FROM A FEW CRAFTSMEN TO AN
INTERNATIONAL NETWORK OF ALLIANCES:
BOSCH DIESEL FUEL INJECTION SYSTEMS
Don E. Kash
Robin N. Auger
Center for Science and Technology Policy
School of Public Policy
George Mason University
4400 University Drive, MS 3C6
Fairfax, VA 22030-4444
[email protected]
[email protected]
September 2003
This research has been supported, in part, by grants from the National Science Foundation and the Center for
Innovation Management Studies at North Carolina State University. The authors thank the funding organizations
for their support.
ABSTRACT
Managers of the innovation of complex technologies have to develop strategies and
policies that produce adaptive organizational networks. Studies of thirteen technologies carried
out in six countries suggest that managers and policy-makers benefit from focusing on
organizational networks, not single organizations. The evolution of the fuel injection technology
for diesel engines initiated and repeatedly innovated since 1922 by Robert Bosch GmbH of
Stuttgart, Germany is used to illustrate the policy and management adaptations necessary to
carry out repeated innovations as technologies move through different innovation patterns and
as they evolve from simple to complex. Special attention is given to the role of cooperative
alliances in the innovation, knowledge management, and decision-making associated with the
development of the diesel injection technology.
Three innovation patterns are evident in this evolving story. The Transformation (firstof-a-kind) Pattern (1922 – 1927) covers the period from the initiation of work on diesel injection
systems to the market introduction of the first in-line pump. The first Normal (incremental)
Pattern (1927 – 1960) covers the incremental innovations of mechanical in-line fuel injection
systems. The first Transition (major redesign) Pattern characterized the sixteen years between
1960 and 1976 when the distributor pump, a sophisticated mechanical system, was developed. A
subsequent Normal Pattern that saw incremental innovations of the distributor pump extended
into the 1980s. For two decades from 1980 to 2000 a second Transition Pattern characterized
the innovation activities that produced a complex electro-mechanical injection system. A third
Normal Pattern began in 2000 and continues today.
Over roughly two decades between 1960 and the early 1980s, the Bosch organization
evolved from a hierarchical to a network structure as it carried out innovations that converted a
simple technology into a complex one. As the technology has become ever more complex, the
Bosch organizational structure has grown to include a tightly linked network that ranges from
suppliers to users and includes a broad range of mechanical and electronic expertise. The
innovation of the injection technology today involves intimate interaction between product
design and manufacturing process activities. These innovation activities manifest a process of
co-evolution between a continuously adapting network of supplier and user organizations and
diesel injection technology that has occurred as part of an ever-changing environment (e.g.,
market, public policy).
2
From A Few Craftsmen To An International Network Of Alliances:
Bosch Diesel Fuel Injection Systems
Introduction
Organizational networks are essential to the innovation of complex technologies.1
Networks are composed of multiple organizations that include the holders of core capabilities,
the suppliers of complimentary assets, and user organizations.2 Alliances are the organizational
relationships, which may vary in nature and structure, used to establish critical linkages in the
networks that carry out the innovation of complex technologies.3 No organization (e.g.,
company) acting alone has all the knowledge, skills and capabilities needed to carry out the
innovation of complex technologies. Thus alliances make it possible for organizational networks
to access, create, synthesize, and diffuse the diverse tacit and codified knowledge (as well as
other skills and capabilities) necessary for the innovation of complex technologies. In most
cases as networks become more complex, the opportunities for and the speed of innovation
increase.4
This paper exemplifies two fundamental tenets of Keith Pavitt’s work: 1) to improve our
understanding of the innovation process through the development and use of new conceptual
frameworks or classification schemes, and 2) to improve our understanding of the management
of innovation within the firm by gleaning lessons from empirical case studies. The paper is part
of a larger study of thirteen technologies carried out in six countries which addresses another of
Pavitt’s areas of interest: the differences among firms and countries in technological
development and innovation and the determinants of those differences. We investigate the
pattern of technological and organizational co-evolution5 using a case study of the innovation of
A complex technology is one that cannot be understood in sufficient detail by an individual so that it can be
communicated across time and distance with the precision necessary to be exactly reproduced. In contrast, a simple
technology can be understood.
2
DeBresson, Chris and Fernand Amesse, “Networks of Innovators: A Review and Introduction to the Issue,”
Research Policy, Vol. 20, No. 5, October 1991, pp. 363-79; Miller, Roger, “Global R&D Networks and Large-Scale
Innovation: The Case of the Automobile Industry, Research Policy, Vol. 23 No. 1 January 1994, pp.27-46.
3
Teece, David J., “Competition, Cooperation, and Innovation: Organizational Arrangements for Regimes of Rapid
Technological Progress,” Journal of Economic Behavior and Organization, Vol. 18, No. 1, 1992, pp.1-25.
4
Kash, Don E., Robin N. Auger and Ning Li, “Organizational Requirements for the Innovation of Complex
Technologies,” in John de la Mothe and Albert N. Link, eds., Networks, Alliances and Partnerships in the
Innovation Process, Boston: Kluwer, 2002, pp.165-190.
