Value creation and the UK economy: a review of strategic options

International Journal of Management Reviews Volume 56 Issue 3amp4 pp 191ndash213

191

copy Blackwell Publishing Ltd 20049600 Garsington Road OxfordOX4 2DQ UK and 350 MainStreet Maiden MA 02148 USA

SeptemberDecember 2004

Blackwell Publishing LtdOxford UKIJMRInternational Journal of Management Reviews1460-8545copy Blackwell Publishing Ltd 2004563amp4

ORIGINAL ARTICLE

Value creation and the UK economy a review of strategic options


Tim

Edwards

Giuliana

Battisti

and

Andy

Neely

Tim Edwards is from Cardiff Business School Cardiff University Aberconway Building Colum Drive Cardiff CF10 3EU UK Giuliana Battisti is from Aston Business School Aston University Birmingham B4 7ET UK Andy Neely is Professor of Operations Strategy and Performance Cranfield School of Management Deputy Director of ESRCEPSRC AIM Research Initiative Visiting Professor of Operations Management London Business School

In this review paper we ask how UK business might realize improved productivity throughvalue creation Our aim is to evaluate the ability of UK firms to reduce the productivity gapby assessing the challenges associated with the following strategic options (a) increasingefficiency and effectiveness through the adoption of better practices (b) innovating toproduce products or services that generate more revenue (through either higher prices or largervolumes) while remaining at the same position in the value chain and (c) fundamentallychanging position in the value or supply chain and moving to a position where the productsand services that are delivered inherently generate more value To this end we contend thatthe core issues that affect such endeavours relate to the conceptualization and managementof change and innovation By considering the interconnections between firm-level activitiesand wider institutional processes and structures we assess the links between knowledgeproduction skills provision and productivity including the role of the state and otherinstitutions in the context of the micro-processes of innovation We conclude with adiscussion of the research and policy implications of the attempt to make more sense ofinnovation and reduce the UKrsquos productivity gap

Introduction

The UKrsquos innovative and productivity per-formance remains a subject of considerableinterest not least because of the productivitygap between the UK and the USA France andGermany Analysis of government statisticssuggests that the productivity gap between theUSA and the UK is over 30 when measuredin terms of GDP per worker and over 20between France and the UK (see Figure 1) Thesize of the productivity gap between the UKand France and the UK and Germany increasesto approximately 30 when measured in terms

of GDP per hour worked because employeesin France and Germany work fewer hoursthan those in the UK (DTI 2003) Assessmentsof the productivity gap reveal weaknessesin the collaborative capacity of UK firms aswell as inadequate innovation investment andmanagement training across large sections ofthe economy Concerns persist about the basisof the UKrsquos competitiveness which is relianton both low input costs and an efficient busi-ness environment (Porter and Ketels 2003)Notably conventional wisdom proposes thata firmrsquos lsquocompetitive edgersquo no longer restssolely with static price competition but relies

192

copy Blackwell Publishing Ltd 2004


on a firmrsquos ability to create and exploit know-ledge faster than its competitors The challengeremains to encourage large sections of the UKeconomy to pursue such a strategic orientation

Integral to such a repositioning (the cre-ation of higher value along the value chain) areissues related to the innovative potential ofUK firms including the skills and competencylevels of management and the workforce Yetimproving the innovative potential of the UKeconomy presents serious problems in termsof conceptualization and management Inparticular such an endeavour is mediated by acomplex array of intra-organizational inter-organizational and environmental factors (seeBirdi

et al

2003) Broadly intra- and inter-organizational issues reflect the often politi-cized and controversial characteristics of theinnovation process For example when assessinghow firms can create higher value it is vital toappreciate existing social relations within thefirm and the industry sector and the extent towhich these inform the strategic choices ofmanagers Notably knowledge can be thedriver of change but equally the biggest bar-rier to it In turn wider institutional processesalso mediate strategic choices In the case ofskills provision for instance matched studiesshow how firms in countries with higher skill(and productivity) levels are much better ableto adapt and exploit technology to boostproductivity Such findings have importantimplications in the context of the UK as thepreponderance of a low-skills economy appears

related at least in part to limitations in exist-ing institutional mechanisms in the provisionof skills (see Bloom

et al

2003)This paper sets out to address the concep-

tual and managerial challenges implicated inthe UK governmentrsquos ongoing quest to improvethe value-adding characteristics of the econ-omy Here we begin to integrate the basicarguments that are implicated in the accompa-nying systematic reviews around an apprecia-tion of the strategic challenges facing managersof large sections of the UK economy Thispaper offers a summary of the core findingsof these papers and draws upon additionalliterature to provide a broader criticalappraisal of innovation and value creation Inparticular we integrate the key observationsaround ideas of networking and promisingpractices As such this paper is not a system-atic review of the literature rather it is acommentary on the barriers and enablers toseveral strategic options open to managers

We start by defining the value chain andinnovation Here we contend that innovation isnot simply a question of trading lsquoknowledgersquobut reveal that such processes are political andinherently controversial Crucially the adop-tion of a value perspective of strategy has tobe based on a realistic view of the existingsocio-economic and political structures withinand without the firm In the next section webuild on these insights by illustrating some ofthe challenges confronting a large section ofthe UK economy in terms of the low-skill low-quality equilibrium debate These discus-sions lead to a detailed appraisal of the followingstrategic propositions

(1) increasing efficiency and effectivenessthrough the adoption of better practices

(2) innovating to produce products or servicesthat generate more revenue ndash via eitherhigher prices or larger volumes ndash but real-ized by remaining at the same position inthe value chain

(3) fundamentally changing position in thevalue or supply chain and moving to aposition where the products and services

Figure 1 UK productivity gap

193



that are delivered inherently generate morevalue

The extant literature (including the findingsof the papers included in this special review)offer a point of departure to illustrate the pol-icy and research implications of each strategicoption The final section concludes

Defining the Value Chain

The notion of a value chain derives from thefield of microeconomics where it is used tocharacterize the process through which a goodor service moves from raw materials to finalconsumption (Figure 2) Porterrsquos (1985) intro-duction of the value chain concept is used todescribe the supplier and buyer relationship ndashin the context of delivering products and ser-vices ndash where costs take place and value isidentified and added In this case value refersto the level of usefulness or importance ofactivities generated between stages of thechain The value chain represents a tool whichwill lsquodisaggregate the business into strategi-cally relevant activitiesrsquo with the most rele-vant aspects being those activities that createthe most value In turn competitive advantageis based on the firmrsquos being able to performthose activities lsquomore cheaply or better thanits competitorsrsquo (Brown 1997)

Arguably success depends on the wayfirms identify their business and link thiswith knowledge competencies and customers(Normann and Ramirez 1993) Adopting avalue strategy is all about positioning the firmin the right place on the value chain the chal-lenge is to ensure sustainable value creation(Walters and Lancaster 2000) Ensuring andimproving the fit between competencies andcustomers can take a variety of strategicforms First meeting customersrsquo priorities andproducing communicating and deliveringvalue can be achieved by building increased

efficiency and effectiveness into the valuechain Adopting efficient means of production(ie new technologies) and lsquobest practicersquo isoften seen as a key step to maintaining andimproving the value of products and servicesthat are offered to customers Likewise devel-oping and delivering products and services innovel ways (but staying at the same pointalong the value chain) can also achieve newvalue The notion of lsquovalue innovationrsquo is oftenused to capture how radical shifts in existingproducts and services can make the competi-tion irrelevant (Kim and Mauborgne 1997) Inturn firms can create value by fundamentallyrepositioning themselves on the value chain orby organizing their operations along the chainin better ways For example higher value canbe created by developing partnerships alongthe value chain rather than by keeping armrsquos-length relations or hierarchies of commonownership (Walters and Lancaster 2000)

Such strategies reflect the priority givento transforming existing business processesrather than simply erecting barriers to rivals(Horvath 2001) These activities involve thedevelopment leveraging and transformationof existing products services and processes(Horvath 2001 Sanderson 1999) or provokinga quantum leap in value by shifting what ismade available to customers (Kim andMauborgne 1997) To understand such proc-esses it is necessary to begin by offering arobust interpretation of innovation

Defining Innovation

At present and despite the voluminous litera-ture our understanding of innovation ndash thecommercial exploitation of ideas ndash remainsrelatively limited (Wolfe 1994) Many of thereasons behind this are linked to the lack ofa common theoretical basis for innovationresearch (Drazin and Schoonhoven 1996)That said developments in this field have

Figure 2 Value chain for packaged foods Source Johnston and Lawrence (1988 96)

194



begun to coalesce around the idea that innova-tion should be considered in terms of strategicconduct within institutional processes andstructures (Nooteboom 2000) This view hasthe potential of creating understanding throughan examination of firm-level activities linkedwith knowledge creation within the context ofthe firmrsquos business system Contrary to thestudies of for example technical innovationsthat tend to assume innovations to be lsquoarte-factsrsquo that are simply lsquodroppedrsquo into firmssuch an analysis provides a critical examina-tion of the institutional processes and struc-tures that inform and mediate innovation andthe strategic choice of managers

