Manufacturing strategies and government policies

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Microelectronics and the Garment Industry: not yet a perfect fit

SUMMARY The garments sector is a major source of exports and employment in many Idcs. If automated technology were to become available, comparative advantage might revert to the developed countries. This is lent further importance by the fact that the basic technology is similar to that used in the shoe and leather industries which are also major sources of Idc exports. Garment technology has remained remarkably static over the last century and there have been few technological barriers to new entrants to the industry. However, the introduction of microelectronics technology is beginning to affect this and the advantages of low wage costs are beginning to be undermined. This article warns that emerging microelectronics technologies may erode the comparative advantages of developing countries which fail to adjustto the changing technological environment. RESUME La micro?électronique et l'habillement: une gêne aux entournures Le secteur de l'habillement est une source importante d'exportations et d'emplois dans bien des PVD. Avec l'automation, l'avantage relatif pourrait revenir aux pays développés, d'autant plus que les techniques de base sont analogues à celles de la chaussure et du cuir, importants secteurs d'exportation des PVD. L'industrie de l'habillement a peu bougé depuis un siècle, et les nouveaux venus n'ont pas jusqu'ici senti la contrainte des exigences techniques. La micro?èlectronique pourrait retourner la situation et minimiser l'avantage des bas salaires. Cet article met en garde les PVD qui ne sauront pas s'adapter à l'évolution technique. RESUMEN La microelectrónica y la industria del vestido: todavía no ajustan perfectamente El sector de la industria del vestido es una fuente importante de exportaciones y empleo en muchos países menos desarrollados. Si se dispusiera fácilmente de una tecnología automatizada, la ventaja comparativa podría pasar de nuevo a los países desarrollados. Esto adquiere aún mayor importancia por el hecho de que la tecnología básica es semejante a la utilizada en las industrias del cuero y el calzado, que también constituyen importantes fuentes de exportaciones de los países menos desarrollados. La tecnología de las prendas de vestir ha permanecido notablemente estática durante el último siglo y apenas han existido barreras tecnológicas para los nuevos participantes en la industria No obstante, la introducción de la tecnología microelectrónica comienza a influir en esto y empiezan a reducirse las ventajas de los costos salariales bajos. Este artículo constituye una advertencia de que las tecnologías microelectrónicas que empiezan a surgir pueden disminuir las ventajas comparativas de los países en vías de desarrollo que dejen de ajustarse a un ambiente tecnológico cambiante

Crisis-driven innovation: The case of humanitarian innovation

Innovation is often presented as a survival issue and this provides a powerful metaphor to focus attention on the need to manage it effectively. But in the humanitarian context it takes on a very literal meaning. Crises, whether natural or man-made, require rapid problem solving if agencies and aid workers are to avoid the huge negative impacts of such disasters. That makes consideration of how innovation takes place in this sector an urgent challenge. How can the humanitarian sector best organize to enable innovation and what are the roles for key actors – donors, agencies, and most importantly ‘users’? Our paper summarizes the nature of the challenge and reviews experience so far in humanitarian innovation (HI).  There is a second issue which we also explore. Arguably crisis conditions provide a ‘laboratory’ for exploring alternative approaches and generating novel innovation trajectories which might diffuse more widely – the concept of ‘reverse innovation’. Are there lessons which could be learned for mainstream innovation management? And if so, what are the mechanisms which might enable such learning and experience exchange to take place

Tendências e implicações do uso de inovações modernizantes no Brasil

Brazil; R&D; innovation

Upgrading the technological capabilities of foreign transnational subsidiaries in developing countries: the case of electronics in Thailand

Although substantial research shows the importance of transnational corporations (TNCs) to export-led growth in some developing countries, it cannot be assumed that TNC subsidiaries will automatically upgrade their capabilities through time or in a uniform fashion. This paper explores the pattern and pace of a sample of exporting TNC subsidiaries operating in the electronics industry in Thailand, showing how the different architectures of global value chains (centralised versus decentralised) shaped the technological progress of subsidiaries in this country. The case evidence suggests a wide variety in upgrading through time, with some subsidiaries failing to develop capabilities and remaining as ‘assembly only’ plants. Other more dynamic plants developed process engineering and product design skills, investing heavily in capability building. One common determinant in capability building appears to be the overall technology strategy of the global value chain leader (or parent company). In those subsidiaries which did not upgrade beyond assembly, technology decisions and processes were tightly controlled within the parent headquarter locations in relatively centralised international value networks. By contrast, the more dynamic plants exercised more discretion over local capability building. The latter operated in relatively decentralised networks, more open to domestic policies to encourage upgrading. The study suggests that governments should tailor upgrading policies not only according to the approximate level of capabilities attained by local subsidiaries, but also according to how receptive subsidiaries are to upgrading, arguing that capability building and policy receptiveness go hand-in-hand. Other countries hoping to upgrade the quality of foreign direct investment might also wish to focus policies on the more technologically capable, ambitious and receptive categories of foreign subsidiary