb slices.
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Despite its unique position in TCM, herb slice development in modern society faces
great challenges. Because of a lack of consistent standards, most of Chinese herb
slices are produced by small workshops or small factories that just follow their own
experience, and ad hoc formulas, which results into market disorder and consumer
distrust. Medical effectiveness and quality of Chinese herb slices have become a
major concern for Chinese medicine doctors, patients, and regulators.
In such a situation, Chinese herb slices face extreme viability and legitimacy pressures,
especially compared with the competing systematically standardized Western Medicine
(modern medicine) compounds. Standards of Western Medicine include GMP (Good
Manufacturing Practice), GSP (Good Supply Practice), GCP (Good Clinical Practice), etc,
which cover the process from the early production to the final prescription. They provide
convincing assurances for medicine quality. We could summarize the logics of Chinese herb
slices and Western Medicine as in Table 1.
-------------------------------------------------------Insert Table 1 about here
--------------------------------------------------------
While the need to develop standards for Chinese herb slices is widely acknowledged,
how to do that is unclear. On the one hand many people insist that Chinese herb slices
are a result of TCM theory and should only stick to the logic of TCM. They think the
standardization of Chinese herb slice is to apply TCM theory to integrate the different
practices in reality to generate a wholly consistent standard. But they are criticized
for not bringing needed change to Chinese herb slices, behaving as if it is impossible
to standardize them.
On the other hand many researchers argue that the standardization of Chinese herb
slices should follow the logic of Western Medicine. They think TCM theory is
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confusing and unclear and Western Medicine theory is systematic and evidencebased. They suggest to leave out TCM theory in standardizing Chinese herb slices and
use Western Medicine practices. But they are criticized for moving away from TCM
traditions and basic advantages, which are at the core of Chinese herb slice distinctive
character. In doing so, critics suggest that we may generate new western medicine but
not Chinese herb slices any more.
The debate of choosing TCM theory or Western Medicine theory put the
standardization of Chinese herb slice in a bind. Besides, there is no systematic
scientific research work specific to Chinese herb slices in universities. These
difficulties lead newly-established Chinese herb slice companies to act as standardsetter through “standardizing by doing”.
Methodology
Case studies
To explore organizations’ behavior, we used a case study design. We studied two
firms that have played active roles in standard-setting: KangmeiCo and XinhehuaCo.
We select these two case firms for three reasons. First, they are the most influential
players in the industry of Chinese herb slice. Until the end of 2011 they were ranked
as the top 2 manufacturers, enjoying national reputation and conducting marketing
nationally. Second, both of them are leading firm in standard-setting. While most
industrial firms are just ignorant or waiting for introduction of standards, they
participate into all the important standard-setting of Chinese herb slice and make
important contributions to the standardization of Chinese herb slice. Both the leaders
of these firms have been elected as members of the National Committee of
Pharmacopeia. Third, while they have chosen different corporate strategies they stick
firmly to the standardization of Chinese herb slice, according to tradition, which
provides us with a chance to understand the importance of standardization in
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supporting different TCM development choices. The background information of our
two case firms is shown in Table 2.
-------------------------------------------------------Insert Table 2 about here
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For comparison purposes, we have also studied three other firms. Although these
firms have not been involved into standard-setting of Chinese herb slice, they could
provide additional information about the challenges and consequences of standardsetting for Chinese herb slices. Their input was used to understand better and test the
information from the two main case firms, which helped provide an objective stepping
back for the understanding of standardization activities of focal firms.
Data collections
Due to the complexity of Chinese herb slice standardization, we collected the
necessary materials and data from multiple sources. First, we collected the
descriptions of Chinese herb slices in ancient and current Chinese medicine books.
These books provide a general understanding of the nature of Chinese herb slice,
especially the medical logic under the traditional processing techniques. Second, we
analyzed governmental documents and publications regarding standards of Chinese
herb slice. Particularly, we focused on the published official GMP guidelines and
Pharmacopeia (2005 and 2010 Vision). Third, we collected material and data specific
to the two case firms, including annual report, industry analysis report, analysis
articles from industry newspapers, and published research articles by case firm
researchers in academic journals. We also read a company book of KangmeiCo,
which gives detailed description of the main business activities in its history,
including its standard-setting activities.
