Most tail companies are not zombies, overburdened by an insurmountable mountain of debt or a broken business model. Rather they are companies surviving, but not yet thriving. And they account for fully 80-90% of all jobs. They are not the tail; they are the dog. If you restricted creative destruction to true zombie – those whose productivity was negative – this would make little arithmetic difference to average productivity, raising it by perhaps 1%. 55  A more creative solution to the long tail problem would be to build a stronger diffusion infrastructure – that is to say, creating some stronger and longer diffusion spokes to attach to the UK’s strong innovation hub. Let  54 55  Schumpeter (1942). Assumes workers with negative productivity flow into firms with zero productivity. 20  All speeches are available online at www.bankofengland.co.uk/speeches  20  me discuss three approaches for creating those institutional spokes. All three are already underway, to some extent. Once in place, they could speed-up the process of technological trickle-down to the long tail. (a) Supporting Supply Chains  Recent years have seen a lengthening and deepening of supply chains, nationally and internationally. 56  The  largest UK companies have direct supply chain links with several thousand other companies, large and small, national and international. As well as benefitting efficiency and lowering costs, these supply chains provide a natural infrastructure that could be harnessed to spread good practice across companies.
Some companies already actively support firms in their supply chain to help improve their productivity, the fruits of which can then be shared. A set of structured projects are underway nationally, co-ordinated by Be the Business, which aim to use the supply chain infrastructure to disseminate knowledge and best practice across companies in the long tail. As another example, I recently visited a company which had invested in a new technology centre. This enabled them to simulate all of the processes and products in their complex business. They had created, in effect, a “digital twin” of their business. This technology allowed them to evaluate the impact of potentially productivity-improving changes to their business model, cheaply and quickly. Indeed, it was being used in just this way to drive through those changes. Once established, this digital twinning technology can be applied to any business, large or small, simple or complex. Indeed the company I visited was doing just that, inviting in companies from their supply chain to help them understand and improve their business productivity-wise, in a way which benefitted both sides. If that digital twinning model could be introduced across greater numbers of companies and lengthier supply chains, it could serve as a very effective diffusion engine for innovation. One way of doing so, recently proposed by academic and inventor Philip Bond, would be to create a central digital-twinning infrastructure that could be available to any company across the UK.