Firms hit by kneejerk planning

British manufacturing firms innovate because of pressure from the market-place and not as a result of strategies developed by management, a survey has found.

According to Michael West, project director of Sheffield University's Institute of Work Psychology, the finding is deeply worrying.

He said: "It suggests that many companies are responding to rather than determining developments in the market, which leaves them poorly placed to compete in an increasingly brutal global marketplace."

The survey, thought to the biggest of its kind, has been carried out by Sheffield researchers in collaboration with colleagues at Oxford University and the London School of Economics and backed by the Economic and Social Research Council.

The work shows that the most innovative firms are characterised by good interdepartmental co-ordination and communication.

Only 10 per cent of firms were rated by the researchers as "moderate" to "very high" innovators. Professor West said: "Many more managers must find the courage to apply the rhetoric of innovation and enlightened practice in the face of fierce competition in the future."

This will mean constantly reviewing strategies for innovation, supporting new ideas from anywhere in their companies and encouraging effective communication and teamwork.

The study involved a postal survey last year of 230 directors and senior managers from 170 United Kingdom manufacturers. The firms ranged in size from 60 to nearly 2,000 employees and represented sectors such as engineering, electronics, plastics, rubber and food and drink.