Indian Ocean Rim: Assessing the prospects for cooperation and integration

This article assesses recent events leading to the establishment in 1997 of a regional organisation for the Indian Ocean Rim, subtitled an Association for Regional Cooperation (IOR‐ARC). This is a case of ‘open’ regionalism of the functionalist kind. New members may be admitted in 1999 and, as trade integration has not been ruled out, the openness of the design may lead to the changeover from regional cooperation to regional integration after 2004. By 2003 the members of the Association for South‐East Asian Nations (Asean) of the IOR‐ARC will have free‐trade arrangements in that region and by 2004 the SADC members of the IOR‐ARC will be similarly structured, making a free‐trade scenario within the IOR almost irresistible. This will create new problems, making it very difficult for the less competitive nations to endorse their continued membership of this bloc unless project cooperation now under way makes complementarity more meaningful, equipping states and market sectors to cope better with the more competitive nature of free trade that always applies in market integration. This will pose great challenges for South Africa.     

How Internet technologies impact information flows in R&D: reconsidering the technological gatekeeper

Previous studies have firmly established the technological gatekeeper to be a key node in the innovation process – acquiring, translating, and disseminating external information throughout the R&D unit. However, the gatekeeper concept has received modest attention in recent times. We argue that the concept needs to be re‐examined in light of the recent advances in Internet technologies that have dramatically altered how knowledge workers source and share their information. Drawing on social network analysis and interview evidence from a medical devices R&D group, we find that the gatekeeper role is still vital, but no longer needs to be performed by a single individual. Instead, the modern R&D group can keep abreast of the latest technological advances through a combination of Internet‐enabled internal and external communication specialists. This study makes a number of important contributions. The gatekeeper theory is extended through the development of an updated conceptual framework. We also discuss the practical implications of our findings and advise R&D managers on how to organise resources to maximise optimal information flows.     

Accounting and Competitive Tendering in UK Local Government: An Institutionalist Interpretation of the New Public Management

The paper applies institutional theory to analyse the changing role of accounting and contracting in UK local government as the compulsory competitive tendering (CCT) regime was extended to white-collar activities such as housing management, finance, legal services and information technology. Employing an organizational fields model, accounting changes were seen to be influenced by a combination of legal coercion, normative and competitive forces, the resistance and manipulation of the large local authorities together with the facticity of the new accounting and contracting regimes. The theoretical framework is applied to field-work carried out in a large metropolitan authority in the north of England where CCT methodologies directly affected housing management but not other services such as finance. Although resisting CCT for finance, the authority subsequently introduced a radical scheme of voluntary competitive tendering for selected finance processes. The paper examines how accounting and contracting may be adapted to emerging trends in the New Public Management associated with Best Value policies.     

A performance-oriented risk management framework for innovative R&D projects

Uncertainty is one of the major inherent difficulties in developing innovative products, due to their highly dynamic markets and technologies. The presence of a large degree of uncertainty leads to high R&D risks, resulting in many R&D failures. Therefore, it is important to manage R&D risks through all R&D stages to improve R&D project success rates. This paper proposes a new risk management framework that aligns project risk management with corporate strategy and a performance measurement system to increase success rates of R&D projects and to accomplish corporate strategic goals. The balanced scorecard is used to identify major performance measures of an R&D organization based on the firm vision and strategy. Quality function deployment is adapted to transform organizational performance measures into project performance measures and a systematic procedure is developed for risk identification, assessment, response planning, and control. The proposed risk management framework enables an R&D project to be focused on achieving the corporate goals and provides a more effective way to identify, assess, analyze, and monitor R&D risks along the project cycle. The proposed methodology is illustrated with a drug development project.     

Capacity utilization rates and unemployment rates: are they complements or substitutes in warning about future inflation?

This research examines capacity utilization as a measure of economic slack in the US economy. Many macroeconomists have questioned the use of capacity utilization as a measure of economics slack on several fronts. The first issue revolves around the definition and accuracy of measurement of the capacity utilization rate in the US economy. Since this research use existing Federal Reserve measures of capacity utilization no insights into the definition and measurement issues are offered other than the fact that a consistent role is found for two different Fed measures of capacity utilization in explaining inflation. The second issue effectively involves the concern as to robustness of the link between the capacity utilization rate and inflation. It was found that there is indeed reason for the Federal Reserve to take note of changes in capacity utilization when trying to determine its policy position with regard to inflation. Clearly, the high capacity measure developed in this research offers distinct information about the inflation process. The third issue raises the question as to whether the capacity utilization and unemployment rates are complements or substitutes in the inflation equation. Both rates tend to provide similar information regarding price changes at low levels of aggregate resource usage. However, as resource usage in the economy becomes increasingly close to its maximum potential, the labour market impact on inflation, as capture by unemployment rate measures, is distinctly different from that of capacity constraints. Finally, if the capacity utilization rate is indeed a useful measure of inflationary pressure, is there a threshold level of the capacity utilization rate above which policymakers should become particularly concerned about the potential of accelerating inflation? It was found that across two measures of inflation, the widely discussed capacity threshold level is in the 84-85% range.