William J. Abernathy

A dynamic model of process and product innovation

This article reports results from empirical tests of relationships between the pattern of innovation within a firm and certain of the firms characteristics: the stage of development of its production process and its chosen basis of competition. The hypothesized relationships posed for the present investigation are a synthesis of prior research by the present authors on two distinct but complementary conceptual models of innovation, concerning respectively: the relationship between competitive strategy and innovation, and the relationship between production process characteristics and innovation. The empirical investigation is carried out with data available from the Myers and Marquis study of successful technological innovation in five different industry segments. The essential aspects of the hypothesized relationships are that the characteristics of the innovative process will systematically correspond with the stage of development exhibited by the firms production process technology and with its strategy for competition and growth. As a more specific example these relationships predict that there will be coherent patterns in the stimuli for innovation (market, production or new technology); in the types of innovation (product or process, original or adopted, etc.) and in barriers to innovation. The presently reported statistical evidence is decidedly favorable to the hypothesized relationships, even though the adaptations needed to implement tests with existing data introduce dependencies that limit conclusions which would otherwise be warranted. The broad implication is that strong and important relationships exist among the capability of a firm to innovate, its competitive strategy and the posture of its production resources.

Innovation: Mapping the winds of creative destruction☆

This paper develops a framework for analyzing the competitive implications of innovation. The framework is based on the concept of transilience the capacity of an innovation to influence the established systems of production and marketing. Application of the concept results in a categorization of innovation into four types. Examples from the technical history of the US auto industry are used to illustrate the concepts and their applicability. The analysis shows that the categories of innovation are closely linked to different patterns of evolution and to different managerial environments. Special emphasis is placed on the role of incremental technical change in shaping competition and on the possibilities for a technology based reversal in the process of industrial maturity.

Technology, productivity and process change

Abstract A descriptive model of process evolution is proposed as a new basis for clarifying the relationships among technological innovation and productivity improvement within an organization. As a production process develops over time it does so with a characteristic pattern: process flows become more rational, tasks more specific, processes more capital intensive, product designs more standardized, etc. As this development continues over time the overall nature of a process is significantly altered and various stages of development can be noted that are similar in different industries and sectors. These stages have important implications for research on technological innovation and productivity improvement from a managerial and policy perspective. The paper explores the nature of this process evolution, the sources that stimulate this evolution, and several implications for research on technological innovation and productivity improvement.

The climate for innovation in industry: The role of management attitudes and practices in consumer electronics

Abstract This article explores policy factors that may have systematically influenced the innovative vitality of the U.S. consumer electronics industry during the post World War II period. A series of successful innovations in electronic equipment that have become the foundation of international rivalry in this industry are examined with a focus on the several factors that might explain the relatively sluggish performance of U.S. firms in comparison with counterparts from Japan and elsewhere. The article suggests that the institutional climate for innovation, pertaining to considerations that are internal to the firm like management attitudes, practices and conventions, are predominantly important in explaining the innovative behavior of the industry. These tend to dominate the more frequently cited external or macroeconomic factors like inflation, industry structure, government regulation, the propensities to save and invest, etc. A great potential for improving economic progress lies in opportunities in research and education to provide a better basis for top executives to understand the key role of technology in management and corporate strategy.

Parallel and sequential R&D strategies: Application of a simple model

It is common in technological development to identify and explore several approaches to a particular objective so that the best approach may be chosen. The outcome of any approach is uncertain; hence, it is difficult to choose the best one at an early date. To deal with this uncertainty, two or more approaches to the objective may be continued in parallel until a clear choice between them can be made, i.e., a parallel strategy. Such a strategy can provide better information for a decision, maintain options, or hedge against the occurrence of an unsatisfactory outcome. This paper addresses the managers problem of deciding when to use or continue a parallel strategy. The principal focus is based on studies of 14 projects and illustrates the application, in one setting, of a general model appropriate to the structure of the decision as it is widely faced in practice. It discusses the information requirements for a sound choice between parallel and sequential strategies and the consequences of choosing a strategy on the basis of incomplete information.

