Manufacturers told to place creativity at core of strategy

MANY reasons have been put forward for the failure of British manufacturing companies to compete: the latest that they do not create the right conditions for successful innovation, writes Roger Trapp.

That is the view of Richard Scase, professor of organisational behaviour at the University of Kent at Canterbury. Manufacturers, instead of seeking 'off-the-peg' quick fixes, should follow the lead of professional, media and high- technology organisations, he said last Thursday at the fourth innovation seminar of the Economic & Social Research Council.

His research suggested that in professional, media and hi-tech firms, innovation was not only part and parcel of strategy but was built in to the day-to-day approach to doing business.

Work processes were more explicitly and directly market- driven, with those responsible for product and service innovation in regular contact with clients, he told an invited audience of senior policy-makers in business and government at the Institution of Civil Engineers in London. He said innovation, marketing, sales and profit were closely intertwined, in ways which were unusual in large manufacturing organisations. As a result, innovation and creativity became the cultural core of the business, he said.

His examination of manufacturing companies showed, however, that specialist research and development departments were often not involved in the framing of corporate strategy, and there was little dialogue between marketing and R&D. The staff involved in these areas often felt their potential was not being realised, he added.

The lesson was that manufacturers should pay greater attention to the cultural dynamics of their organisations and the barriers to change that they create. 'Quick fixes don't work. Instead, greater resources should be devoted to analysing the factors that lie behind an organisation's culture and then formulate proper change programmes.'

On a more practical level, he said, British companies should form strategic alliances with customers and suppliers. He cited the example of US, European and Japanese competitors that have developed alliances through joint ventures, co-owned subsidiaries and other co-operative arrangements.