Annals of Business Administrative Science 8 (2009) 75–90
Available at www.gbrc.jp

Online ISSN 1347-4456 Print ISSN 1347-4464©2009 Global Business Research Center

Modularization, Design Optimization, and Design
Rationalization: A Case Study of Electronics Products

Tetsuo YOSHIMOTO
Faculty of Business Administration, Ritsumeikan University
Manufacturing Management Research Center, the University of Tokyo
E-mail: tyoshimo@ba.ritsumei.ac.jp

Abstract: The purpose of this paper is to provide a review of modularization by Japanese firms
on the basis of the analytical framework of product architecture. Japanese firms try to create
system control modules, and attempt the rationalization of the design. However, they always
design systems using the basic concept of integral type architecture. Modularization by
Japanese firms is not a random design. It is the result of a design strategy that simultaneously
achieves the optimization and rationalization of the product design.
This paper reviews the product modularization processes of Japanese firms based on theanalytical framework of product architecture theory. Basically, Japanese manufacturing firms
have created system control modules to achieve rational product designs. However,conceptually, the system was always designed as an integral type. We conclude that, toJapanese firms, modularization is not a random choice of design but is the result of design
strategies to simultaneously meet the optimization and rationalization of the product design.
Keywords: design optimization, design rationalization, design solutions, system control module

Introduction

firms have played a leading role in the productinnovation of these digital products. A product with

Manufacturers in newly industrialized economies

new concepts and the latest elemental technology is(NIEs) are catching up with Japanese firms in thegenerally thought to face difficulties in terms of

Asian region at an increasing pace. Digital products

commercialization and operation, especially if neither

such as LCD televisions and DVD players are typicalin-depth product knowledge nor technology is at

examples. It has been acknowledged that Japanesehand. However, recently, there have been cases in75

Yoshimoto

which firms with no technological capabilities have

manufacturers who strategically convert a product’s

designed successful products. The proliferation ofarchitecturetechnology and the catching-up of the NIE countries

modularization. Japanese manufacturers promote

are threatening Japanese firms. As a result, theproduct

first-mover advantage of Japanese manufacturers will

accept modularized products from the Japanese. A

be lost in a very short period.1

typical example of this is the electronics industry in

and

those

modularization.

who

passively

Chineseacceptmanufacturers

Asia.

An analytical research study based on the united
framework of product architecture theory has madeThis paper distinguishes product modularization

an attempt to illustrate the various inter-firmbased on the differences in a product’s “conceptual

relationships of these catch-up firms. Fujimoto andarchitecture” and “physical architecture.” Conceptual

Shintaku (2005) shed light on Chinese manufacturingarchitecture is the basic design concept chosen at thebusinesses that use the analytical framework ofdesign stage of production. Physical architecture is

product architecture.

how the final product is structured, that is, the patternof the physical embodiment in which the functional

Shintaku, Tatsumoto, Yoshimoto, Tomita, andand structural elements are shaped.

Park (2008) claim that the drivers of this businessphenomenon are the proliferation of technology at an

Developing modularization requires integrated

accelerated pace and the international division ofknowledge of the product’s system as a whole. We

labor. Product architecture theory expressively

should remember that modularization is the result of

explains the impact of modularization on industries

design efforts.

and manufacturers.

products with a dual nature: Conceptual architecture(basic design concept) is integral, but “physicalHowever, the answer to the question of who
initiated

modularization

is

not

Japanese manufacturers design

architecture” is modular. This has been presented inclear

comparison with Chinese manufacturers.

yet. Modularization did not occur by chance; it is thebyJapanese manufacturers basically design amanufacturers. Manufacturing firms in NIE countries

product system with highly integral characteristics tomerelyrealize differentiation. However, once the product isresultofdesignutilize

rationalizationtheoutcomeeffortsofdesignrationalization. We attach importance to the fact thatconceptualized,

there is a difference in the design capability ofmodularization. Focusing on product knowledge, the1

thesystem

is

prone

to

ability to achieve successful modularization is based
Akamatsu (1962) and Vernon (1966) claim that the
production of new products first begins in advanced
countries and is then transferred to low labor-costdeveloping countries. However, they do not mention theeffect of the proliferation of technology at an accelerating
pace. Sakakibara (2005) instituted the problem of theinnovator’s profitability.

on the design capability of highly integral systems.
It is generally acknowledged that Japanesemanufacturers strategically adopt an integral product76

Modularization, design optimization, and design rationalization

model with higher performance in order to hinder

Ulrich & Eppinger, 1995). The integral type shows

catch-up countries like China. However, as observed,

more complexity in corresponding patterns, and theJapanese manufacturers have competed with Chinese

modular type shows more simplicity. Integral typemanufacturers in the realm of modular products byarchitecture is composed of mutually adjusted

improving their product performance. For Japaneseparts. This type of architecture is chosen when thefirms, upgrading each module is not the answer: their

final product value and performance are higher. The

differentiation strategy is to tune up total systemcorresponding functional and structural elements are

performance. Even if physical architecture has turned

intricately related (a many-to-many correspondence

into the modular type, the product system will be

between functional and structural elements), and adesigned under the conceptual architecture of an

number of specific functional parts are used in the

integral type.