Innovation is not simply about invention orthe creation of new ideas it is about the dif-fusion of ideas and their subsequent appropri-ation into society Adoption presents differingchallenges depending on the innovation(s)For instance new products are tangible arte-facts in which knowledge is

blackboxed

Onsuch occasions the technical knowledge whichis objectified should present fewer problemsduring adoption as it is generally assumedthat existing organizational structures enablerather than inhibit implementation Processinnovations are in contrast less tangible tacitand context dependent Such processes aredifficult to adopt precisely because they arelsquoloosely coupledrsquo practices that are likely tobe open to reinterpretation (Newell

et al

2002) Notably as technologies have becomemore complex it is apparent that their intro-duction often requires the redesign of firmstructures and as such increases the levels ofrisk and uncertainty associated with changeThis can be usefully illustrated using exam-ples from the literature focused on the adop-tion of new technologies or outsourcing aimedat cost-minimizing production inputs Here ithas been shown that the adoption of a labour-saving or cost-reducing process technologydoes not always lead to productivity gains(Bresnahan

et al

2002 Caroli and Van Reenen1999) A case in point is the IT lsquoproductivityparadoxrsquo where despite sizeable investmentsin IT firms often only report comparatively

small productivity gains (see Brynjolfsson andYang 1996 for a survey) Bresnahan

et al

(2002) attribute this failure to the lack oforganizational structures or managementmethods aimed at facilitating the introductionof new technologies a finding confirmed byrecent studies conducted by the LSErsquos Centrefor Economic Performance in collaborationwith McKinsey Bresnahan

et al

(2002) sug-gest that productivity gains derive not justfrom firms lsquoswitching onrsquo IT equipment butfrom the joint processes of adoption organ-izations redesign and change to the service oroutput mix Although inventions can bebought in (such as with standard cost-reducingtechnologies) workplace reorganization mayinvolve uncertain and difficult decisionsassociated with often complex and cognitivelydemanding work which indicates shifts orincreases in the demands placed on employees(Bresnahan

et al

2002 Brynjolfsson and Hitt2002 Caroli and Van Reenen 2000) Thisindicates that firms require both skilled work-ers and professionals capable of sustainingand leading change and of responding to cus-tomer (and suppliers) needs The lack of skillsand the shortage of human capital can retardthe adoption and implementation of innova-tive practices while the lack of organizationalchanges and product or service redesigns canact to weaken the management of change(Caroli and Van Reneen 1999)

Arguably organizations constitute an arrayof competencies individuals artefacts andpractices Changes to these competencies andpractices or the development of new productsprocesses and services is inherently uncertainbecause of resistance or problematized becauseof an absence of the knowledge necessary todevelop make sense of and introduce proce-dures processes or services Understandinghow firms can improve their innovative poten-tial requires an examination of the extent towhich their existing lsquozones of manoeuvrersquo(see Clark and Staunton 1989) provide themeans to undertake these new activities Inthe firm this is achieved by making sense of theuncertainty that may surround the develop-

195



ment of new products processes and servicesor the adoption of promising practices Uncer-tainty is in two parts

the degree of uncertainty embodied and embeddedwithin an innovation and the extent to whichusers already possess levels of knowledge and skillwhich enable them to systematically encode theuncertainty and to devise means for handling itslevel (Clark and Staunton 1989 51)

Assessing and overcoming uncertainty is dif-ficult because technical innovation as withorganizational innovation presents differentchallenges over time (Newell

et al

2002) Inthe case of technical innovation these can becharacterized in terms of the innovation pro-cess ndash invention diffusion and implementationInvention relies on knowledge search it is apersonalized process where individuals formassociations primarily based on skills andexpertise for the purpose of turning ideas intoactionable concepts and models (Nonaka 1991)Diffusion involves the exchange of solutionswhile boundary-spanners exchange knowledgein ways that are appropriate to their localsituation (Tushman and Scanlan 1981)Appropriation occurs when these individualsengage in such activities as to lsquofitrsquo the lsquoknow-howrsquo within the firm Adding value throughinnovation involves varying activities duringthe innovation process (Newell

et al

2002)During invention the acquisition of knowledgeis likely to rely upon increased lsquonetworkingrsquoOnce diffused implementation is likely toneed a within-organization lsquocommunityrsquoapproach whereby individuals work closelytogether in order to establish trust and sharedmeanings and understandings (Weick 1990)which go to ensure the appropriation of newknowledge Successful appropriation willdepend on how readily this is captured andstored in the organization Here routinizationis essential to sustain and embed knowledge(Clark and Staunton 1989)

For the purpose of this paper it is assumedthat innovation involves lsquothe development andimplementation of new ideas by people who

over time engage in transactions with otherswithin an institutional orderrsquo (Van de Ven

etal

1989 590) Value is created by the appli-cation of knowledge to improve change ordevelop specific tasks and activities ndash value isunlikely to be created by the simple stockpil-ing of knowledge in databases (McDermott1999) Notably innovation is increasingly dis-tributed across networks of actors structuraldivisions within the firm nations and cultures(Newell

et al

2002) Not only does innova-tion rely on the firmrsquos management to recog-nize potentially useful developments (eglsquobest practicersquo) it is also likely to rely on thecollaborative efforts between individuals acrossfirm boundaries to ensure that new practicesare embedded in the firmrsquos architectureHowever such challenges cannot be explainedwith reference to the innovation project aloneAs Whitley (2003 667) has argued firms indifferent national locales lsquodevelop distinctivekinds of capabilities that influence how theycompete in different sectors and technolo-giesrsquo In other words the selection processthat informs strategic decisions to innovate islikely to be governed by the internal contex-tual attributes of the organization and bytheir position within a social network whichinforms whether a new idea or innovation islegitimate and viable (Drazin and Schoon-hoven 1996)

Arguably a lsquoconstructionistrsquo perspectiveis necessary if policy-makers and managersare to understand value creation and thecomplex dynamic between intra- and inter-organizational and environmental elements Ouraim is to begin to unpack some of these issuesin the context of the extant literature We wouldargue that strategic choices are not readilyaccountable using functional accounts as thecontroversies associated with knowledge pro-duction and the constraints of the socio-economic and political environment infer acrucial interconnection between agency andwider institutional processes and structuresTo begin we outline innovation in the con-text of the low-skill low-quality equilibriumdebate

196



Innovation and the Low-skillLow-quality Equilibrium Debate

The low-skill low-quality equilibrium debatehas its origins in Finegold and Soskicersquos(1988) seminal paper considering the UKrsquosdeficiencies in vocational education and train-ing (VET) In this Britain was described astrapped in lsquoa self-reinforcing network of soci-etal and state institutions which interact to stiflethe demand for improvement in skill levelshellip [resulting in] the majority of enterprisesstaffed by poorly trained managers and work-ers produc[ing] low-quality goods and ser-vicesrsquo This provides an important juncture inresearch and policy terms as it denotes thepopularization of the debate and subsequentefforts to make sense of the role of skills andknowledge in competitiveness and organiza-tional performance within advanced economies

Until the work of Finegold and Soskice(1988) much of the debate on the relativelypoor performance of the VET system in theUK was narrowly focused on lsquosupply sidersquoproblems which included failings in full-timeeducation and work-based training (Keep andMayhew 1999) In contrast the low-skilllow-quality equilibrium debate has contributedto improving our understanding by consider-ing a more complicated set of circumstanceswhere lsquodemand sidersquo issues are included andexpressed in terms of lsquosystemsrsquo failure Fromthis perspective the low-skill form of workorganization within UK industry is believedto also infer lsquoinstitutional conditions ndash short-termfinancial markets an adversarial industrialrelations system and a low-supply of skills inthe labour marketrsquo (Finegold 1999 61) Thelink between skills and competitiveness islocated within the context of lsquoenvironmentalcultural and structural factorsrsquo which includesystems of production industrial relationsinter-firm networks industrial capital corpo-rate governance politics and so on (Keep andMayhew 1999) This can be illustrated as fol-lows although there has been much criticismof the relatively low-level task-specificcharacter of workplace training for the poor

performance of the workforce (for exampleNVQ level (Green 1998)) it is insufficient toassume that supply-side issues explain ashortfall in the mastery of leading-edge tech-nologies in UK firms Demand issues and therole of management are consequential in thecontext of firm strategy Hence it is unlikelythat firms will adopt high-performance prac-tices unless adequately integrated withinfor example high-performing supply chains(Oliver and Delbridge 2002) Hence the pre-ponderance of low-specification goods manu-factured using Fordist production methods isas much about industry structure as it is aboutthe national provision of skills

How business and the UK governmentaddress the linkages between industry-specificneeds and national VET provision is notstraightforward The relationship between skillsdevelopment knowledge and the needs ofindustry reveals a complex interplay betweenthe appropriate allocation of public fundsthrough training provision and the uncertainstrategic challenges facing managers in respectof innovation The chance for UK firms to adoptpromising practices to develop new valuethrough knowledge construction or to reposi-tion along the value chain needs to be viewedin the context of firm-level practices and thesewider institutional processes To begin toappreciate the complexity of such linkagesit is useful to consider the high-skill ecosystemsof Northern and Southern California Theseare geographic clusters of organizations (firmsand research institutions) employing staffwith advanced specialized skills in a particularindustry or technology (Finegold 1999) Theirsuccess depends in part on the structuralaspects that facilitate rapid skills and techno-logy development At the institutional levelthese rely on the local proximity of world-classresearch institutions and adequate financemechanisms which represent the very high-est levels of social and financial capital Yetconverting such resources into services alsorelies on a sophisticated learning process ndashvalue creation involves a highly educatedworkforce

and

knowledge production processes

197



based on informal learning Skills develop-ment is linked to project-based informallearning processes which include visits tocustomers suppliers or partner companies ratherthan through formalized training programmesHence social relations formed on trust ensurethe conversion of tacit knowledge into con-cepts and outcomes that are accessible withinand without the firm (Nonaka 1991) Theseinstitutional processes and the microprocessesform the dual sides of competitiveness theprovision of resources and the developmentof human capital to exploit knowledge andunderstanding High-skills ecosystems are notwithout their own problems (Finegold 1999)and are unlikely with perhaps a very fewexceptions to be replicated in the UK butthey usefully demonstrate the dynamicsbetween firm and institutional processes orhow formal education resources and informalactivities contribute to the creation of value

