The purpose of this book is to present a theory of technical systems that can help us better understand the demands technology places on organizations. New technologies in general require new patterns of activity and reward some patterns over others. Quoting Brian Arthur:"When a novel technology...

The purpose of this chapter is to describe the complementary elements of a logistical platform and show how they can work together to deliver a high ROIC. A secondary purpose of the chapter is to illustrate the power and limitations of a strategy of value capture based exclusively on ROIC.I use...

The purpose of this chapter is to understand how technology contributed to the emergence and evolution of modular production networks between 1980 and the present. In a modular production network, the activities needed to create a functioning system (for example, a personal computer) are...

The purpose of this chapter is to examine the value structure of flow production processes and to explain why it is necessary to rationalize flow processes using the tools of systematic management. I first explain the problems facing managers of multi-step flow production processes at the end of...

The purpose of this chapter is to explain what the technologies of flow production with bottlenecks require and reward in organizations. I argue that the organizations best suited to implementing these technologies are vertically integrated spanning all potential bottlenecks. They are subject to...

Spurred by the success of the IBM PC, in the early 1980s, a new form of organization—the digital platform ecosystem—became common in all industries that used digital technology. Digital platform ecosystems were vertically distintegrated organizations, characterized by distributed governance,...

Moore’s Law is the prediction that transistor densities of semiconductor chips will double, speeds double, and prices drop by half approximately every eighteen months to two years. The Law lies at the heart of the high rates of technical change observed in the computer, communication and...

Many products are manufactured in networks of firms linked by transactions, but comparatively little is known about how or why such transaction networks differ. This paper investigates the transaction networks of two large sectors in Japan at a single point in time. In characterizing these...

The purpose of this book is to present a theory of technical systems that can help us better understand the demands technology places on organizations. New technologies in general require new patterns of activity and reward some patterns over others. Quoting Brian Arthur:"When a novel technology...