product. In modular type architecture, modules, inJapanese manufacturers try to achieve thewhich functional elements are attached to structural

optimization and rationalization of a product’s design

elements, are combined on a relatively simple

simultaneously. In order to do this, a “self-solution tointerface

the problem” is attempted by using digital control

functional and structural elements). The modular

technology. The performance of the entire system isdesignachieved by optimizing product design. In this case,simplicity. Once an interface is created, addressing

an integral type is selected as the product architecture

and attaching functional elements to the structural(basic design concept). At the same time, any error inelements in the “physical embodiment” are very

the entire system is replaced with the design solution

simple.

(one-to-one

conceptiscorrespondence

characterized

betweenby

thisfor a specific module (partial design solution) in order

Since architecture is an analytical concept thatto enhance rationalization. On the other hand,concerns the ways in which patterns can connect toChinese manufacturers procure worked-out systems

each other, the focus is on the fundamental design

as solutions, ex-post.

regardless of the subject. Therefore, architectural

This paper examines the case of color televisions

analysis allows classification across various different

in Asia.

industries and products.
Ideally, integral type and modular type patterns

1. Encapsulation of integral expertiseare abstract concepts that are difficult to observe in

1-1. Product architecture
Product

architecture

is

the

reality. We assume that these two ideal types are thebasicdesignofpolar points on a continuum. A specific type ofcorresponding patterns between functional andarchitecture can be placed at some point on the

structural elements (Fujimoto, 2008; Ulrich, 1995;

continuum and conceived of as belonging to either
77Yoshimototype by way of the degree of relativity (Fujimoto,products’ architecture in keeping with the market

2002; Oshika and Fujimoto, 2006).

demand, thus indicating that selected architecture

It is necessary to take into consideration thehierarchiesofasystemwhen

adopting

depends on the customers’ needs.

an

The technology and capabilities of eacharchitectural approach. Most products are systems

manufacturer are different. As a result, thethat consist of two or more types of architecture at thearchitecture that is selected or that can be selected

sub-system level. That is, different types ofdepends on the firm. Different manufacturers arearchitecture are combined into a hierarchicallikely to select different types of architecture for astructure. It is necessary to note which level ofsingle product in the same time period andhierarchy we are targeting when we analyze productplace/region. In general, the integral type is selectedarchitecture.

when

improvedat.

Differentiation

Product architecture theory does not evaluate
whether an industrial structure or corporate strategy is

performance
strategy

is

aimed

pushesproduct

architecture toward the integral type.

advantageous, either from a technical or an

Manufacturers select architecture under various

engineering point of view. The focus of architecture

conditions. Product architecture is strongly related totheory is to examine the dynamic profile of the

product development management and market

architecture (i.e., diversity and variability) and to

strategy decisions (Ulrich & Eppinger, 1995).

understand the live appearance of industrial structures
1-2. Good design and modularization

and business strategies.
The dynamic profile of an architecture is defined

In this chapter, we consider the relationship between

by various conditions (e.g., customer preference,

modularization and design theory. Suh (1990, 2001)

technology, organizational capability, etc.), which we

arguescall the “selection” problem of architecture. The

functional-structure model of products.

thataxiomaticdesignbuildsthedominant architecture will differ among identicalSuh distinguishes a good design from a bad one

industries and products according to the time periodon the basis of the principles of design. The principles

and place/region (Shintaku, 2007). For instance, with

provide guidance for evaluation and decision-making

regard to customers’ needs, if customers in a certain

in design processes. The design axioms provide

region prefer integral type architecture, it becomes

principles. Suh describes the two axioms necessary

the dominant architecture.

for a good design: the independence axiom and theinformation axiom.2

However, gradually in the same region, thecustomers’

choiceofarchitecturemay
2change. Accordingly, manufacturers change their78

Suh points out the following: There is no standard that
selects “good design.” The reason is that the decisions
taken behind creating a design are not good.

Modularization, design optimization, and design rationalization

In this paper, we focus on the independence
axiom.

Our

goal

is

to

considerproblem in coupled designs.

theUncoupled design is characterized by one-to-one

relationship between a good design and productcorrespondence between functional elements andarchitecture.3

designparameters.

