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Innovating to Compete: Lessons for Diffusing and Managing Change in the Workplace.

Innovating to Compete: Lessons for Diffusing and Managing Change in the Workplace By Richard E. Walton. San Francisco, CA, Jossey-Bass, Inc., Publishers, 1987. 361 pp.

In recent years, the need for nations, industries, and firms to be "competitive" in an expanding global economy has captured the imagination of writers, politicians, business leaders, economists, and others who study or are

affected by domestic and international competition. For some, competitiveness means the ability to sell or produce effectively in world markets, as in the auto industry. For others, the term has become synonymous with the need to reduce Labor costs which often is manifested in worker give-backs or concessions. Some think of competitiveness in the context of product quality. All agree, however, that failure to be and remain competitive can lead to economic distress.

The author believes that one of the major needs for strong competitors is to be innovative, and toimplement change and innovation as effectively and as quickly a possible. His thesis, presented in a model, is that certain essential propositions, or components, strongly influence the development, diffusion, and mangagement of change The first component is a "guiding model," which is a expression of the vision brought to bear regarding innova

tion and change in general. For example, a model that does not take into account the interests and needs of all stakeholders that would be affected by the innovation or change will undoubtedly fail.

The second component, "economic necessity," and the third, "social context," are the forces that motivate interested parties to innovate and adapt to change. Without strong economic pressures, change comes slowly, if at all. Innovation and change also require a commonality of social values before effective innovation can be attempted. Stakeholders must believe that the social effects of innovation are worth the effort, and in their best interests. The fiftg is "competence," or the capacity to implement and manage the innovation process. Here, the notion is that the best innovations will fail to be implemented unless there is competent management of the process. These propositions or components constitute the framework for the author's model(s) but are not equal in all situations. They can or should be weighted to give more attention and analytical value to the ones that are most important in a given situation.

The author tested his model using the shipping industry which is and has been an important international industry dominated by several countries, including the United States. The eight countries analyzed in the study varied with respect to their capacity to innovate, depending upon the degree to which they felt economic pressure, the influences of social systems and values they had developed over time, and the institutional arrangements they had lived under, such as Labor unions, government agencies involved in shipping regulation, government financial support, shipboard staffing rules, and so forth.

Application of the model, no matter which components were used or which weights were applied, saw Norway, Holland, and Japan as High Innovators, the United Kingdom, Sweden, and West Germany as only Moderate Innovators and Denmark and the United States as Low Innovators. The United States was lowest of all, mainly because of weaknesses in certain key areas. One, "economic necessity" as a motivator, was very weak in the United States because of government subsidy of the industry and the move to extensive "Re-Flagging," or the use of foreign flagged vessels to ship products to and from the United States.

Institutionally, the U.S. maritime industry deals with several unions with considerable power. Work rules have kept work crews larger than for most countries, and there are requirements that only U.S. seamen may be hired for certain types of commercial shipping. The fact is that, except for social context, the United States is more influenced than all of the other countries by negative factors which work against innovation and change.

' While this analytical framework was tested retrospectively, the model(s) are certainly applicable to current or future considerations. If one were interested in determining the degree to which a firm, an industry, a plant, a country, or any other entity could be expected to innovate and implement changes that are required, this model would be most helpful.

Finally, while competence in managing the process is clearly essential to effective implementation of innovation and change, there is another competence that the author sees as essential. He calls it "metacompetence," or the ability to manage the context for innovative change. This capacity operates outside the "tactical" aspects of management; it is the "strategic" focus of being able to modify the basic components set forth in the model "to influence future activity." In other words, to see the need for and help shape policies and legislation, develop incentives,shape values and beliefs, and work towards establishing institutional changes to facilitate innovation and change.

This is an interesting and useful book. It provides an analytical framework that is usable, understandable, and makes good sense. It adds a significant dimension to the body of knowledge concerning readiness for innovation and change, and the essentials of effective implementation.

Publications received

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server, June-July 1988, pp. 16-19.

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Vol. 9, No. 1, 1988, pp. 2-7.

Economic and social statistics

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and Government Financing in General Equilibrium," The

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Bliss, Christopher, "A Theory of Retail Pricing," The Journal of

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of Business, April 1988, pp. 147 - 63.

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Economic growth and development

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Faulhaber, Gerald and William J. Baumol, "Economists as In

novators: Practical Products of Theoretical Research,

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The Alternative to the Strike," Fordham Law Review, No

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Perkins, Dwight Heald, "Reforming China's Economic Sys

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Stockman, Alan C. and Alejandro Hernandez D., "Exchange

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Labor and economic history

Blewett, Mary H., Men, Women, and Work- Class, Gender, and

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Gordon, Andrew, The Evolution of Labor Relations in Japan:

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Kaufman, Stuart B., ed., The Samuel Gompers Papers.- Vol II

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1887-90. Champaign, University of Illinois Press, 1987,

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Labor force

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Brockner, Joel and others, "Survivors' Reactions to Layoffs: We

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U.S. has No Unemployment Problem. Cambridge, MA, Na

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Great Britain, Department of Employment, "Labour Force Out

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Monetary and fiscal policy

Benninga, Simon and Eli Talmor, "The Interaction of Corporate

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Foster, R. Scott, "Economic Development: A Regional Chal

lenge for the Heartland," Economic Review, Federal

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Smith, Tim R., "Economic Development in the Nation's Heart

land: Issues and Strategies," Economic Review, Federal

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Wages and compensation

"Earnings of Women and Minorities -Two Studies: Trends in

Earnings Differentials by Gender, 19 71 - 81," by Francine

D. Blau and Andrea H. Beller; "The Earnings of Women

and Ethnic Minorities, 1959-79," by Leonard A. Carlson

and Caroline Swartz, Industrial and Labor Relations Re

view, July 1988, pp. 513 -52.

Holzer, Harry J., Lawrence F. Katz, Alan B. Krueger, Job

Queues and Wages.- New Evidence on the Minimum Wage

and Inter-Industry Wage Structure. Cambridge, MA, Na

tional Bureau of Economic Research, Inc., 1988, 33 pp.

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search, Inc., 1988. (Working Paper Series, 2546.) $2, paper.

New York State Department of Labor, Annual Report of the

State Advisory Council on Employment and Unemployment

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and Unemployment Insurance, 1988, 75 pp.

Snipp, C. Matthew and Gary D. Sandefur, "Earnings of Ameri

can Indians and Alaskan Natives: The Effects of Residence

and Migration," Social Forces, June 19 8 8, pp. 994 - 1008.
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Author:Burdetsky, Ben
Publication:Monthly Labor Review
Article Type:Book Review
Date:Oct 1, 1988
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