Core Compence and 'Choice and Focus' Strategic Behavior : Case Study of World Notebook Computer Industry

In the late 1980's, the value-added distribution pattern in value chain was smile-curve as the development of Modular/Open Product Architecture in the electronics industry. Electronics makers have concentrated their resources on the marketing area or R&D area while entrustingthe low value-added activities like the final assembly to external EMS/ODM makers in terms of smile-curve. This positioning strategic concept for choosing and focusing on high valueadded area of value chain is generally accepted in many computer makers like Dell, HP, Acer, etc. However we find that there is a different strategic behavior in those electronics makers such as Toshiba and Sony in Japan and ASUS in Taiwan. This observation is posing limitation of the positioning strategic concept. In this paper, we provide a concept of using the viewpoint of evolving core competence to consider the choice and focus strategic behavior by case study of the world notebook makers. We use this framework to realize the mechanism that the electronics makers can implement choice and focus strategic behavior successfully as the progressing of Modular/Open Product Architecture in the electronics industry. The results of my analyses show that two choice and focus strategic patterns could be developed possibly with the repertory and evolution of 'Core Competence'. First, 'Strategy of choice and focus to high value-added area's hould be developed by building core competence on marketing or R&D activities and outsourcing production activities like final assembly to EMS/ODM makers. Second, 'Strategy of choice and focus to high value-added product'should be developed by building core competence on integrating the resource accumulated on R&D and production activities. Based on this assumption, we can explain why the strategic behaviors of electronics makers don't converge upon the strategic concept for focusing and choosing resources to high value-added area in face of smile-curve.