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Serving hospitals in order to maintain competitive advantage. Both of these firms have been among the strongers advocates of descentralization.
Technological change is proliferatinginterrelationshios and making them more achievable. Technology is breaking down barriers between industries and driving them together, particulary those based on electronics/information technology. Microelectronicslow-cost computers, and communications technologic are permeating many businesses and causing technologies to converge. As these technologies are assimilated into many products and productionprocesses, the opportunities for shared technology development, procurement and component fabrication are increasing. The rush of many large diversified firms such as Gould and United Technologies toacquire electronics firms is a manifestation of this trend.
These same technologies are changing the functions of products and making them parts of larger systems, sometimes controlled centrally with acommon computer. Integrated aircraft cockpits, office automation, telecommunications, and lighting, heating, airconditioning, security, and elevator systems in buildings are just a few examples wherehistorically distinct businesses are now becoming strongly related.
New technology is also making it possible to share activities across business unit lines where it was not feasible previously.So-called “flexible automation” is one important example, in which a computer-controlled machine can produce a variety of similar products with minimal setup time. While flexible automation ispenetrating slowly and its limits have yet to be defined, it is enhancing the possibilities for sharing component fabrication and assembly facilities among business units whit related products. Flexibilitythat allows sharing also holds promise in other areas such as automated testing and computer-aided design.
The growing sophistication of information systems is also a powerful force in opening up...