Architectural Innovation: The Reconfiguration of Existing Product Technologies and the Failure of Established Firms
Architecturai Innovation: The Reconfiguration of Existing Product Technologies and the Failure of Established Firms Rebecca M. Henderson
Massachusetts Institute of Technology
Kim B. Clark
Harvard University
This paper demonstrates that the traditional categorization of innovation as either incremental or radical is incomplete and potentially misleading and does not account for the sometimes disastrous effects on industry incumbents of seemingly minor improvements in technological products. We examine such innovations more closely and, distinguishing between the components of a product and the ways they are integrated into the system that is the product "architecture," define them as innovations that change the architecture of a product without changing its components. We show that architectural innovations destroy the usefulness of the architectural knowledge of established firms, and that since architectural knowledge tends to become embedded in the structure and information-processing procedures of established organizations, this destruction is difficult for firms to recognize and hard to correct. Architectural innovation therefore presents established organizations with subtle challenges that may have significant competitive implications. We illustrate the concept's explanatory force through an empirical study of the semiconductor photolithographic alignment equipment industry, which has experienced a number of architectural innovations.*
© 1990 by Cornell University. 0001-8392/90/3501-0009/$1,00.
The distinction between refining and improving an existing design and introducing a new concept that departs in a significant way from past practice is one of the centra! notions in the existing literature on technical innovation (Mansfield, 1968; Moch and Morse, 1977; Freeman, 1982). Incremental innovation introduces relatively minor changes to the existing product, exploits the potential of the established design, and often reinforces the dominance of established
Massachusetts Institute of Technology
Kim B. Clark
Harvard University
This paper demonstrates that the traditional categorization of innovation as either incremental or radical is incomplete and potentially misleading and does not account for the sometimes disastrous effects on industry incumbents of seemingly minor improvements in technological products. We examine such innovations more closely and, distinguishing between the components of a product and the ways they are integrated into the system that is the product "architecture," define them as innovations that change the architecture of a product without changing its components. We show that architectural innovations destroy the usefulness of the architectural knowledge of established firms, and that since architectural knowledge tends to become embedded in the structure and information-processing procedures of established organizations, this destruction is difficult for firms to recognize and hard to correct. Architectural innovation therefore presents established organizations with subtle challenges that may have significant competitive implications. We illustrate the concept's explanatory force through an empirical study of the semiconductor photolithographic alignment equipment industry, which has experienced a number of architectural innovations.*
© 1990 by Cornell University. 0001-8392/90/3501-0009/$1,00.
The distinction between refining and improving an existing design and introducing a new concept that departs in a significant way from past practice is one of the centra! notions in the existing literature on technical innovation (Mansfield, 1968; Moch and Morse, 1977; Freeman, 1982). Incremental innovation introduces relatively minor changes to the existing product, exploits the potential of the established design, and often reinforces the dominance of established