Notably although our understanding ofthe problems of the UK VET system haveimproved since the original work it remainsthat there is lsquoan imperfect appreciation of thenature of skills and of their contribution to thedevelopment of a more competitive highervalue-added economyrsquo (Keep and Mayhew1999 1) The debate is in many parts forexample our basic understanding might belimited owing to the bipolar model of low ver-sus high skills that is perhaps an oversimplifi-cation of the actual situation (Finegold 1999)Shortcomings are also evident in the mislead-ing assumption that the production of high-tech products is indicative of a highly skilledworkforce As Keep and Mayhew (1999 11)have noted lsquoworkers who solder togetherintegrated circuit boards do not need degreesrsquoArguably our understanding of the apparentmismatch between skills provision (which hasmassively increased since the 1980s) and thedemand for skills training demands a moresophisticated assessment of the relationshipbetween knowledge production and competence(see Bloom

et al

2003)In the next section we consider these and

other issues in respect of the strategic options

available to managers endeavouring to addnew value to firm-level activities We begin byreviewing recent research into the adoption ofpromising practices and speculate on thetraining implications of these findings

Creating Value ndash Adopting Promising Practices

According to Leseure

et al

(2004)

ad hoc

studies demonstrate that during the 1990sUK firms lagged behind other European coun-tries in the adoption and performance resultsof promising practices (Bessant

et al

1996Boddy

et al

1988 Hanson

et al

1994) Morerecent studies by Clegg

et al

(2002) indicatethat the UK has started to bridge the gap inthe adoption of best practices but that UKbusiness still tends to use them less effectivelyand extensively Successful implementationdepends on professionals and skilled workerssustaining and leading change during theadoption process This process can be charac-terized as follows (Leseure

et al

2004 32)

bull

initiation

ndash all events that lead to the deci-sion to transfer a best practice

bull

set-up

ndash planning for the implementationof the best practice

bull

implementation

ndash the stage from the launchof the change programme to the executionof the short term actions that have beenplanned

bull

ramp-up

ndash the stage when the practice isactually used ie ramp-up to performance

bull

integration

ndash final stage of the adoptionprocess ie when firms achieve satisfac-tory results and its use becomes graduallyroutinized

Appropriation is predicated on the firmrsquos abil-ity to learn adopt adapt and routinize newpractices Here management has to be able tolsquorecognise the value of new external know-ledge assimilate it and apply it to commercialendsrsquo (Cohen and Levinthal 1990) indicatingthat redesign human capital and cognitiveskills are harmonizing assets within thelsquoorganizational capitalrsquo of the firm (Dunne

et al

198



1996) Yet the problems encountered by UKfirms (especially during implementation) arealso linked to these same elements As pointedout by the extensive review of the extant liter-ature by Leseure

et al

(2004) the main inhib-itors seems to be internal factors such as poormanagement of change reflected in organiza-tional rigidities (poor knowledge and humanresource management lack of investmentlack of customers or external relationship)(see Table 1)

The challenges alluded to in the findings ofLeseure

et al

(2004) can be usefully assessedwith reference to developments in manufac-turing sectors where the adoption of continuousimprovement and problem-solving practicesreflects the diffusion of Japanese managementprinciples (ie Toyota production system)Cooke and Morgan (1998) argue that manyleading manufacturers have begun a process oflsquoexperimentationrsquo involving a lsquosemi-permanentprocess of organizational innovationrsquo basedon an lsquoattempt to create a more collaborativecorporate culture both within the firm andbetween the firm and its principle suppliersrsquoThis is indicative of a move away from thebasic principles of lsquoscientific managementrsquoand the adoption of policies lsquodedicated to total

quality and to active participation in newproduct developmentrsquo (Leonard-Barton 1992)Advocates of lean thinking purport a shiftwith the factory floor increasingly seen as aplace where knowledge can be created aswell as applied where production workersthink as well as do (Womack

et al

1990)This has been usefully characterized in thelsquolearning factoryrsquo model which consists ofthe following dimensions (Delbridge

et al

1998 227)

bull

Innovation is the central motif of the learn-ing factory The learning factory generatescodifies and applies knowledge to improveits various products structures and processes

bull

Learning factories are host to continuousimprovement activities that are driven byinternal sources of information such astacit knowledge of shop-floor workers thecontextual knowledge of technicians andthe formal knowledge of professionals andcraft workers

bull

The learning factory also benefits fromimprovement derived from external sourcesof information such as problem-solvingsuppliers and the supplier developmentprogrammes of customers

Table 1 Internal inhibitors of the adoption of best practice internal to the organizations

Human CapitalResourcesbull Poor enactment of leadership role (no clear line of responsibilities for the project lack of firm commitment

and active championing from top management)bull Lack of understanding communication and knowledge-sharingbull Insufficient education training and development for workforce and managementbull Cultural resistance and lack of employees motivation

Processbull Little setting of goals objectives targets for best practicebull Lack of measurement assessment and review during the implementation processbull Lack of customer or external relationship focusbull Inappropriate control of the adoption processbull Poor communication at all organizational level ndash Lack of knowledge sharingbull Little empowerment of employees

Financialbull Lack of investments in equipment people and processes

Perspectives and Partnershipsbull Lack of customer or external relationship focus (No engagement in supplier quality management

unwillingness to learn from customersupplier Poor benchmarking Little engagement in networking)

Source Personal elaboration of Leseure et alrsquos (2004) findings

199



bull

The learning factory is embedded in aninnovation network of collaborators withwhom there is information exchange andshared learning

How such practices are experienced on theshop floor is open to contention Notably thosestudies adopting a normative approach (Oliverand Wilkinson 1992 Womack

et al

1990)tend to take an lsquoideal typersquo view of such tech-niques assuming a unilinear interpretation ofdiffusion and appropriation In contrast criti-cal studies of the Japanization of the labourprocess (Delbridge

et al

1992 Elger and Smith1994 Smith and Meiksins 1995 Williams

et al

1992) have indicated that the lsquoborrow-ingrsquo of social innovations across contexts ismore problematic Recent work by Delbridgeand Barton (2000) on the car componentsindustry supports this view and suggests thatconformity to such practices will be differen-tiated across several dimensions the

degree ofspecialization

(relating to the use of special-ists or specialist groups in the organization ofproblem solving and continuous improvementactivities) the

breadth of participation

(relat-ing to the level of shop floor inclusion in suchactivities) the

degree of centralization

(relatingto the role of management in such activities)and the

level of standardization

or the proce-dures governing group problem solving Theysuggest lsquothat developments at individual plantsis informed by the social and institutional con-text of operations and by the plantrsquos specifichistoryrsquo (Delbridge and Barton 2000 188)This supports what Elger and Smith (1994 46)have contended in that the lsquoselection andinterpretation of social innovations such asthose associated with Japan of necessity aremediated and interact with home-grown condi-tions and existing practicesrsquo These lsquolocalrsquo con-ditions as demonstrated by Leseure

et al

(2004)can reflect considerable inhibitors which revealinterconnections between firm-level conditionsand wider institutional structures that mediatevalue-creating actions and opportunities

Notwithstanding the appropriation of pro-mising practices remains possible as long as

managers and employees are able to accessand use knowledge As indicated by Pittaway

et al

(2004) networking represents a consid-erable resource in this respect in so far as itoffers an information channel for entrepre-neurs (Birley 1985 Hoang and Young 2000Smeltzer

et al

1991) while managerial net-works positively affect the adoption of practicesespecially when they are cross-functionalinvolving actors from a range of contextsSupport of this view can be found in the lsquoUKInnovation Survey 2001rsquo (see Figure 3) whichconfirms that UK firms source technologiesand other innovation-related knowledge andinformation from multiple sources For exam-ple in the period 1998ndash2000 the key sourcesof information for UK enterprises were inter-nal to the enterprises themselves (185) fol-lowed by market suppliers (12) clients orcustomers (12) Yet relatively weak sourcesincluded institutional entities (public sectorincluding government research organizationsuniversities or private research institutes)and professional links (conferences tradeassociations technical trade press or fairs andregulations) Such evidence continues to dem-onstrate the varied and patchy performance ofmany institutional mechanisms in the UK context

Social networks and networking can pro-vide the basis for managers to overcome thebarriers to resource acquisition problem-solving and commitment to change especiallyin an increasingly distributed innovation pro-cess (see Pittaway

et al

2004) For examplethe engagement of customers and suppliers innetworks with buyers can strengthen the com-mitment of the supplying and buying firmrsquostop management to their role and integrationenhancing co-operation and investment Inturn networks of individuals (informal) andof organizations (formal) form the basis forsuccessful adoption that can when appropriatelyorganized contribute to skills development inways that overcome many of the lsquohome grownrsquodifficulties such as (but not only) the poormanagement of change and the organizationalrigidities experienced by UK managers andbusinesses

200



The next section looks more closely at theskills required for the adoption of promisingpractices and the role of institutional structuresin enhancing such skills and competences