5
Mangematin, Vincent, “The Simultaneous Shaping of Organization and Technology within Cooperative
Agreements,” in Rod Coombs, Albert Richards, Pier P. Saviotti, and Vivien Walsh, eds., Technological
Collaboration: The Dynamics of Cooperation in Industrial Innovation, Brookfield, VT: Edward Elgar, 1996, pp.
1
3
diesel fuel injection technology carried out by Robert Bosch GmbH (Bosch).6 Bosch’s diesel
fuel injection technology is, at the beginning of the 21st century, both the world’s performance
standard and the world’s leader in sales. Bosch has evolved from a “workshop for precision and
electrical engineering” founded in Stuttgart, Germany in 1886 to an organization with locations
in over 130 countries. The company produces a wide range of automotive equipment in addition
to fuel-injection technology, as well as many other technical products.
Over the eight decades since Bosch initiated work on a diesel fuel injection system, the
technology has evolved from a simple piston pump to multiple complex electro-mechanical
subsystems that are seamlessly integrated into diesel-powered systems. As part of this evolution,
the technology has become strikingly complex and sophisticated, and the organizational system
that has carried out these innovations has evolved from a workshop populated by skilled
craftsmen to a complex network composed of diverse organizations linked by alliances. This
paper investigates: 1) three patterns of innovation and their application to Bosch diesel fuel
injection technology, 2) the role of cooperative alliances in Bosch injection technology
innovation, and 3) the Bosch organizational network’s knowledge management and decisionmaking.
Patterns of Innovation
Although each technological innovation has its own distinctive sources of knowledge and
capability, innovation processes can be grouped by the existence of similar characteristics, or
patterns. Rycroft and Kash have labeled three patterns: transformation (first-of-a-kind), normal
(incremental), and transition (major redesign).7 Some of the most evident distinctions between
the patterns are variations in the organizational structures and processes used to access and use
knowledge and to make decisions. The repeated innovations of the Bosch injection technology
have manifested all three patterns. An innovation occurs with the first successful introduction of
119-41; Nelson, Richard R., “The Coevolution of Technologies and Institutions,” in Richard W. England, ed.,
Evolutionary Concepts in Contemporary Economics, Ann Arbor, MI: University of Michigan Press, 1994, pp. 13956.
6
Kash, Don E., “Bosch Fuel Injection Systems for Diesel Engines,” School of Public Policy Working Paper 03:1,
Fairfax, VA: George Mason University, June 2003.
7
Rycroft, Robert W. and Don E. Kash, The Complexity Challenge: Technological Innovation for the 21st Century,
London: Pinter, 1999, pp. 179-198.
4
a technology into a market. The innovations that manifest the transformation and transition
patterns fit within that set commonly identified as radical. The innovations that manifest the
normal pattern are commonly identified as incremental. An overview of what has occurred with
the Bosch diesel injection technology is sketched in Figure 1.
The transformation innovation pattern characterizes the organizational structures and
processes that produce first-of-a-kind technologies, i.e., new designs. When the first-of-a-kind
technology is a complex technology, a network of organizations, including holders of core
capabilities, complementary asset suppliers, and end users (customers), must be formed. Only
networks such as these can provide and integrate the diverse knowledge needed for the
innovation. Thus, as the transformation innovation pattern occurs, both a new network and a
new technology must be designed and built, largely through a trial and error learning process.
The square A in the lower left corner of Figure 1 represents the innovation of the first diesel fuel
injection technology. It took Bosch five years to develop its first commercial product, the in-line
pump, thus the transformation pattern characterized the period from 1922 to 1927.
Bosch Innovation Trajectories
Complexity
• Mass production
processes, flexible
kits for all engine
sizes
• Basic diesel needs:
atomization,
metering, timing
C – Transition to Electro-Mechanical Control
o
---C
x
mple
---N
1980-2000
-
-logy
16
--
ork-
etw
16 Piezo-electric
Control (2003)
ch
no
l
Te
ex
le
imp
---S
h
Tec
2
1
i
--
gan
-Or
3
--ion
zat
1930
6
EPVM (1962)
6
EPVA(1966)
7
VE (1976)
1960
1970
Unit Injector /
13 Unit Pump
System (1994/95)
--
7
5
1922-27
10 11 12
Ne
1962-76
5
4
9
tw
ork
-
C
B
2 A-Pump (1953)
3 M-Pump (1957)
4 P-Pump (1962)
8
pl
om
1 First In-Line Pump (1927)
.---
A
hno
Tec
og
y--
13 14 15
---
• Fuel economy,
reduced emissions,
size, price,
integrated timing
C
B – Transition to Distributor Pump Technology
---
• Fuel economy,
direct injection,
lower emissions,
flexibility
A – Transformation Period
Performance
• Systems integration
and synthesis,
fuel economy,
emissions control,
comfort, functions,
pilot injection and
shape of injection
8 VP-20 (1982)
9 VE-EDC (1986)
P-Pump Electronic
10 Governor (1987)
14 VP-44 (1996)
Common
15 Rail (1997)
11 VE-EDC/DI (1989) Innovation legend:
Incremental
P-pump Electronic
Major
12 Timing and
Fundamental
Governor (1993)
1980
Time
1990
2000
2010
5
Figure 1: Bosch Diesel Fuel Injection Innovation Trajectories
The transition innovation pattern characterizes the organizational structure and processes
that produce major changes, i.e., redesigns, of existing generic technologies. Like the
technologies, the networks that carry out transitional innovations must undergo major redesigns
themselves. They must merge or integrate new core capabilities in order to create a new
organizational network with all of the capabilities needed to carry out the transitional innovation
of the technology. Thus the redesigned network must be able to access, create, and synthesize
knowledge that did not previously exist in the network. The triangles B and C in Figure 1
represent the major redesigns that moved the injection technology from an in-line mechanical
system through a series of transitional innovations that now give the Bosch network the
capability to deliver a range of sophisticated electro-mechanical technologies specifically
designed to fit each customer’s need. During the second Bosch transitional period, a network
was developed that included advanced electronic, electrical, software, and mechanical
knowledge, and this network learned how to synthesize these diverse kinds of knowledge.
