The organisation of innovation: collaboration, cooperation and multifunctional groups in UK and German manufacturing

Abstract

Abstract:Marked differences exist between the institutional and social context for innovation in the UK and Germany. The question addressed here is how these different contexts impact on the objectives and organisation of innovation in UK and German manufacturing. In particular, we examine the extent to which UK and German plants engage in inter-plant collaboration and co-operation and multifunctional working as part of their innovative activity, and explore the reasons for differences in these patterns of involvement. The investigation is based on a large-scale, comparative survey of manufacturing plants in the two countries In Germany, institutional and social norms are found to encourage collaborative interplant innovation but aspects of the German skills training and industrial relations systems make the adoption of more flexible internal systems more difficult. In the UK on the other hand, the more adversarial nature of inter-firm relations makes it more difficult to establish external collaborations based on mutual trust, but less restrictive labour market structures make it easier for UK plants to adopt multifunctional working. This is linked to differences in attitudes to the property rights and transaction cost problems inherent in innovation.

Organizing the Innovation Process: Complementarities in Innovation Networking

“…The data we use here are taken from the Product Development Survey (PDS), a nationally representative postal survey of UK and German manufacturing plants" innovation activity (Roper et al, 1996;Love and Roper, 2004). In each country the sample was structured to allow size-band, regional and industry sector comparisons.…”

“…The PDS is particularly well suited to examining complementarities between external knowledge sources because it provides detailed information both on firms" innovation outputs as well as the organization of firms" innovation activity (see, for example, Love and Roper, 2004).…”

“…In a study of innovation organization between the two countries, Love and Roper (2004) find that these institutional and social norms do have an effect on the overall pattern of external networking in the innovation process. German plants were significantly more likely than their UK counterparts to have external linkages in each aspect of innovation activity, and there were marked differences in the reasons given for inter-plant collaboration or co-operation between the two countries.…”

“…By contrast, the UK innovation and production system has been characterised by its dependency on fickle capital markets, short-term business objectives and a more opportunistic (or entrepreneurial) approach to innovation (Roper, 1997;Dore et al, 1999). The consequence is a tendency towards more radical and sporadic 3 A detailed analysis of the institutional and structural differences between the organization of innovation in the two countries is provided in Love and Roper (2004), and so only an overview is provided here.…”

“…The UK-Germany comparison is of particular interest both because of shortcomings in UK national innovation performance, differences in the nature of innovation activity (Finegold and Wagner, 1998;Herrigel, 1996), and the marked institutional and organizational contrasts between the two countries (Finegold and Soskice, 1988;Dore et al, 1999;Culpepper, 1999;Love and Roper 2004). …”