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Long distance links inspire innovation

12 July 2016
Firms that make an effort to reach out to distant partners become more innovative and productive, a University of Sydney researcher has found.

Working with Professor Yasuyuki Todo (Waseda University) and Dr Hiroyasu Inoue (Hyogo University), Dr Petr Matous from the University of Sydney’s Faculty of Engineering and IT found that supply chains can work as important channels for the flow of information, innovation, and productivity between individual firms.

The data revealed a high diversity of industrial knowledge
Dr Petr Matous, complex systems researcher and senior lecturer

Using Japan’s national supply network dataset – a one of its kind worldwide – Dr Matous and Professor Todo have also explored the role of interfirm networks in recovery from the Great East Japan earthquake and tsunami, which damaged the Fukushima Daiichi Nuclear Power Plant. They found that firms with geographically long supply links recover faster from natural disasters.

Their results have been published in Research Policy and Network Science.

Dr Petr Matous, a complex systems researcher in the School of Civil Engineering and whose work focuses on the interplay of technologies with social or interorganisational networks and the environment said:

“Firms in different geographical regions tend to have access to different types of knowledge, supply links that reach across different regions are highly relevant to organisational learning.”

“The data revealed a high diversity of industrial knowledge in terms of the types of patents that firms file in different parts of the country,” said Dr Matous.

“Although it may seem more efficient in the short term, firms that trade mainly with physically nearby firms are more likely to stagnate in terms of innovation and productivity.”

The research paper also shows that firms that are linked to each other tend to possess similar types of knowledge.

Because of that, firms that have access to various unconnected firms have access to more diverse knowledge than firms who cooperate mainly within their own trading clique.

“What we found was firms that have access to different network cliques perform better,” said Dr Matous.

 

Victoria Hollick

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