The normal innovation pattern characterizes the organizational structure and processes
that produce improvements, i.e., incremental innovations, within an existing generic design.
Incremental innovations result largely from cumulative learning within the network established
to innovate the first-of-a-kind technology or a redesigned technology. Although incremental
innovations require diverse knowledge and participation by various organizations such as
complementary asset suppliers and end-users, in the normal innovation pattern the linkages
among these network participants already exist. Thus, the network is able to generate internally
most of the knowledge needed to carry out the incremental innovations. In Figure 1 normal
pattern innovations are represented by circles; through 2002 Bosch diesel fuel injection
technologies had experienced three periods that were characterized by normal innovation
patterns. The third period began in 2000 with the network that had emerged to carry out the
innovation of the electro-mechanical injection systems. Within this normal pattern the network
has been able routinely to innovate designs that meet the particular niche needs of the ever more
diverse diesel engine designs.
During its evolution, the Bosch diesel fuel injection technology crossed a fundamental
threshold as it transitioned from a simple to a complex technology. The time it took to cross the
6
simple to complex threshold involved a more than two-decade period beginning in the 1960s and
continuing into the 1980s. The simple to complex change resulted from an accumulation of
learning and innovations. This period witnessed a major evolution from a hierarchical
organization that utilized primarily mechanical knowledge to a network organization that could,
with increasing speed, synthesize diverse knowledge (e.g., mechanical, materials, electrical,
electronic, and software) located in different organizations. The organizational network that was
developed by the use of alliances includes the diesel division, other Bosch divisions, and many
other organizations.
Innovation and Cooperative Alliances
At the heart of the success of the processes that have produced the Bosch fuel injection
innovations has been an evolving organization with an ability to learn repeatedly. For the early
years, much of the organizational learning came from: accumulating experience, the codification
of that experience, and the development of theory. Thus, the learning involved both the handson (i.e., tacit) knowledge acquired by Bosch craftsmen and the growing body of codified (i.e.,
explicit) knowledge represented by specifications, descriptions and drawings, as well as the
theory, data and processes that were being accumulated in the broader scientific/technical
community. Learning was originally embodied primarily within individuals, but over time it
became group knowledge, and ultimately, through alliances, organizational network knowledge.
With the innovation of complex electro-mechanical systems, it was necessary to develop a
capacity for intimate and rapid interaction among organizations that included, for example,
process equipment makers, component suppliers, universities, the Bosch diesel organization, and
injection system users.
As the complexity of the Bosch technology has increased, network knowledge and
capabilities have increased to meet the requirements for much more complex performance,
evaluation, and analysis. Cooperative alliances were, and remain, necessary to the Bosch
innovation network to be able to access, use and synthesize ever more diverse explicit and tacit
knowledge. The following section discusses the role that alliances have played in the innovation
of Bosch diesel fuel injection technology, and it is organized according to the innovation patterns
presented in Figure 1 and discussed briefly above.
7
Transformation Pattern: Mechanical Pressurized Diesel Injection System
Bosch identified the need for an injection system as a result of interactions with early
developers of diesel engines, and in 1922 it purchased patents from the Swiss firm Arco-Lang as
an early step in the company’s development of a pump. Bosch improved upon the patented
design, and the basic demands of a diesel fuel injection system—atomization, metering, and
timing—were satisfied by the in-line injection pump first introduced to the market in 1927. This,
and other, early in-line pumps were “simple” mechanical technologies; the generic design
involved a plunger pump that forced fuel into the combustion chambers of the engine via a
hydraulically operated nozzle. Bosch used only the plunger design in its injection systems for
nearly four decades; it remains in use today and is produced in large quantities by Bosch and
other manufacturers.
While this early licensing alliance provided codified knowledge necessary for the
innovation, the initial in-line injection system was developed by Bosch personnel using “craft,”
or tacit, knowledge over the course of five years of trial and error development. A small
technical staff with excellent basic engineering knowledge recruited from the technical
universities plus craft-based technicians, the“Ober Ingenieurs,” characterized the Bosch
organization during this time.
