Institutional diversity and modes of organization for advanced technology development: Evidence from the semiconductor industry

The research reported here sought to determine whether successful firms in a technologically dynamic industry have converged on a standard mode to organize their research and development activities, regardless of national context. It investigated the organizational drivers of success for advanced technology development in the global semiconductor industry.;The study developed a model that explains the observed differences between US and Japanese firms as divergent responses to mounting information-processing challenges in the technology development process. One strategy led US firms to centralize their knowledge-creation activities; another led Japanese firms to maintain and deepen their decentralizing approach. These choices were, in turn, conditioned by the national-institutional context in which the firms are embedded.;The study compiled and analyzed a database of technical-performance and organizational-practice measures covering a 15-year period from 1979 to 1994. The analysis revealed that while US firms had fallen substantially behind the leading Japanese firms by the mid-1980s, and many had exited the industry in the late 1980s, by the mid-1990s the remaining US firms had mostly regained lost ground. Analysis of the organizational database, however, revealed large differences between the practice of US and Japanese firms, on six dimensions. These gaps widened substantially in the 1990s.