Integrative Capabilities, Vertical Integration, and Innovation Over Successive Technology Lifecycles

The analysis presented here provides a new explanation for why vertically integrated and specialized firms may continue to coexist as industries evolve, especially during time periods when conditions unequivocally favor lower cost specialized firms. In contrast to the common view that firms should match their organizational form to the prevailing nature of technology, vertically integrated firms may rationally choose to stay integrated and bear...