Normal Pattern: Mechanical Injection Systems
From 1927 to the early 1960s, Bosch carried out repeated incremental innovations (the
normal innovation pattern) of the plunger mechanical pump, resulting in three different
commercially successful products: the A, M, and P pumps (see Figure 1). The incremental
innovations that characterized this period resulted in the adaptations needed for engines of
different sizes and performance requirements. The creation of “kits” of components and design
modifications gave the in-line design significant flexibility. The knowledge developed and used
in carrying out the incremental innovations was predominately empirical and tacit and was
heavily derived from trial and error processes. The close informal interactions with engine
manufacturers during this period drove the incremental innovation process.
8
Prior to the 1960s most of the Bosch injection systems delivered fuel to indirect injection
(IDI) engines that had relatively low injection pressures (up to 300 bar). With the innovation of
the P pump in 1962, injection pressures were doubled, thus it was possible to design direct
injection (DI) turbo-charged diesels for commercial use.8 Having crossed this threshold, a
pattern of innovation followed that continued to incrementally increase injection pressures to
more than 1300 bar. The significance to Bosch of the incremental innovations that produced the
P pump can be seen by looking at its production and sales. Since 1962 Bosch has produced an
average of 1,000 P pumps daily, and its sales have provided much of the capital for the
development of other designs.
Transition Pattern: Mechanical Distributor Pump
The beginning of the transitional innovation pattern that delivered a successful distributor
pump occurred in 1960. Part of the stimulus for undertaking the innovation of the distributor
pump was a growing belief that there was a need for a diesel engine-compatible injection system
for cars with performance capabilities that could not be met and delivered by the in-line pump.9
The transition pattern encompassed a learning process that required three distinct designs
(EPVM, EPVA, and VE) before major commercial success was achieved.
During development of its initial commercial distributor pump, Bosch bought a French
company that had developed a distributor pump of a different design. Bosch personnel worked
with the French personnel to incorporate some aspects of the acquired design with its existing
one to produce its second commercial distributor pump, which saw limited commercial success.
The third and highly successful design that came out of the transition process was the VE pump
that was selected by Volkswagen in 1976 for use in its commercially successful Golf. Among
other factors, the success of the VE reflected the learning that Bosch had been accumulating as
part of the development of the two preceding distributor pumps. In addition, the focus on fuel
DI engines are more fuel efficient, and thus more economical than IDI engines, and are now used in most
commercial vehicles and trucks.
9
The performance needs were low cost, small size, integrated timing, and a capacity to work as part of an IDI
engine that had a “swirl” chamber (i.e., the smaller of the two combustion chambers had what was known as a
“swirl” design). The in-line pump design could not meet these performance requirements and it specifically would
not work on a swirl chamber engine. The model M in-line pump adopted by Mercedes for use in its cars in 1957
worked because its IDI engine had a patented pre-combustion chamber that worked with the in-line design. Bosch’s
other customers, however, either had or were designing engines that had the swirl chamber configuration.
8
9
economy that stimulated the market for the Golf was driven by the energy crisis that began in
1973.
The learning associated with the VE pump represented the beginning of a period of rapid
increase in the range of technical capabilities that would be developed within what was to
become a Bosch-centered organizational network. Both the nature and the speed of the
innovations that were to follow would change in distinctive ways. The VE was a very different
design, and it represented the integration of technical capabilities that had been developing in the
years following World War II. The VE is appropriately seen as the launching of the process that
saw the simple injection systems of the past become complex.
Normal Pattern: Mechanical Distributor Pump
The years between 1976 and 1980 involved incremental innovations of both the VE and
the P pumps, plus innovations in process technology. The incremental innovations that occurred
during this period did not produce any commercially successful new injection system models,
but, similar to the normal pattern that followed the transformation innovation of the in-line
pump, the incremental innovations that followed the introduction of the VE increased the
flexibility of the distributor pump.
By working closely with the diesel engine and automobile manufacturers, the VE was
adapted to meet the needs of different engines and different performance requirements. There
were, in all advanced countries, increasing pressures for lower exhaust emissions and increased
fuel economy. It was widely accepted that DI engines offered great benefits for cars, but they
could only be used if noise, emission, and comfort problems could be overcome. The experience
with DI engines in the commercial engine arena was being used to respond to these emerging
market demands. In summary, the normal innovation period between 1976-1980 saw a wide
range of incremental innovations and the broad recognition that future innovations would have to
produce injection systems that delivered higher pressures and ever more precise control.
Although Bosch remained committed to its axial piston design distributor pump during
this period, it did, as part of the purchase of Sigma Diesel, the French company previously
mentioned, acquire a radial piston design distributor pump. Although the radial design was not
the reason for the purchase, it would prove to be an asset during the next transition period.
10
Perhaps a greater asset acquired through the purchase of Sigma was the knowledge embodied in
the highly educated engineers in the company. Bosch managers gave the French engineers predevelopment projects, including a high-pressure distributor pump, but a decision was made not
to develop it immediately.