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Fourth, we conducted semi-structured interviews. In the two case firms we have
interviewed the chairman, general manager, and other senior managers. We have also
communicated with ordinary engineers and manufacturing workers at case companies.
In total, for each company we interviewed XXX people. We also conducted factory
visits to understand the challenges involved in applying
standards. Fifth, we
interviewed 6 researchers and professors from three Traditional Chinese Medicine
universities specialized in Chinese herb slices. These multiple sources helped us to not
only obtain information about case companies’ activities regarding standardization but
also understand the whole context of Western Medicine and TCM logic competition
in China.
Analysis
Putting the two leading firms as core analysis objects, we tried to combine a process
perspective and a theme perspective in analysis. We focused on two core standards:
GMP for Chinese herb slice; Pharmacopeia of Chinese herb slice. We traced the
whole standardization process from 2003 when efforts of standardizing Chinese herb
slice GMP was first initiated. This helped identify all the main events and steps in
standard-setting. All the steps and events were analyzed around three main themes:
institutional logic concerned; activities taken by firms; and final standards.
Findings
Motivation for standardization
GMP is mainly related to standards affecting the production environment and
operations. SFDA (State Food & Drug Bureau) introduced the Chinese
pharmaceutical industry GMP in 1998. It was first mostly focused on the production
of chemical drugs and not applied to Chinese Medicine. Concerned with the poor
production practices of Chinese herb slice, the SFDA began in 2003 experimental
GMP certification of Chinese herb slice firms. In so doing, SFDA chose 46 firms in
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19 provinces as experimental firms. KangmeiCo and XinhehuaCo were two of the 46
chosen firms. In contrast to other firms, which were hesitant or reluctant to accept
experimental GMP certification, these two firms were very cooperative, which
eventually resulted in their influential standardization roles.
These firms’
past experience in manufacturing chemical drugs explains their
behavior. KangmeiCo began its business producing generic drugs and the founder of
XinhehuaCo also had more than 20 years’ experience operating a chemical drug
business. In their experience, they realized that the core principle of Western
Medicine production is stability, the most important challenge for Chinese herb slice
production. The development of Chinese herb slices is generally constrained by
concerns about quality instability: first, herbs as raw materials come from many
sources, which leads to quality differences; second, processing techniques are
secretive and vague, which may lead the same Chinese herb to generate different
Chinese herb slice products; third, the prescription and further uses of Chinese herb
slice are not standardized, which leads sometimes to side effects, dangerous for
patients’ health. In contrast, Western Medicine production standards ensure consistent
and stable quality.
Inspired by Western medicine practices, the founders of both firms regard GMP
standardization as a pioneering step to rebuild the legitimacy for Chinese herb slice in
society. In so doing, their actions can help them gain first-mover advantages in the
industry . The understanding of Western Medicine standardization logic provided
them with confidence and direction to found Chinese herb slice GMP and
pharmacopeia.
GMP for Chinese herb slice
Although encouraged to begin GMP standardization work, both firms were aware of
the difficulties ahead. The SFDA had at that time just provided simplified guidelines
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for GMP certification. These were based on Western Medicine practices and didn’t
quite fit Chinese herb slice characteristics. In fact the SFDA didn’t know how to
establish GMP standards and had to allow manufacturing firms to explore by
themselves. Their general strategy was to leave space to firms to establish GMP
standards experimentally, then they would collect the results and summarize them into
an integrated GMP standard. As a consequence, KangmeiCo and XinhehuaCo began
their GMP certification process with much freedom to create. They realized soon that
the most feasible process was to refer to the Western Medicine GMP practices to
design their own.
