Remaining Small: the common and distinctive characteristics of 'Specialised Suppliers' in Japan

  • Hiroo Okuda

Student thesis: Doctor of Business Administration


Small and medium enterprises (SMEs) employ a large portion of the workforce in almost every country. Also, SMEs are considered the important actors for innovation. There are many studies on innovative Japanese SMEs. However, the majority of these studies are case studies introducing the story of developing innovative products. Recently several academics tried to identify common characteristics among these innovative SMEs in Japan. The author of the current research also noticed several common characteristics among innovative Japanese manufactures which did not clearly state in the previous studies. Moreover, the author was curious about why these small innovative companies tend to remain small even they had an opportunity to grow. These innovative Japanese manufacturers provide unique inputs, products or processing services to client companies to solve their problems. This characteristic is identical to a characteristic of Specialised Suppliers in Pavitt's taxonomy (Pavitt, 1984). Pavitt also pointed out that Specialised Suppliers were relatively small. Thus, the author believed these innovative small companies in Japan were categorised as Specialised Suppliers. Although Pavitt's paper on his taxonomy was referred to more than 2.6 thousand in the Web of Science database and nearly 10,000 times in Google Scholar, surprisingly, a few studies examined the nature of Specialised Suppliers. In other words, most studies dealt with Pavitt's taxonomy as if it was proven. Although Pavitt statistically identified common characteristics among four categories of Supplier Dominated, Scale Intensive, Specialised Suppliers, and Science Based companies, it seems the taxonomy did not explain why common characteristics exist sufficiently. The current research attempted to find the underlying reasons of common characteristics among Specialised Suppliers and examine the border of the category. And most of all, this research tried to answer why they prefer remaining small. The findings imply a rational strategy for remaining small as a Specialised Supplier.
Date of Award1 Aug 2022
Original languageEnglish
Awarding Institution
  • The University of Manchester
SupervisorBruce Tether (Supervisor) & Mercedes Bleda (Supervisor)


  • Pavitt's taxonomy
  • Specialised Suppliers
  • innovation
  • SMEs
  • Japanese firms
  • small manufacturer

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