Skills and Training ndash Adopting Promising Practices

A key question is the extent to which UKbusiness has the necessary skills to enable theappropriate adoption of promising practicesThe resolution of these issues is likely todepend on the effective utilization of thosemechanisms which enable both knowledgeproduction and skills development throughcollaborative links that are meaningful toall those participating It is apparent fromLeseure

et al

(2004) that the inhibitors toadoption reflect weak connections betweenthe firm and the institutional structures thatinform strategic choices Issues relating toskills competencies and adoption cannot betaken out of the context of the business sys-tem An illustration of the often successfulintegration of firm- and industry-level activities

for the purpose of value creation is to befound in the work of the Society for MotorManufacturers and Traders (SMMT)

The SMMT industry forum has establisheda framework to support sustainable world-leading competitiveness in the UK vehicleand components industry This represents theadoption of promising practices based on leanmanufacturing methods and offers opportuni-ties for either individual firms via its MasterClass or multiple firms via the Supply ChainGroup training programmes For individualfirms the industry forum offers second- andthird-tier car components suppliers an oppor-tunity to work with specially trained forumengineers to implement a range of measuresto help improve quality cost and deliveryimprovements A key aspect of this work isthe learning process based on learning bydoing The skills imparted for the eliminationof waste are context specific and inextricablylinked to the wider strategic issues of the sup-ply chain and industry Firms are introducedand trained to conduct value stream mappingprocess improvements and team leadership

Figure 3 Proportion of respondent grading importance of information sources as high Source lsquoUK innovation survey 2001rsquo elaboration by B Stockdale DTI httpwwwdtigovukieseecotrendspdf

201



and supply chain management activities Hencethe industry forum engages with firms torespond to the pressures of an increasinglyglobal and competitive market place Value cre-ation and training take on strategic importanceas suppliers are brought under one umbrellafor the purpose of collaboration and support

Here the SMMT facilitates the adoption ofbest practice by responding to many of theshortcomings of UK business identified byLeseure

et al

(2004) First the trainers on theprogrammes provide a co-ordinating rolethat helps to keep the firm on track with theskills and training development process Inturn the engineerrsquos role is to ensure that theemployeersquos benefit from and draw upon theskills and expertise of the engineers withintheir own context It is via the involvement ofthe engineers that co-ordination and measure-ment of these processes is effectively managedreviewed and assessed ndash control is crucial tothe effective adoption of such promising prac-tices Finally because this work is focused onthe car component industry the emphasis ison lsquoindustryrsquo improvements that work alongthe supply chain

The role of institutions such as the SMMTis crucial in encouraging value creation As itstands the role of trade associations couldbe improved such as with trade conventions(see Pittaway

et al

2004) yet as the SMMTexample shows it is possible to see how suchinstitutions can help to address the low-skills low-quality debate in the context of specificindustries The SMMT has raised the game inrespect of support and direction Against abackdrop of globalization and increasing pres-sure to add value the industry forum has setnew standards which challenge a low-skillviewpoint Such normative pressure clearlyhas the potential to reframe the skills debatewithin the UK vehicle and components indus-try Significantly such provision emphasizesthe contextual and processual characteristicsof innovation and knowledge production Inthis case the success of such programmesis based around the essentially bespoke andstrategic relevance of their work

Which lsquobest practicersquo

Finally as to the ques-tion lsquowhich is the ldquobestrdquo practicersquo the answeris which ever is the best for the individualfirm There are many management practicesand organizational models At any moment forany given firm there is an optimal organiza-tion form or management method which ifused by the firm will yield the greatest benefit(Perrow 1967) It is around this principle andthe fact that complementarities exist amongpractices that the concept of lsquosystem oforganizational innovationsrsquo has been developedand used (Huselid 1995 Ichniowski and Shaw1995 MacDuffie 1995) lsquo

High-performanceworkplaces

rsquo result from the synergic interac-tion of many work management practices ndashTQM formal team working job rotationemployee involvement programme trainingcompensation and management performancesystems (Huselid 1995) The lsquosystemrsquo whensuccessfully implemented creates a uniquesource of competitive advantage for the firmwhich is difficult for competitors to replicatewith increased quality productivity and oftenbetter performance than more traditional sys-tems (see Black and Lynch 2001 Cappelliand Newmark 2001 Colombo and DelMastro2002 Huselid 1995 Ichinowski 1990 Ichi-nowski

et al

1996)The systems approach has resonance with

the lean production paradigm (see Davies andKochhar 2000 Krafcik 1988 Wormack

et al

1991) Such a paradigm in part implies thereduction in the managerial hierarchy withthe elimination of intermediate manageriallayers and the decentralization of the decisionauthority to the hierarchical level where therelevant information resides with few levelsbetween blue collars and plant managers so asto exploit localized expertise This generatesflatter structures the delegation of decisionauthority work in teams organized aroundprocesses with empowered workers with high-skills levels and cross-training rewards andprofit sharing Although there are examples ofsuccessful adoption not all techniques applyto all types of work Firms have specificidentified needs and these vary by size market

202



objective ownership and national environmentVertical organizations might suite some typesof industries better or there might exist hybridorganizations such that high-performanceworkplaces require skills competences andcapability that not all firms possess

Therefore there is no one lsquobestrsquo practice orlsquobestrsquo organizational model Promising prac-tices need to be firm specific and relevant tothe firmrsquos strategic and environmental contin-gencies (the market the firm operates in thefinal product characteristics how the newflexible technologies apply to the work theexisting intra- and inter-organizational struc-ture the existence of highly skilled workforce)and appropriate to the firmrsquos unique socialsetting (Newell

et al 2002) In this caseadoption needs to be assessed not only withinthe context of existing understanding withinthe firm but also where appropriate across theindustry Here mediating bodies (eg theSMMT) can usefully inform managementof the utility of these promising practices Aslong as such institutions are able to offerimpartial (as far as is possible) advice theredoes appear to be room for a role within theexisting institutional framework for suchbodies to act as the adviser and provider of skillsknowledge and expertise More generally it isthrough such mechanisms that the UK gov-ernment and other institutions can encouragethrough incentives and financial awards thesuccessful take-up of promising practices

Creating Value ndash Product Process and Service Development

Creating value (while remaining at the samepoint along the value chain) through productprocess and service development can take twobroad forms The first option is for firms toseek to develop new products andor servicesfor which consumers are willing to pay moreThe second is to develop new products andorservices for which more consumers are will-ing to pay An example of the former wouldbe the development of mobile phone techno-logy while an example of the latter would be

the low-cost airlines The low-cost airlineshave not innovated to develop products andor services that are inherently worth more Infact they have innovated to develop productsandor services that cost the consumer lessbut through which they have been able mas-sively to grow market share

In either case ndash innovating to produce newproducts andor services or innovating to grownew markets ndash it is crucial to understand fromwhere the innovations come In this respectPittaway et al (2004) have identified thoseattributes associated with networks and net-working that enable and facilitate valuecreation through product process and servicedevelopment Most notably social capital asan outgrowth of such networks is the basis forlsquoknowledge-sharing through trust-based rela-tionshipsrsquo (Newell et al 2002 129) The linkbetween social capital and innovation is evi-dent in the way collaborative relationships andnew product development can be enhanced bynetworking activities especially for firms thatcannot engage in their own RampD Networkscan provide small businesses with the linkinto RampD that is contracted by larger firms aswell as setting up marketing and manufactur-ing relationships (Rothwell and Dodgson 1991)Networks can also act as information channelsfor entrepreneurs which enable the integrationof suppliers co-suppliers and distributors dur-ing innovations projects Moreover networkparticipation offers the following benefitsduring development activities (Pittaway et al2004 23ndash24)

bull share the riskbull access new markets or technologiesbull improve product speed to marketbull pool complementary skillsbull safeguard property rights when complete

contracts are not possiblebull access external knowledge

Importantly there is no consensus on the bestnetwork type As with the findings fromLeseure et al (2004) in respect of promisingpractices Pittaway et al (2004) found thatnetworks and networking is industry purpose

203



and innovation specific That said there is ageneral view that they are effective enablerswhich contribute to information spreading andthe forming of formal and informal relation-ships with diverse organizations For exampleit has been proved that in the UK networksand networking among firms plays a relevantrole in boosting output and competitiveness inseveral industries (Ahuja 2000 Powell et al1996) while some networks in high-techindustry have led firms to generate 20 moreproduct improvements than those firms not inthe network (Gemuumlnden et al 1996) Clearlythere is an opportunity for industry-specificsupport through the encouragement of net-working that encourages formal and informalcollaboration (eg Biotechnology) (see Pittawayet al 2004)

Networks and networking offer a signific-ant component of the innovation process thathas to be understood within the context of thestrategic decisions of managers In the case ofproduct process and service developmentsstrategic choice can take many forms rangingfrom incremental changes that entrench exist-ing understandings and skills to those that areradically altering or discontinuous and whichchallenge the firmrsquos existing architecture(Clark and Staunton 1989) What is significantabout trying to change the existing rules of theindustry and the market place (despite the

obvious challenges) while remaining at the samepoint along the value chain is the approach tovalue creation strategies often adopted by themost successful firms According to Kim andMauborgne (1999) in a five-year study ofhigh-growth firms and their less successfulcompetitors those firms that maintained highgrowth in revenues and profits were found toapproach strategy radically differently Theseauthors found that such high-growth compa-nies were innovative in strategy and in theexecution of business In the case of strategywhat distinguishes high performers from theless successful is a strategic logic called valueinnovation The less successful firms followeda more conventional approach to strategy whichwas dominated by the idea of staying ahead ofthe competition In contrast the high-growthfirms paid very little attention to matching orbeating their rivals instead they sought tomake their competitors irrelevant (Figure 4)