The GMP of Western Medicine emphasized five key aspects: processing techniques,
facilities and equipment, material and product management, people management, and
environment management. The different logics and case firm activities in each of
these aspects are summarized as Table 3.
-------------------------------------------------------Insert Table 3 about here
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Processing techniques(Pao Zhi)
Among all the GMP work, processing techniques are the core component. In the
production of chemical drugs, chemical synthesis, the heart of the process, requires
consistent manufacturing techniques which could be used to produce the same
chemical drug product anywhere. The distinguishing feature of Chinese herb slices is
however that they must be processed through special techniques (Pao Zhi). In the
past, Pao Zhi was a secret inherited through mentor relationship and only roughly
written in different TCM books, without any consistent and measurable instructions
that could be applied into mass production. Then the objective of standardizing Pao
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Zhi was to transform these haphazard Pao Zhi techniques into quantified and
consistent production techniques, while maintaining the original logic of Pao Zhi.
Without any mature knowledge KangmeiCo and XinhehuaCo had to find innovative
ways to standardize the ancient techniques. Referring to their experience in producing
chemical drugs, their choice was to find out a way through which they could
reproduce the traditional Pao Zhi process in a modern manufacturing context,
imitating and enlarging the Pao Zhi processes into factory production. This has been
described below by the vice president of Quality Management at KangmeiCo who
was in charge of the whole GMP procedure:
At that time, we invited several old masters of Chinese Medicine (Lao Yao
Gong) who didn’t know modern science and technology, but have spent a
lifetime making Chinese herb slices. We asked them to show the whole Pao Zhi
processes with their own tools and methods. When they did, we recorded all
the data and information. After that, we imitated the whole Pao Zhi processes
by using machines and equipments, accumulating data about temperature,
time, humidity, etc. We did this again and again until that the old masters of
Chinese Medicine (Lao Yao Gong) thought the machine-produced product
reach a quality they were satisfied with. We then quantified and transformed
the traditional Pao Zhi process into operable standards.
They repeated this approach again and again to all their product types of Chinese herb
slice and consequently established a complete set of processing techniques for
Chinese herb slice which became an input into the national standards later. In building
the standards, both firms incorporated the spirit of Western Medicine GMP into
reengineering the production of Chinese herb slice but maintained the principal
processing (Pao Zhi) procedures and techniques of Chinese herb slice as in TCM
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theory.
Although both firms conducted their work separately without any early
communication, they chose similar approaches and achieved similar results.
Facilities and machines
Facilities and machines are another key point for GMP standardization. According to
Western Medicine logic, facilities and machines should be specific
to each
manufacturing technique, to avoid cross-production pollution and clean processes.
Also, firms the latest technology equipment to ensure that drugs are the safest possible
for users. But in the traditional Chinese herb slice production practice there is no
specific requirement for facilities and equipment. Simple tools and a manual process
dominate. However, use of machinery has to take into account the special
requirements of Pao Zhi techniques. For example, processing with vinegar (Cu Zhi),
processing with wine (Jiu Zhi), steaming (Zheng Zhi), etc., all of these Pao Zhi
techniques require specific facility and machinery design.
Both firms designed their new facilities themselves. The lay out took into
consideration the requirements of the various functions and their sequence.
In
particular, they segregated raw material preparation, processing, and final product
storage, locating them in separate specialized facilities. They even located different
processing techniques, such as cleaning, cutting, etc, into separate rooms, with
appropriate ventilation, dust abatement, smoke elimination, exhaust of moisture, and
cooling, etc.
As some production machines and facilities did not exist in the GMP of Western Medicine.
KangmeiCo and XinhehuaCo designed the machines with the cooperation of some
machine producers. The machine producers reflected the Pao Zhi specific logic in the
development of a modern mechanized system. Although the process was handled
independently by each firm, the result is that some machines created by KangmeiCo
and XinhehuaCo are different in design yet perform similar functions. The two firms
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still face challenges. In particular, they still can’t meet the same standards as in
Western Medicine. Also, some Chinese herb slice techniques, such as sun shining,
can’t be achieved. Also, some final product selection and packaging have to be
completed manually and some Pao Zhi techniques still can’t be reproduced by
machines.