However,

this

kind

of

relationship does not arise naturally in most

The independence axiom values one-to-one
mapping between functional requirements and design

designs.

parameters. Suh classifies design into uncouplednecessity. For instance, when a certain function isdesign,coupleddesignated to two or more design parameters, thedesign. Uncoupled design maintains an independent

designer will try to bundle them together in a group.

relationship between the function and design

Designers should recognize the very complex

decoupledparametersevendesign,

when

the

and

parameters

natureare

Designofeffortsbymodularization.

designers

Makingareaproduct

considersarchitecture modular requires prior product vision

uncoupled design to be a good design. Coupled(i.e., a basic type of thinking in terms ofdesign, on the other hand, is labeled as a bad design.

engineering). Effort must be put into resolving

When taking the axiomatic approach, designs

complexities (Baldwin & Clark, 2000). Clusteringchanged.

The

axiomatic

approachgoodmethods that use the design structure matrix (DSM)

designs. Coupled designs always bear the trade-off

and others form the module. In other words, these

problem. With uncoupled designs, however, thetechniques

trade-off problem is solved. In other words, anarchitecture.

withoutany

trade-offproblemsarearemethodologies

tomodularize

uncoupled-design solution is modularization. In the

Designers who encounter complexities in design

axiomatic approach, the modular-type design is arequirements are puzzled. They try to divide thegood design.

problem into individual pieces and find a solution for

Baldwin and Clark (2000) introduce a design

each piece. These partial design solutions are thenphilosophy to solve the interference between thebuild up again into a system, using design

parameters and the trade-off problems of complex

rules. Modularization is not a specific design

systems. They eliminate the interdependencies ofapproach. It is an economic approach to design thatfunctions. Therefore, by definition, architecture isapplies the principles of divide-and-rule. 4 The

strictly different from the modularization concept of

axiomatic approach and modularization have theUlrich (1995) and of this paper. However, both takesame intention, which is to help the engineer.

up the same issue, which is to solve the interference
4

3

Refer to Okuma and Fujimoto (2006) for axiomatic
design and product architecture.

79

The methodology of the analysis of functions, theresolution of functions, and the synthesis of partial
solutions is called “universal knowledge in design”; thishas been presented by Pahl and Beitz (1988).

Yoshimoto

The independence axiom and modularization,

When differentiation strategies are chosen,

according to the design theory, are concepts of goodsystems are often designed from scratch. In this case,design solutions.

modularization is difficult. Function coupling isclosely related to the acceptable range of the target

1-3. Rationalization and optimization

function (Suh, 1990, 2001). The tolerance ofProduct integration and systematization knowledge

functions is frequently open to compromise. However,(in-depth knowledge) are necessary to achieve

competition or market needs may not permit any

modularization (Aoshima & Nobeoka, 1997; Gu,

compromise. In cases where differentiation becomes2008). When functional requirements increase,

the important competitive factor, it is necessary tosystems get more complex. Therefore, when a narrowseek maximum performance. The complexity ofrange of design parameter is acceptable, the task

designbecomes harder.

compromises are tolerated.

increases

when

the

least

functional

It is not easy to achieve uncoupled design with

The trade-off problem in design occurs when themodular architecture. When a modular product (realcomplexity of design increases. When a coupledmachine) is dissolved into modules, we can see thatdesign cannot be avoided, an optimization method isthe function running at the level of each module isused (algorithmic, etc.). Coupled designs givevery sophisticated. As functional interdependencies

priority to functions. Less important functions are

between modules become weaker, the corresponding

considered to be constraints. The Pareto-optimal

patterns between the function and structural elements

solution is a typical case. The Pareto-optimal solution

become simpler.

selects design solutions from the leading edge ofWhen we wish to avoid function coupling (i.e.,

performance. Design solutions accept the couplinginterference) in a system, we can contain interferingfunction as a given. The best performance is selectedfeatures in closed components. This narrows thefrom two or more solutions.

range of functional interferences in the whole

Axiomatic design or modularization is thesystem. Clustering and reintegration are basics for“rationalization approach to design.” It is a device forbuilding modular-type architecture products.

handling complex systems (Baldwin & Clark,

Manufacturers select types of architecture based

2000). The optimization method is the “optimization

on various conditions. However, the constraints byapproach to design,” which seeks maximum

which firms are bound differ, as do theirperformance. These are the types of architecture

capabilities. Even if modularization is aimed at,(basic design concepts) of integral type products.

constraint conditions and capabilities may not allow

In other words, the rationalization approachit.

aims at modularization; the optimization approach80Modularization, design optimization, and design rationalization

aims at integration.

design concept) is of the integral type. However, theactual product (physical embodiment) is of the

1-4.

Modularization

in

the

electronics

modular type. The design concept does not match theindustry: Encapsulationarchitecture of the realized product. Recent advances

Modularization requires the conversion of coupledin software (embedded software) and semiconductors

designs into uncoupled designs. In practice, it ishave brought innovative changes to electronic

difficult to modularize a new design. For the latest

products (Ogawa, 2007). Japanese manufacturers

products,

competition

andmarketpositively

quickly.

