The firm. Techno-organizational changes, industrial relations and performances. An enquiry on Reggio Emilia local industrial system

It is not unknown that the evolution of firm theories has been developed along a path paved by an increasing awareness of the organizational structure importance. From the early “neoclassical” conceptualizations that intended the firm as a rational actor whose aim is to produce that amount of output, given the inputs at its disposal and in accordance to technological or environmental constraints, which maximizes the revenue (see Boulding, 1942 for a past mid century state of the art discussion) to the knowledge based theory of the firm (Nonaka & Takeuchi, 1995; Nonaka & Toyama, 2005), which recognizes in the firm a knnowledge creating entity, with specific organizational capabilities (Teece, 1996; Teece & Pisano, 1998) that allow to sustaine competitive advantages. Tracing back a map of the theory of the firm evolution, taking into account the several perspectives adopted in the history of thought, would take the length of many books. Because of that a more fruitful strategy is circumscribing the focus of the description of the literature evolution to one flow connected to a crucial question about the nature of firm’s behaviour and about the determinants of competitive advantages. In so doing I adopt a perspective that allows me to consider the organizational structure of the firm as an element according to which the different theories can be discriminated. The approach adopted starts by considering the drawbacks of the standard neoclassical theory of the firm. Discussing the most influential theoretical approaches I end up with a close examination of the knowledge based perspective of the firm. Within this perspective the firm is considered as a knowledge creating entity that produce and mange knowledge (Nonaka, Toyama, & Nagata, 2000; Nonaka & Toyama, 2005). In a knowledge intensive organization, knowledge is clearly embedded for the most part in the human capital of the individuals that compose such an organization. In a knowledge based organization, the management, in order to cope with knowledge intensive productions, ought to develop and accumulate capabilities that shape the organizational forms in a way that relies on “cross-functional processes, extensive delayering and empowerment” (Foss 2005, p.12). This mechanism contributes to determine the absorptive capacity of the firm towards specific technologies and, in so doing, it also shape the technological trajectories along which the firm moves. After having recognized the growing importance of the firm’s organizational structure in the theoretical literature concerning the firm theory, the subsequent point of the analysis is that of providing an overview of the changes that have been occurred at micro level to the firm’s organization of production. The economic actors have to deal with challenges posed by processes of internationalisation and globalization, increased and increasing competitive pressure of less developed countries on low value added production activities, changes in technologies and increased environmental turbulence and volatility. As a consequence, it has been widely recognized that the main organizational models of production that fitted well in the 20th century are now partially inadequate and processes aiming to reorganize production activities have been widespread across several economies in recent years. Recently, the emergence of a “new” form of production organization has been proposed both by scholars, practitioners and institutions: the most prominent characteristic of such a model is its recognition of the importance of employees commitment and involvement. As a consequence it is characterized by a strong accent on the human resource management and on those practices that aim to widen the autonomy and responsibility of the workers as well as increasing their commitment to the organization (Osterman, 1994; 2000; Lynch, 2007). This “model” of production organization is by many defined as High Performance Work System (HPWS). Despite the increasing diffusion of workplace practices that may be inscribed within the concept of HPWS in western countries’ companies, it is an hazard, to some extent, to speak about the emergence of a “new organizational paradigm”. The discussion about organizational changes and the diffusion of HPWP the focus cannot abstract from a discussion about the industrial relations systems, with a particular accent on the employment relationships, because of their relevance, in the same way as production organization, in determining two major outcomes of the firm: innovation and economic performances. The argument is treated starting from the issue of the Social Dialogue at macro level, both in an European perspective and Italian perspective. The model of interaction between the social parties has repercussions, at micro level, on the employment relationships, that is to say on the relations between union delegates and management or workers and management. Finding economic and social policies capable of sustaining growth and employment within a knowledge based scenario is likely to constitute the major challenge for the next generation of social pacts, which are the main social dialogue outcomes. As Acocella and Leoni (2007) put forward the social pacts may constitute an instrument to trade wage moderation for high intensity in ICT, organizational and human capital investments. Empirical evidence, especially focused on the micro level, about the positive relation between economic growth and new organizational designs coupled with ICT adoption and non adversarial industrial relations is growing. Partnership among social parties may become an instrument to enhance firm competitiveness. The outcome of the discussion is the integration of organizational changes and industrial relations elements within a unified framework: the HPWS. Such a choice may help in disentangling the potential existence of complementarities between these two aspects of the firm internal structure on economic and innovative performance. With the third chapter starts the more original part of the thesis. The data utilized in order to disentangle the relations between HPWS practices, innovation and economic performance refer to the manufacturing firms of the Reggio Emilia province with more than 50 employees. The data have been collected through face to face interviews both to management (199 respondents) and to union representatives (181 respondents). Coupled with the cross section datasets a further data source is