From Silicon Valley to Singapore: Location and Competitive Advantage in the Hard Disk Drive Industry

Overview

Momentous developments in the global economy over the last two decades have dramatically increased the availability of industrial investment sites and lowered the cost of relocating core activities to new countries. But how should these developments be exploited for competitive advantage? Firms face competing pressures: scale economies and the advantages of proximity push them to concentrate activities in one or only a few locations, while low wages and new markets invite ...

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Overview

Momentous developments in the global economy over the last two decades have dramatically increased the availability of industrial investment sites and lowered the cost of relocating core activities to new countries. But how should these developments be exploited for competitive advantage? Firms face competing pressures: scale economies and the advantages of proximity push them to concentrate activities in one or only a few locations, while low wages and new markets invite dispersal across several countries.

This book examines how location decisions have contributed to the global dominance of U.S. firms in the hard disk drive industry. In analyzing the industry since its beginnings some forty years ago, the book explains how American leadership in disk drives has rested on the formation of two complementary industrial clusters. Fundamental research and product development has been located almost entirely in the United States, principally California. Manufacturing has been concentrated in Southeast Asia (initially in Singapore and later in Thailand and Malaysia as well). This duality has proven key to the successful competitive position of the U.S. disk drive industry.

Beyond the particulars of the disk drive industry, the authors present new perspectives on the sources of industrial leadership, the strategic behavior of multinational corporations, the geographic evolution of industry, and the creation and endurance of industrial clusters. Managers will gain insight into how location decisions can contribute to organizational effectiveness, and will learn that globalizing production, while keeping innovative activities at home, can contribute to their firms’ competitive advantage. Policy makers will find that first mover advantages may be as important for countries as for companies, since early and systematic efforts to attract a specific industry can generate a critical mass of investments that, over time, will make a location resistant to inducements offered by other countries.

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Editorial Reviews

From the Publisher
"A valuable resource for senior managers constantly seeking to improve their firms' competitive position."—Dirk R. Thomas, Vice President, Strategy and Business Development, IBM

"A thought-provoking examination of the factors that have influenced the disk-drive industry's global growth and evolution. The authors illustrate how indiustry leaders have used a variety of location strategies to gain a competitive edge."—Steve Luczo, CEO, Seagate Technologies

"Offers rich new insights into the dynamics of one of Silicon Valley's least understood but most innovative sectors. Policy makers and business leaders will learn much about technology, geography, and globalization from this sophisticated analysis."—AnnaLee Saxenian, author of Regional Advantage: Culture and Competition in Silicon Valley and Route 128

"This volume reports the findings of an impressive research effort designed to identify the location strategies that have allowed US firms to maintain dominant positions within the international disk-drive industry. . . . This excellent book will be of interest to managers, policy makers, and academicians alike."—Choice

"An authoritative and comprehensive analysis . . . the breadth of research promises to make this the reference book for hard disk drives. . . . The case study itself will provide substantial fodder for debates on the globalization of high-technology manufacturing, development policy, firm strategy, and competitive advantage."—Enterprise and Society

Booknews
Explains how decisions about location helped US firms achieve global dominance in the hard disk drive industry. Details how American firms were able to develop two complementary industry clusters, with fundamental research and product development concentrated in the US (principally California), and manufacturing in Southeast Asia. This example offers new perspectives on the sources of industrial leadership, strategic behavior, and the geographic evolution of industry. McKendrick is research director of the Information Storage Industry Center at the University of California-San Diego. Annotation c. Book News, Inc., Portland, OR (booknews.com)
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Product Details

  • ISBN-13: 9780804741835
  • Publisher: Stanford University Press
  • Publication date: 12/28/2000
  • Edition description: 1
  • Edition number: 1
  • Pages: 372
  • Product dimensions: 6.00 (w) x 9.00 (h) x 0.90 (d)

Meet the Author

David G. McKendrick is Research Director of the Information Storage Industry Center at the University of California, San Diego. Richard F. Doner is Associate Professor of Political Science at Emory University. Stephan Haggard is Professor of International Relations and Pacific Studies at the University of California, San Diego.

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Table of Contents

List of Figures
List of Tables
List of Disk Drive Related Abbreviations
Acknowledgments
Pt. 1 Introduction
1 Why Location Matters 3
2 Industry Background: Technology, Competition, and Geographic Reach 16
Pt. 2 Location and Competitive Advantage
3 A Theory of Industry Evolution, Location, and Competitive Advantage 37
4 Alternative Explanations for Industry Advantage 66
5 Global Shift and Competitiveness in Hard Disk Drives 87
6 Leveraging Locations: American Industry and Its Southeast Asian Production System 119
Pt. 3 Case Studies
7 Singapore 155
8 Thailand 184
9 Malaysia 204
Pt. 4 Implications
10 Policy, Politics, and Location in Developing Countries 227
11 Globalization and Industrial Leadership 253
App. A Industry Origins and Technological Evaluation 275
App. B An Innovator's Dilemma? 283
Notes 289
References 317
Index 341
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