Technical innovation in the manufacturing enterprise: context and process

Abstract

This study is about the micro bases of technical change. Strategic action at innovating technology within the manufacturing enterprise is one prominent route to aggregate technical change. There is, however, little understanding of this strategic behavior – in all the academic disciplines that apply to social production. As an attempt to remedy this, we have focused our study on two vital issues: A. Are there enduring factors, within and outside the enterprise, that predispose the enterprise in its choice to innovate technology? Do some factors further determine the kind of technical innovation that the enterprise undertakes? Historical evidences and approaches in different disciplines led us to a theoretical framework appropriate to dealing with this issue. B. The second issue is: What is the process of such strategic behavior? Do processes differ? If yes, why? Literature on process is much less crystallized than that on gross consequences. Our first task was therefore to develop the categories in which to understand process. We derived categories from two prevalent models. A new model emerged which combines the core technological processes with general organizational ones. A pilot study of three enterprises revealed that the occurrence of each innovation must be in a wide organizational context, through categories of data which may often be unique to a firm and industry. We therefore used the method of field-study, depth-interviewing, and case building. Secondary enterprises were involved in the study. These form a wide spectrum of size, ownership, industry, and region of operation.

The main finding of the study is that enduring or non-controllable factors influence, to a great extent, the innovative behavior of the enterprise. The process is influenced by (a) the form of enterprise and the extent of R&D evolution, (b) the nature of innovation-stimulus, i.e., whether it is a response to a crisis or problem or it is opportunity-seeking, (c) the relatedness of an innovation-idea to existing operations, and (d) the extent of top-management support given to the idea. The choice, of whether to innovate technology and in what direction, is itself determined by (a) the extent of “systemization” of the existing manufacturing-technology of the enterprise, (b) the structure of the product-market, and (c) the rate of technological change and importance of scale in the particular business-environment. It seems also to be influenced, in both negative and positive ways, by regulatory policy. This concretizes the view that technical innovation is not similar or equally likely in all enterprises. Social expectations and interventions must therefore be different for different type of enterprise. While the management of innovation in the firm shows up to be extremely arduous in some situations, various organizational mechanisms to facilitate the process and to build a strategic strength in innovating also emerge from the study.