Whensemiconductors and software technology as thecorresponding patterns between structures anddriving power for upgrading and rationalizing

functions are not yet clarified, it is necessary to build

product design.

requirementschange

is

keen

very

the product using coupled design. The integral type is

use

the

edificeofknowledge of

The semiconductor and software technologies

then selected as the type of architecture (basic design

used

for

electronics

products

arecontrolconcept). In these cases, manufacturers try to findtechnologies. Japanese manufacturers secure thecommon grounds for the best design solution.

integration of the total product system by using digital

Shintaku, Ogawa, and Yoshimoto (2006a)

control, namely, semiconductors and embedded

clarified the following in the case of DVD productsoftware. They encapsulate integral expertise indevelopment

disk

specific modules that control the total productdevelopment). Products with new concepts andsystem. Modules form complex systems and provide

technology become integral-type products. However,high performance capacity (Aoki, 2002). This paper

a lot of electronics products are changed into modular

distinguishes modules that control the total system

types over time. This is made possible byfrom modules that are subject to control. The former

improvements in design. There is an intentional

kind of module is called the “system control module”;

process of pushing the product toward the modular

it achieves modularization and acts as an adhesive

type. Products are thus often changed from themedium between modules. Shintaku, Ogawa, andintegral type to the modular type. However, there are

Yoshimoto (2006a, 2006b) refer to the creation ofcases in which a new product has appeared as asystem control modules as the “encapsulation of themodular type from the very beginning. Typicalsystem-integration element (encapsulation of theexamples of this are highly differentiated products

integral expertise).”(andadditionally,

optical(high-end segment models). There is performance

The system control module is created bycompetition in modular products as well, when the

consolidating product integration knowledge into

best performance is aimed at. Architecture (productspecific
81

modules.

This

consolidation

requiresYoshimoto

integrated knowledge. In order to modularize productknowledge, but who is able to build commercializedarchitecture, one should be able to conceive the total

products. Manufacturers do this by assembling

system beforehand. In the case of electronics products,

ready-made modules. This is already happening withintegration expertise is replaced by digital control

DVD players. Manufacturers only have to procure

technology. In recent electronics products, the systemsemiconductor chipsets (system control modules) andcontrol module has replaced integration elements

opticalwith digital control technology.

manufacturers fit into this model. Designing such

The application of system control modules turns

pickups.

The

products

ofChineseproducts is very simple (Shintaku, Ogawa, Yoshimoto,the rationalization of design into a reality. Knowledge

2006a, 2006b).

systems and integrated design are indispensable for

Chinese firms are modeled on the manufacture

rationalization. The system control module is a meansof modular type products. Japanese firms bring forthof simultaneously achieving optimum design andmodularization. Therefore, there is really a distinction

system rationalization.

per se between Japanese and Chinese firms, and this

In

the

same

hierarchicaltree

structure,difference lies in the design capabilities of the firms.

modularization operates at the upper level, and

2. Product design of the TV set

integration operates at the lower level (Aoshima &business of Chinese and JapaneseTakeishi, 2001).
The encapsulation of integration elements

firms

allows functional partition, structure segmentation,

2-1. Case: Japanese firms

and re-coupling as an engineering system. Designers
First, we consider the cathode-ray tube (CRT: picture
who are ignorant of the trade-off condition in design
tube)

televisionbusinessofJapaneseare unable to create modular systems. Optimization
manufacturers. The knowledge of systemizing
andrationalization

requirethesameelectronics

products

into

products is the source of Japan’s differentiatingknowledge.

Turning

strategies. Many Japanese manufacturers possess
modular types requires design efforts from both theoriginal technology and design expertise. Designs ofrationalization

approachandtheoptimization
TV-set chassis are unique to each company. The

approach.
system design solutions for chassis become productIf modularization proceeds, the basic concepts
differentiation.
of modular types can easily be selected in theForexample,anumberofelemental

following products as long as the system is nottechnologies have been developed for better pictures
drastically changed. An extreme example would be aand have been absorbed into the system. In the
manufacturer who lacks either the technology or theprocess, engineers revise the system and clear the82Modularization, design optimization, and design rationalizationinterdependencies between components.

technology has made it easy to solve problems in the

Let us describe a case in which a new CRT iscase of LCD TVs. Among television products, LCD

introduced. This introduction demands major changes

TVs are relatively easy to design.

to the system. For instance, if a flat CRT is adopted

However, effort must be put into an optimal

instead of a round shaped CRT, the design factors forsolution for better pictures. Newly developed panels

systemization change drastically. 5 The new designthat use the latest elemental technology require newwill be uncoupled design, and the engineers selectsystems. This is the same as in the case of flat

integral type design concepts. The concept is

CRTs. Modularization is achieved by encapsulatingreflected in the chassis design. Japanese firms reduce

the technology in the system control module.

the load of the chassis design by using semiconductor

Japanese firms make products modular. Integral

technology while maintaining the uniqueness of thetype architecture (design concept) is confined tochassis.

partial design solutions (digital control of theJapanese firms have used the advancement ofsystems) as the intention is to reduce design

semiconductors for the purpose of differentiation andcomplexity. In each case in which a Japanese firmcost reduction (Hiramoto, 1994; Shintaku, 1994;

offers a new differentiation system, a new system

Sugiyama, 2000; Yoshimoto, 2007). Semiconductors

control module has been developed for it. The final

are system control modules. The number of electronic

product achieves differentiation by integral typecomponents decreases with the encapsulation ofdesign, but the physical appearance of the product is

integral expertise; the functions of the physicalof the modular type.

components are described by the control technology

Japanesesystem.

