Competitive firms in thin regions in Norway: The importance of workplace learning

Abstract

The article departs from empirical studies of two competitive firms in an organisationally thin region in Norway. The main question in the article is how these firms have achieved global competitiveness. The article focuses its inquiry on how the firms organise their innovation activity, giving special attention to the firms' organisational learning and absorptive capacity. It is found that find that workplace learning enables the firms to utilise knowledge in uncommon ways. The learning rests on specific organisational traits in the firms, such as broad participation, long-term on-the-job training, the use of practice-based knowledge in innovation projects, and links to national and global knowledge sources. The characteristics of thin regions indicate that these traits make up a generally applicable strategy in such regions.

Bypassing Structural Shortcomings: Innovative Firms in Peripheral Regions

“…Thus, building internal capacities along various dimensions can be considered a strategy of firms from peripheral regions to compensate for lacking relevant knowledge available regionally, which, at the same time, reduces firms' interaction requirements. These indications confirm recent research by Flåten et al (2015) who argue that strong internal capacities, built by workplace-learning, constitute central factors for the competitiveness of firms in 'thin' Norwegian regions. Consequently, this research contributes to a more nuanced understanding of the factors that shape the innovation capacity of firms from peripheral regions active in LMT manufacturing: the firms investigated as part of this study tend to rely on diverse and multifaceted internal capabilities, coupled with multi-scalar external linkages-including local and non-local contacts.…”

“…It is widely accepted that firm competitiveness is significantly driven by internal resources and how they are coordinated (Taylor and Asheim 2001). Firms can be perceived as unique bundles of resources such as technological capabilities, production experiences and organisational routines, specific human resources or the existing customer base which collectively ensure competitiveness (Foss 1997;Flåten et al 2015). Thus, firms become generators and processors of knowledge that draw capacities from embedded learning and the particular routines that shape the distinct characteristics of firms' knowledge bases (Taylor and Asheim 2001).…”

Innovation in the periphery: Compensation and exploitation strategies

“…Our results thus confirm findings from other recent studies (Grillitsch & Nilsson, ). Many respondents point to a high loyalty of the workforce (especially in R&D departments) and highlight its advantages: It limits undesirable knowledge spill‐overs, protects tacit knowledge, and strengthens the internal knowledge base (Flåten et al, ; Isaksen, ). It also allows for lower wages (particularly in those cases where the danger of headhunting is low), which can be a decisive factor in a high wage country like Austria.…”

“…Most firms see the limited supply of skilled labour as major innovation constraint in the Austrian periphery. All respondents report that they build upon an efficient organisation and a strong internal knowledge base, as was suggested by Flåten et al (2015). In this regard, the relevant knowledge consists both of the professional experience and the industry-specific knowledge that is acquired over time.…”

“…There seems to exist widespread consensus that firms in the periphery might have to undertake more strategic efforts to generate innovations when compared with their counterparts in urban regions. Hence, an efficient internal organisation and strong in-house knowledge creation, that is, building up high-level internal competence, have been identified as key strategies for developing innovations in peripheral locations (Doloreux & Shearmur, 2012;Flåten, Isaksen, & Karlsen, 2015;Grillitsch & Nilsson, 2015;Isaksen & Karlsen, 2016).…”