Authority in the Age of Modularity
AbstractThis paper builds upon on-going research into the organisational implications of 'modularity'. Advocates of modularity argue that the Invisible Hand of markets is reaching activities previously controlled through the Visible Hand of hierarchies. This paper argues that there are cognitive limits to the extent of division of labour: what kinds of problems firms solve, and how they solve them, set limits to the extent of division of labour, irrespective of the extent of the market. This paper analyses the cognitive limits to the division of labour relying on an in-depth case study of engineering design activities. On this basis, this paper explains why co-ordinating increasingly specialised bodies of knowledge, and increasingly distributed learning processes, requires the presence of knowledge integrating firms even in the presence of modular products. Such firms, relying on their wide in-house scientific and technological capabilities, have the 'authority' to identify, propose, and implement solutions to complex problems. In so doing, they co-ordinate networks of suppliers of both components and specialised competencies.
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Bibliographic InfoPaper provided by SPRU - Science and Technology Policy Research, University of Sussex in its series SPRU Working Paper Series with number 101.
Length: 25 pages
Date of creation: 01 Jun 2003
Date of revision:
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More information through EDIRC
modularity; division of labour limits; knowledge integrating firms;
Find related papers by JEL classification:
- L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
- O3 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-08-08 (All new papers)
- NEP-INO-2007-08-08 (Innovation)
- NEP-KNM-2007-08-08 (Knowledge Management & Knowledge Economy)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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