Transition Pattern: Electro-mechanical and Complex Integration
For the two decades between 1980 and 2000 the Bosch injection technology and
organization was characterized by a transition innovation pattern. A review of the environment
within which an organizational network developed strikes one with the magnitude of the change
and the critical role flexibility and a capacity for adaptation has played. Within this context
perhaps the most striking thread underlying this transition is the importance of the Bosch
reputation for quality. Repeatedly, in spite of what appears from hindsight to have been a
number of cases where the Bosch network was slow in making technology adaptations and
carrying out redesigns, its reputation for quality saw it achieve market success. In major part the
network’s record of technological success has resulted from its ability to rapidly access and
synthesize new knowledge by linking to other organizations and from its openness to taking
initiatives that involve the participation of many members of the network. Additionally, four
external developments had major influences on the innovation process that produced the
transition. These were: an increased focus on environmental protection, a need for fuel
economy, rapid developments in digital electronics, and increasing consumer affluence. These
developments influenced the pursuit of the knowledge needed to meet the changing performance
standards.
The transition occurred in two stages. The first saw redesigns of many of the injection
systems that produced complex electro-mechanical systems. As part of the co-evolutionary
process there was an evolution from a hierarchical organization concerned primarily with
mechanical knowledge to a network that integrated a diverse range of knowledge that required
accessing mechanical, electrical, electronic, and software learning. The first stage, then, was
characterized by a process that was heavily involved with developing and assembling
components into injection systems that are seen as distinctive subsystems of diesel engines.
Central to this capability was the development of solenoid actuators.
11
The second stage began in the mid-1990s. It saw an innovation process that involved a
complex synthesis that produced a nearly seamless interaction between the injection system and
diesel powered cars and commercial vehicles. Only a systems integration of a very complex and
sophisticated kind could provide the kind of precise and sensitive interaction between the fuel
injection technology and the diesel-powered systems required to satisfy what had become
exceptionally demanding performance standards. By 2000 diesel-powered systems had to meet
stringent fuel economy and emission standards and do so while providing a level of comfort with
regard to flexibility, noise, starting, smoothness, and acceleration that was equal to or better than
what was offered by gasoline powered systems. Central to this capacity for performance was the
development of high-speed solenoid valves with high levels of reliability.
The introduction of electro-mechanical diesel fuel injection technology into the
commercial market was characterized by the innovation of several different systems, each with
distinct combinations of electrical and mechanical components (see Figure 1). The innovations
during the first stage of the transition, the VP-20, VE-EDC, and VE-EDC/DI, were mechanical
systems that had seen electronic control modules substituted for mechanical controls. In the
latter part of the 1980s Bosch’s customers became more intimately involved in the network that
carried out these innovations. For example, Volkswagen (VW) participated in the network as it
was developing the VE-EDC/DI and the VW engine that used this technology entered the market
in 1989, delivering a major improvement in fuel economy.
To achieve what was clearly the next step it was necessary to innovate electromechanical injection systems that represented a new integrated design. Achieving the set of
interrelated performance objectives that were demanded by the mid 1990s required a single
electronic control system that synthesized and utilized information that included, for example,
inputs from the exhaust system and transmission through to the diverse range of engine data. For
these synthesized data to be used effectively the injection system had to provide a level of
precise engine control that was beyond anything previously seen, plus pumps that could provide
the high injection pressures needed for DI engines.
By the mid 1990s digital electronics offered the capacity to collect and synthesize the
diverse data required for new integrated designs and, in addition, the first versions of a control
technology that provided the needed precision had been innovated. Three new designs were to
12
carry the transition to electro-mechanical injection systems to its conclusion. They were the unit
injector system/unit pump system (UIS/UPS), the VP-44, and the common rail system.
The UIS/UPS technology currently provides the highest injection pressures that, in
conjunction with other improvements, deliver increased efficiency, considerable emissions
reduction, and reduced noise. Bosch initially gained access to the UIS/UPS technology designs
for commercial diesels in 1989 by purchasing a substantial interest in the U.S. firm Diesel
Technology.10 European manufacturers of commercial diesels had encouraged Bosch to buy an
interest in the U.S. firm. The European companies took this initiative in part because Bosch’s
record of high quality manufacturing offered security that they could utilize the UIS/UPS
technology with greater confidence. In similar fashion, Bosch gained access to UIS/UPS
technology for auto engines with the purchase of a development group that had been created by
the Austrian steel company VOEST to produce an injector system. The development group was
working on a UIS/UPS design for VW, and the German auto company encouraged Bosch to gain
access to this technology in part with the belief that Bosch’s manufacturing capabilities would
enhance the prospects for a reliable technology.
In 2002 Bosch UIS/UPS was providing high injection pressures that could be precisely
controlled for both commercial and auto diesels. The combination of digital electronics, sensors,
software, solenoid valves, and high pressure pumps offered a flexibility that made it possible to
meet the ever increasing performance requirements. Achieving the performance requirements
was possible because of the continuous innovation of both product and process technology.
During this period Opal chose to make a commitment to a new diesel engine for its cars,
and this was a major factor in the Bosch network undertaking the development of the VP-44.