Relearning from the old masters: Lessons of the American System of Manufacturing

Abstract Nineteenth and early twentieth century America witnessed the development of a spectacularly successful manufacturing infrastructure that propelled the United States into the forefront of the worlds economic powers. The “American System of Manufacturing, ” a term once used exclusively by historians to describe the progress of the firearms and other light metalworking industries in early nineteenth century New England, has been recast in this paper to describe the advances in management practice, work force attitudes, and process technology that characterized American industry from 1800 through the 1930s. The managers responsible for building the American System of Manufacturing addressed themselves to the extraordinary opportunities made possible in their day by an unprecedented season of technological ferment. Their insights and managerial responses, which are the focus of this paper, led to the establishment of product quality and reliability, and excellence in technology-driven manufacturing, as the cornerstones of American industry. The comfortable maturity into which American industry drifted during the 1950s and 1960s disrupted the evolutionary progress of the American System. Confident that the age-old “problem of production” was firmly in check, American managers redirected their efforts away from the shop floor and towards marketing and finance. The ensuing absence of innovation in product and process innovation, and in the management of the work force, created a competitive vacuum that has been exploited by aggressive foreign producers. The heightened challenge to Americas basic industries posed by these foreign competitors has induced lengthy debate among academics, industry officials, and practicing managers, concerning the steps that need to be taken to redress Americas declining industrial capacity. Our contribution to this re-examination has two objectives. First, we will attempt both to categorize the types of management issues and production problems that since 1800 have confronted American managers, and to identify the practical responses these issues elicited. Second, we will combine the insight garnered from our historical examination with our knowledge of contemporary management issues to detail the lessons of the American System and to identify areas in the realm of production and operations management where change is most needed. Our inquiry has revealed that changes in the character of American industry occurred as workers and managers instituted new approaches to better manage technology. The succession began with the concept of manufacturing as a sequential flow process. Later, this basic notion was expanded as managers used advances in both process and product technology to provide for the competitive continuity of their firms. The rapid pace of technological diffusion in nineteenth century America not only fostered the growth of external, technology-based suppliers, but also complicated the task of production management by requiring firms to coordinate their internal resources with the actions of suppliers. This change necessitated, of course, that managers keep abreast of a bewildering array of changes in production and process technology. The management developments that emerged in response to the appearance of technology-oriented suppliers were the most advanced expressions of American manufacturing at the end of the nineteenth century. These advances are of interest to us for yet another reason, however, because the existence of a skilled manufacturing infrastructure helped prepare the ground for the first generation of automobile manufacturing. Although the first car producers were by and large assemblers who put together in rented shops components supplied by others, their efforts rested on a, by then, well-developed and widely diffused competence in manufacturing. Only because a host of other non-automotive shops and companies had mastered the full range of skills, technical and organizational, pioneered during the nineteenth century, could the first generation of work on automobiles proceed. Driven by the scale economies associated with capital-intensive, high-volume operations, relationships between auto producers and suppliers shifted in focus and emphasis as the car industry matured. In particular, the growing requirements of specialization and coordination in the auto industry demanded an increasingly bureaucratic form of organization and, by extension, the development of managerial skills appropriate to that form. The mastery of a genuine “flow” system of production at high-volume levels defined the organizational competence on which would rest the great manufacturing achievements of twentieth century American industry. With the development of a dominant product design and the production base responsible for building it, American industry had by the outbreak of World War II achieved unquestioned dominance in the work of manufacturing. Or had it? Industry certainly thought so for the post-war decades were to see a redirection of effort away from production management. The search for greener managerial pastures left untapped, however, the potential to be reached by diligent and relentless concentration on the work of production, and obscured gains attainable from better training and utilization of the work force. The task now facing American producers in a hotly contested global struggle for industrial ascendancy is to begin to understand and to extend the lessons that emerge from their now dormant industrial heritage.

Honda motor company's CVCC engine

Honda Motor Company of Japan in a four-year period from 1968 to 1872 designed, tested, and mass-produced a stratified charge engine, the CVCC, which in comparison to conventional engines of similar output at the time was lower in CO, HC and NO/sub x/ emissions and higher in fuel economy. Honda developed the CVCC engine without government assistance or outside help. Hondas success came at a time when steadily increasing fuel costs and the various provisions of the Clean Air Act had forced US automakers to consider possible alternatives to the conventional gasoline engine. While most major engine manufacturers had investigated some form of stratified charge engine, Hondas CVCC was the only one to find successful market application. This case study examines the circumstances surrounding the development of the CVCC engine and its introduction into the Japanese and American markets.