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

Marked differences exist between the institutional and socialcontext for innovation in the UK and Germany. The question addressedhere is how these different contexts affect the objectives andorganisation of innovation in UK and German manufacturing. Inparticular, the paper examines the extent to which UK and Germanplants engage in inter-plant collaboration and cooperation andmultifunctional working as part of their innovative activity,and explores the reasons for differences in these patterns ofinvolvement. The investigation is based on a large-scale, comparativesurvey of manufacturing plants in the two countries. In Germany,institutional and social norms are found to encourage collaborativeinter-plant innovation, but aspects of the German skills trainingand industrial relations systems make the adoption of more flexibleinternal systems more difficult. In the UK, by contrast, themore adversarial nature of inter-firm relations makes it moredifficult to establish external collaborations based on mutualtrust, but less restrictive labour market structures make iteasier for UK plants to adopt multifunctional working. Thisis linked to differences in attitudes to the property rightsand transaction cost problems inherent in innovation.