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Product Customization |
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Saxenian describes how Silicon Valley firms realized that their competitive angle was in product customization. They came to understand during the 1980's, that they were no match for the Japanese commodity semiconductor makers (who efficiently made generic, wide-application devices). With a flourish of new start-ups, Silicon Valley turned its attention toward the growing custom and semi-custom markets that were demanding specialized, design-intensive, high value-added semiconductors.
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A wide range of consumer and industrial products were all being renewed with the integration of semiconductor technology. Silicon Valley was at the center of this renaissance. Instead of pursuing scale economies to reduce unit manufacturing costs, Silicon Valley firms succeeded by pursuing market share with a continuing stream of new and unique devices. (Competing in terms of quality and diversity, not low cost).
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Saxenian, Annalee. Regional Advantage: Culture and Competition in Silicon Valley and Route 128. Harvard University Press. Cambridge, MA. 1994.
This is a fascinating examination of how a region's industrial culture can provide significant competitive advantages to that region's companies. By comparing and contrasting the differences between how business works on Route 128 in Massachusetts, and in Silicon Valley in California, Saxenian reveals why Silicon Valley has become synonymous with high technology, and why few people have even heard about Route 128. A detailed examination of the two models introduces readers to the innovative practices which have lead to many of Silicon Valley's innovations. Regional Advantage is a treasure chest for executives keen on improving their external relations with suppliers, subcontractors, customers and even their competitors.
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