This

isachievedbyproducts

designasmanufacturers
a

means

of

modularize

theireasingdesignrationalization. The TV set, however, has been

complexity. This is not open modularization, but

designed under integral type architecture. The systemrather is a closed approach, intended for in-house use.

control module brings the physical appearance of the
2-2. Case: Chinese firms

system close to the modular type.
Next, we consider LCD TVs. Generally, image

Chinese businesses rely on the procurement of theprocessing Large Scale Integrations (LSIs) are

CRT and the LSI from overseas companies. Thesedesigned by each company individually and are thenfirms often lack product integration knowledge andinstalled in the chassis. The reason for this is the same

therefore

as in the case of the CRT TVs. Digital control

outside. Knowledge has been input into the universal

purchaseknowledge

from

LSI Application Specific Standard Product (ASSP),
5

which is available at reasonable prices in the

The case of flat-CRT TV development at Sony, illustrated
by Katsumi (1998), serves as a reference.

83

Yoshimotocommercial marketplace and is purchased by Chinesesystem by putting together universal LSIs andfirms. It can be considered a system control module ofcommodity cathode-ray tube modules.

the commodity type. LSIs have become easier to use

The same can be said for LCD TVs. Chinese

as performance has improved. LSIs help the designer

manufacturers buy LCD panel modules (i.e., modulesof the product regardless of his/her productconsisting of drive circuits mounted on panels andintegration knowledge. Modules evolve independent

backlight units, pre-assembled) and image processingof any adjustments between manufacturers (Baldwin

LSIs from outside (Shintaku et al., 2008). LSIs and& Clark, 2000; Aoki, 2002).

panel

modulesarecommodity

type

The dependence on external knowledge also

products. Although LCD panels look similar,

appears in the case of CRT TV development byperformances (color representation, view angle, etc.)

Chinese firms. The CRT and the deflection yoke must

differ with each panel manufacturer. As a result, there

beachieve

is a need to match panel modules and image

compatibility. Japanese firms procure the deflection

processing LSIs, and engineers need to make design

yoke and the CRT and assemble them into an optimal

adjustments. However, in Chinese firms, parameters

design. Chinese firms buy ready-made modules

are just selected from an installed list.

mutually

adjustedtocalled integrated-tube-components (ITC), in which

The LSI is the system control module for LCD

the deflection yoke and the CRT are encapsulated

TVs. The design solutions for the basic functionalwith optimal adjustments. An ITC is a conditioned

systems of the LCD TV are installed in the LSI. The

CRT, provided by a vendor. With ITCs, knowledge ofmost common way is to apply the LSI vendor’s

how to make the adjustments is unnecessary, andreference design. Chinese firms consider the option ofChinese firms are able to design and produce TV sets

installed parameters in LSIs to be the system design

even if they possess neither the knowledge of nor thein LCD TVs.7 That is to say, the nature of TV set

expertise for adjustments.

design of Chinese manufacturers is passive.8

However, ITCs do not guarantee the best

3. Discussion

performance. Chinese manufacturers procure several
ITCs from different manufacturers and adopt them forAs

previously

noted,

Japanesefirms’ active

the same product model as if they are compatible
vendors set either of these two. Japanese TV
manufacturers produce the former, and Chinese TV
manufacturers produce the latter. When using the ITC
without specification requirements, the optimization of
the performance (for instance, picture quality) is difficult(Shintaku et al., 2005).
7
Refer to Shintaku et al., (2007) for the designs of
LCD-TV by Chinese firms.
8
Examples of designs by Chinese firms are cellular phones,
room air conditioners, and microwave ovens.

(Marukawa, 2007). As a result, the final goods show
varied performance in the same product model
category. 6 Chinese manufacturers design the TV
6

There are two kinds of deflecting yokes integrated into the
ITC: The user-specific specification（optimum
coordination）and the standard specification. CRT

84

Modularization, design optimization, and design rationalization

modularization has resulted from the efforts made toassume that the architecture characteristic (i.e., theachieve rational designs. The modular approach is thephysical embodiment) is of the integral typecanon of “good design” for engineers who wish totoo. However, in the case of TV systems, total productexclude complexities. Yet, competitive goods cannot

performance cannot be enhanced merely by applying

be created just by rational design.

the latest technical updates to specific modules. The

Design rationalization is not the only source ofdifferentiation strategy must be sought by simplifying

competitiveness. The differentiation strategy is ascomplex design problems, using the optimization

important as rational design.

approach.

