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Abstract

The opening of the Brazilian computer market to foreign enterprises and trade in 1992 presented a unique challenge to the technologically dynamic national banking automation (BA) industry. National BA firms' responses varied in relation to their size and dependence on this market segment. Despite the weight of new entrants (such as A T& T and Olivetti), the segment's leader preserved its competitive position. This paper explores how this small, national banking automation firm reoriented its hitherto successful flexible and cooperative technological strategy to face these competitive challenges. It briefly examines the firm's innovative strategy in the protected market environment. It also discusses the firm's strategic responses to the new environment and the corresponding changes in its corporate innovation process. It explores the constraints imposed on a long-term technological learning process by such reorientation. The concluding section examines the normative strategic impli cations for similar firms and sectors in developing countries, and suggests the need for innovative and flexible cooperative socio-institutional arrangements to make up for the diminished edge in technological innovation brought about by responses to liberalisation.

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Meeting the Liberalisation Challenge: Technological Learning in the Brazilian Banking Automation Industry

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