constituted by longitudinal balance sheets (1994-2004). Collecting reliable data that in turn provide reliable results needs always a great effort to which are connected uncertain results. Data at micro level are often subjected to a trade off: the wider is the geographical context to which the population surveyed belong the lesser is the amount of information usually collected (low level of resolution); the narrower is the focus on specific geographical context, the higher is the amount of information usually collected (high level of resolution). For the Italian case the evidence about the diffusion of HPWP and their effects on firm performances is still scanty and usually limited to local level studies (Cristini, et al., 2003). The thesis is also devoted to the deepening of an argument of particular interest: the existence of complementarities between the HPWS practices. It has been widely shown by empirical evidence that when HPWP are adopted in bundles they are more likely to impact on firm’s performances than when adopted in isolation (Ichniowski, Prennushi, Shaw, 1997). Is it true also for the local production system of Reggio Emilia? The empirical analysis has the precise aim of providing evidence on the relations between the HPWS dimensions and the innovative and economic performances of the firm. As far as the first line of analysis is concerned it must to be stressed the fundamental role that innovation plays in the economy (Geroski & Machin, 1993; Stoneman & Kwoon 1994, 1996; OECD, 2005; EC, 2002). On this point the evidence goes from the traditional innovations, usually approximated by R&D investment expenditure or number of patents, to the introduction and adoption of ICT, in the recent years (Brynjolfsson & Hitt, 2000). If innovation is important then it is critical to analyse its determinants. In this work it is hypothesised that organizational changes and firm level industrial relations/employment relations aspects that can be put under the heading of HPWS, influence the propensity to innovate in product, process and quality of the firm. The general argument may goes as follow: changes in production management and work organization reconfigure the absorptive capacity of the firm towards specific technologies and, in so doing, they shape the technological trajectories along which the firm moves; cooperative industrial relations may lead to smother adoption of innovations, because not contrasted by unions. From the first empirical chapter emerges that the different types of innovations seem to respond in different ways to the HPWS variables. The underlying processes of product, process and quality innovations are likely to answer to different firm’s strategies and needs. Nevertheless, it is possible to extract some general results in terms of the most influencing HPWS factors on innovative performance. The main three aspects are training coverage, employees involvement and the diffusion of bonuses. These variables show persistent and significant relations with all the three innovation types. The same do the components having such variables at their inside. In sum the aspects of the HPWS influence the propensity to innovate of the firm. At the same time, emerges a quite neat (although not always strong) evidence of complementarities presence between HPWS practices. In terns of the complementarity issue it can be said that some specific complementarities exist. Training activities, when adopted and managed in bundles, are related to the propensity to innovate. Having a sound skill base may be an element that enhances the firm’s capacity to innovate. It may enhance both the capacity to absorbe exogenous innovation and the capacity to endogenously develop innovations. The presence and diffusion of bonuses and the employees involvement also spur innovative propensity. The former because of their incentive nature and the latter because direct workers participation may increase workers commitment to the organizationa and thus their willingness to support and suggest inovations. The other line of analysis provides results on the relation between HPWS and economic performances of the firm. There have been a bulk of international empirical studies on the relation between organizational changes and economic performance (Black & Lynch 2001; Zwick 2004; Janod & Saint-Martin 2004; Huselid 1995; Huselid & Becker 1996; Cappelli & Neumark 2001), while the works aiming to capture the relations between economic performance and unions or industrial relations aspects are quite scant (Addison & Belfield, 2001; Pencavel, 2003; Machin & Stewart, 1990; Addison, 2005). In the empirical analysis the integration of the two main areas of the HPWS represent a scarcely exploited approach in the panorama of both national and international empirical studies. As remarked by Addison “although most analysis of workers representation and employee involvement/high performance work practices have been conducted in isolation – while sometimes including the other as controls – research is beginning to consider their interactions” (Addison, 2005, p.407). The analysis conducted exploiting temporal lags between dependent and covariates, possibility given by the merger of cross section and panel data, provides evidence in favour of the existence of HPWS practices impact on firm’s economic performance, differently measured. Although it does not seem to emerge robust evidence on the existence of complementarities among HPWS aspects on performances there is evidence of a general positive influence of the single practices. The results are quite sensible to the time lags, inducing to hypothesize that time varying heterogeneity is an important factor in determining the impact of organizational changes on economic performance. The implications of the analysis can be of help both to management and local level policy makers. Although the results are not simply extendible to other local production systems it may be argued that for contexts similar to the Reggio Emilia province, characterized by the presence of small and medium enterprises organized in districts and by a deep rooted unionism, with strong supporting institutions, the results and the implications here obtained can also fit well. However, a hope for future researches on the subject treated in the present work is that of collecting good quality information over wider geographical areas, possibly at national level, and repeated in time. Only in this way it is possible to solve the Gordian knot about the linkages between innovation, performance, high performance work practices and industrial relations.

