Environment and Planning C: Politics and Space

The role and importance of entrepreneurship and new business creation to the economy have been the subject of increased attention in recent years. Indeed, it is now widely recognised that the promotion of entrepreneurship is not only necessary for a healthy economy, but also critical for sustaining prosperity and creating new jobs. The authors discuss the debate on intervention in the business creation process, and pay particular attention to one aspect of such intervention, namely entrepreneurship training. The issue of the effectiveness of this type of training is also addressed, and the results of a comparative study of eight enterprise training programmes in five European countries, are presented. In addition to the intercountry comparison of entrepreneurship training programmes, the research undertaken comprised a three-year longitudinal study of participants in one of these programmes (CCNEA). The combination of the analysis of the comparative study with the more in-depth case study, has highlighted a number of issues which should be of particular interest to enterprise policymakers throughout Europe. These include the need for early stage awareness-raising through the education system, and the importance of providing secure funding for programmes; for pre-programme screening; for evaluation; and the need to ensure wide access.

The role of clusters and clustering in economic development is of current policy interest, in part because of analyses and studies that have associated these forms of collaboration with regional and local prosperity and development. Although some of the literature supports or starts from this association, there are also critiques of the clusters concept and its feasibility as a policy development and intervention strategy. Intrinsic to part of these concerns has been a view that clusters cannot be created without business involvement and input at the heart of the process. The paper addresses this issue via an examination of four cases of potential clusters development from the perspectives of the businesses involved. Although clear evidence for the existence of a cluster could only be established definitively in one of the four cases, there were extensive indications of clustering as a collaborative activity across all four cases. Based on this, a process of clusters formation and emergence was developed that applied to the cases. This process consists of several phases of clusters emergence and points to three stages of clusters development: potential, emerging, and established. A key implication is that processes of clusters formation may provide an opportunity for the formulation of ‘bottom-up’, contextually sensitive clusters development strategies for groups of businesses.

In this paper we are concerned with the nature and extent of product and process innovation and adoption of information and communications technologies (ICTs) in manufacturing plants and SMEs. The paper is based on extensive postal surveys conducted in southeast (SE) England, Northern Ireland (NI), and the Republic of Ireland (RoI) with a harmonised survey instrument. We confirm the findings of a number of previous studies by demonstrating a positive association between product and process innovation and business performance. Data collected from all three surveys show that sales growth, employment growth, and profit margins were higher for innovators than growth, for noninnovators. It also appears that although foreign-owned plants show a higher propensity for innovation than indigenously owned plants, the latter grew faster than their foreign owned counterparts in all three regions. This suggests that a targeting strategy focused on innovative, indigenously owned SMEs may be particularly rewarding. With regard to the nature and extent of the use of ICT and electronic business (e-business), the survey found a higher level of adoption of nearly all ICT facilities in SE England compared with the levels in NI and the RoI. Differences in ICT capability between the regions are greatest in the case of smaller plants, with the adoption of various ICT facilities being particularly favoured amongst the smallest plants in SE England, most of which are indigenously owned. However, there is evidence to suggest that the technology may be underutilised in each region, possibly reflecting a lack of in-house knowledge and resources in some applications and external barriers in others. SE England was found to have the highest proportion of plants engaged in some R&D compared with the two Irish regions, particularly NI. Unsurprisingly, there is a tendency for the propensity of a firm to be engaged in R&D to increase with firm size. The surveys also underlined sectoral differences in explaining the relative importance of R&D. ‘Technology transfer’ was significantly more common in the two Irish regions, reflecting the higher proportion of externally controlled plants. With respect to the role of external linkages in innovation, links with customers and suppliers were the ones most commonly identified in all three regions. In SE England there is a particularly low propensity to engage in collaboration with external agencies and research institutions, indicating scope here for further policy intervention. We conclude with a number of suggestions for the agenda of the new regional centre of manufacturing excellence in SE England.

During the past twenty years, the emphasis of policy towards high-technology industry has shifted from national innovation systems to take account of globalisation and the formation of regional clusters. Support for high-technology sectors now takes place at a number of levels—regional, national, and international. However, the extent to which firms operate in these three arenas, and how relevant government action is for the needs and behaviour of firms in respect of these is open to question. The paper reports on a study into innovation in Germany and the United Kingdom, in a particular industry—opto-electronics—which has a highly global character, but is also characterised by concentrations of firms in clusters. The contrasting experiences of firms in two regions—Wales and Thuringia—and the different policy emphasis of the regional government provide a test for the relevance, appropriateness, and impact of government policies towards high-technology industry. By focusing on the experiences of innovating firms, the authors provide a conceptually rich understanding of innovation in terms of two processes, which are often conflated in public policy—stimulating knowledge and technology transfer, and providing resource support. The paper concludes with a suggestion that support for innovation needs to be based around the twin concepts of redundancy and systems thinking, and a series of questions policymakers need to keep in mind are proposed.

