Paper Review of "Architectural Innovation: the Reconfiguration of Existing Product Technologies and the Failure of Established Firms"

The paper introduces the category of “architectural innovation” on the basis that seemingly minor changes to technology which may earlier be classified as an incremental innovation can have competitive consequences of a radical one. The key concept is the distinction between component knowledge and architectural knowledge. The paper argues that firms concentrate on refining components within a stable architecture established by a dominant design, and consequently, their “information-processing capabilities” are shaped by the existing architecture. While building upon component knowledge, their architectural knowledge is outmoded and made obsolete by architectural innovations. Their resulting inability to identify or understand new interactions between components has serious competitive consequences.
The conceptual framework of the paper is clear and straightforward. The main argument is advanced in a logical manner, and supporting premises (such as the way organizations manage knowledge) are supported by prior literature. Within the boundaries of the paper’s assumptions, the argument is persuasive. Furthermore, the application to the photolithographic alignment (PA) equipment industry justifies the model. The trends in the industry suggest the conceptual framework is largely accurate.
Nonetheless, the assumptions made limit the usefulness of the concept. Firstly, the analysis of firms’ information-processing is restricted to communication channels, information filtering and problem-solving strategies, ignoring other institutions, such as “cross-functional” product development teams, that organizations may have. Given that these may have profound impact on the development of architectural knowledge, the model cannot be applied to firms with such institutions. Secondly, assumptions of firms’ behaviours are based strictly on the Abernathy-Utterback model. As evident in the fact that some firms are able to introduce architectural innovations, not all firms focus