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No industries had greater impact on everyday life and work in the second half of the twentieth century than consumer electronics and computers. Yet the epic story of the founding of the Information Age remains almost completely unknown. Now Pulitzer Prize-winning historian Alfred D. Chandler Jr. systematically records for the first time from a global perspective the origins and evolution of these transforming industries. In this marvelous chronicle of the trailblazing high-technology companies and products that laid the foundation for the Electronic Century, Chandler shows with unerring command of fact and data precisely where, when, how, and by whom technical knowledge was initially commercialized.
In richly textured magisterial prose, Chandler describes how Radio Corporation of America shaped the consumer electronics industry from its beginnings in the 1920s to the 1960s. He explains how catastrophic management decisions that brought about the collapse of RCA opened the door to Sony and Matsushita and ultimately to Japan's worldwide conquest of consumer electronics markets. At the same time, Chandler shows that the computer industry has been a strikingly American triumph. Readers will discover a wealth of penetrating insights in Chandler's riveting account of the rise of the mainframe, the minicomputer, and the microprocessor. What is more, Chandler documents the surprising and little-known fact that first mover IBM dominated the computer industry from the 1950s to the 1990s and that the Japanese, first by making IBM plug-compatibles and later with their large systems and servers, became its major competitors.
Only by following the history of firms that commercialized these new technologies and knowing the details of competitive success and failure can managers truly understand their industries. Inventing the Electronic Century is timely and essential reading for every manager and student of high technology.
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By Jose Ernesto Passos (São Paulo, SP Brazil)
Alfred Chandler has organized the factual information of the key companies in the Consumer Electronics and Computer Industries during the second half of the XX century. The title of my review is a suggestion of another apropriate subtitle of this book.
The subject is very complex, specially if we look at the technology involved. My major comment is: the author has a limited technical knowledge and this has limited the depth of his analyses, comments and conclusions. This does not invalidate the major conclusions that he has presented in this book.
I think that it would be interesting to expand the story told in this book by studying/describing the evolution of the whole envinronment around these industries, including the engineering schools and research institutes that supply the brains to develop all the technology involved.
The history of the electronics industry carry an important lesson, about concentration of skills and economic power in only one company (RCA). It was a good thing, while RCA was leading, but when it started to make major strategic mistakes it brought down the whole American Industry. The Japanese Industry used several companies to compete against American and European Companies, this created a whole envinronment, that included engineering schools, research facilities, several different companies where one could make a career and different ideas being tested and pursued at the same time. When you look at the capacity of inovation and development of new technologies of the japanese companies and their envinronment they were a lot more competitive. They created a competitive envinronment so agressive in Japan that western rivals were later decimated by them.
The lesson hidden in the history of the electronics industry is very important, when we look at the industrial policy in America in other industries, like Automobiles, where there is only two American Manufacturers, it is easy to see why Japanese companies are doing much better, they are following the same type of competitive organization in this industry... Ford and GM are going in the same direction of RCA... This will raise a very important question, in what industries does America plans to remain competitive in the future??? This will determine the long term stability of the American Democracy.
One may criticize the quality of this book, but the history told in this book should be understood and deserves attention.
One aspect related to the industries studied that should be brought to attention is the availability of information about the japanese industry due to the language barrier.
By Howard Aldrich (Chapel Hill, NC USA)
In earlier books by Chandler that I liked very much, such as Strategy & Structure and The Visible Hand, historical narrative took precedence over facts and figures. Epic stories were told, and individual biography was subordinated to broader historical developments. In this book, I felt the balance tilted the other way: I found myself fighting to concentrate on the story, while wading through very specific details that I quickly forgot as I moved onto the next company history.
Chandler has certainly done his homework. In the Preface, he notes his limited technical knowledge of the consumer electronics and computer industries, but one would never guess that from the adept way he handles technical terms and explains the significance of various innovations. With many tables in the text and more in the appendix, Chandler convincingly documents his story.
It is a simple one: firms that came to dominate their industries did so by being first movers that established integrated learning bases, based on technical, functional or managerial knowledge. They thus gained economies of scale and scope (another concept that Chandler has contributed to the business history literature), obtained a critical head start, and successfully beat back most entrepreneurial startups. In consumer electronics, a handful of Japanese firms built on their initial advantages to not only dominate world markets but also to destroy domestic producers in the U.S. In computers, however, IBM built a lead it never relinquished, even though it was repeatedly challenged by European and Japanese firms.
Chandler noted, with obvious relish, that top executives in many firms engaged in short-sighted strategies that eventually brought them down. For example, RCA created many innovations that it licensed to the Japanese firms that ultimately destroyed it. Indeed, perhaps the major benefit of including so many detailed company histories is that they remind us of just how wrong so many excutives have been!
If you know little about the history of these two industries, Chandler's book will give you an excellent overview. If you are familiar with them, you can still appreciate Chandler's skill in conveying the international comparative context for their evolution in the 20th century. In his provocative conclusion, Chandler asks whether the Japanese firms, with their strong integrated learning bases and dominance of consumer electronics, will ultimately triumph in the struggle for control of the world's information technology industries.
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