The strategic logic of value innovation canbe summarized as follows

bull Industry assumptions where conventionalthinking might start with the idea that thefirmsrsquo industrial conditions are given valueinnovators no matter what the state of theindustry are looking for significant ideasand important leaps in value to the customerand to profits

Figure 4 Strategic logic of value innovation

204



bull Strategic focus usually firms allow com-petitors to set the parameters of strategicdecision making However this leads firmsto compete at the margin for incrementalshare From the value perspective the aimis not to compete on existing parametersrather it is to examine critically theseparameters and to ensure that they addvalue to the most significant and whereappropriate try to define new sources ofvalue

bull Customers often firms seek growth byretaining and expanding their customerbase through more customization andspecialization In contrast value innovatorsdevelop commonalties rather than differences

bull Assets and capabilities many firms viewbusiness opportunities through the lens oftheir existing assets and capabilities Incontrast value innovators ask lsquowhat if westart anewrsquo This is not to say that valueinnovators never leverage their existingassets and capabilities Instead they assessbusiness opportunities without being biasedor constrained by their current position

bull Product and service offerings conven-tional competition takes place within clearlyestablished boundaries defined by theproducts and services the industry tradi-tionally offers Value innovators think interms of the total solution buyers seek

Integral to such a strategic positioning isthe quest for resilience ndash successful firms thatconsistently maintain advantage in the marketplace are forever challenging their own strate-gic logic moving from one lsquovalue innovationrsquoto yet another This is what Hamel andValikangas (2003) describe as the ambitionfor lsquozero traumarsquo a strategy that is forevermorphing where the organization is constantlymaking its future rather than defending itspast

This also indicates that value innovationsmight be simply architectural innovationsthat reconfigure an established system to linktogether existing components in a new waywhile leaving the core design concept untouched

(Henderson and Clark 1990) The applicationof this type of innovation can be illustratedfor example by the movement of a techno-logy from large to small that leaves the coreconcept unchanged but changes the relation-ships developed between components in asmaller space and proximity while maintainingthe integrity and functionality of the overalldesign Architectural innovations can success-fully add value to the existing components ortechnical knowledge generating competitiveadvantage for the organization (Hendersonand Clark 1990) At the same time existingarchitectural knowledge or incremental inno-vations based upon the existing productarchitecture can create internal rigidities thatendanger the competitive advantage of thefirm and lower the barrier to new entrantson the market (see for example the case ofXerox and the entrance of rival companiesproducing successful smaller copiers withalmost the same core technological compo-nents in Clark 1987) This indicates that tobe able to survive firms need to be open tochanges and not to be locked in by embeddedarchitectural knowledge

Although this work provides insight intothe options open to firms such departuresfrom conventional business thinking representdaunting challenges which are likely to remainthe exception rather than the rule An insightinto some of these challenges can be illus-trated with reference to the various contingen-cies that often inform the strategic conduct ofmanagement The political nature of innova-tion is especially apparent when firms areinvolved in acquisitions mergers divestituresdownsizing or cost-reduction activities Drazinand Schoonhoven (1996) have argued thatsuch episodes are likely to have adverseimplications for innovation This is becausefaced with such events senior executives arelikely to adopt short-term approaches

bull increase financial controlsbull decrease strategic controlsbull reduce the time and attention devoted to

innovation-related activities

205



The adoption of these strategies restricts effortencouragement and resources away frominnovation such that emphasis is placed onfinancial rather than strategic control Subse-quently motivation and support of innovationat the individual group or network level issupplanted by the need to satisfy the moreurgent and immediate strategic needs Innova-tion is controversial precisely because suchactivities are informed by a set of factors andelements that are only partially within thecontrol of managers

Further to various contingencies influenc-ing the management strategic conduct otherfactors such as competency and skills mighthave adverse implications for innovationThey are discussed in the following section

Skills and Training ndash Product Process and Service Developments

Creating value through product or serviceinnovation represents an opportunity as wellas a challenge because the resource constraintsaround innovation are usually tied to the lackof management competency and skilledlabour According to Freel (1998) this is man-ifest in the way technical entrepreneurs forexample are likely to be better equipped todeal with the technical characteristics of inno-vation but experience difficulties in ensuringsuccessful commercialization Constraints ofthis form are not restricted to entrepreneursbut are experienced by firms of all sizes Thedifficulties confronted by technicians manag-ers and employees alike relate to the processthrough which the firmrsquos resources are createdand then rendered as services (Tsoukas 1996)Translating resources into services relieson the knowledge applied to these resourcesthrough for example the firmrsquos routines(Nelson and Winter 1982) Yet the renderingof services from resources is not withoutproblems This is due to the fact that lsquoa firmrsquosknowledge is distributed in the sense that it isinherently indeterminatersquo and because theprocess of knowing is uncertain (Tsoukas1996 22) Firms are both distributed and

decentred such that management practice ismediated by limitations in lsquoknowing whatthey knowrsquo and lsquoknowing what they need toknowrsquo

Overcoming such constraints is by defini-tion incredibly difficult Yet the translation ofresources can be facilitated through collabora-tions whereby firms actively engage in activitiesto move them beyond the low-skills equilib-rium The most notable example involvingpublic funds is the renamed KnowledgeTransfer Partnership (KTP) (formerly knownas TCS ndash Teaching Company Scheme) TheKTP illustrates how adequately educatedgraduates and post-graduates have a key rolein assisting firms to create value through skillsdevelopment knowledge production andadoption To illustrate pound1 million of TCSsupport as it was known buys 58 jobs pound36million value added pound30 million exportspound133 million turnover pound15 million capitalexpenditure and pound02 million RampD expenditure(PACEC 1998) KTPs are built on a collabora-tive agreement between firms and universitiesfor the resolution of a business problem that isbeyond the means of the firm Value added iscreated through joint development activities ndashthe firm has access to the scientific engineeringtechnological and business skills and expertiseof the UKrsquos universities the participatingacademic benefits from working with industrythat should inform subsequent research andteaching and the associate ndash a well-qualifiedgraduate ndash has the opportunity to take up aquality career in industry (QuinquennialReview 1996) Problems linked with thedistributed and decentred characteristics ofinnovation can be addressed by drawingtogether the embedded knowledge of theindustrial supervisor (usually a senior managerin the firm) with the expertise of the academicHere the associate acts as a boundary-spannerinterpreting and applying new forms ofknowledge within the firm

By definition the KTP is designed to facil-itate the shift from low skills to higher skillsthrough joint development and innovationEncouraging managers to invest in such

206



activities is positively influenced by fundingarrangements that help firms to share therisks However adoption of such practicesalso depends on the management of the firmbeing open to the idea of innovation as well asbeing able adequately to support and facilitatethe process on-site In this respect participa-tion through KTP is likely to be beyondthe reach of the most needy firms preciselybecause they do not have the resources orinfrastructure to support such activities Over-coming such problems is likely to be achievedin part by combining such bespoke provisionwith training that is generic and designedbroadly to develop management skills Arecent example can be found at Cardiff Busi-ness School and the Sustaining ProfitableGrowth (SPG) programme which is designedto develop the strategic and leadership skillsof Welsh managers Such basic and peer-based provision provides an important startingpoint for managers with limited experience ofinnovation and can help them engage with morechallenging lsquoprojectrsquo-focused programmessuch as the KTP programmes

In the same way as new product processand service developments represent quite con-siderable opportunities as well as challengesfor firms remaining at the same point alongthe value chain the same can be said for thosefirms endeavouring to reposition or reorganizethemselves along the value chain throughinnovation

Creating Value ndash Repositioning along the Value and Supply Chain

The third strategic option open to UK managersis to reposition (or reorganize their operations)along the value chain including the supplychain The need for such a dramatic change inthe existing business model reflects the natureof the business environment which is becom-ing increasingly turbulent where corporateresilience is a crucial strategic goal Hencethe successful firm is the one able to reinventitself dynamically and not be dependent on itslsquoincumbencyrsquo or existing competitive advant-

age As Hamel and Valikangas (2003) haveargued lsquoto thrive in turbulent times companiesmust become as efficient at renewal as theyare at producing todayrsquos products and servicesrsquo

In this respect the dominance of large ver-tically integrated companies is being chal-lenged by the value-adding partnership whichcan be described as a set of independent com-panies that work closely together to managethe flow of goods and services along the entirevalue chain Low-cost computing and com-munication packages are increasingly givingcompetitive advantage back toward partner-ships of smaller companies each of whichperforms one part of the value-added chainand co-ordinates its activities with the rest ofthe chain The flexibility and responsivenessof small and medium-sized enterprises (SMEs)are translated along the value chain so that thediversity of the whole chain can become thebasis of new ideas and innovation (Johnstonand Lawrence 1988)

Value-adding partnerships are generallycreated whenever a non-integrated firm dealswith another firm that performs the next phaseof the value chain and so each stands to ben-efit from the otherrsquos success These relation-ships seldom evolve synergistically and moreoften than not firms keep their distance anddo their best to keep financial gains tothemselves It is not uncommon for firms todevelop weakening strategies with partnershipsin an effort to control profits Value-addingpartnerships are innovative in so far as theyinvolve efforts to ensure stakeholder buy-incollaboration mutually beneficial operationsand even mutual training The advantages areobtained through the way the constitutentfirms of the chain are able to focus on justone step of the value chain For example theMcKesson Corporation showed how a distrib-utor of drugs health-care products and otherconsumer goods transformed itself into thehub of a large value-adding partnership andas such increased its own value-adding activ-ities (Johnston and Lawrence 1988) Exam-ples such as these are in contrast to verticalintegration where non-productive outcomes

