Management of Technology and Innovation in Japan

44 A. Takeishi and Y. Aoshima
Shimano’s Strategy: Creating Markets Through Component
Integration
System Components
Shimano’s success was a result of successively introducing innovative new products
to pursue ease of use for the rider. Throughout the history of Shimano’s successful
product innovations, the key was the development philosophy of system
components that came out in the mid 1970s.
Dura-Ace, SIS, New Deore XT and STI all commonly share the idea that various
parts should be optimized to function and perform as a system. In the bicycle
industry, where interfaces are standardized and each part is made by a specialist
manufacturer rather independently, most manufacturers viewed the derailleur,
gearshift lever and brake as separate components. Shimano, however, viewed
these as a single unit, and integrated them as a system achieving new functions
and higher performance that could not be reached until then. In other words, Shimano
changed the architecture of some of key component systems in bicycles
from “open, modular” to “closed, integral”.
These “architectural” innovations required a variety of ingenuity and a great
deal of effort at Shimano. We have already mentioned many technical problems
that had to be overcome in the process of integrating parts. The innovation of a total
system was made possible by the accumulation of various improvements and
innovations in individual parts technology. 12 The parts technologies newly developed
by Shimano include the components that Shimano does not produce such as
UG and HG chains. Shimano’s attitude is to develop a particular technology if it is
required to have the system function and perform as targeted.
Knowledge about a component is not enough for improving the component. An
image of the final product must be drawn based on an understanding of the needs
of end users. Superior parts cannot be developed without understanding the environment
in which they will be used. Therefore, although Shimano has never di-
12 The system component philosophy was realized through the technical development of
individual parts, but this system-component philosophy also has an aspect of encouraging
technical innovation of individual parts. In the process of improving the functions
and performance as a system, it becomes clear that a certain part is holding the system
back and there is a mechanism that forces the technical innovation of the part in the bottleneck.
Rosenberg found that a particular technical innovation was pursued to overcome
an imbalance with other interrelated parts, and this in turn encourages another
technical innovation of other related parts. (N. Rosenberg, Perspectives on Technology,
New York, NY: Cambridge University Press, 1976) For example, for audio systems,
increased amplifier performance causes increases in speaker performance, and for
automobiles, increased engine performance leads to increases in brake performance. In
the case of Shimano, in the process of integrating parts that previously had standardized
interfaces, engineers came to be aware of strong interdependence between parts that
had not received attention in the past, and this awareness encouraged further technological
innovations.