Architectural Innovations - Article Example

Running header: Architectural innovations Student’s name: Name of institution: Instructor’s name: Course code: Date of submission: Architectural innovations The name of the article is architectural innovation. This article is written by Rebecca M. Henderson from the institute of technology of Massachusetts and Kim B. Clark from Harvard University. The article was written in 1990 and it is the 35th volume, issue number one of the administrative science quarterly. The subject of the article is redesigning the existing technologies on products and the effects of architectural innovation on established firms. The article shows that categorization of innovation into two; radical or incremental is incomplete and it does not involve the disastrous effects of minor improvements in the product technology in current firms. Henderson and Clark introduce a model which addresses the changes in innovation by incorporating two more types of innovation which are architectural and modular innovations. The writers’ main focus is the architectural innovation that changes product’s architecture without changing the core design concepts and components of the product. The articles also describe the evolution of the architectural knowledge where the main focus is on channels of communication, information filters and the strategies for solving problems in architectural knowledge management. Finally, the article focuses on the challenges resulting to implementation of architectural innovation especially on the established firms (Henderson & Clark, 1990). Learning points The article describes the types of innovation and their application in the industries focusing on how they change the product. It also describes the importance of innovation architecture in product development, the disastrous effects of architecture innovation in existing industries, and factors affecting the implementation of architectural innovation. Incremental innovation introduces minor changes to the design, exploits the established design’s potential, and it maintains and reinforces the dominance of existing firms. It does not provide new science but it requires skills and poses very significant consequences on the firm’s economy over time. Radical innovation employs various scientific and engineering principles and gives way to potential applications and new markets. It makes it difficult for the established firms. These two innovations require various organization capabilities hence, providing different competitive consequences. In order to make the innovation complete, the writers added two more types of innovation which are modular and architectural innovation. The modular innovation changes the concept of core design only without changing the architecture of the product. Architectural innovation is our main concern and it changes the architecture of the product while leaving the concepts of core design and the components unchanged. This innovation shows the relationship between the component and the architectural knowledge. The architectural innovation disrupts the established organizations as they find it expensive to adopt the existing plant with the new knowledge and at the same time, changing their strategies, communication channels and information filtering to adapt to the management of architectural knowledge. This leads to heavy investment due to their implanted architectural knowledge. However, the new firms find it easier to apply the architectural innovation because they not contain any partial irrelevant knowledge in architecture (Albers & Brewer, 2003). The words that keep repeating in this article include architectural innovation, architectural knowledge, component, the core design concepts, and product’s architecture. Architectural innovation the changes in the architecture of the product while maintaining its core design and components. Components are the basic parts that were incorporated to form that product while the core design concepts involve the original or the basic knowledge of the product. Architecture of the product is designing, engineering and manufacturing of product by an organization. Architectural knowledge involves the new knowledge on product development devised in order to upgrade the quality of an existing product (Henderson & Clark, 1990). Relevant statements Innovation is “the use of new knowledge to offer a new product or service that customers want” Afuah, 2003:13. From this statement, every organization aims at making profit which is enhanced through production of the best products as compared to its competitors. In order to do this, the organization has to differentiate its products from other competitors in order to win more customers and in turn make more profit. This requires application of new knowledge within the organization to modify the existing product to be more appealing to the customers and on the other hand to generate more profit. Profit will occur if the firm will offer the products in a cost that is lower than its rivals or making the same product different from others in a way that it attracts the customers. This requires innovation of the product to abide to advancement in technology and to maintain its competitive advantage. ‘The essence of architectural innovation is the reconfiguration of an established system to link together existing components in a new way’ Henderson, & Clark, 1990: 4. Architectural innovation redesigns the existing components to come up with a new look. The main aim of reconfiguration of the product is to enable the organization to maintain or increase its market in order to make more profit. In order to