Material and product management
In the Western Medicine logic, to control production and final product risks, all the
information about materials and products should be recorded with the utmost
precision. In case of emergency, the information can be tracked and analyzed to
diagnose the problem. This requires a system for material and product management.
But the traditional Chinese herb slice logic only emphasizes that original herbs should
be Dao Di, which means that herb should be from specific geographic areas and has
been collected in a traditional way, in specific season, cutting only specific part, etc.
This introduces important difference between the Western Medicine and Chinese herb
slice practices. For example, in the Western Medicine GMP guidelines, raw material
should be clear and cleaned. But the Chinese herb slice raw material is made of
agricultural products or wild herbs, which are still with dirt and sand. They
requirefactory preparation.
As a result, a specific material and product management system had to be devised. In
particular it calls for a new standardized tracking system for quality control that could
record and track all the information from purchasing, to manufacturing, to logistics, to
prescription. And the system has to take into account the specific characteristics of
herb slice idiosyncrasies.
XinhehuaCo took a more proactive role to design and experiment with such a system.
They identified more than 20 QC (Quality Control) point in production, and used the
most advanced technology to stabilize quality. Today, they record all the information
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and data from herbs input to the final products. All the information is electronically
stored for client tracking. XinhehuaCo also encloses now product reports to clients for
every business order. Samples from every business order are stored for three years for
tracking purposes. Recognizing the value of such a contribution, the central
government has chosen XinhehuaCo as a representative unit to promote and diffuse
their system to other Chinese herb slice firms.
Similarly KangmeiCo has also designed a tracking system that is composed of a series
of self-developed machine and software responsible for controlling, recording,
storing, and analyzing quality information. With such a system both firm could
guarantee quality information tracking at least within herb slice production. Besides,
both firms are extending this system upstream and downstream. XinhehuaCo has
established three GAP (Good Agriculture Practices) bases and is planning to establish
another two in the coming year. Now, it enjoys the second largest GAP bases in
China. These two firms are also extending their system into hospital pharmacies.
Particularly KangmeiCo take charge of the operation of some client hospital
pharmacies, and integrates its system to the downstream management.
Environment management
Environment is highly emphasized in the GMP of Western Medicine, because of
concerns about possible chemical pollution. In the history of pharmaceutical industry,
unexpected industrial incidents have caused much alarm, and actions to avoid harm.
In contrast, the traditional
Chinese herb slice production logic ignores the
environment. Most Chinese herb slice have traditionally been made in small
workshops, with little influence on the environment. But the new mechanized model
requires different behavior.
The two case firms adopted the Western Medicine GMP requirements to design
specific processes and deal with waste and rejected materials Both firms emphasized
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that no industrial chemical materials be used in the production process, to conform
with the traditional Chinese herb slice principles. But, sor some Chinese herbs
poisonous effects, they designed special production processes.
People management
In the Western Medicine GMP, employees involved should have knowledge of
chemistry and pharmacology, and be qualified to take responsibility of work. Again in
contrast, the traditional Chinese herb slice production logic emphasizes people’s long
experience of Chinese herb slice and “learning by doing,” rather than systematic
training.
As a consequence, the two firms shied away from tradition and selected people
according to their knowledge of Western Medicine. They then allowed them to use
their knowledge to carry out the production of Chinese herb slice. As the chairman of
XinhehuaCo summarized:
I find that to achieve success we need to use the persons who studied Western
Medicine to do Traditional Chinese Medicine. On the contrary the persons
who used to study Traditional Chinese Medicine usually follow the logic,
terminology, and techniques of Traditional Chinese Medicine, which doesn’t
work out consequently.
Not only recruiting talents with
Western Medicine background, both firms also
developed a system to integrate Western Medicine and generate a knowledge system
about Chinese herb slice. In establishing and implementing GMP, both firms
experimented to develop new protocols for workers, which in essence is a
combination of the two logics.
