Software's hidden challenges1
Robert E. Cole · 2006
Abstract This chapter examines another key ICT industry — packaged software — of which Japan is a huge net importer. In what goes to the heart of the modularization issue, it is shown that the large electronics firms were reluctant to unbundle hardware and software, and insisted on maintaining proprietary systems; indeed, free software was (is) frequently used to boost hardware sales. Spinning out software divisions into group companies led to the maintenance of this orientation, rather than the creation of independent software firms focused on innovation. In a so-called ‘curse of genba shugi’, it is argued that the shopfloor focus of Japanese manufacturing firms, despite its many positive contributions to productivity and quality, creates enormous pressures for customization, which adds heavy costs and forecloses benefits of standardization and corporate wide optimization that would come from the use of packaged software.