Enabling Employee Driven Innovation EDI-Europe Conference, Bruxelles 02.03.09 Peer Hull Kristensen

Content of speech Why is EDI becoming an important issue? What are the signs of and where do we find EDIs? Why are EDIs emerging in Nordic Countries? Towards Enabling Welfare States?

Why is EDI becoming important? Tendencies in the New Economy: From functionally integrated hierarchies to networked firms and open innovation systems Globalized networks Combining innovation and cost-reduction: Constantly redefinition of roles and rules among firms in global value chains Developing High Performance Work Organizations: Integrating planning and execution in teams; decentralizing external relations (can-ban-systems) New Managerial techniques: Continuous improvement, root-cause analysis, appreciative enquiry, simultaneous engineering, heuristic design. The big challenge: The “Projective City” and the “Networked economy” for the few or the many?

Percentage of U.S. Industrial R&D by Size of Enterprise Source Chesbrough 2003 Company Size 1981 1989 1999 <1.000 Empl. 4.4 9.2 22.5 1.000-4.999 6.1 7.6 13.6 5.000-9.999 5.8 5.5 9.0 10.000-24.999 13.1 10.0 >25.000 70.7 67.7 41.3

Table 1.1 : Foreign Direct Investments (stock) in percentage of GNP 1990 and 2002 source: Eriksson et al. 2006: 9. Country To/from 1990 2002 Denmark To From 6.9 5.5 41.7 43.4 Sweden 5.3 21.3 46.0 60.5 Finland 3.8 8.2 27.0 52.8 USA 7.5 12.9 14.4 England 20.6 23.2 40.8 66.1 Germany 7.1 8.8 22.7 29.0 France 9.1 28.2 45.8 Ireland 72.3 24.5 129.1 29.9 China 7.0 0.7 36.2 2.9

What signs of and where to find EDIs? The Lisbon Scorecards: 2002: Only Finland contest the US: The Finish Innovation System (NOKIA) 2004: Finland, Denmark and Sweden outperform the US: Two Innovation Systems and Danish Flexicurity 2006: Denmark, Finland, Sweden, Netherlands, Germany and UK outperforms the US WHY?

Translearn: What happens in Firms in the Nordic Countries? Living with and being highly responsive to the changes in ownership, in benchmarks, scorecards, etc. from owners, financial markets, customers and regulatory institutions. Yet A New Strategic pattern of firms: Combining products with services, Doing continuous improvement and innovation for customers’/owners’ organization Searching for increasingly sophisticated and demanding customers or owners

Transitional forms of organization Firms are able to change their role towards customers, owners and suppliers continuously A capability that is rooted in integrating planning and execution and constantly experimenting with High Performance Work Organization and Learning organizations Which are a mess in constant flux, but often consist of a dual structure of operational teams and ad hoc teams – mutually reconstituting each other (most extreme case Unimerco) The legacy of Industrial Relations for creating negotiating restructuring.

Signs of Change among Danish Employees Do you apply your own ideas at work? ”Often” ”Now and then” 1985: 34% 21% 2000: 69% 20% Grundfos: From approx 15.000 (2004) to 29.000 (2006) written proposals for improvements

Why are EDI emerging in Nordic Welfare States? Employee autonomy dependent on universalistic WFS and freedom to mobility. Work in the Projective City: Unpredictable in terms of content, team, place and timing Access to the “Projective City” and mobility dependent on Education The liberated family: access to personalized services for kids, the elderly, unemployed, etc Lifelong learning, distant projects, unpredictable life-courses The Big Wheel of Enabling Welfare States: EDI in the interface between the public and private sector

Figur 2. Lønspredning og kompetencespredning Figur 2. Lønspredning og kompetencespredning. Kompetencespredning målt som de 95 procent bedste i forhold til de 5 procent dårligste. Kilde: OECD

Table : Public spending as percentage of GDP on families and on elderly 1998 (1): Public spending on families of which Services Public Spending on elderly of which services Denmark Finland Sweden United Kingdom United States 3.77 3.36 3.31 2.22 0.51 2.23 1.44 1.68 0.49 0.29 9.77 8.53 11.17 10.58 5.20 2.95 1.54 3.71 0.81 0.05 (1): Cash amount for a two-earner family with two children as a percentage of GDP. Source: OECD, 2007 B, p 66.