Embracing the Knowledge Economy

Embracing the Knowledge Economy

The Dynamic Transformation of the Finnish Innovation System

New Horizons in the Economics of Innovation series

Edited by Gerd Schienstock

In an astonishingly short period of time, Finland has developed into one of the world’s leading knowledge societies whilst retaining a comprehensive welfare state. The book traces this rapid transformation from a resource-based to a knowledge-based society. The authors describe the country’s strengths and weaknesses in the new economy and demonstrate how Finland has been able to catch-up with the leading industrial countries by exploiting new techno-organizational opportunities. Experts from different fields provide rich empirical material on Finnish industries, firms, regions and institutions, and the role they have played in the transformation process. The book also details the business and economic restructuring which was required, and explores new trends in the country's science, technology and innovation policy.

Chapter 7: The flexible production model in Finnish companies: Trends in production management, work organization and employment relations

Tuomo Alasoini

Subjects: innovation and technology, innovation policy


Tuomo Alasoini 7.1 INTRODUCTION This chapter examines the introduction and dissemination of the new flexible production model in Finland, from the perspective of companies and the national innovation system. It uses a conceptual framework developed by Bélanger et al. (2002), in which ongoing structural change in business is examined in terms of a transition from a Fordist production model to a new production model through three interrelated dimensions: production management, work organization and employment relations. The concept ‘production model’ is used here as a theoretical abstraction, which may include a wide range of country- and sector-specific variations. In highlighting the special features of trends in Finland, the chapter also examines them in a wider comparative perspective. 7.2 FROM A FORDIST MODEL TO A NEW MODEL – HOW TO CONCEPTUALIZE, MEASURE AND ASSESS CHANGE? The post-war era up to the early 1970s could be described as the golden age of the Fordist production model. The year 1973 marks the end of this golden age, being the year when the oil crisis put an end to the period of rapid economic growth and accelerating productivity that the advanced industrial countries had enjoyed since the war. The social legitimacy of the Fordist model was based on beneficial interaction between mass production and mass consumption. A powerful accumulation of capital made it possible to modernize the production process, thus generating 128 The flexible production model in Finnish companies 129 a rapid rise in productivity that was acceptable to employees. As a consequence, employees began...

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