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Basic Characteristics of Intra- and Interfirm Interaction

  • Yoshitaka Okada

Abstract

Technological development, competition in the semiconductor market, and corporate strategy interacted in a complex way to generate the dynamics of the Japanese semiconductor industry. To keep winning in an environment of severe market competition, Japanese semiconductor manufacturers constantly searched for ways to cut production costs, automate production, improve product quality, and make technological and product innovations. To ensure their survival, they extended their efforts at making changes to address their relationships with parts, material, and equipment manufacturers and even customers. The outcome of such efforts is the development of competitivecum-cooperative (CCC) interaction.

Keywords

Mutual Influence Functional Area Spot Market Asset Specificity Manufacturing Equipment 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.
    Each questionnaire asked respondents to specify the estimated proportions of transactions conducted with each type of company. For example, for procurement of parts and materials, the questions were as follows: (1) What percentage of the total cost of the procurement of parts and materials is used for purchasing from companies with which you have a long-term relationship and which have a weaker overall capability than your company, (e.g. closely-and verticallyaffiliated companies [vertical keiretsu], small-and medium-sized companies and venture firms)?; and (2) What percentage of the total cost of the procurement of parts and materials is used for purchasing from companies with which you have a long-term relationship and which have a similar overall capability as your company, (e.g. closely-and horizontallyaffiliated companies [horizontal keiretsu], independent companies and alliance partners)?; and (3) What percentage of the total cost of the procurement of parts and materials is used for purchasing from companies in a temporary relationship with your company (e.g. spot markets and arm’s-length transactions)?; and (4) What percentage of the total cost of the procurement of parts and materials is used for internal purchasing (intrafirm divisions and sections, and majority-owned subsidiaries and foreign affiliates) A similar format was used for the other functional areas.Google Scholar
  2. 2.
    Interview with Company Q manager.Google Scholar
  3. 3.
    Respondents were asked to select the most important company in each category of partner and to answer questions about that company. For example, to acquire information about the characteristics of vertical CCC interaction in the procurement of parts and materials, questions were written as follows: Please select the most important parts and materials manufacturer that has the following characteristics: a weaker overall capability than your company and a long-term relationship with your company (e.g. closely-and vertically-affiliated companies [vertical keiretsu], small-and medium-sized companies and venture firms). And please answer the following questions about the company: (1) Characterize the relationship between your company and the company you have identified. (a) Degree of interdependence (1. very weak, 2. weak, 3. intermediate, 4. strong, 5. very strong) (b) Degree of cooperation (1. very weak, 2. weak, 3. intermediate, 4. strong, 5. very strong) (c) Frequency of interaction (choose a category and specify the number of times) ( ) times/day ( ) times/week ( ) times/month ( ) times/year (d) Degree of firm (asset) specificity of products ( 1. products with no firm-specific characteristics, 2. products with a low degree of firm-specific characteristics, 3. products with an intermediate degree of firm-specific characteristics, 4. products with a high degree of firm-specific characteristics, 5. products with a very high degree of firm-specific characteristics.) (e) What are the goals and interests that your company shares with the selected company? ( ) (f) Degree of capability to coerce the company (1. very weak, 2. weak, 3. intermediate, 4. strong, 5. very strong) (g) Degree of vulnerability to be coerced by the company (1. very weak, 2. weak, 3. intermediate, 4. strong, 5. very strong)Google Scholar
  4. 4.
    Interview with Company Q Manager.Google Scholar
  5. 5.
    Interviews with managers in Companies Q and R.Google Scholar
  6. 6.
    Interview with Company Q manager.Google Scholar
  7. 7.
    Interviews with managers in Companies Q, R, T, U, and V.Google Scholar
  8. 8.
    Interviews with managers in Companies Q, R, and U.Google Scholar
  9. 9.
    Interview with Company R manager.10 Information from NEC.Google Scholar
  10. 11.
    At Toshiba, basic research on the semiconductor was carried out in the ULSI Research Center which reported directly to top executives. Applied research, such as developing engineering samples and mass production technology, was conducted in the Semiconductor Device Engineering Laboratory and the Engineering Department of the Semiconductor Group, both of which reported to the head of the Group. Engineering departments in factories developed commercial samples and improved production technology (information from Toshiba). Similarly, at Hitachi, basic research was conducted in the Advanced Research Laboratory, the Central Research Laboratory, the Hitachi Research Laboratory, the Mechanical Engineering Research Laboratory, the Production Engineering Research Laboratory, and the Microelectronics Products Development Laboratory. Applied research was conducted in the Device Center, and R&D for immediate application was conducted in departments within factories (information from Hitachi).Google Scholar

Copyright information

© Springer Japan 2000

Authors and Affiliations

  • Yoshitaka Okada
    • 1
  1. 1.Sophia UniversityChiyoda-ku, TokyoJapan

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