The electro-mechanical synthesis represented by the VP-44 created a complex interdependent
fuel injection system. The VP-44 system features high nozzle injection pressures (above 1700
bar) and a combined pump-engine control unit that uses the latest computer technology. When
the Bosch network began work on the VP-44 it was able to use the technical knowledge
(specifically a radial design) it had acquired with the purchase of Sigma Diesel almost twenty
years earlier by integrating a central electronic control unit into this design. The VP-44
represented an order of magnitude increase in the level of complexity when compared to
Diesel Technology was owned by Penske through its ownership of Detroit Diesel, a manufacturer of commercial
engines.
10
13
previous distributor systems. Innovation of the system involved the integration of knowledge,
capabilities, and organizations, on a scale, and with a level of complexity, that had not previously
existed.
The Common Rail System (CRS) is the last of the three highly integrated injector
systems innovated by Bosch in the 1990s. The unique feature of the CRS is that pressure
generation and fuel injection are completely decoupled from each other. The six modules11 of
the CRS are integrated, controlled, and coordinated with the engine by a single electronic control
system. The CRS uses syntheses of the advances the Bosch network has made in delivering
increased pressures and providing precise control to offer great flexibility to customers. The
CRS offers the potential to deliver an injection system that can provide, rapidly, for the specific
performance requirements of niche markets.
During the early 1990s, again with the encouragement of customers, Bosch bought an
Italian development group, ELASYS, from Fiat. This group had developed a CRS with the
support of the Italian government. The ELASYS prototype had built on work being done for
decades at a Swiss technical school. This very sophisticated system required high quality
manufacturing if it was to be reliable, and this resulted in the pressure by engine producers for
Bosch to make the purchase and become the manufacturer. The Bosch CRS technology was
introduced to the market in 1997 for passenger cars and in 1999 for commercial vehicles. The
speed with which the CRS was adopted suggests both the accelerating rate of innovation and the
close relationships among the participants in the Bosch-centered organizational network. The
Bosch network now has a capability to deliver specialized designs of its injection technologies
for specific uses in very short periods of time.
Building an Innovation Network
The transition in the Bosch organization that made it possible to develop the UIS/UPS,
VP-44, and CRS required the creation of a complex organizational network. It began with an
expansion of the range of technical expertise in Bosch. In the late 1970s Bosch separated its
diesel injection organization from the gasoline injection organization. The diesel organization
The six components are: pump, pressure control valve, line leading from the pump to the accumulator, rail, line
leading from the accumulator to the cylinder injector, and cylinder injector.
11
14
that was created was designated the K5 division. Shortly after its creation a change in the
technical background of the leadership of K5 occurred. For roughly the first six decades of
Bosch diesel injection activities people with mechanical skills and mechanical engineering
knowledge led and populated the organization. The new head of K5 was an electrical engineer
who had spent eight years working in the United States for Westinghouse on electronic control
systems. This change in leadership reflected the belief that the future success of diesel injection
systems would require the integration of electronics.
In 1979 the second oil crisis focused major attention on fuel economy, resulting in
increased public and governmental pressures for more efficient engines. During the same period
pressures were growing for finding ways to reduce emissions. In 1980 K5 made the decision to
develop electrical-electronic expertise that would lead to the development of the solenoid
actuators as the route to better control. This involved the integration into the organization of not
only Bosch employees with a different expertise, but it also resulted in linkages to the electronics
division of Bosch that was located forty kilometers from Stuttgart, as well as to the broader
electronics community. Interdisciplinary integrated project teams were created to facilitate the
mixing of technological talent. The initial electronics project groups reported directly to the
head of K5, and were thus organizationally parallel to the large organizational units that
produced the different established injection systems, e.g., in-line and mechanical distributor.
The 1980 electronics initiative is best seen as the beginning of a process of rapid
organizational change that built a network of electro-mechanical organizations and knowledge
with a unique capability for the synthesis of repeated electro-mechanical innovations. The
network, through a process of trial and error, was able to create, access, and integrate a range of
knowledge that was far beyond the capabilities of any individual. The fusion of electronics and
mechanics represented the end of the era in which it was possible to believe that any individual
could do a complete systems design on his own.
The character of K5 and the broader organizational network changed rapidly. In 1980
electronics was foreign to the deeply embedded mechanical culture of the K5 division. A view
held by some in K5 was that there was no need for major change and no need for the electromechanical design. Moreover, it was argued, a major change carried a high risk. There was not
a consensus in Bosch in the early 1980s that it was necessary to take what was perceived as the
high risks associated with the innovation of an electro-mechanical technology. Thus, the
15
initiatives taken and sustained within the transitional pattern required concerted leadership from
top management. One part of what made the change possible is the structure of Bosch. It is a
privately held corporation (today controlled by a foundation set up by the Bosch family) and has
a tradition of financing its research and development initiatives from internally generated funds.
The availability of an environment that tolerates long development times, plus the relatively
longer development times associated with innovations in the auto and commercial vehicle
industries, provided an environment that supported a transitional innovation pattern that took two
decades.