207



and control are exercised through single man-agement structures Notably vertical integra-tion has weaknesses for example in theprocess of exploiting their distinctive compe-tencies many large integrated firms empha-size one competitive dimension and are oftenvulnerable to new challenges In this regardthe benefits of the individual competenciescontributed by the individual firms are signi-ficantly diminished

The orthodoxy in modern supply chainthinking reveals the incursion of lean methodsand the move towards joint developmentactivities and co-ordination Yet these alsorepresent significant problems especially forSMEs In this case integration a key aspectof current supply chain thinking is often madedifficult for SMEs owing to lsquoresourcersquo andlsquoculturalrsquo constraints In particular managerscan find it difficult to respond to the demandsof supplier arrangements because they do notunderstand what skills and competencies aresought to operate in high-performing supplychains This is exacerbated by their inabilityto analyse their own capabilities and ascertainshortcomings or readily find support from theright state agencies (Macpherson and Wilson2003 Monkhouse 1995) It is also importantto recognize that many managers find it diffi-cult to shift from market-driven interpretationsof how to conduct business towards those thatare more collaborative in form

Interestingly it remains to be seen whetherthe UK government can play a direct role inhelping SMEs to work towards closer supplierrelations In particular there is some consid-erable scepticism as to the worth of such sup-port in the context of the SME population AsCurran (1999 43) has argued lsquoit is difficult tosay very much worthwhile about the impact ofsmall business policy in the UK over the last20 yearsrsquo Existing industry forums (see above)are an obvious source of skills training andexpertise In this respect the UK governmentmight focus on using such mechanisms to dis-tribute financial incentives to assist firmsincluding SMEs to respond to the challengesof globalization In this respect the nature of

the skills and training issues that are likely toinform such support are usefully considered inrelation to SMEs

In addition to challenging the structure ofthe value and supply chain value creation isalso possible through new make-or-buy deci-sions (Leavy 2001) Specifically the pace ofchange relative to product process and mate-rials technologies has made the potential tooutsource more varied and so created excitingpathways to innovation growth and competi-tiveness Increasingly there is evidence thatthis applies to both manufacturing and servicefirms with many of the City of Londoninvestment banks for example outsourcingoperations to alternative locations ndash somewithin the UK and some outside it At thesame time outsourcing can be extremely dan-gerous as this might lead the firm towards thelower end of the value chain leading to whatis called the lsquolock in effectrsquo However whenproperly developed lsquostrategic outsourcingsubstantially lowers costs risks and fixedinvestments while greatly expanding flexibil-ity innovative capabilities and opportunitiesfor creating higher value-added and share-holder returnsrsquo (Quinn 1999 10) Here thereare three questions linked to the propositionof outsourcing

bull In what way should a firm decide tooutsource

bull Why should a firm outsourcebull To what extent and under what circum-

stances do the benefits of partnership out-weigh that of sourcing from the market andvice versa

As the literature suggests such decisions bycustomers have significant implications forsuppliers and therefore firms need to beresponsive to the needs of customers with theability to respond to market and partnershipdemands While outsourcing is significant insome industries ndash for example automobilesand semiconductors ndash its application is notprevalent across all industries (Berman et al1997) Quinn and Hilmer (1994 43) assertthat outsourcing is only appropriate where

208



lsquoit can achieve definable pre-eminence andprovide unique value for customersrsquo or whenit has a lsquocritical strategic needrsquo For those thatoutsource the greatest pay-off is to be foundin the opportunity to innovate learn and cre-ate value through the pooling of a firmrsquos capa-bilities with those of lsquobest-in-classrsquo suppliersThe underlying strategic goal is the creationof an improving fit between capabilities andcustomers throughout the value chain (Normannand Ramirez 1993)

Skills and Training ndash Repositioning along the Value and Supply Chain

From the evidence UK business and espe-cially SMEs will find it difficult to repositionthemselves along the value and supply chainUsing the case of UK SMEs as the examplethe implications of this are likely to be severebecause if SMEs cannot add value throughtheir product or relational capabilities it islikely that they will become increasingly pres-sured from global sourcing through the use ofe-purchasing or e-market systems (Rhodesand Carter 1998) A reduction in the numbersof suppliers will only be averted if SMEsimprove their competencies to support supplychain management practices (Macpherson andWilson 2003) These include business processcompetencies (including benchmarking con-tinuous improvement flexibility innovation)interactive competencies (including customerfocus communication) and production com-petencies (including performance quality)(Macpherson 2001) As argued by Macphersonand Wilson (2003 210)

being able to identify and strengthen supply chaincompetences will be an important factor for SMEcompetitive advantage and will be dependent ontwo major issues the willingness and opportunityto develop appropriate skills and the belief orperception by the SME management that closerintegration is important for their success

Developing appropriate skills has provedproblematic in the context of SMEs as the

competence-based NVQ programmes are oftenseen as too generic and do not reflect thediverse needs within the SME sector (Banfieldet al 1996 Connor and Haydock 1997)Equally owner-managers often appear not tovalue the certification process (Matlay andHyland 1997) However as Macpherson andWilson (2003) argue the benefits of workingwithin high-performing supply chains repre-sents an opportunity for SMEs to learn fromtheir customers This is much closer to themodel of skills development and learning thatappeals to SMEs ndash lsquoit is immediate focusedon real business issues and addresses thespecific business needs of the SME albeitpossibly from the perspective of the customerorganizationrsquo As demonstrated in the case ofthe SMMT success for SMEs is likely to rely onlarger organizations and their industry forumrsquoswillingness to disseminate learning throughthe supply chain as well as championing newpromising practices In this case increasingglobalization and rationalization of suppliersappears to offer a convincing argument for agood number of UK car components suppliersto engage in the programmes provided by theSMMT Arguably from a policy perspectivethis work suggests that skills training willrequire a multi-agency approach that combinesindustry and firm specific training at a genericlevel with more problem-specific challenges

The evidence provided during this reviewhas alluded to a range of issues that have bothpolicy and research implications Signific-antly our basic understanding of the innova-tion process remains partial partly because ofthe lack of empirical evidence and partlybecause of the lack of theoretical rigour of alarge section of the existing studies In thenext section we begin to outline the policyand research issues that arise from this specialissuersquos contribution ndash not just in this paperbut also in the other systematic reviews

Policy Implications

This discussion has begun to illustrate someof the issues associated with the low-skill

209



low-quality debate in the context of those stra-tegic options that are potentially open to UKbusinesses embarking on new value-addingactivities This paper has identified three strat-egies that might help the firm to move awayfrom the low-skills equilibrium

bull increasing efficiency and effectivenessthrough the adoption of better practices

bull innovating to produce products and orservices that can generate more revenue(either through higher prices or larger vol-umes) while remaining at the same positionin the value chain

bull fundamentally changing position in thesupply chain and moving to a positionwhere the products and services that arebeing delivered inherently generate morevalue

The first policy implication is that these threestrategies should be explicitly recognized andincorporated into any strategy for innovationIn essence a broad definition of innovationwhich recognizes that innovation is not sim-ply constrained to technological innovationshould be adopted

At a more detailed level there are also spe-cific issues that any government policy has toaddress These which are outlined in the otherpapers in this special issues (see Leseure et al2004 Pittaway et al 2004) include

bull poor management of change (especially atthe integration and assimilation stage ofprocesses and practices new to the firm)

bull organizational rigidities (lack of appropri-ate workplace reorganization)

bull poor exploitation of skillsbull lack of customersrsquo focus and external rela-

tionships (supply-chain dynamics inputsfrom consultants and vendors)

In addressing these issues policy-makers andmanagers need to consider how best to developand encourage more specialized informalskills and learning Arguably it is only whenformal education and general training isaccompanied by a sustained process of know-ledge production and informal learning within

the organization that firms will then be ableto introduce and implement new strategiesefficiently and successfully

It is against these issues that we propose thefollowing Value creation is likely to be bestserved by the long-term support of firm-specific and industry-specific learning skillsdevelopment and innovation activities Recog-nition of the contextual and social constituencyof value creation is a prerequisite of futurepolicy provision Improving existing formalstructures to assist in firm- and industry-specific knowledge exchange is crucial inencouraging informal learning processes

In this context the enhancement of net-working and inter- and intra-organizationalrelationship is seen as a vehicle of informationtransmission among top management aboutbest practices and strategies (eg input fromconsultant and vendors) higher value supplyndashcustomer partnering within the supply chaingenerator of value added to product and pro-cess innovation especially for those firms thatcannot sustain internal RampD

Research Implications

It is apparent from the current reviews and theaccompanying discussion that innovation andthe knowledge production process representinherently controversial and context-specificprocesses The research implications are likelyto be as follows

bull Future research effort should be targetedtowards examining the firm-level micro-processes of innovation in the context ofspecific institutional structures (sectorindustry and supply chain) improving ourcurrent understanding of the adoption ofpromising practices and product processand service developments is likely to beachieved by encouraging more in-depthlongitudinal studies which examine thelink between knowledge performance andadoption

bull New insights into the relationship betweenskills training and successful innovation

210



are also likely to be achieved via longitudi-nal investigations of knowledge transfer(including along the supply chain) ndash theaim must be to examine how intentionalitygives rise to outcomes and how change isactually experienced within and across theorganization

