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The Benefits Of Radical Inovation In ‘Architectural Innovation'

636 words - 3 pages

This review focuses on the research paper ‘Architectural Innovation: The Reconfiguration of Existing Product Technologies and the Failure of Established Firms’ (Henderson and Clark, 1990). Radical and incremental innovations have long been the corner stone of which firms base their knowledge of technological innovations. However, the research paper serves to shed light on one of the less evident forms of innovation – Architectural Innovation. Architectural innovations are, as defined by Henderson and Clark, an innovation that change the way in which components of a product are linked together, while leaving the core design concepts untouched (Pg. 1, Para 5). In other words, architectural innovation destroys the usefulness of a firm’s architectural knowledge, but preserves the usefulness of its knowledge about individual product components. The paper argues that the inability of firms to identify and recognise new interactions between components has serious competitive consequences. The argument is exemplified in the photolithographic industry, where one after another, firms lost their market share due to a seemingly minor incremental improvement made to the product, which was in fact architectural innovation, as identified by Henderson and Clark.

In the paper, the authors provided strong evidences to exemplify the competitive consequences of architectural innovation. Using the photolithographic industry, the authors presented the frequent changes in market leadership throughout the history of this industry due to a seemingly minor innovation by new firms. These events effectively illustrated the importance of identifying and responding to this less apparent form of innovation. Regardless of whether a new firm or established one, the failure to identify architectural innovation by rivals will result in a shakeout process where the less competitive firm will be eliminated.

Despite the strength of evidence provided, there is a tendency to favor new entrants as opposed to established firms. The authors state that new entrants are able to exploit the potential of architectural innovation more effectively....

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