British Journal of Political Science 39 (2009) pp449-482This article provides a new framework for understanding the differences and similarities in economic and political institutions across developing countries, and aims on going beyond the three perspectives of institutional variance that have dominated studies on this topic for many years:Modernization approach (1965), developing economies were modernizing industries however still dominated by pre-war practices to secure high growth rates.Neo-corporatism (1970), states were able to bargain with employers and movements about wages, working conditions etc. Mass production economies.Social system of production (1990), more attention to the behaviour of firms. Sectoral government, national innovation systems, new ways of production.Where the authors fundamental break with these approaches, is how behaviour is affected by the institutions of the political economy. Three frameworks that visualise these relationship:Institutions are socializing institutions that instill a particular set of attitudes and norms in those who operate within themThe effects of institutions follow from the power they confer to particular actors through sanctions the hierarchy supplies or resources it hasInstitutions of the political economy are a matrix of sanctions and incentives, where to actors react and respond predictable The firm is seen as an entity with ultimately relational capabilities, that need proper coordination to be effective and successful. The main relations a firm must coordinate are:Industrial relations, how to coordinate bargaining over working conditions of the labor forceVocational training and education, securing the workforce and investing in skillsCorporate governance, secure return on investmentInter-firm relations, relations with other enterprises...

Harvard Business Review jan/feb 1994, pp 77During the 1980s, manufacturing companies adopted improvement programs, to pursue the goal of superior manufacturing. Nevertheless, many of these programs failed. This is because simply improving manufacturing is not a strategy for manufacturing to achieve competitive advantage. The essence of competitive strategy are the skills and capabilities that enable a factory to excel and make it possible for these improvements programs to achieve their goal. The key to long term success is being able to do certain things better than your competitors, and these organizational capabilities are much more sustainable than something you can make or buy. By adopting improvement programs, or outsourcing projects the company is not encouraged to learn and develop capabilities. The theory of the focused factory, centered at a narrow set of tasks, enhances the development of skills, the creation of routines, competencies and better operating skills. The same with vertical integration and sourcing, organizations can forget how things are done. There is no learning potential anymore. Long-term success requires that a company continually seek new ways to differentiate itself from competitors, and transform their manufacturing organizations into sources of competitive advantages. Two important points to look after are:Start with the idea that the primary way manufacturing adds value to an enterprise is by enabling it to do certain things better than its competitors can. Grate manufacturing strategies are built on unique skills and capabilities, not on investments, systems or practices that can be easily imitated.The company has to develop a plan for building the capabilities it wants to acquire. Providing guidelines and programs for this, enables managers to be more focused on the tasks, which enables and enhances the development of these...