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Innovation, Learning Organizations and Industrial Relations

  • Peter Nielsen
  • Bengt-Åke Lundvall

Innovation may be seen as a process of knowledge creation and the speed and direction of knowledge creation reflects the organizational set-up of the firm as well as its investments in R&D and training. Establishing ‘a learning organization’ where horizontal interaction and communication inside and across the borders of the firm is a major factor promoting knowledge creation in the context of a learning economy. An important issue is to what extent direct and indirect participation of employees in shaping the new form of organization is critical for its realization. On the basis of a unique data set covering 2000 Danish private firms it is demonstrated that firms combining several of the organizational traits of the learning organization are much more prone to introduce new products than the others. It is also demonstrated that such firms have involved employees in different forms of direct and indirect participation much more frequently than the rest. As more sectors become exposed to the need to engage in incremental product and service innovation the economic potential of diffusing good practices in terms of organization and participation is growing and needs to be reflected in firm strategies and public policies aiming at promoting innovation and knowledge creation.

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Paper provided by DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies in its series DRUID Working Papers with number 03-07.

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Date of creation: 2003
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Handle: RePEc:aal:abbswp:03-07
Contact details of provider: Web page: http://www.druid.dk/

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  1. Keld Laursen, 2002. "The Importance of Sectoral Differences in the Application of Complementary HRM Practices for Innovation Performance," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 9(1), pages 139-156.
  2. Reinhard Lund, 1998. "Organizational and Innovative Flexibility Mechanisms and their Impact upon Organizational Effectiveness," DRUID Working Papers 98-23, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
  3. Bengt-Âke Lundvall & Peter Nielsen, 1999. "Competition and transformation in the learning economy - Illustrated by the Danish case," Revue d'Économie Industrielle, Programme National Persée, vol. 88(1), pages 67-89.
  4. Bengt-ake Lundvall & Bjorn Johnson, 1994. "The Learning Economy," Industry and Innovation, Taylor & Francis Journals, vol. 1(2), pages 23-42.
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