Most developing countries are now operating in a new, more open, trading climate and this is forcing their industries to cope with global competitors. To do so effectively requires new forms of organisation, both within and between firms. Research shows that the techniques that have transformed industry in Japan and other industrially advanced countries can be applied successfully even in countries where levels of education and technology are much lower. Governments need to recognise the challenge that firms face, and can assist them to restructure by encouraging innovation and providing a favourable policy environment. But there are no easy blueprints to follow – and the penalties for failing to adapt will be severe.
