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Abstract
The literature relating to networks and organizational culture has acknowledged trust to be a valuable intangible asset. This article reviews the theoretical literature and the limited empirical research on trust in relation to business organizations and activity. Within this framework, the early history of Burroughs Wellcome & Co. reveals the importance of trust in building a cohesive organization and in establishing a reputation with the medical profession and with the trade. The study shows the construction of trust to have been an essential dimension in the company's growth to become the leading pharmaceutical manufacturer in Britain by 1914.
Acknowledgements
The two principal archival sources drawn upon in preparing this article are the Wellcome Archives and the archives of the Wellcome Foundation (WFA) in which the letter books of Henry S. Wellcome (Wellcome LB), and Silas M. Burroughs (SMB LB), were the sources used most. At the time of going to press, much of the material consulted was still being catalogued and was not, therefore, available to the public. I am grateful to the archivists of the Wellcome Trust for their cooperation and advice, notably from Ms Julia Shepherd. The article has benefited from Dr E.M. Tansey's extensive knowledge of the archives, which she has been generous in sharing, and her research into the early history of the research laboratories of Burroughs Wellcome & Co. I am indebted to them and to the Wellcome Trust which funded the research on which this article is based. I am also indebted to Professor Bruce Lyons and the anonymous referees for constructive comments made on an earlier draft.
Notes
1 See Dasgupta, “Trust as a Commodity.”
2 One exception in this respect is to be found in Casson, Information and Organisation.
3 Lyons and Mehta, “Contracts, Opportunism and Trust.” See also Lane and Bachman, eds., Trust Within and Between Organisations; Stiglitz, “Formal and Informal Institutions.” For a more recent review of the literature, see Nooteboom and Six, eds., The Trust Process in Organisations.
4 See Nooteboom, Trust: Forms, Foundations, Functions, Failures, and Figures.
5 Casson, Information and Organisation, 117–145; idem, The Economics of Business Culture, 3.
6 British Medical Journal, 138, 4 June 1938, 1214.
7 Corley, “The Beecham Group in the World's Pharmaceutical Industry,” 24.
8 Church, “The British Market for Medicine in the Late Nineteenth Century,” 281–298.
9 Tansey and Milligan, “The Early History of the Wellcome Research Laboratories”; Tansey, “The Wellcome Physiological Research Laboratories, 1894–1904,” 1–41.
10 Chapman, Jesse Boot, 97–98.
11 Slinn, “Research and Development in the UK Pharmaceutical Industry,” 168–186.
12 WFA, PP/SMB/6, Burroughs to Wellcome, 10 May 1882; WFA, Acc. 87/33, 16, Burroughs to Wellcome, 23 Dec. 1882.
13 Chemist & Druggist, 25, 15 Dec. 1885.
14 Tansey, “Pills, Profits, and Propriety,” 3–9.
15 Chemist & Druggist, 21, 15 March 1879, 63.
16 WFA, Acc. PP 110, quoted in “Medical Formulae,” 32.
17 WFA, Acc. 85/16, Trade Marks, Burroughs Wellcome & Co. The substance was later found to contain fluorine, a poisonous or deleterious ingredient. This verdict appeared in Journal of American Medicine, 1939, 113, 1, 78.
18 Vaughn, “Secret Remedies,” 101–111.
19 Ibid.
20 For a recent survey of the literature on the history of marketing, see Church, “New Perspectives,” 503–542.
21 WFA, LB 36, Box 523, Burroughs to Lennox-Brown, 17 Oct. 1879.
22 WFA, Acc. PB 110, “Medical Formulae,” 39.
23 WFA, Acc. 87/33: 2, Burroughs to Wellcome 27 Feb. 1883. In 1891, when the Westminster Hospital inquired about their products, the list of hospitals supplied by BW&Co. included St George's, the Royal Free, King's, University College Hospital, Charing Cross, Middlesex Hospital for Women, St John's Hospital for Diseases of the Skin, the Royal Infirmary, Glasgow, Royal Hospital, Portsmouth, Birmingham General Hospital, and Bradford Infirmary. WFA, Wellcome LB 16, 129, 155, BW&Co to R. Parker, FRCS, 12 July 1901; to Spencer FRCS, 17 July 1901.
24 WFA, Wellcome LB 11, 616, 617, BW&Co to Hull and to Francis, 23 May 1898; LB 11, 720, BW&Co to Hull, 18 July 1898; LB 12, 509, HO-Australia, 7 July 1899.
25 WFA, Acc. 87/33: 2, Burroughs to Fellowes, 1882 n.d.
26 WFA, Wellcome LB 11, 502–504, BW&Co to Wellcome, 25 March 1898.
27 An important example is Wellcome's advice to George Pearson, chief London sales representative and subsequently Wellcome's deputy manager: ‘Dr Thin of Harley Street is old-fashioned, he is principal medical officer of P & O opposed to medical officers prescribing goods such as B&W. Please go and see him and send a detailed report’. WFA, Wellcome LB 12, 830, BW&Co, Wellcome to Pearson, 13 Nov. 1899.
28 For a recent review of the history of advertising in Britain during this period, see Church, “Advertising Consumer Goods.”