reduce additional expenditures the primary components of the products will remain the same but the outcome will be a different architecture of the product. This will in turn lead to addition of very few expenses to produce a very competitive, upgraded product which even if the product price will increase the customers will be maintained or increased due to the quality of the product. The two statements are directed towards the importance of innovation which requires the firm’s commitment to integrate its internal resources effectively with in order to maintain and increase a competitive advantage. They also focuses on the move made by the firm to employ new knowledge in the redesigning its products in order to achieve the satisfaction of its customers. If through innovation the firm satisfies its customers, it will in turn lead to maintaining of the firm’s long-term profitability (Henderson & Clark, 1990). Critical analysis In any business context, there must be competition where the entrepreneurs fight to win the customer’s satisfaction and increasing and maintaining the profitability of the business. Also, in order to give the customers the best products equivalent to their money, there must always be competition in any field. This means that, the entrepreneurs will be faced by challenges of maintaining their business. This requires continuous redesigning of their products to remain in the market. However, the already existing entrepreneurs sometimes fail to identify a specific innovation as architectural because this typed of innovation fits well in old framework at the begging but later fails. These entrepreneurs also fail to effectively apply the new architectural knowledge. This is because the architectural knowledge may be in a context where part of old knowledge in architecture may be relevant. Also these entrepreneurs find it difficult to change one learning mode to the other. This will result from heavy investments in new innovation viewing it as incremental of the current technology with underestimating of the impact of incremental technology in the implanted architectural knowledge of the entrepreneur. This leads to more expense with little understanding of the architectural knowledge which paves way for the new entrepreneurs who do not have partial and implanted irrelevant knowledge in architecture. This makes the new entrepreneurs succeed first by introducing redesigned products thus, winning their market and leading to collapse of others business. This provides the best understanding on why the organizations that invents certain products end up losing their customers to new markets of the same product with little improvements done according to technological advances (Henderson & Clark, 1990). To overcome this, an organization will have to change its orientation from stable architecture refinement to search for new solution in a context that is constantly changing. This will help them abandoned the old architectural knowledge in a faster and easier way in order to maintain their markets. Practical implications One of the principles for entrepreneurship that I can apply from reading the article is being decisive. As a leader in any organization, you have to make decisions on what needs to be done in order to adapt the innovation architecture. This will help in application of the architectural knowledge in redesigning the products without underestimating the old knowledge in architecture thus, the organization will achieve configuration in a faster and effective way before interference of the new entrants. This increases the profitability of the organization and also prevents collapsing of the organization due to competition from rival organizations. Another principle involves understanding the work where by being a constant learner and moving with the changing technologies, as a manager, I will be able to point out any innovation required before the competitors thus, maintaining the profitability (Dash, R. (2007). Learning reflections The article explains that the traditional innovation categorization into radical and incremental innovation only is not complete as it the two does not incorporate the minor improvements due to changes in technology of products. The article introduces two other types of innovations which are modulator and architectural. The article specializes on architectural innovation which takes into consideration the changes in the architecture without affecting the concepts of the core design and the components. Understanding of the architectural knowledge is very essential as lack of its understanding poses challenges in established firms. Lack of proper incorporation and adoption of architectural knowledge in established firms exposes them to failure as the new entrants effectively adopt the knowledge and secure their market places. As an explanation of the disastrous effects of architectural innovation, the article provides different companies which have been overtaken by new entrants due to lack of adequate architectural knowledge with an aim of performing minor improvements in the products to move with the changing technology (Henderson & Clark, 1990). References Albers, J. A. & Brewer, S. (2003). Knowledge Management and the Innovation Process: The Eco-Innovation Model, Journal of Knowledge Management Practice pp. 1-20. Dash, R. (2007). 11 Principles of Entrepreneurial Leadership. Retrieved on 28th February 2012 from: http://4entrepreneur.net/2007/09/19/11-principles-of-entrepreneurial-leadership/ Henderson, R. M & Clark, K. B. (1990) Architectural Innovation: The Reconfiguration of Existing, Administrative Science Quarterly, (35)1, pp. 9. Read More