Organizational Inertia and Competitive Decline: The British Cotton, Shipbuilding and Car Industries, 1945–1975

This article attributes the declining competitiveness of the British cotton, shipbuilding and car industries between 1945 and 1975 to employers' slow and imperfect adoption of more bureaucratic methods of work administration. An explanation is developed for British employers' excess inertia. First, I maintain that the interdependent nature of British employers' decision making on matters of training and work organization tended to 'lock-in' individual firms to a particular configuration. Secondly, I show how the uncertainty perceived by the majority of producers over the need for reform prevented more progressive minorities from using collective employers' associations to coordinated a timely switch to more bureaucratic methods. Thirdly, I argue that once these obstacles were overcome the process of achieving organizational reform was slowed or even blocked by a lack of trust between labor and management. While the idea that trust may play a role in successful administrative innovation has received some attention in the literature on organizational behavior, there has been little effort, as in this paper, to integrate this idea into an explanation involving uncertainty and interdependent decision making. The essay aims to persuade the reader that this eclectic approach holds unexplored promise for addressing problems of administrative innovation.