The organisation of innovative activities in European software firms.
This thesis examines the organisation of innovative activities at the firm level by
proposing a conceptual framework that is built upon a survey of the recent
economic literature on technical change and by applying this framework to the
computer software and services industry.
The objectives of the study were the following: to analyze the nature of technical
change in the software industry, the sources of firms' innovation and the
competencies used in the innovative activities; to focus on the relationship
between internal competencies and external sources of innovation~ and to give a
picture of the division of labour among firms in the innovative activities.
This work proposes a conceptual framework that takes into account the
interactions between technical and organisational innovations at the firm level and
focuses on the innovation process as a 'division of knowledge' that involves
different types of actors: individuals, with different skills, working in the same
organisation, firms specialising in substitute or complementary products, users
and academic research centres.
The empirical analysis employed qualitative data drawn from interviews with both
large a.nd small firms, and quantitative data on corporate changes of large firms
(e.g., creation or shut-down of subsidiaries, launch of new producis, set up of
The main results of the research can be summarised as follows. First, software
firms show a cumulative, incremental pattern of product innovations and an
increasing commitment to process innovations. The research shows the linkages
between technical and organisational changes. Process innovations affect the retraining
of software analysts-programmers and project managers, encounter
obstacles in the transmission of new software engineering knowledge from the
R&D department to business departments, and shape the division of tasks
throughout the firm. The second research result concerns the correlation between
internal skills and the firms' propensity to set up linkages with external sources of
innovation. The use of generic-abstract capabilities (mathematical skills) in
innovative activities make firms more open towards external channels of technical
change. On the contrary, the use of context-specific capabilities (experience with
the development of software applications) reduces finns' propensity to interact
with external sources of technical change. Finally, there is evidence of an
increasing division of labour among firms in the software industry, as indicated by
the large and rising number of inter-firm cooperative agreements stipulated during the period between 1984 and 1 ?92. The analysis of inter-firm linkages and internal
restructuring also points to the importance of organisational change as one
dimension of the general corporate change.