Technological innovation in Emilia-Romagna: knowledge, practice, strategies

The present study aims at assessing the innovation strategies adopted within a regional economic system, the Italian region Emilia-Romagna, as it faced the challenges of a changing international scenario. As the strengthening of the regional innovative capabilities is regarded as a keystone to foster a new phase of economic growth, it is important also to understand how the local industrial, institutional, and academic actors have tackled the problem of innovation in the recent past. In this study we explore the approaches to innovation and the strategies adopted by the main regional actors through three different case studies. Chapter 1 provides a general survey of the innovative performance of the regional industries over the past two decades, as it emerges from statistical data and systematic comparisons at the national and European levels. The chapter also discusses the innovation policies that the regional government set up since 2001 in order to strengthen the collaboration among local economic actors, including universities and research centres. As mechanics is the most important regional industry, chapter 2 analyses the combination of knowledge and practices utilized in the period 1960s-1990s in the design of a particular kind of machinery produced by G.D S.p.A., a world-leader in the market of tobacco packaging machines. G.D is based in Bologna, the region’s capital, and is at the centre of the most important Italian packaging district. In chapter 3 the attention turns to the institutional level, focusing on how the local public administrations, and the local, publicly-owned utility companies have dealt with the creation of new telematic networks on the regional territory during the 1990s and 2000s. Finally, chapter 4 assesses the technology transfer carried out by the main university of the region – the University of Bologna – by focusing on the patenting activities involving its research personnel in the period 1960-2010.

Bridging innovation, nature and tradition: assessment of strategies for rural tourism development in Maramureş (Romania)

In the frame of EU rural policy, always more oriented towards environmental concerns and green livelihoods, Romania stands out for the predominance of rural areas and high nature value farming. The country has to face the challenge of joining the modernization process of rural farming systems with the valorization of local assets. Tourism has emerged as one of the main drivers of change and contributors for a sustainable exploitation of local resources. Rural tourism (RT) can foster the enhancement of the territorial capital (TC), the preservation of public goods (PGs) and the promotion of a more environmental oriented livelihood. The research focuses on a case study area, two valleys from Maramureş, where environmental approaches as diversification strategies are partially explored. The work investigates the role of tourism initiatives for the promotion of green oriented practices. The first part of the work is based on a literature review and interdisciplinary analysis of secondary data to identify the key issues: from rural development policy, to the concept of TC, of PGs and RT. The Romanian development programmes and related strategies are investigated; afterwards the characteristics of the County and the role of RT as diversification and valorisation policies is considered. The second part is based on the collection of primary data through interviews to different local stakeholders (farmers owners of rural guesthouses, local administrators, networks and artisans). The main frequencies are analyzed, a cluster analysis is computed to evaluate the similarities within the most representative groups and a comparative analysis is carried out between the two Valleys. The frame of the analysis is based on a set of indicators following the dimensions of the TC, to assess the characteristics of the local stakeholders and to outline the perception about the local PGs and on the adopted strategies to manage the territory. Final considerations are elaborated and few scenarios are outlined, giving relevance to the importance of improving awareness and creating embeddedness among public-private local stakeholders and resources as a tool for a socio-economic and environmental development of the area.