Intense global competition and the advent of a raft of employment regulations (notably, the national minimum wage, or NMW) have placed the UK garment industry under severe pressure. The prospects for a significant segment of this sector—ethnic-minority-owned businesses—appear to be extremely gloomy, although earlier predictions of its demise proved to be unduly pessimistic. Drawing on case studies of eighteen firms, we present an examination of longitudinal change in the Asian-dominated West Midlands clothing industry. In particular, the aim is to examine the responses of manufacturers to market and regulatory change (in particular, the NMW). The findings clearly illustrate that the sector is in decline, with firms finding it increasingly difficult to cope with cheap imports, labour shortages, and employment regulations. A range of responses was evident and included firms that resorted to operating in ‘grey’ markets; manufacturers that ‘retrenched’ their operations; ‘work intensification’; and businesses that attempted to move ‘up-market’. Finally, potential policy responses are considered. In particular, the case of the Coventry Clothing Centre is examined. The Centre worked with the grain of employment legislation, and appeared to have experienced some success in encouraging local firms to accommodate the NMW and improve working practices.

This paper provides an account of a questionnaire-based study of small and medium-sized enterprises (SMEs) and their responses to the current requirements of environmental best practice. The study was based within South Yorkshire. We aim to explore the current relationship between SMEs and the environment and how this affects their concept of ‘sustainable business’. The main finding reported is that most manufacturing and service organisations surveyed believe environmental issues affect their business. However, meeting environmental requirements is seen as a business cost that is not transferable to customers in terms of added benefits and few organisations could show that it led to a competitive advantage. SMEs have only a generalist awareness of environmental legislation, and information provided by most local support services is not presented in a format that is efficient or effective. Our recommendations are that the assistance provided by local support agencies with regards to environmental best practice should be critically reviewed, and this review should seek to understand the reluctance and real difficulties faced by SMEs in comprehension and implementation of environmental legislation. This paper should therefore be used in conjunction with associated information when considering the best way to help prepare SMEs for greater involvement in environmental best practice and the achievement of sustainable business.

The author presents the analysis of a survey of 500 high-tech enterprises in Shanghai which was designed to examine the local social, political, and economic environment in which high-tech enterprises operate and compete. Information sought in this survey comes in two kinds: the characteristics of high-tech enterprises; and their assessments of specified elements constituting their business environment. Survey findings suggested that state-owned or quasi-state-owned enterprises are still the leading players although local private enterprises and transnational corporations are becoming indispensable actors in high-tech industrial development in Shanghai. Among these enterprises, those which are locally based are mainly small and medium-sized enterprises and are in the start-up stage of business; they are domestically oriented and are not strong enough to exploit foreign markets. Foreign-based enterprises in Shanghai are, however, mainly subsidiaries, branch plants, or assembly lines, rather than regional headquarters, suggesting that Shanghai occupies a relatively low position in the international division of labor. The second part of the survey suggests that, in boosting the development of high-tech businesses, Shanghai achieves tangible objectives and improves the physical environment efficiently. Nevertheless, it is still quite weak in some soft dimensions, such as dynamic entrepreneurial culture, adequate business-support services, sophisticated educational and professional systems, comprehensive legal framework, etc. However, these dimensions are key components of innovative milieu in which technological innovation and entrepreneurial activities are facilitated and nurtured.

There is often a gap between the creation of knowledge and the use of new knowledge in the economy, a situation which has pushed many governments to establish programmes for knowledge transfer and new-firm formation. I examine the initiatives taken by the government in the Netherlands to advance new-firm formation in biotechnology. Drawing on experience in entrepreneurship—its institutional setting in general, and more specifically on developments in biotechnology start-ups—I aim to identify critical success factors for this policy. The policy seems promising in covering all development stages of start-up firms and in using a network approach—with implementation by an intermediary organisation as a solution for coordination problems. The low popularity of entrepreneurship, including some negative regulatory factors in biotechnology, and the danger of the policy focusing on the top innovative start-ups are threats to success. Other threats may be a fragmentation of ferees and a narrow focus on a national situation rather than cooperation with adjacent countries. I suggest a number of critical success factors that can be used in policies to enhance new-firm formation in biotechnology, and indicate some lines for further research.