The research opportunities remain considera-ble especially in relation to cross-nationalcomparator studies based on performancemeasurement and qualitative in-depth investi-gations of micro-level processes Our under-standing of innovation is unlikely to improveunless the research community systematicallybegins to grapple with both the formal andinformal characteristics of adoption andinnovation

Conclusions

This review paper has considered a wide rangeof issues associated with strategic innovationin the context of creating a higher-value econ-omy and reducing the UKrsquos productivity gapwith the USA France and Germany By wayof illustration it has been possible to considerthe opportunities and challenges facing UKmanagers when attempting to introduce (i)promising practices (ii) new product processand service developments and (iii) reposition-ing and organizing along the value and supplychain In each of these strategic areas the keyconcerns reveal that strategic choices and thesuccessful implementation of change relies onthe micro-processes within the firm and widerinstitutional processes associated with industry-specific structures and state provision andlegislation By way of discussion this paper hasalso begun to consider existing skills and train-ing provision which reveal the complexities oftrying to create new value through innovation

Although the academic and policy commu-nities are increasingly beginning to realize thecomplex interconnections between firm prac-tice and the mediating affects of the firmrsquosenvironment there is still very little empiricalresearch that tries to offer insights into these

dynamics By way of proposals this reviewpaper addresses these concerns and sets out aconstructionist manifesto The key aim is tofurther a more critical pursuit of innovationresearch that makes better sense of for exam-ple lsquovalue innovationrsquo or lsquozero traumarsquo With-out more contextually grounded research ourunderstanding of such notions will remainpersistently superficial without an appreci-ation of how intentionality gives rise to out-comes or how these strategic decisions areexperienced at the level of the firm Arguablyit is only at such times that it will be possibleto talk directly to the problems of the low-skills low-quality equilibrium debate and theproductivity gap in a truly meaningful manner

References

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Banfield P Jennings P and Beaver G (1996)Competence-based training for small firms ndash anexpensive failure Long Range Planning 29 94ndash102

Berman E Bound J and Machi S (1997) Implica-tions of skill-biased technological change inter-national evidence centre for economic performanceDiscussion Paper No 24

Bessant J Caffyn S and Gilbert J (1996) Learn-ing to manage innovation Technology Analysis ampStrategic Management 8 59ndash70

Birdi K Denyer D Munir K Neely A and Prabhu J(2003) Post Porter Where Does the UK Go fromHere Summary Report from the AIM ManagementResearch Forum June wwwaimresearchorg

Birley S (1985) The role of networks in the entre-preneurial process Journal of Business Venturing1(1) 107ndash117

Black SE and Lynch LM (1999) Whatrsquos drivingthe new economy the benefits of workplaceinnovation NBER Working Paper 7479

Black SE and Lynch LM (2001) How to competethe impact of workplace practices and informationtechnology on productivity Review of Economicsand Statistics 83 434ndash445

Bloom N Conway N Mole K Moeslin K andNeely AD (2003) Solving the skills gap Sum-mary of the AIM Management Research Forum

211



Boddy D Cahill C Charles M Fraser-Kraus Hand Macbeth D (1998) Success and failure inimplementing supply chain partnering an empiricalstudy European Journal of Purchasing amp SupplyManagement 4(2ndash3) 143ndash151

Bresnahan TF Brynjolfsson E and Hitt LM(2002) Information technology workplace organ-ization and the demand for skilled labor firm-levelevidence Quarterly Journal of Economics 117339ndash376

Brown L (1997) Competitive Marketing StrategyMelbourne Nelson

Brynjolfsson E and Yang S (1996) Informationtechnology and productivity a review of the literatureAdvances in Computers 43 179ndash214

Campbell Collaboration (2001) Homepage httpcampbellgseupenneduabouthtm

Cappelli P and Newmark D (2001) Do high per-formance work practice improve establishmentlevel outcomes Industial and Labor RelationsReview 54 737ndash775

Caroli E and Van Reenen J (1999) Organizationskills and technology evidence form a panel ofBritish and French establishments IFS WorkingPapers W9923 Institute for Fiscal Studies

Clark PA and Staunton N (1989) Innovation inTechnology and Organisation London Routledge

Clegg CW Wall TD Pepper K Stride CWoods D Morrison D Cordery JL CouchmanP Badham R Kuenzler C Grote G Ide WTakahashi M and Kogi K (2002) An interna-tional study of the use and effectiveness of modernmanufacturing practices Human Factors andErgonomics in Manufacturing 12 171ndash191

Cohen WM and Levinthal DA (1990) Absorptivecapacity a new perspective on learning andinnovation Administrative Science Quarterly 35128ndash152

Colombo MG and Delmastro M (2002) The deter-minants of organizational change and structuralinertia technological and organizational factorsJournal of Economics amp Management Strategy 11595ndash635

Connor J and Haydock W (1997) Managementdevelopment in the small firm do competence-based approaches work Enterprise and Growth inthe Small Business Sector collection of papers byBolton Business School Bolton UK

Cooke P and Morgan K (1998) The AssociationalEconomy Firms Regions and Innovation OxfordOxford University Press

Curran J (1999) What is small business policy in theUK for Evaluation and assessing small business

policy International Small Business Journal18(3) 36ndash50

Davies AJ and Kochhar AK (2000) A frameworkfor the selection of best practices InternationalJournal of Operations amp Production Management20 1203ndash1217

Delbridge R and Barton H (2000) Crossing bound-aries in the learning factory evidence of cross-functional and inter-organisational knowledgetransfer in the auto components industry Paper pre-sented at the 7th International Conference of theEuropean Operations Management AssociationBelgium 4ndash7 June

Delbridge R Kenney M and Lowe J (eds) (1998)Manufacturing in Transition London Routledge

Delbridge R Turnball P and Wilkinson B (1992)Pushing back the frontiers management controland work intensification under JITTQM factoryregimes New Technology Work and Employment7(2) 97ndash106

Drazin R and Schoonhoven CB (1996) Commu-nity population and organization effects oninnovation a multilevel perspective Academy ofManagement Journal 39 1065ndash1083

DTI (2003) Innovation Report ndash lsquoCompeting in theGlobal Economy the Innovation Challengersquo httpwwwdtigovukinnovationreportindexhtm

Dunne T Haltiwanger J and Troske K (1996)Technology and jobs secular changes and cyclicaldynamics NBER Working Paper 5656

Elger T and Smith C (eds) (1994) The Trans-national Transformation of the Labour ProcessLondon and New York Routledge

Finegold D (1999) Creating self-sustaining high-skill ecosystems Oxford Review of Economic Policy15(1) 60ndash81

Finegold D and Soskice D (1988) The failure oftraining in Britain analysis and prescriptionOxford Review of Economic Policy 4(3) 21ndash53

Freel M (1998) Evolution innovation and learningevidence from case studies Entrepreneurship andRegional Development 10(2) 137ndash149

Gemuumlnden HG Ritter T and Heydebreck P(1996) Network configuration and innovation suc-cess an empirical analysis in German high-techindustries International Journal of Research inMarketing 13 449ndash462

Grandori A (1997) An organizational assessment ofinterfirm coordination modes Organization Studies18 897

Grandori A and Soda G (1995) Inter-firm networksantecedents mechanisms and forms OrganizationStudies 16(2)

212



Green A (1998) Core skills key skills and generalculture in search of the common foundation invocational education Evaluation and Research inEducation 12(1) 23ndash43

Hamel G and Valikangas L (2003) The quest forresilience Harvard Business Review 81(9) 52ndash63

Hanson P Voss C Blackman K and Oak B(1994) Made in Europe A Four Nation StudyLondon IBM Consulting

Horvath L (2001) Collaboration the key to valuecreation in supply chain management SupplyChain Management An International Journal6(5) 205ndash207

Henderson R and Clark K (1990) Architecturalinnovation the reconfiguration of existing producttechnologies and the failure of established firmsAdministrative Science Quarterly 35 9ndash30

Hoang H and Young N (2000) Social embedded-ness and entrepreneurial opportunity recognition(more) evidence of embeddedness Working Paper

Huselid M (1995) The impact of human resourcesmanagement practices on turnover productivityand corporate financial performance Academy ofManagement Journal 38 635ndash872

Ichniowski C (1990) Human resource managementsystems and the performance in US manufacturingbusiness NBER Working Paper 3349

Ichniowski C and Show K (1995) Old dogs andnew tricks ndash determinants of the adoption ofproductivity-enhancing work practices BrookingsPapers on Economic Activity 1

Ichniowski C Show K and Prennushi G (1996)The effect of human resource management prac-tices on productivity a study of steel finishing linesAmerican Economic Review 291ndash313

Johnston R and Lawrence PR (1988) Beyond ver-ticle integration ndash the rise of the value-adding part-nership Harvard Business Review JulyndashAugust

Keep E and Mayhew K (1999) The assessmentknowledge skills and competitiveness OxfordReview of Economic Policy 15(1) 1ndash15

Kim WC and Mauborgne R (1997) Value innova-tion the strategic logic of high growth HarvardBusiness Review JanuaryndashFebruary

Krafcik JF(1988) Triumph of the lean productionsystem Sloan Management Review 30 41ndash51

Leavy B (2001) Supply strategy ndash what to outsourceand where Irish Marketing Review 14(2) 46ndash52

Leonard-Barton D (1992) The factory as a learninglaboratory Sloan Management Review Fall 23ndash38

Leseure M Birdi K Bauer J Denyer D andNeely AD (2004) Adoption of promising

practice a systematic review of the literatureAdvanced Institute of Management ResearchFebruar wwwaimresearchorg

