The Managerial Strategy and Firm Organization of Large high-Tech Firms in Silicon Valley

Abstract

This study is interested in the characteristics of large high-tech firms in Silicon Valley. The large high-tech firms in Silicon Valley is well adapting to the structural change of information technology industry toward "open system". The managerial strategy of these firms is to focus on their specialized segment and to develop new products swiftly. To fulfil this managerial strategy, these firms are delegating their power to the suborganization and utilizing semi-organization and informal organization internally. And these firms are forming the networks with the other high-tech firms in this region and extending the horizontal cooperation one another. By their networks these firms are openly communicating one another about which technology is newly developed and how the market demand is changing. This study is surveying the present situation of Hewlett-Packard, Sun Microsystems, Apple as the typical case of large high-tech firms in this region. Even though they have the different background and are specialized in the different segment of information technology industry, they are well adapting their organization to the trend toward open system. In contrast to these cases, the large high-tech firms(DEC, Apollo) at Route 128 in Boston is in the crisis of management because they have stuck to their organization based on the closed system. As the result of this study, we have found the new type of high-tech firms different from the traditional firms such as IBM or DEC. This new type of high-tech firm is representative of the information technology industry in U.S.A. and is diffusing to the other regions of U.S.A