An Innovation System Perspective on Adaptation Strategies to Climate Variability and Water Management in India

Government policies play a critical role in influencing market conditions, institutions and overall agricultural productivity. The thesis therefore looks into the history of agriculture development in India. Taking a political economy perspective, the historical account looks at significant institutional and technological innovations carried out in pre- independent and post independent India. It further focuses on the Green Revolution in Asia, as forty years after; the agricultural community still faces the task of addressing recurrent issue of food security amidst emerging challenges, such as climate change. It examines the Green Revolution that took place in India during the late 1960s and 70s in a historical perspective, identifying two factors of institutional change and political leadership. Climate change in agriculture development has become a major concern to farmers, researchers and policy makers alike. However, there is little knowledge on the farmers’ perception to climate change and to the extent they coincide with actual climatic data. Using a qualitative approach,it looks into the perceptions of the farmers in four villages in the states of Maharashtra and Andhra Pradesh. While exploring the adaptation strategies, the chapter looks into the dynamics of who can afford a particular technology and who cannot and what leads to a particular adaptation decision thus determining the adaptive capacity in water management. The final section looks into the devolution of authority for natural resource management to local user groups through the Water Users’ Associations as an important approach to overcome the long-standing challenges of centralized state bureaucracies in India. It addresses the knowledge gap of why some local user groups are able to overcome governance challenges such as elite capture, while others-that work under the design principles developed by Elinor Ostrom. It draws conclusions on how local leadership, can be promoted to facilitate participatory irrigation management.

Computational strategies to include protein flexibility in Ligand Docking and Virtual Screening

The dynamic character of proteins strongly influences biomolecular recognition mechanisms. With the development of the main models of ligand recognition (lock-and-key, induced fit, conformational selection theories), the role of protein plasticity has become increasingly relevant. In particular, major structural changes concerning large deviations of protein backbones, and slight movements such as side chain rotations are now carefully considered in drug discovery and development. It is of great interest to identify multiple protein conformations as preliminary step in a screening campaign. Protein flexibility has been widely investigated, in terms of both local and global motions, in two diverse biological systems. On one side, Replica Exchange Molecular Dynamics has been exploited as enhanced sampling method to collect multiple conformations of Lactate Dehydrogenase A (LDHA), an emerging anticancer target. The aim of this project was the development of an Ensemble-based Virtual Screening protocol, in order to find novel potent inhibitors. On the other side, a preliminary study concerning the local flexibility of Opioid Receptors has been carried out through ALiBERO approach, an iterative method based on Elastic Network-Normal Mode Analysis and Monte Carlo sampling. Comparison of the Virtual Screening performances by using single or multiple conformations confirmed that the inclusion of protein flexibility in screening protocols has a positive effect on the probability to early recognize novel or known active compounds.

Preclinical development of anti-cancer strategies against human HER-2

HER-2 is a 185 kDa transmembrane receptor tyrosine kinase that belongs to the EGFR family. HER-2 is overexpressed in nearly 25% of human breast cancers and women with this subtype of breast cancer have a worse prognosis and frequently develop metastases. The progressive high number of HER-2-positive breast cancer patients with metastatic spread in the brain (up to half of women) has been attributed to the reduction in mortality, the effectiveness of Trastuzumab in killing metastatic cells in other organs and to its incapability to cross the blood-brain barrier. Apart from full-length-HER-2, a splice variant of HER-2 lacking exon 16 (here referred to as D16) was identified in human HER-2-positive breast cancers. Here, the contribution of HER-2 and D16 to mammary carcinogenesis was investigated in a model transgenic for both genes (F1 model). A dominant role of D16, especially in early stages of tumorigenesis, was suggested and the coexistence of heterogeneous levels of HER-2 and D16 in F1 tumors revealed the undeniable value of F1 strain as preclinical model of HER-2-positive breast cancer, closer resembling the human situation in respect to previous models. The therapeutical efficacy of anti-HER-2 agents, targeting HER-2 receptor (Trastuzumab, Lapatinib, R-LM249) or signaling effectors (Dasatinib, UO126, NVP-BKM120), was investigated in models of local or advanced HER-2-positive breast cancer. In contrast with early studies, data herein collected suggested that the presence of D16 can predict a better response to Trastuzumab and other agents targeting HER-2 receptor or Src activity. Using a multiorgan HER-2-positive metastatic model, the efficacy of NVP-BKM120 (PI3K inhibitor) in blocking the growth of brain metastases and the oncolytic ability of R-LM249 (HER-2-retargeted HSV) to reach and destroy metastatic HER-2-positive cancer cells were shown. Finally, exploiting the definition of “oncoantigen” given to HER-2, the immunopreventive activity of two vaccines on HER-2-positive mammary tumorigenesis was demonstrated.