Pharmacopeia of Chinese herb slices
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After the establishment of GMP for Chinese herb slice, attention has moved to
standardize Chinese herb slices for Chinese pharmacopeia. Usually pharmacopeia
defines the quality standard, and indicates what the final product should be. This work
meets more difficulties than those in GMP because of doubts about effectiveness and
reliability of Chinese herb slice test techniques. In TCM theory, the effectiveness of
Chinese herb slices is described by TCM terminology. The effectiveness test is often
judged by its geographic origin, visual look (Xing Zhuang), and beliefs, most of which
depend on the level of expertise on TCM. These are very subjective and difficult to
summarize in consistent standards. Comparatively, the effectiveness of ingredients,
and test techniques for Western Medicine are very clear and specific, which makes it
easier to reach a consistent pharmacopeia.
Even compared with Chinese herbs and Chinese compound medicine, Chinese herb
slice industry is much less present in academic research. Although some professors
and researchers in academic institutes and universities have begun carrying out
research about Chinese herb slices, these are mostly limited to lab experiments and far
from mass production. These difficulties led to two outcomes: (1) firms were given
more influence in establishing pharmacopeia for Chinese herb slices; (2)
pharmacopeia of Western Medicine has become an important reference.
KangmeiCo decided to imitate the Western Medicine idea of effective components.
While the real effective components or component groups are not clear for Chinese
herb slice yet, the firm chose the most representative components that have been
identified by traditional Chinese herb slice as index components. Not just identifying
one component, the firm chose a series of components as testing targets, meaning
multiple components have been identified as group index. Besides work on target
components, KangmeiCo has tried to create an integrative method combining Western
Medicine and Chinese herb slice testing logics. At last, the final description in the
pharmacopeia combines Western Medicine and Chinese herb slice requirements. On
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the one hand, according to TCM logic, every product labeling includes its
geographical origin, processing techniques, Xing Wei Gui Jing, Pei Wu Ying Yong,
Fang Ji Ju Yu, etc. On the other hand, it refers to Western Medicine logic by
including effectiveness analysis, side effects, pharmacology, and others.
Similarly, XinhehuaCo cooperated with a local TCM university to conduct research
about several types of Chinese herb slices. Their final results have been incorporated
into the 2010 Vision of Chinese Pharmacopeia. In November 2009 the central
government approved XinhehuaCo to found the first State Engineering Research
Center for Pao Zhi of Chinese herb slice. All the work of KangmeiCo and
XinhehuaCo has been included into 2010 Vision Chinese Pharmacopeia.
Benefits and challenges of standardization
With its exploratory work in developing GMP appropriate for Chinese herb slice,
XinhehuaCo and KangmeiCo have not only become the first two firms to receive
GMP certification in China in 2003 but also the only one to become an actor in
Chinese herb slice standard-setting. The innovative practices of the two firms have
been introduced as a model in the industrial GMP meeting organized by the SFDA,
which integrated the revision of GMP specific to Chinese herb slice. Through these
activities involving firms and universities, standards of Chinese herb slices have been
established for the first time in the Chinese Pharmacopeia. 656 types of Chinese herb
slices are listed in the pharmacopeia, which doesn’t cover all the Chinese herb slices
but could provide coverage of the most frequently used products for patients. For
KangmeiCo and XinhehuaCo their active participation in standardization not only
bring great industrial fame, but gives them an upper hand in setting industrial game
rules, a significant benefits in the long run.
In October 2004 SFDA publicized formal regulation requiring all the provinces to
begin GMP certification examination for all Chinese herb slice firms. In the new
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regulation it requires that all the firms must operate under the new GMP, starting from
January 1st 2008. But reports indicate that by the end of 2010 only about 25% of
industrial firms have passed the new GMP certification, an indication of the
challenges and difficulties of establishing and implementing production standards
specific to Chinese herb slices, despite the efforts of GMP standardization by actors
like KangmeiCo and XinhehuaCo. In fact both firms are also worried about the cost of
meeting the standards, with large investments into machineries and management
systems.
