Localized Technological Search And Multi-Technology Companies

Two major themes that have emerged from recent theoretical and empirical studies of technology at the firm level have been the tendencies on the one hand to localization of technological search and on the other hand to the spread of multi-technology companies, required to incorporate an ever-growing extent of advanced technologies. These trends appear contradictory. This paper analyses the contradictions through the use of patents data as an indicator of technological specialization. Two industries and some of their leading corporations are singled out for analysis - the electronics industry (especially in Europe). as an upstream 'high-tech' industry. and the food-processing industry, a downstream sector that is now having to make use of a burgeoning range of technologies. The paper examines their major corporate changes in the light of the technological data, through the use of concentration indices. It shows that both industries are trying to reconcile the contradiction with greater specialization taking place in sub-units of the firms. though the effect is more muted in food-processing where demand factors predominate. The need to command multiple diverse technologies is being targeted by restructuring firms in terms of both external relationships and internal reorganizations, but the basic contradiction still remains and may bc insoluble.