It is necessary to rationalize design when

Fierce competition calls for differentiatedimproving the performance of the TV productproducts

system. Japanese manufacturers should take the

manufacturers combine the optimization approach

optimization

with the rationalization approach in digital control

approachapproachandsimultaneously,

thedesigns.

Japanesetechnology (engineering). Consequently, they haveintensified competition. As further differentiation iscome to design modular type (physically modularsought, the system gets more complex and the design

built)

becomes

concepts.

Japanesetheyrational

facecoupled.

becauserationalization

withmanufacturers

products

withJapanese

integral

firms

have

type

designalwaysbeen

incorporate control engineering knowledge based onchallenged to both optimize and modularize productdigital technology into the product design. In fact,

design.

they create the system control module.

Japanesesystemsaredrivenbycontrol

Modularization by Japanese engineers is themechanisms that are peculiar to each company. To

result of closed in-house efforts to achieve rational

Japanese firms, modularization is aimed at in-house

design. The final goods (i.e., televisions) are notuse only. The purpose is to exclude complexities thatmodular products of the ideal type. Televisions do notthey face, not to promote open architecture.

allow

of

Japanese firms build into their products optimal

modules. “Noise” (that is, the decreased functional

solutions for modularization. That is, they create thestatus of the system) is generated in the system ifsystem control module themselves. Conceptually,

modules are merely put together at random. Noise isthese system control modules are of the integral

an obstacle to product differentiation. It adversely

type. The physical framework is modular, withaffects the whole system.

conceptual architecture of the integral type.

infinite

flexiblecombinations

The selection of architecture is an issue of the

Of course, there is the alternative of not making“selection of the design concept.” In general, when asystem control modules. The physical product can beproduct system is described as an integral type, weof the integral type. Modularization is only one of the85Yoshimoto

options, since Japanese firms can select from two

4. Concluding remarks

physical architecture types (integral and modular).
Most Chinese firms are not capable ofmodularizing

products

themselves.

They

Design efforts to exclude complexity as much as

takepossible lead to the pursuit of modular design, and theadvantage of the modularized output of overseas

result is modularization. Product knowledge ofmanufacturers. Chinese firms buy system control

rational design becomes the “modularity driver.”modules because creating these modules is difficult

Japanese firms have pursued active modularization as

for them. The Chinese design concept (architecture)means of overtaking competition. What is notable inis of the modular type. This is the difference between

the modular designs of Japanese firms, as compared

Chinese and Japanese firms.

to the modular designs of Chinese firms, is that

Semiconductor divisions in Japanese electronics

Japanese firms can differentiate themselves even withfirms sell system control modules as ASSP. 9 IC

modular products. They lead modularization and seek

specialized producers in Europe, the United States,

technical

and Taiwan also sell system control modules. These

capability lies in the fact that integral typeproducers refer to Japanese manufacturers’ modulearchitecture can also be selected. They are able tounits

convertforfunctional

partition(andsystemdifferentiation

physicalsimultaneously.

architecture

and

to

Their

(embodimentpartition). Module vendors follow the system designs

characteristics)

optimizesystemof Japanese manufacturers.

design. Modular design is only a choice. They cancompete on the basis of the performance of the

Many Chinese firms have no intention ofmodularized products.

repairing the defects that come with coupled

The capabilities of producing modular designs

designs. Moreover, they do not rationalize the designs
by themselves. They only recycle systems that have

and

of

been rationalized in the past by leading industrial

different. Firms that manufacture modular products

firms. As a result, the designs of Chinese firms showmay

the characteristics of imitation. The conceptual

systems. It is hard to differentiate only by combiningarchitecture of products made by Chinese firms

modules. If products are not differentiated, they getcoincides with their physical embodiment.

caught in fierce pricing wars. Typically, this is what

face

producing

modulardifficulties

designingproducts

theareoriginal

Chinese manufacturers face in their markets.
Chinese firms rely on others’ product designs fordesign solutions. As a result, they do not accumulate
9knowledge

The final goods division (at Japanese electronics firms)
designs the system control module. However, it is not
sold. The semiconductor division develops the ASSP byreferring to the design of the final goods division.

andcannotdesignoriginal

new

products. It is difficult to design products that will86Modularization, design optimization, and design rationalization

appeal to customers by imitating existing modular

Developing Economies, (1962, Preliminary Issue,

systems. An in-depth knowledge of systems andNo. 1), 3–25.

rigorous concepts is extremely important for a

Aoki, M. (2002). Sangyo akitekucha no mojuruka:

value-added product. System technologies are not the

Rironteki intorodakushon. In M. Aoki, & H. Andoaggregated result of component technologies (Ishii,(Eds.), Mojuruka: Atarashii sanygo akitekucha no1987).

honshitsu

Modularization from Japanese firms is a result(pp.

3–31).