Discussion
Responding to Timmermans and Epstein(2010)’s call for empirical study of different
kinds of standards operating in distinct social domains, our study of Chinese herb
slices finds significant standardization in the past decade. Western Medicine and
TCM are two completely different systems of medical knowledge about
understanding and treating disease and medicine. Because medical treatment is related
to strong beliefs (Nonis & Hudson, 2009), both of these systems are based on strong
institutional logics that are rooted deeply in society and culture. On the one hand they
are very distinct from each other in terms of knowledge base and practice guidelines.
On the other hand they are also related and frequently mentioned when doctors and
patients are trying to think about treatment in a comparative mindset. They are two
parallel rather than competing logics. Especially, since herb slice is specific to TCM,
the logic of Western Medicine doesn’t compete directly with the logic of Chinese herb
slice. Although co-existence of weak logics may cause stability in the relationship
among logics (van Gestel & Hillebrand, 2011), the co-existence of these two strong
but distinct logics generates mirroring, and tension for each other, at least in China,
but also across the World.
The co-existence of these two mirroring logics generates pressure for the Chinese
herb slice industry. Mature standards of Western Medicine are the models for the
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development of Chinese herb slice standards, and its significant presence and
effective medical power forced actors to undertake standardization efforts. Even
Western Medicine doesn’t compete with Chinese herb slice directly, but its mirroring
existence will reflect the relative weakness of Chinese herb slice in standardization,
which stimulates the standardization actions for Chinese herb slice. The logic of
Western Medicine acts as a reference here, which forces and guides Chinese herb
slices industrial standardization. But these competing logics have an effect even in the
Western world, and treatment uncertainty leads to alternative treatments in which
Chinese traditional medicine plays a role. So we have the following proposition:
Proposition 1: The co-existence of two strong but distinct institutional logics
leads to mirroring, andmotivates the establishment or change of standards for
both.
While GMP and pharmacopeia are also basic industrial standards in Western
Medicine, the standardization in Chinese herb slices is new and different. We can see
that leading herb slice firms are taking actions related to industrial standard-setting.
They have acted from standard follower to standard founder. Beginning as imitator of
Western Medicine standards they become creator of their own Chinese herb slice
standards. We can also notice that the leading firms that are active in the
standardization of Chinese herb slice are led to master the two logics to perform. Both
firms in this research have developed expertise in implementing of Western Medicinebased GMP standards, which gives them motivation to participate into standardization
work. These firms act as institutional entrepreneur and use their internal consensus as
a basis to bridge institutions and conduct their standardization projects (Markowitz,
Cobb, & Hedley, 2012). More importantly, the mastery of two mirroring logics
provides them with capability to bridge these logics to establish or change standards.
So we have the following proposition:
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Proposition 2: The plurality of logics motivates and enables the organizations
mastering plural logics to act as institutional entrepreneurs in standardization.
Firms can act as institutional entrepreneurs by reproducing new meaning (concepts,
objects and subject positions)(Munir & Phillips, 2005). Leading Chinese herb slice
firms have acted as active institutional entrepreneurs here with their cooperation with
academic organization and government bureau. Here we show that when stakeholders
are confused by a plurality of logics, firms as institutional entrepreneurs can carry out
standardization activities by deploying other logics as reference to reinterpret their
own logic and convince stakeholders. In so doing, they not only change their own
organizational logic (Spicer & Sewell, 2010) but change the whole organizational
field. As the importance of embodied identity work in resolving institutional
contradiction(Creed et al., 2010), the logic interpretation, referring to other logics,
contributes to rebuild identity and get new legitimacy. As our findings have shown,
the leading Chinese herb slice firms create industrial standards through mirroring the
logic of Western Medicine to reinterpret the logic of TCM. As standardization of open
source may imply a possible advantage in standardization strategy (Oshri et al., 2010),
with the reference of Western Medicine logic, the logic of TCM has been maintained
but reinterpreted in Chinese herb slice standardization, which results in a successful
industrial performance. So we have the following proposition:
Proposition 3: In a plurality of logics, standardization through reinterpreting
one’s own logic in reference to other logics leads to better standardization
consequences.