MacDuffie JP (1995) Human resource bundles andmanufacturing performance organizational logicand flexible production systems in the world autoindustry Industrial and Labour Relations Review48 196ndash218

Macpherson A (2001) Corporate directions insupply chain management implications for SMEcompetences and inter-organizational relationsResearch in management and business ManchesterMetropolitan University Working Paper Series 0105

Macpherson A and Wilson A (2003) Supply chainmanagement improving competitive advantage inSMES In Jones O and Tilley F (eds) Competi-tive Advantage in SMEs Organizing for Innovationand Change Chichester Wiley

Matlay H and Hyland T (1997) NVQs in the smallbusiness sector a critical overview Education andTraining 39 325ndash332

McDermott R (1999) Why information technologyinspired but cannot deliver knowledge manage-ment California Management Review 41103ndash117

Monkhouse E (1995) The role of competitivebenchmarking in small to medium-sized enterprisesBenchmarking for Quality Management Technology2 41ndash50

Nelson RR and Winter SG (1982) An Evolution-ary Theory of Economic Change Cambridge MAHarvard University Press

Newell S Robertson M Scarbrough H and Swan J(2002) Managing Knowledge Work BasingstokePalgrave

Nonaka I (1991) The knowledge-creating companyHarvard Business Review NovemberndashDecember96ndash104

Nooteboom B (2000) Learning and Innovation inOrganisations and Economies Oxford OxfordUniversity Press

Normann R and Ramirez R (1993) From valuechain to value constellation designing interactivestrategy Harvard Business Review JulyAugust

Oliver N and Delbridge R (2002) The characteristicsof high performing supply chains InternationalJournal of Technology Management 23 60ndash73

Oliver N and Wilkinson B (1992) The Japaniza-tion of British Industry Oxford Blackwell

PACEC (1998) The Economic Impact and Opera-tional Effectiveness of the Teaching CompanyScheme Cambridge

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Perrow C (1967) A framework for the comparativeanalysis of organizations American SociologicalReview 194ndash208

Pittaway L Robertson M Munir K Denyer Dand Neely AD (2004) Networking and innova-tion a systematic review of the evidence AdvancedInstitute of Management Research London httpwwwaimresearchorgaimforumshtml

Porter M and Ketels CHM (2003) UK Competi-tiveness Moving to the Next Stage ManagementResearch Forum Summary Report 6 LondonAdvanced Institute of Management ResearchLondon httpwwwaimresearchorgAIM

Powell W Koput KW and Smith-Doerr L (1996)Interorganizational collaboration and the locus ofinnovation networks of learning in biotechnologyAdministrative Science Quarterly 41(1)

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Rhodes E and Carter R (1998) Electronic com-merce technology and changing product distributionInternational Journal of Technology Management15 31ndash49

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192



on a firmrsquos ability to create and exploit know-ledge faster than its competitors The challengeremains to encourage large sections of the UKeconomy to pursue such a strategic orientation

Integral to such a repositioning (the cre-ation of higher value along the value chain) areissues related to the innovative potential ofUK firms including the skills and competencylevels of management and the workforce Yetimproving the innovative potential of the UKeconomy presents serious problems in termsof conceptualization and management Inparticular such an endeavour is mediated by acomplex array of intra-organizational inter-organizational and environmental factors (seeBirdi

et al

2003) Broadly intra- and inter-organizational issues reflect the often politi-cized and controversial characteristics of theinnovation process For example when assessinghow firms can create higher value it is vital toappreciate existing social relations within thefirm and the industry sector and the extent towhich these inform the strategic choices ofmanagers Notably knowledge can be thedriver of change but equally the biggest bar-rier to it In turn wider institutional processesalso mediate strategic choices In the case ofskills provision for instance matched studiesshow how firms in countries with higher skill(and productivity) levels are much better ableto adapt and exploit technology to boostproductivity Such findings have importantimplications in the context of the UK as thepreponderance of a low-skills economy appears

related at least in part to limitations in exist-ing institutional mechanisms in the provisionof skills (see Bloom

et al

2003)This paper sets out to address the concep-

tual and managerial challenges implicated inthe UK governmentrsquos ongoing quest to improvethe value-adding characteristics of the econ-omy Here we begin to integrate the basicarguments that are implicated in the accompa-nying systematic reviews around an apprecia-tion of the strategic challenges facing managersof large sections of the UK economy Thispaper offers a summary of the core findingsof these papers and draws upon additionalliterature to provide a broader criticalappraisal of innovation and value creation Inparticular we integrate the key observationsaround ideas of networking and promisingpractices As such this paper is not a system-atic review of the literature rather it is acommentary on the barriers and enablers toseveral strategic options open to managers

We start by defining the value chain andinnovation Here we contend that innovation isnot simply a question of trading lsquoknowledgersquobut reveal that such processes are political andinherently controversial Crucially the adop-tion of a value perspective of strategy has tobe based on a realistic view of the existingsocio-economic and political structures withinand without the firm In the next section webuild on these insights by illustrating some ofthe challenges confronting a large section ofthe UK economy in terms of the low-skill low-quality equilibrium debate These discus-sions lead to a detailed appraisal of the followingstrategic propositions

(1) increasing efficiency and effectivenessthrough the adoption of better practices

(2) innovating to produce products or servicesthat generate more revenue ndash via eitherhigher prices or larger volumes ndash but real-ized by remaining at the same position inthe value chain

(3) fundamentally changing position in thevalue or supply chain and moving to aposition where the products and services

Figure 1 UK productivity gap

193










Defining Innovation



194





blackboxed


et al


et al



et al


et al


et al



195






et al


et al




etal


et al



196








and


197





et al






et al

(2004)

ad hoc


et al

1996Boddy

et al

1988 Hanson

et al


et al


et al

2004 32)

bull

initiation


bull

set-up


bull

implementation


bull

ramp-up


bull

integration



et al

198




et al



et al



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et al

1998 227)

bull


bull


bull










199



bull



et al


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et al



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Policy Implications


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210





Conclusions




References










211
































212



































213

























193










Defining Innovation



194





blackboxed


et al


et al



et al


et al


et al



195






et al


et al




etal


et al



196








and


197





et al






et al

(2004)

ad hoc


et al

1996Boddy

et al

1988 Hanson

et al


et al


et al

2004 32)

bull

initiation


bull

set-up


bull

implementation


bull

ramp-up


bull

integration



et al

198




et al



et al



et al


et al

1998 227)

bull


bull


bull










199



bull



et al


et al


et al










et al




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et al



et al


200






et al





201





et al



et al






et al



et al


202













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Policy Implications


209





















210





Conclusions




References










211
































212



































213

























194





blackboxed


et al


et al



et al


et al


et al



195






et al


et al




etal


et al



196








and


197





et al






et al

(2004)

ad hoc


et al

1996Boddy

et al

1988 Hanson

et al


et al


et al

2004 32)

bull

initiation


bull

set-up


bull

implementation


bull

ramp-up


bull

integration



et al

198




et al



et al



et al


et al

1998 227)

bull


bull


bull










199



bull



et al


et al


et al










et al




et al


et al



et al


200






et al





201





et al



et al






et al



et al


202













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205










206










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Policy Implications


209





















210





Conclusions




References










211
































212



































213

























195






et al


et al




etal


et al



196








and


197





et al






et al

(2004)

ad hoc


et al

1996Boddy

et al

1988 Hanson

et al


et al


et al

2004 32)

bull

initiation


bull

set-up


bull

implementation


bull

ramp-up


bull

integration



et al

198




et al



et al



et al


et al

1998 227)

bull


bull


bull










199



bull



et al


et al


et al










et al




et al


et al



et al


200






et al





201





et al



et al






et al



et al


202













203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























196








and


197





et al






et al

(2004)

ad hoc


et al

1996Boddy

et al

1988 Hanson

et al


et al


et al

2004 32)

bull

initiation


bull

set-up


bull

implementation


bull

ramp-up


bull

integration



et al

198




et al



et al



et al


et al

1998 227)

bull


bull


bull










199



bull



et al


et al


et al










et al




et al


et al



et al


200






et al





201





et al



et al






et al



et al


202













203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























197





et al






et al

(2004)

ad hoc


et al

1996Boddy

et al

1988 Hanson

et al


et al


et al

2004 32)

bull

initiation


bull

set-up


bull

implementation


bull

ramp-up


bull

integration



et al

198




et al



et al



et al


et al

1998 227)

bull


bull


bull










199



bull



et al


et al


et al










et al




et al


et al



et al


200






et al





201





et al



et al






et al



et al


202













203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























198




et al



et al



et al


et al

1998 227)

bull


bull


bull










199



bull



et al


et al


et al










et al




et al


et al



et al


200






et al





201





et al



et al






et al



et al


202













203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























199



bull



et al


et al


et al










et al




et al


et al



et al


200






et al





201





et al



et al






et al



et al


202













203









204













205










206










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208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























200






et al





201





et al



et al






et al



et al


202













203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























201





et al



et al






et al



et al


202













203









204













205










206










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Policy Implications


209





















210





Conclusions




References










211
































212



































213

























202













203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























203









204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























204













205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























205










206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























206










207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























207












208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























208










Policy Implications


209





















210





Conclusions




References










211
































212



































213

























209





















210





Conclusions




References










211
































212



































213

























210





Conclusions




References










211
































212



































213

























211
































212



































213

























212



































213

























213

























Value creation and the UK economy: a review of strategic options

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Transcript of Value creation and the UK economy: a review of strategic options