Integrating Quebec SMEs Into Production Networks: A Spur to Competitiveness

By cooperating in production networks to play an important role in the global value chains of multinationals, smaller manufacturing firms in Quebec can successfully confront the challenges posed by globalization.

Document Highlights

The trend toward a world market for labour, capital, goods, and services, coupled with the breakdown of vertical integration among multinational corporations (MNCs), is leading to vast transformations. Firms that were formerly stable and competitive have had to evolve or disappear. Through a literature review and interviews with participants in various industry sectors in Quebec, this report shows how small and medium-sized enterprises (SMEs) can work together to play an important role in the global value chains of MNCs through integrated production networks. The findings point to a number of factors behind successful networks: the presence of world-class MNCs to provide access to large markets and knowledge; close lateral relations between SMEs to share information about markets and technology; forums for communication between MNCs and SMEs; forums for collaboration between industry and academic institutions; SMEs willing to foster innovation by hiring highly trained people; and government cooperation to ensure, for example, appropriate transportation, communications, and financial infrastructure.