Tokyo;

Toyokeizai

Shinposha. (In Japanese)of the design efforts to unite design optimization andAoshima, Y., & Nobeoka, K. (1997). Purojekuto

design rationalization. It is clearly a design strategy tochishiki no manejimento. Soshiki Kagaku, 31(1),improve competitiveness by using digital control

20–36. (In Japanese)technology.

Aoshima, Y., & Takeishi, A. (2001). Akitekucha toiu

The catching-up of firms in NIE countries

kangaekata. In T. Fujimoto, A. Takeishi, &remains a threat to Japanese manufacturers. 10 This

Y. Aoshima (Eds.), Bijinesu akitekucha: Seihin

catch-up has been accelerated by the proliferation ofsoshikimodules created using Japanese technology. The(pp. 27–70). Tokyo: Yuhikaku. (In Japanese)rationalization

sekkei

Fujimoto, T. (2002). Seihin akitekucha no gainen

double-face design strategy (that is, a strategic design
synthesizes

senryakuteki

modularity. Cambridge, MA: MIT Press.

by business evolutions that make the best use of

that

no

Baldwin, C. Y., & Clark, K. B. (2000). The power ofaction assignments of Japanese firms can be solved

approachpurosesu

sokuteiandsenryaku

nikansuru

noto.

(RIETI

Discussion Paper Series 02-J-008). (In Japanese)

optimization). The impact of system control modules

Fujimoto,cannot be effectively mastered. The mind-set toT.

(2004).

Nihonnoimprove the appeal of modular products (physicaltetsugaku.

embodiment) created by integral design concepts

Shinbunsha. Research Institute of Economy, Trade(conceptual architecture) is necessary.

& Industy. Tokyo. (In Japanese)

Nihonkeizai

Fujimoto, T. (2008). Akitekucha to kodineshon no

References

keizaibunsekinikansuru

shiron.

(MMRC

Discussion Paper Series No. 207). The University

Akamatsu, K. (1962). A historical pattern ofof Tokyo. (In Japanese)

economic growth in developing countries. The
10Tokyo:

monozukuri

Fujimoto, T. & Shintaku, J. (Eds.) (2005). Chugoku
The catching-up of firms in NIE countries is owing to thecomplicated relationship between competition andcooperation. Asian manufacturing turned thisrelationship into a growth engine. As Shioji (2008) calls
it, the “East Asian domination industry” is an industry inwhich East-Asian firms gain a high share of global
production.

seizogyonoaakitekuchabunseki.

Tokyo:

Toyokeizai Shinposha. (In Japanese)
Gu, S. (2008). Seihin-akitekucha no dainamizumu:
87Yoshimoto

Mojuruka chishiki-togou kigyokan-renkei. Kyoto:

Sakakibara,

Mineruba Shobo. (In Japanese)K.

(2005).

Inobeshonnoshuekika. Tokyo: Yuhikaku. (In Japanese)

Hiramoto, A. (1994). Nihon no terebi sangyo:

Shintaku, J. (1994). Nihon kigyo no kyoso senryaku:

Kyoso-yui no kozou. Kyoto: Mineruba Shobo. (InSeijukusangyono

gijutsu-tenkan

Japanese)kigyo-kodo. Tokyo: Yuhikaku. (In Japanese)toKatsumi, A. (1998). Sony no idenshi: Heimen

Shintaku, J. (2007). Chugoku no kaden-sangyo toburaunkan terebi “VEGA” tanjo monogatari ni

Nihon-kigyo no senryaku. In T. Fujimoto & Tokyo

manabu shohin kaihatu no hosoku. Tokyo:

Daigaku 21 Seiki COE Monozukuri Keiei Kenkyu

Daiyamondosha. (In Japanese)

Senta (Eds.), Monozukuri keieigaku: Seizogyo wo

Ishii, T. (1987). Atarashii shisutemu sekkei. In
H.

Inose

(pp.

(Ed.),

73–114).

KogakuTokyo:

niokeru
Tokyo

koeru

sekkeiseisan-shiso(pp.

475–485).

Tokyo:

Kobunsha. (In Japanese)

Daigaku

Shintaku,

Shuppankai. (In Japanese)

J.,

Kato,

H.,

&

Yoshimoto,T. (2005). Chugoku mojura-gata sangyo niokeru

Marukawa, T. (2007). Gendai Chugoku no sangyo:

nihon kigyo no senryaku: Kara-terebi to eakon

Bokkousuru Chugoku kigyo no tsuyosa to morosaniokeru Nicchu-bungyo no kesu. In T. Fujimoto &Tokyo: Chuokoronsha. (In Japanese)

J.

