Shared Performance: The Proactive Diffusion of Competitiveness and Industrial and Local Development

Abstract

This article extends the study of corporate restructuring to the issue of performance by integrating the performance of individual firms with the performance of an industrial system and local economy. We view the spread of performance throughout the system as “development,” which we define (in contrast to much of the industrial literature) in terms of both corporate and worker welfare. Reconceptualizing the concept of “transfer,” we broaden conventinal “technology transfer” to “competitiveness transfer,” whereby the transfer of intangibles such as knowledge and learning capability as preeminent in a people-first strategy of competitiveness enhancement. The study reconceptualizes firm performance by introducing new criteria, namely a firm's intent to improve performance and diffusion capability, i.e., the process by which competitiveness is transferred or spread to other firms. The latter criterion reflects corporate strategy to achieve system-wide competitiveness. A case study of a foreign-owned manufacturing firm in the United States, given the fictitious name Spreadwell, empirically grounds competitiveness transfer and diffusion capability. Spreadwell's relations with its suppliers suggest new concepts for the analysis of corporate diffusion, namely the roles of an effective system of human relations and the proactive diffusion of problem-solving ability prior to technology transfer. The paper documents the success of the Spreadwell-supplier relationship, and the principals’motives for entering into a partnership characterized both by risk and reward. Recognizing the hierarchical character of the Spreadwell industrial system, the authors identify the diffusion of competitiveness at different scales to clarify distinct implications for local development and policy.

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