Innovation in “Low-Tech” Industries: Portuguese Footwear Industry

The Portuguese footwear industry had in the last five years a remarkable performance in the exportation values, the trade balance and others economic indicators. After a long period of difficulties and with a strong reduction of companies and employees since 1994 until 2009, the Portuguese footwear industry changed the strategy and is now a success case between the international players of footwear. Only the Italian industry sells footwear with a higher value than the Portuguese and the distance between them is decreasing year by year. This paper analyses how the Portuguese footwear companies innovate and make innovation, according the classification proposed by the Oslo Manual. Also, analyses the strategy follow in the innovation process and shows the linkage between the type of innovation and the strategy of innovation. The research methodology was qualitative and the strategy for data collection was the case study. The qualitative data will be analyzed with the MAXQDA software. The economic results of the footwear companies studied shows differences between all of them and these differences are related with the innovation strategy adopted. The companies focused in product and marketing innovation, oriented to their target market, have higher ratios “turnover per worker” than the companies focused in process innovation. However, all the footwear companies in this “low-tech” industry create value and contribute to a positive foreign trade of 1.310 million euros in 2013. The growth strategies implemented has the participation of the sectorial organizations in several innovative projects. And it’s obvious that cooperation between all of them is a critical element to the performance achieved by the companies and the innovation observed. The Portuguese footwear sector has in the last years an excellent performance (economic results, exportation values, trade balance, brands and international image) and his performance is strongly related with the strategy in innovation followed, the type of innovation and the networks in the cluster. A simplified model, called “Ace of Diamonds”, is proposed by the authors and explains the way how this performance was reached by the seven companies that participate in the study (two of them are the leaders in the setor), and if this model can be used in others traditional and “low-tech” industries.

• António Marques
• Graça Guedes

• Footwear industry
• innovation strategy
• low-tech industry
• Oslo Manual.

[1] M.E. Porter, Competitive advantage: creating and sustaining superior
performance. New York: The Free Press, 1985.
[2] M.E. Porter, “Clusters and the new economics of competition”, Harvard
Business Review, Vol.76 (6), 1998, pp.77-90.
[3] APICCAPS, World Footwear Yearbook 2014. Porto: Publicações
APICCAPS, 2014.
[4] APICCAPS, Footure 2020: Plano Estratégico – Cluster do Calçado.
Porto: Publicações APICCAPS, 2013.
[5] H. Hirsch-Kreisen, D. Jacobson, S. Laestadius and K. Smith, Low-Tech
Industries and the Knowledge Economy: State of the Art and Research
Challenges. Oslo: PILOT: Policy and Innovation in Low-Tech, STEP –
Centre for Innovation Research, 2003.
[6] K. Pavitt, “Sectoral patterns of technical change: towards a taxonomy
and a theory”, Research Policy, Vol. 13, 1984, pp. 343-373.
[7] R. Evangelista, Knowledge and Investment. Cheltenham: Edward Elgar
Publishing Limited, 1999.
[8] M. Q. Patton, How to Use Qualitative Methods in Evaluation.
California: Sage Publications Inc., 1987.
[9] J. Hill and P. McGowan, “Small Business and Enterprise Development:
Questions about Research Methodology”, International Journal of
Entrepreneurial Behaviour and Research, Vol. 5, (1), 1999, pp. 5-18.
[10] M. D. Myer, Qualitative Research in Business & Management. London:
SAGE Publications Ltd, 2009.
[11] R. K. Yin, Case Study Research: Design and Methods. Sage
Publications, 4th edition, London, 2009.
[12] K. M. Eisenhardt,”Building Theories from Case Study Research”,
Academy Management Review, Vol.14 (4), 1989, pp. 532-550.
[13] J. W. Creswell, Qualitative Inquiry & Research Design: Choosing
Among Five Approaches. 2nd ed. Thousand Oaks: Sage Publications,
2007.
[14] M. Saunders, P. Lewis and A. Thornhill, Research Methods for Business
Students. 5th Ed. London: Financial Times Prentice-Hall, 2009.
[15] OECD, Oslo Manual: guidelines for collecting and interpreting
innovation data. 3rd edition. Paris: OECD Publishing and
Eurostat/European Commission, 2005.
[16] R. Rothwell and W. Zegveld, Innovation and the small and medium
sized firms. London: Frances Pinter, 1983.
[17] R. Rothwell and M. Dodgson, “Innovation and size of firm”, The
Handbook of Industrial Innovation, Ed. M. Dodgson and R. Rothwell.
Cheltenham: Edward Elgar, 1994.
[18] C. Freeman and L. Soete, The economics of Industrial Innovation. 3rd
Edition. London: Pinter, 1997.
[19] M. Heidenreich, “Innovation patterns and location of European low- and
medium-technology industries”, Research Policy. Elsevier, Vol. 38, (3),
2008, pp. 483-494.
[20] K. J. Arrow, “Economic Welfare and the Allocation of Resources for
Inventions”, Ed. R.R. Nelson, the Rate and Direction of Inventive
Activity. Princeton, NJ: Princeton University Press, 1962.
[21] B.A Lundvall, National Systems of Innovation: Towards a Theory of
Innovation and Interactive Learning. London: Pinter, 1992.
[22] S. J. Kline and N. Rosenberg, “An overview of innovation”, Ed. R.
Landau, and N. Rosenberg, The Positive Sum Strategy. Washington,
D.C.: National Academy Press, 1986, pp.275-305.
[23] H. Chesbrough, “The Era of Open Innovation”, MIT Sloan Management
Review, Vol.44, (3), 2003, pp.35-41.
[24] Monitor Company. Construir as vantagens competitivas de Portugal.
Lisboa: Edição Forum para a Competitividade, 1994.
[25] M. E. Porter, The competitive advantage of nations, 11th ed. Chippenham
and Eastbourne: Palgrave Macmillan, 1998.