Central to the success of the two-decade transition was the building of an organizational
network that linked, in intimate ways, suppliers of diverse capabilities at one end with diesel
manufacturers at the other. Part of the capacity to access and integrate the diverse knowledge
needed for the transition was the location within a hundred kilometers of Stuttgart of the key
suppliers and users of an increasingly complex injection technology. Over the course of the two
decades Bosch developed an organizational and personal network that shared common interests,
trust, and a culture that facilitated the transitional innovation, e.g. the Swabian reputation for
thrift, orderliness, and pride in workmanship.
From their beginning, the Bosch fuel injection systems enjoyed continuous
improvements; many of these improvements involved process innovations. Repeated
improvements occurred, for example, in metallurgy, grinding, honing, and measurement
techniques. Bosch people emphasize that these improvements, particularly those associated with
machine tools, have been facilitated by the geographical proximity of their machine tool
suppliers. High-trust personal links between Bosch and its suppliers have been invaluable, as
have the links with other Bosch organizational units such as the electronics division.
The history of high-trust linkages that involved more than maximizing immediate
economic transactions provided a powerful reference system for adapting the mechanical
organization to an electro-mechanical organizational network. The early critical relationship
with the Bosch semiconductor organization illustrates what was possible. An effective
relationship was developed rapidly between organizations with very different kinds of expertise.
Part of the rapid capacity to develop successful cooperation with the semiconductor
organizations was its close proximity (within forty kilometers of Stuttgart). Commercial success
required not only quick interaction between the K5 group and the semiconductor unit, but also
16
continuous access to the rapidly changing worldwide electronics community. For example,
innovation of the VP-44 required a 32-bit microprocessor. At that time only 16-bit
microprocessors were commercially available from the semiconductor industry. Bosch’s ability
to design and then use a merchant fabricator to manufacture its own 32-bit microprocessor
required accessing the knowledge of the broader semiconductor community.
Similarly, the development of control systems that could synthesize data from diverse
sources to achieve desired engine performance required new computer capabilities, both
hardware and software. Software that could simulate the very complex processes associated with
the direct injection of high-pressure fuel was critical, and this was a whole new area of
knowledge that had to be accessed and integrated into the network in the post-1980 period.
Simulation made it possible to quickly design UIS/UPS and CRS for specific engines and
performance patterns. Simulation was also a key factor in making the rapid development of the
VP-44 possible. A high-level Bosch manager succinctly characterized the organizational and
knowledge transition that was occurring in the 1980-2000 period. In his discussions with the
Bosch leadership at the time of his appointment the new manager said, “The key to success
would be the ability to work in teams with the disparate organizations and people who had the
diverse knowledge needed for innovation.” The manager’s approach represented the route to
rapid acquisition and integration of the knowledge necessary for the innovation of the ever more
complex injection systems that would be developed in the last two decades of the 20th century.
The manager’s language was prescient; it recognized that fuel injection systems had now moved
from relatively simple mechanical systems to ever more sophisticated, ever more complex
systems that required the integration of diverse kinds of knowledge at ever-greater speed with
increasing flexibility.
The need for speed and flexibility was to become strikingly evident in the 1990s as the
pressure from customers for specialized designs of fuel injection systems became pervasive.
Bosch’s customers, because they were part of the innovation network, understood that new
capabilities existed and they were able to confidently demand, with short turn around times, fuel
injection systems that could be orchestrated to respond to their particular engine designs and
characteristics. Part of the design/sales approach of the automobile companies was to have their
own unique diesel engines. The Bosch people note that as complexity increases the capacity for
adaptability of design increases. Not surprisingly as the capacity for adaptability increased the
17
demand for specialized designs increased and one automobile company after another began to
specialize the diesel engine models they offered their customers.
Prior to 1990, the target of technical development was functionality. After that there was
a change in philosophy--a change to quality, cost, and delivery (QCD, à la the Kaizen system)-and concomitantly a greater stress on teamwork. To shorten development cycles, K5 committed
itself to simultaneous engineering as a way of doing business. Over the course of the 1980-2000
period the Bosch diesel injection network gave ever-greater emphasis to the development of a
broad range of software capabilities. Much of the major software capability was located in
Bangalore, India. As previously noted, computer simulation had become critical, but so had
computer-aided design and manufacturing. These computer capabilities made it possible to
move rapidly from design to manufacturing, and they speeded communication within the
complex organizational network that developed over the two decades after 1980.
Normal Pattern: Electromechanical Systems and Beyond
By 2000 the innovations that had occurred within the transition pattern had put in place
an innovation capability of major breadth and depth. The transition to electro-mechanical
systems involved the development of an organizational network that can carry out the innovation
of new designs on a repeated and incremental basis. The complex network that exists today has
capabilities for rapid learning that represents something that is quite new; designs are now
developed to meet specific engine performance requirements by what is appropriately
characterized as self-organizing network.
Part of the capacity for routine, incremental innovations of specialized designs for
individual customers comes from the fact that Bosch has representatives co-located with its
customers who deal directly with applications, thus assuring that the injection systems are
seamlessly integrated into the diesel engines. These applications people, located worldwide, are
key to the rapid learning of the network. They represent knowledge links in the network that can
move both tacit and codified knowledge with great speed and can assist the network in adapting
rapidly. The Bosch network applications function is intimately tied into the design/production
activities in a way that allows the injection systems to be tuned to the precise uses and designs of
the various engines.