29 WFA, Acc. 82/1 Box 16, Burroughs to Wellcome, 16 Aug. 1884.
30 WFA, PP/SMB LB 36, Box 523, Burroughs to Wyeth, 8 May, 22 Oct. 1879; Davies, “Silas M. Burroughs,” 10–13.
31 WFA, LB 36, Box 523, Burroughs to the Editor, Medical Times and Gazette, 2 May 1879.
32 WFA, Acc. 82/1 Box 78, Advertising book, 1, 1880–1884, F 51.
33 WFA, Wellcome LB 10, 92, BW&Co to Murrell, 1 May 1882.
34 WFA, Wellcome LB 10, 97, BW&Co to Whitmarsh, 5 May 1882.
35 WFA, Wellcome LB 10, 90–91, BW&Co to Harwicker, 27 April 1882.
36 WFA, Wellcome LB 10, 25, Wellcome to Burroughs, 26 May 1882.
37 WFA, PP/SMB/6, Burroughs to Wellcome, 1 April 1882; WFA, ACC 82/1, Burroughs to Wellcome, 7 Aug., 29 Sept. 1884.
38 WFA, Wellcome LB 1, 393–397, Wellcome to Burroughs, 7 Aug. 1885; WA: LB 1, 432; Wellcome to Fraser, 19 Dec. 1885; WFA, Acc. 82/1, Box 14. Wellcome to BW&Co, 19 Jan. 1887; Acc. 82/1, Box 7, Home representatives' convention, 1908.
39 Rhodes James, Henry Wellcome, 124–125.
40 WFA, Wellcome LB, 13, 347–348, BW&Co to Wellcome, 21 March 1900. Demonstrations of the impurities to be found in chemicals supplied by such reputable firms as the fine chemical manufacturers Howards and Merck were the subject of presentations at the company's 1908 conference. WFA, Acc. 82/1 Box 7, Report of home representatives, 1908, 24–29.
41 WFA, GB 31/1, Instructions sent to foreign manufacturing houses, 1898–1932, “re Returns and Rejections at Sydney and New York Works,” 14 July 1914, 38.
42 WFA, Acc. 82/1 Box 18, “Instructions.”
43 WFA, Wellcome LB 10, Wellcome to Searl, 10 Oct. 1895.
44 WFA, LA Wellcome LB 10, 703–705, 21 June 1895.
45 Ibid., 25 Oct. 1895.
46 WFA, Wellcome LB 17, 413–416, 7 Jan. 1902; 430–432, 9 Jan. 1902.
47 Tansey, “The Wellcome Physiological Research Laboratories,” 14.
48 WFA, Wellcome LB 26, 770, 26 May 1904.
49 WFA, Acc. 96/45, BW&Co sales book 2; Tweedale, At the Sign of the Plough, 118.
50 Though the laboratories were not so designated publicly until 1899.
51 Tansey, “The Wellcome Physiological Research Laboratories,” 3–5. In 1902, details of scientists' contracts were altered to become personal arrangements with Wellcome, though they were paid by the company.
52 Ibid., 21.
53 WFA, F/FA/328, WFL trading and profit and loss accounts.
54 Tansey, “The Wellcome Physiological Research Laboratories,” 5.
55 Ibid., 18–26.
56 WFA, F/EA/328, WFL trading and profit and loss accounts.
57 Tansey and Milligan, “The Early History of the Wellcome Research Laboratories,” 95.
58 Dale, “Autobiographical Sketch,” 129.
59 WFA, Acc. 82/1, Wellcome Physiological Research Laboratories, Wellcome to Mellanby, 1 Jan. 1902; WFA, LB 17, 420–426, BW&Co to Wellcome, 8 Jan. 1902, memo 1255.
60 Tansey, “What's in a Name?,” 464; Tansey and Milligan, “The Early History of the Wellcome Research Laboratories,” 96–100.
61 Chemist & Druggist, 28 Jan. 1888, 104.
62 Rhodes James, Henry Wellcome, 211–212, 292; WFA, Acc. 82/1 Box 17, Tabloid case, 810–849.
63 WFA, Acc. 82/1 Box 17, “The Tabloid Case,” 813–816.
64 Medical Times and Gazette, 19 Dec. 1903.
65 WFA, Acc. 82/1 Box 17, “The Tabloid Case,” 824.
66 A hospital pathologist noted that BW&Co was typically slow to introduce new therapeutic remedies, remarking that this must have ‘cost the company dearly’. However, this conservative approach to innovation was the reason why he purchased the company's products in preference to others, reflecting trust in its historically ethical stance. Monthly Memoranda, March 1933, 333.
67 WFA, Wellcome LB 25, 842, BW&Co to Burnett, copied to all travellers, 18 Feb. 1904.
68 Chemist & Druggist, 38, 15 Aug. 1891, 13.
69 WFA, Acc. 82/1 Box 17, typescript (anon), “Re Substitution and Price Cutting,” 18 March 1903, 36.
70 Chemist & Druggist, 68, 14 July 1906, 51.
71 Ibid., 68, 6 Oct. 1906, 535.
72 WFA, Acc. 82/1 Box 7, “Report on Home Representatives' Convention, 1908,” 99, Mr Curry.
73 Ibid., 15–19.
74 Ibid., 4–5, 8, 15–19, 21, 52, 57; Mr Blanchflower.
75 Ibid., 8, Mr Curry.
76 See Telser, “Advertising and Competition,” 537–562.
77 Ibid. See also Nelson, “Advertising as Information,” 729–754, and Norton and Norton, “An Economic Perspective,” 138–148.
78 For over-the-counter widely advertised proprietary medicines which BW&Co also produced, however, the self-interested trust model might possess relevance.