Ogawa, K. (2007). Wagakuni erekutoronikusu sangyono(pp. 149–172). Tokyo:

Shintaku,J.,

Ogawa,

K.,&

Yoshimoto,T. (2006a). Hikari-disuku sangyo no kyoso to

No. 145). The University of Tokyo. (In Japanese)

kokusai-teki kyogyo moderu: Suriawase yoso no

Okuma, S., & Fujimoto, T. (2006). Sekkei purosesu

kapuseru-ka ni yoru mojura-ka no shinten. In

no shimyureshon bunseki ni kansuru shiron: Nihon

K. Sakakibara & S. Kouyama (Eds.), Inobeshon tosangyo no hikaku-yui tokusei wa moderuka

kyoso-yui. Tokyo: NTT Shuppan. (In Japanese)(MMRC

Discussion

Paperseizogyo

Seriesdekiruka.

Discussion

Chugoku

Toyokeizai Shinposha. (In Japanese)

to famuuea ga motarasu keieikankyo no rekishiteki(MMRC(Eds.),

aakitekucha bunseki

ni miru mojuraka no shinka mekanizumu: Maikon

tenkan.

Shintaku

Paper

Series

Shintaku,J.,

Ogawa,

K.,&

Yoshimoto,No. 70). The University of Tokyo. (In Japanese)

T. (2006b). Architecture-based approaches toOshika, T., & Fujimoto, T. (2006). Seihin akitekuchainternational standardization and evolution ofron to kokusai boueki ron no jishou bunseki 2006

business models. International standardization as

nen kaiteiban. (MMRC Discussion Paper Series

a strategic tool: Commended papers from the IEC

No. 72.). The University of Tokyo. (In Japanese)

centenaryPahl, G., & Beitz, W. (1988). Engineering design:

challenge

Electrotechnical

Systematic approach. Berlin: Springer-Verlag.

Switzerland.
88

2006.

Commission,

International
Geneva,Modularization, design optimization, and design rationalization

Shintaku, J., Tatsumoto, H., Yoshimoto, T., Tomita, J.,seihin kaihatsu: Sangyo kan hikaku no shiten& Park, Y. (2008). Seihin-akitekucha karamiru(pp. 63–86). Tokyo: Yuhikaku. (In Japanese)gijutsu denpa to kokusai bungyo. Hitotsubashi

Ulrich, K. (1995). The role of product architecture in

Bijinesu Rebyu, 56(2), 42–61. (In Japanese)the manufacturing firm. Research Policy, 24,

Shintaku, J., & Yoshimoto, T. (2005). Kaigai kigyo

419–440.

tono kyogyo wo tsujita kikan-buzai to kanseihin

Ulrich, K. T., & Eppinger, S. D. (1995). Productjigyo tono renkei moderu. Bijinesu Insaito, 13(3),design and development. New York: McGraw-Hill.

20–35. (In Japanese)

Vernon, R. (1966). International investment andShintaku, J., Yoshimoto, T., Tatsumoto, H., Shiu, J.,international trade in the product cycle. Quarterly& Su, S. (2007). Ekisho terebi no akitekucha to

Journal of Economics, 80(2), 190–207.

Chugoku kigyo no jittai. (MMRC Discussion Paper

Yoshimoto,T.,

Shintaku,J.,&

Ogawa,

Series No. 164). The University of Tokyo. (InK. (2005). Seihin-akitekucha riron nimotozuku

Japanese)gijutu iten no bunseki: Hikari disuku sangyo

Shioji, H. (Ed.) (2008). Higashi Ajia yuuisangyou noniokeru kokusai bungyo. (MMRC Discussion

kyousoryoku: Sono youin to kyouso bungyo

Paper Series No. 37). The University of Tokyo. (Inkouzou. Kyoto: Mineruba Shobo. (In Japanese)

Japanese)

Suh, N. P. (1990). The principles of design. New

Yoshimoto, T. (2007). Buraunkan terebi nimiru

York: Oxford University Press.

bumonbetsu

jigyo-senryaku

tomojuraka:Suh, N. P. (2001). Axiomatic design: Advances andTougougata kigyo no bunkenteki kanri. Doushisha

applications. New York: Oxford University Press.

Shogaku Ronshu, 58(4–5), 145–170. (In Japanese)

Sugiyama, Y. (2000). Kara-terebi sangyo no seihinkaihatsu: Senryakuteki junansei to mojuraka. In[Received October 15, 2009; accepted December 7, 2009]

T. Fujimoto & M. Yasumoto (Eds.), Seikosuru

89Yoshimoto

90

ABAS: Annals of Business Administrative ScienceVol. 8 December 2009

CHIEF EDITOR

Junjiro Shintaku, the University of TokyoEDITORIAL BOARD

Makoto Abe, the University of Tokyo
Takahiro Fujimoto, the University of Tokyo
Makoto Kasuya, the University of Tokyo
Nobuo Takahashi, the University of Tokyo
Technical Editor: Maki Nishida, Global Business Research Center

ABAS: Annals of Business Administrative Science is published annually by Global
Business Research Center, Marunouchi, Chiyoda-ku, Tokyo, JAPAN. http://www.gbrc.jp