Organise to generate innovation

Abstract

Why is it that firms that compete within the same industrial sector have divergent productivity growth over time? Is this phenomenon related to specific characteristics of their organisations, their human capital, their capital investments or a combination of all of these parameters? This paper provides tools and methods to measure technological capability (human capital and change-generating efforts), technical changes processes and productivity growth. It examines the relationship between these various measures. The case material is based on first-hand empirical data gathered at the mill level in two countries (India and Canada) over a period of five to seven years in the pulp and paper sector. The empirical evidence demonstrates that change-generating efforts leading to productivity growth are not only a result of formally qualified individuals (human capital). Change-generating activities were not performed only by specialists but by a larger population of workers in the most productive mills.