SOURCES OF TECHNICAL INNOVATION IN THE NETWORK OF COMPANIES PROVIDINGCHEMICAL PROCESS PLANT AND EQUIPMENT

The purpose of this paper is to explore issues concerning technologica l innovation in the network of firms linked to the chemical industry, with particular reference to the process plant contracting industry. W hile technological and economic maturity inhibit the research and deve lopment activities of plant contractors, little evidence was found of contractors adopting novel strategies to capture special advantage fro m technology developed by equipment manufacturing firms. It is suggest ed that the changing economic and technological environment is creatin g a climate where new or closer contractor-equipment manufacturer rela tionships should receive greater attention. Appropriate alliances betw een contractors and equipment manufacturers can not only help to reduc e plant design, procurement and erection costs, but also offer a means to counter the competitive threat from more specialist firms; in part icular the large equipment manufacturers that possess their own projec t contracting skills. Furthermore, collaboration in niche and 'technol ogy fusion' type innovation offers a means of generating scope for tec hnological competitive advantage, whilst sharing cost and risk. Whilst contractor-equipment manufacturer alliances are one option the nature of the market demands operating company involvement to facilitate com mercialisation.