Conclusion
Using an inductive case method we studied the standardization activities of leading
Chinese herb slice firms, resulting in a co-existence of Western Medicine logic and
TCM logic. Our in-depth analysis of their understanding of both logics and
21
corresponding activities in GMP and Pharmacopeia standardization extends theory on
organizational activities of standardization in the context of plural logics.
By incorporating the institutional logic into the field of standards, our study
contributes to field of standard research in three aspects. First, our study highlights the
importance of the institutional perspective in studying standardization, by
emphasizing that technology is embedded rather than an autonomous component of
institutional logic. Past research often treat technology as an independent factor
isolated from institutions (Windrum, 2004). However, our study indicates that
technology can be understood and treated as inclusive of specific institutional logic,
and requires collective justification in conducting standardization. The integration of
technology into analysis of one institutional logic provides a more comprehensive and
systematic view to study standardization in a world full of plural institutional logics.
Second, we contribute to the standard research by showing that the emergence (or
change) of standards may be pushed or facilitated by mirroring logics. Although
mirroring logics don’t compete with each other directly they provide images that
could drive change, in particular here for standard development. In this process the As
logics mirror each other, they affect standardization by acting as mutual references.
Third, by showing that Chinese firms have deployed their own cultural logics in
standardization, our study also contributes to the conversation about how to conduct
Indigenous standard development in the presence of dominant international standards
(Fomin, Su, & Gao, 2011). While many studies have discussed about how
government or business association(alliance) could use policy and economic
approaches to catch up or conquer dominant international standards (Stewart, Shen,
Wang, & Graham, 2001), the possible roles of cultural logics in developing own
standards, when there are dominant international standards have not been
satisfactorily addressed. Our study indicates the significant role that domestic cultural
22
logic can play in directing the standardization path and deciding the competitiveness
of standards when facing the current international standards.
Our study also contributes to the field of institutional logic by indicating that while
plural logics may lead to institutional change, it doesn’t mean that one logic must
replace the other. On the contrary, a logic may get itself renewed or reinterpreted by
referring and incorporating the other logic into the institutional change. Researchers
have indicated that negative choice and deliberate ambiguity may cause the long-term
persistence of plural logics (van Gestel & Hillebrand, 2011). Our study demonstrates
that a plurality of logics could co-exist over time by renewing themselves ina
continuous mutual referral.
Also, our study emphasizes organizations as institutional entrepreneurs in
standardization within plural logics by highlighting their unique role in mastering and
reinterpreting logics. Organizations as institutional entrepreneurs act as structural
agencies (Heugens & Lander, 2009). Mastering plural logics in a first step,
organizations could innovate by absorbing another logic to facilitate standardization
and institutional change. It highlights the advantages of embeddedness for
organizations willing to play the role of institutional entrepreneur (Garud, Hardy, &
Maguire, 2007). The more embedded into plural logics the more able organizations
are to creatively carry out institutional work.
The co-existence of TCM and Western Medicine provides a context appropriate for
the study of the effects of a plurality of logics. Therefore, our study of Chinese herb
slice standardization gives an interesting setting for the exploration of standard
development. But standardization is a long and dynamic process (Choi, Raghu, Vinze,
& Dooley, 2009). As the standardization of Chinese herb slice is just at the beginning
stage, the continuous observation on this field will help us to deepen the
understanding
of
standardization
through
mirroring.
Relatedly,
studies
of
23
standardization in other parts of the TCM sector, as in Chinese compound medicine,
Chinese medicine hospital, etc, will extend this study to a wider ecosystem. Finally,
this study may lead to a detailed study of the stream of practices that leads to the
reconciliation of apparently opposed logics and order of worths(Cabantous & Gond,
2011). The logics of TCM and Western Medicine play significant role in the
organizational activities of standardization. Other investigations on the impact and
evolution of other logics and order of worth are needed to provide more knowledge
about organizational standardization activities in a changing world.
