INNOVATION AND CHANGING ‘WORLDS OF PRODUCTION’ CASE-STUDIES OF NORWEGIAN DAIRIES

Structural change in the food processing industry in many Western countries has resulted in concentration in administration, in ownership and in the production structure. For many local communities, structural rationalization and plant closure mean less business activity, reduced employment and tax income, as well as loss of know-how in agricultural food processing and distribution. This development has given rise to a debate about how to maintain the creation of local added value in the food sector. Hence, how can firms or local plants strengthen innovation as a competitive strategy within the food processing industry? Researchers from various disciplines are dealing with questions about innovation, local development and competitive strategies. There is a continuum in science between abstract theories and the real world. Theories can be too abstract for applicability, while empirical research can be too close and too specific to the empirical world so there will be little principal knowledge to transfer to other cases. Theories at the meso-level, like conceptions of innovation systems, clusters and localized learning may have better applicability, but there is a need for more research to test such models empirically (Mariussen, 2001). The aim of this paper is to contribute empirically to this need in order to give a better understanding of innovation processes in firms. This can give some implications for practical development and theoretical research as well. More specifically, the purpose of this paper is to identify and discuss problems and important factors in processes of innovation in local dairies. What happens when a firm tries to act in a new way? How do they make progress in the process of innovation? The terms ‘local dairy’, ‘plant ’ and ‘firm ’ are applied synonymously in this paper referring to the unit o