Design Rules: The Power of Modularity, Volume 1

  • 9h 6m
  • Carliss Y. Baldwin, Kim B. Clark
  • The MIT Press
  • 2000

We live in a dynamic economic and commercial world, surrounded by objects of remarkable complexity and power. In many industries, changes in products and technologies have brought with them new kinds of firms and forms of organization. We are discovering new ways of structuring work of bringing buyers and sellers together, and of creating and using market information. Although our fast-moving economy often seems to be outside our influence or control, human beings create the things that create the market forces. Devices, software programs, production processes, contracts, firms, and markets are all the fruit of purposeful action: they are designed.

Using the computer industry as an example, Carliss Y. Baldwin and Kim B. Clark develop a powerful theory of design and industrial evolution. They argue that the industry has experienced previously unimaginable levels of innovation and growth because it embraced the concept of modularity, building complex products from smaller subsystems that can be designed independently yet function together as a whole. Modularity freed designers to experiment with different approaches, as long as they obeyed the established design rules. Drawing on the literatures of industrial organization, real options, and computer architecture, the authors provide insight into the forces of change that drive today's economy.

About the Authors

Carliss Y. Baldwin is Senior Associate Dean and William White Professor of Business Administration, and Kim B. Clark is Dean of the Faculty and Harry E. Figgie, Jr., Professor of Business Administration, both at Harvard Business School.

In this Book

  • Introduction: Artifacts, Designs, and the Structure of Industries
  • The Microstructure of Designs
  • What Is Modularity?
  • The Economic System Surrounding Artifacts and Designs
  • The Modular Operators
  • The Origins of Modularity in Early Computer Designs
  • Creating System/360, the First Modular Computer Family
  • Enterprise Design: A Task Structure plus a Contract Structure
  • Design Options and Design Evolution
  • The Value of Modularity-Splitting and Substitution
  • All Modules Are Not Created Equal
  • The Value of Augmenting and Excluding
  • The Value of Inverting and Porting
  • The Emergence of Modular Clusters
  • Competition among Hidden Modules and Industry Evolution
  • Afterword
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