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Technological Accumulation, Diversification and Organisation in UK Companies, 1945--1983

Author

Listed:
  • K. Pavitt

    (Science Policy Research Unit, University of Sussex, Brighton, BN1 9RF, United Kingdom)

  • M. Robson

    (Science Policy Research Unit, University of Sussex, Brighton, BN1 9RF, United Kingdom)

  • J. Townsend

    (Science Policy Research Unit, University of Sussex, Brighton, BN1 9RF, United Kingdom)

Abstract

A survey of more than 4,000 significant innovations and innovating firms in the UK from 1945--1983 shows that the scope and organisation of technological activities vary greatly as functions of firms' principal activities and size. 1. Technological opportunities and threats are greatest in firms in chemicals and engineering. Opportunities in such science-based and specialist supplier firms in general emerge horizontally (in related product markets) and downstream (in user sectors). In scale-intensive (e.g. steel, vehicles) and supplier-dominated (e.g. printing, construction) firms, opportunities tend to be upstream in related production technologies. Breakthrough innovations in science-based firms also induce clusters of technological opportunities upstream for suppliers, horizontally for partners, and downstream for users. Their effective exploitation requires diversity of firms' technological activities greater than that strictly required for current output. 2. The nature of technological opportunities, and of organisation for their exploitation, also varies with firm size. Firms with fewer than 1,000 employees have major opportunities with specialised strategies in mechanical engineering and instruments. The prevalence of broad front technological strategies, and of divisionalisation, increases sharply with firm size, together with dependence on formal R and D activities. The size of innovating divisions has diminished sharply over the period. Divisionalisation improves the "goodness of fit" between the core business of innovating divisions and the innovations themselves, but 40% have remained consistently outside the core business of divisions. 3. These findings help identify the key tasks of technological strategy in firms in different industries, and of different sizes. Thus, in large firms, divisionalisation can create the small size of unit conducive to effective implementation, but it cannot absolve central management from the continuous task of matching technological opportunities with organisational forms and boundaries.

Suggested Citation

  • K. Pavitt & M. Robson & J. Townsend, 1989. "Technological Accumulation, Diversification and Organisation in UK Companies, 1945--1983," Management Science, INFORMS, vol. 35(1), pages 81-99, January.
  • Handle: RePEc:inm:ormnsc:v:35:y:1989:i:1:p:81-99
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    File URL: http://dx.doi.org/10.1287/mnsc.35.1.81
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    Cited by:

    1. Micheels, Eric T. & Nolan, James F., 2016. "Examining the effects of absorptive capacity and social capital on the adoption of agricultural innovations: A Canadian Prairie case study," Agricultural Systems, Elsevier, vol. 145(C), pages 127-138.
    2. Brautzsch, Hans-Ulrich & Günther, Jutta & Loose, Brigitte & Ludwig, Udo & Nulsch, Nicole, 2015. "Can R&D subsidies counteract the economic crisis? – Macroeconomic effects in Germany," Research Policy, Elsevier, vol. 44(3), pages 623-633.
    3. Mary M. Crossan & Marina Apaydin, 2010. "A Multi-Dimensional Framework of Organizational Innovation: A Systematic Review of the Literature," Journal of Management Studies, Wiley Blackwell, vol. 47(6), pages 1154-1191, September.
    4. Archibugi, Daniele & Filippetti, Andrea & Frenz, Marion, 2013. "The impact of the economic crisis on innovation: Evidence from Europe," Technological Forecasting and Social Change, Elsevier, vol. 80(7), pages 1247-1260.
    5. Faïz Gallouj & Maria Savona, 2009. "Innovation in services: a review of the debate and a research agenda," Journal of Evolutionary Economics, Springer, vol. 19(2), pages 149-172, April.
    6. Pla-Barber, José & Alegre, Joaquín, 2007. "Analysing the link between export intensity, innovation and firm size in a science-based industry," International Business Review, Elsevier, vol. 16(3), pages 275-293, June.
    7. repec:krk:eberjl:v:5:y:2017:i:1:p:169-185 is not listed on IDEAS
    8. Archibugi, Daniele & Filippetti, Andrea & Frenz, Marion, 2013. "Economic crisis and innovation: Is destruction prevailing over accumulation?," Research Policy, Elsevier, vol. 42(2), pages 303-314.
    9. Amore, Mario Daniele, 2015. "Companies learning to innovate in recessions," Research Policy, Elsevier, vol. 44(8), pages 1574-1583.
    10. Kenyon, G.N. & Meixell, M.J. & Westfall, P.H., 2016. "Production outsourcing and operational performance: An empirical study using secondary data," International Journal of Production Economics, Elsevier, vol. 171(P3), pages 336-349.
    11. Hammadou, Hakim & Paty, Sonia & Savona, Maria, 2014. "Strategic interactions in public R&D across European countries: A spatial econometric analysis," Research Policy, Elsevier, vol. 43(7), pages 1217-1226.
    12. Nemet, Gregory F. & Johnson, Evan, 2012. "Do important inventions benefit from knowledge originating in other technological domains?," Research Policy, Elsevier, vol. 41(1), pages 190-200.
    13. Nemet, Gregory F., 2012. "Inter-technology knowledge spillovers for energy technologies," Energy Economics, Elsevier, vol. 34(5), pages 1259-1270.
    14. Faïz Gallouj & Maria Savona, 2010. "Towards a Theory of Innovation in Services: A State of the Art," Chapters,in: The Handbook of Innovation and Services, chapter 1 Edward Elgar Publishing.
    15. Granstrand, Ove, 1998. "Towards a theory of the technology-based firm1," Research Policy, Elsevier, vol. 27(5), pages 465-489, September.
    16. Zander, Ivo, 1997. "Technological diversification in the multinational corporation--historical evolution and future prospects," Research Policy, Elsevier, vol. 26(2), pages 209-227, May.
    17. Hsu, Chia-Wen & Lien, Yung-Chih & Chen, Homin, 2015. "R&D internationalization and innovation performance," International Business Review, Elsevier, vol. 24(2), pages 187-195.
    18. Feldman, Maryann & Kenney, Martin & Lissoni, Francesco, 2015. "The New Data Frontier," Research Policy, Elsevier, vol. 44(9), pages 1629-1632.
    19. René Belderbos & Leo Sleuwaegen & Reinhilde Veugelers, 2010. "Market Integration and Technological Leadership in Europe," European Economy - Economic Papers 2008 - 2015 403, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
    20. repec:eee:crpeac:v:25:y:2014:i:1:p:27-35 is not listed on IDEAS
    21. Piscitello, Lucia, 2000. "Relatedness and coherence in technological and product diversification of the world's largest firms," Structural Change and Economic Dynamics, Elsevier, vol. 11(3), pages 295-315, September.

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    Keywords

    technology; strategy; diversification; accumulation;

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