Breaking the mirror You are working as CTO for a small software company (ERPTEX) which is developing Enterprise

Resource Planning Software for SMEs. The solutions you develop are highly customized and specialized for each firm. Drawing on their experience, your development team members work closely together to design software which runs smoothly and stable. This is one benefit of the integral solutions you offer. Recently ERPTEX has experienced severe competition by open source software. These software solutions are developed by dispersed communities and developers. The loosely coupled and modular product architecture enables them to respond to changes in demands, create add-ons easily, and innovate independently in each module. In order be able to compete with the OSS products you want create products with a similar system structure. Do you have to change the organizational structure of your product development (i.e. task partitioning, division of labor, communication flow) to tackle this problem? How would you realize this change?

Literature recommendations Baldwin, C.Y., Clark, K.B., 2000. The power of modularity. MIT Press, Cambridge, Mass. [u.a.]. Baldwin, C.Y., Clark, K.B., 2003. The architecture of cooperation: How code architecture mitigates free riding in the open source development model. Harvard Business School. Brusoni, S., Prencipe, A., 2001. Unpacking the black box of modularity: technologies, products and organizations. Industrial and Corporate Change 10, 179-205. Clark, K.B., 1985. The interaction of design hierarchies and market concepts in technological evolution. Research policy 14, 235-251. Colfer, L., Baldwin, C., The mirroring hypothesis: Theory, evidence and exceptions. Available at SSRN 1539592. Henderson, R.M., Clark, K.B., 1990. Architectural innovation: the reconfiguration of existing product technologies and the failure of established firms. Administrative Science Quarterly 35. Langlois, R.N., 2002. Modularity in technology and organisation. Journal of Economic Behavior and Organisation 49, 19-37. MacCormack, A., Baldwin, C., Rusnak, J., 2012. Exploring the duality between product and organizational architectures: A test of the mirroring hypothesis. Research policy 41, 13091324. Murmann, J.P., Frenken, K., 2006. Toward a systematic framework for research on dominant designs, technological innovations, and industrial change. Research policy 35, 925-952. Simon, H.A., 1962. The architecture of complexity. Proceedings of the american philosophical society, 467-482. Ulrich, K., 1995. The role of product architecture in the manufacturing firm. Research policy 24, 419-440. Von Hippel, E., 1990. Task partitioning: An innovation process variable. Research policy 19, 407-418.

Exercise Product Planning Case 2