24
TCM doctor
Patient
Chinese
herb
Chinese
herb slices
Chinese
compound
medicine
Figure 1 Production chain of TCM
25
Table 1 Comparison of Logics of Chinese herb slice & Western Medicine
Chinese herb slices
Knowledge basis
Traditional
Western Medicine
Chinese
medicine Modern
sciences
philosophy (Ying Yang, Wuxing (chemistry,
biology,
and others)
pharmacology and others)
Knowledge source
Historical knowledge
R&D result
Manufacturing
TCM Processing techniques(Pao Modern
techniques
Zhi)
biological technique
Equipment
Mostly manually
Advanced machines
Raw material
Herbs from plants or wild area Clean bulk drug
chemical
and
(Dao Di)
Environment
none
Highest requirements of
requirements
People
clean environment
Technician
with
long-time Systematically
experience
Evaluation
trained
operator
of Experience
Clinical trials
clinical efficacy
Composition
Not clear
Safety
Poor
preparation
Composition is clear
may
toxicity
Usage
cause Side effects exist and can
be clearly defined
Bag packaging for prescription of Pill, capsule, spray and
TCM doctors or production of other
TCM compound factory
modern
dosage
forms
26
Table 2 Background information of two case firms
KangmeiCo
XinhehuaCo
History
1997
2001
Ownership
Private
Private
Location
Guangdong Province
Sichuan Province
Employees
4,000
300
Public listed
2001 in Shanghai Stock Exchange
2012 in Shenzhen Stock
Market
Exchange Market

Chinese herb slices


Trade market of Chinese herb

Health maintaining product

Chemical drug
Main businesses
Target market
Mainly domestic market
Chinese herb slices
Mainly domestic market
27
Table 3 Main activities of GMP standardization by case firms
GMP aspect
Logic of
Western
Medicine
Manufacturing  Chemical
techniques
synthesis
 Techniques
should be tested
and consistent
Facilities and
machines
Materials and
product
management
People
management
Environment
management
 Facilities and
machines
should be
located
according to
manufacturing
techniques
 High-tech
machines
 All the
information of
materials and
product should
be detailed
recorded
 People should
have knowledge
of chemistry
and
pharmacology
 People should
be well trained
 No harm to
environment
 Control
pollution
Logic of
Chinese herb
slice
 Pao Zhi
 No specific
requirements
 Implying
demands for
function
specific to
different Pao
Zhi techniques
 Materials
should be
(Dao Di)
Activities of case firms
 Accept the idea of
consistent techniques
 Imitate and enlarge the
traditional Pao Zhi into
qualified and operable
processing techniques that
could be applied into
modern production factory
similar as Western Medicine
 Locate facilities and
machines according to
production function
 Cooperate with to design
machines by self
 XinhehuaCo developed a
quality tracking system
 People should  Recruit employee with
have long
background of Western
experience of
Medicine
Chinese herb  Develop training and
slice
production protocols that
combine logics of Western
 People should
“learn by
Medicine and Chinese herb
doing”
slice
 No specific
 Establish management
requirement
system of dealing with
waste and rejected
materials
28
Table 4 Main activities of Pharmacopeia standardization by case companies
Pharmacopeia
Logic
of Logic of Chinese Activities of case
Western
herb slice
firms
Medicine
Effective component
Testing
 Effective
component
must be clear
 Effective
component
should be
chemical entity
or molecule
 Test method,
device, and
quantitative
level must be
clear
 Visual
 Choosing multiple
look(Xing
effective
Zhuang)
components
 Geographical
 Choosing effective
source(Dao Di)
components
according to the
 Well processed
traditional logic of
through Pao Zhi
Chinese herb slice
rather than single
chemical entity
 Subjective
 Combing testing
judgment by
methods of TCM
expert of TCM
and Western
Medicine
29
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