Design and Innovation: Determinants and Implications

Abstract

This is a "journal format" thesis which consists of six chapters. The first chapter introduces the general background and methodology of the research. Chapters 2 to 5 are four interrelated papers revolving around design in business. The last is the conclusions chapter. Chapter 2 is a review of empirical evidence on the extent to which firms engage in design as well as the potentially associated activities and factors. The reviewed studies cover more than twenty surveys that were conducted in the UK or Europe between 1996 and 2016. The review finds design has been increasingly important to the UK economy; firms' investments in design are modest on average; there are potentially complementarities between design and R&D and between design and marketing; moreover, design is associated with firms' activities in relation to technological and market opportunities. Based on the findings from chapter 2, in chapter 3, I examine the industrial and market environment, business activities and structural characteristics that are associated with firms' commitment to design, informed by the framework of organisational capabilities. I analyse cross-sectional data collected from a large-scale survey (i.e. Innobarometer) which was conducted in the EU-28 and Switzerland in 2015 and 2016. I find the extent of companies' commitment to design is positively associated with technological opportunities, differentiation opportunities, R&D commitment, branding commitment, firm-size and whether the firm is a subsidiary. Also utilising the framework of organisational capabilities, in chapter 4, I argue that design capabilities can help product innovators reach distant customers and improve their sales in distant places, potentially interacting with R&D and marketing. By testing the hypotheses using cross-sectional data collected through the UK Innovation Survey 2017, I find design investment is positively associated with the propensity to trade overseas but not necessarily the value of exports, albeit spending a modest amount on design is still better than not; meanwhile, R&D investment is positively related to both the propensity to export and the value of exports. I do not find design interacting with R&D or marketing in improving the geographical market reach or the exports of product innovators. Likewise, in chapter 5, I examine if and to what extent design and R&D are associated with exporting in the UK Creative Industries, using cross-sectional data collected through a government-commissioned survey. I find investing in design and R&D (within which applied research in particular) to both be related to the propensity to export; moreover, investing in both design and applied research is more strongly associated with export participation than investing in only one of these; further, firms with more investments in design or R&D are more likely to export. I also find design investments to be positively associated with export sales, while R&D is not statistically related to it.

Date of Award	28 Jun 2022
Original language	English
Awarding Institution	The University of Manchester
Supervisor	Bruce Tether (Main Supervisor) & Khaleel Malik (Co Supervisor)