18
The dominant characteristic of the learning organization represented by the injection
system network is the growing intimacy and interaction of what is now known as the Diesel
Services (DS) division (formerly K5) with its suppliers and customers. This intimate network
also includes ever-closer interaction with people in universities.
The need for cooperative relationships will continue to be essential for future innovation
due to the external pressures of the early 21st century on this complex technology. First, there is
a surplus capacity for manufacturing automobiles and, at least in the advanced countries, there is
a growing market for specialized luxury products. The tendency to have relatively customized
options is growing, reinforcing the need for flexibility and adaptability, and is linked to the
increasing complexity of automobile systems. This pattern of adaptability is reinforced by a
growing concern with environmental residuals. In addition, the rapid increase in energy costs
puts additional emphasis on fuel-efficient automobiles, notably those with diesel engines.
Finally, the miniaturization of technologies will undoubtedly involve rapid incremental
innovations of existing diesel fuel injection systems.
Knowledge Management and Decision-making12
Organizational networks are necessary in carrying out the innovation of complex
technologies because networks provide the capacity to do what neither theories nor individuals
can do. Networks offer a way to access and use diverse knowledge that is both codified and tacit
in order to accomplish what has not been done before without an understanding of how to do it.13
Networks thus offer two critical capabilities. First, they provide a way to access, create, and use
(synthesize) diverse knowledge that is located in multiple organizations and individuals. Second,
they provide the structure needed for the range of people and organizations that hold the diverse
knowledge to participate in decision-making.14
This section is taken from Kash, Don E., Robin N. Auger and Ning Li, “Organizational Requirements for the
Innovation of Complex Technologies,” in John de la Mothe and Albert N. Link, eds., Networks, Alliances and
Partnerships in the Innovation Process, Boston: Kluwer, 2002, pp.165-190.
13
Kline, Stephen J, Conceptual Foundations for Multidisciplinary Thinking, Stanford: Stanford University Press,
1995, pp. 171-8.
14
Sing, Kulwant, “The Impact of Technological Complexity and Interfirm Cooperation on Business Survival,”
Academy of Management Journal, Vol 40, No. 2, April 1997, pp.339-67.
12
19
The Bosch case study provides an illustration of how knowledge management and
decision-making processes occur. In addition, the case study offers insight into both the difficult
adaptation associated with crossing the threshold from a simple to a complex technology and
insight into the structure and processes associated with each of the three innovation patterns.
A review of the knowledge needed to carry out the innovations of Bosch’s diesel fuel
injection technology over the last eighty years indicates a trend toward knowledge diversity that
has been accelerating at an ever more rapid rate since the 1960s. The growing diversity of
knowledge has two dimensions: it includes both greater knowledge depth (e.g., a capacity for
executing ever finer machining) and breadth (e.g., the inclusion of electronics into a mechanical
technology). The Bosch organization’s reservoir of both codified and tacit knowledge has
increased over its lifetime, and that increase has been accelerating in the last two decades. The
knowledge is located in a growing number of organizations, both in other Bosch units and in
organizations linked to Bosch through the diesel fuel injection network. The organizational
network has developed a body of routines and heuristics15 that are essential to the successful
interactions of the different organizations. The routines and heuristics exist as both codified and
tacit knowledge embedded in the Bosch-centered network.
A review of the decision-making associated with the injection system innovations
beginning in the 1960s suggests what is increasingly a self-organizing system—a system where
decision-making occurs via a process that is coordinated by consensus concerning what the
performance characteristics of the new innovation will be. Further, this self-organizing system is
delivering decisions ever more rapidly. This was especially evident as the network entered the
new century and was manifesting the capacity to deliver specialized configurations of multiple
injection system designs. The exceptions to this general pattern occurred when the decision was
made to design the mechanical distributor pump in the early 1960s and again with the decision to
design an electro-mechanical injection system in the early 1980s. In these instances the top
management of Bosch mandated both technical and organizational changes.
An illustration of the knowledge and decision-making adaptation over the last eight
decades is shown in Figure 2. Box 1 in the upper left corner covers the period from 1922-1960
and reflects the fact that the knowledge needed to carry out the innovation of the in-line pumps
15
Nelson, Richard R. and Sidney G. Winter, An Evolutionary Theory of Economic Change, Cambridge, MA:
Belknap Press, 1982.
20
was predominately mechanical and the decision-making was centralized in a few organizational
leaders. Both the knowledge needs and the centralized decision-making during the first four
decades reflected the fact that the technology was simple. The same knowledge and decisionmaking characteristics were evident in both the first-of-a-kind innovation taken to the market in
1927 and the follow-on incremental innovations. The Bosch organization was accumulating a
great deal of learning both from its own internal work and from the explosion of technical
knowledge that was occurring more generally. In the midst of this time period World War II
drove advances in nearly every technical area, and the pattern of advancement continued in the
post-war period. In summary, for this simple technology the same knowledge and decisionmaking characteristics appear in the transformation and normal innovation patterns.
19221960
Centralized
Decisionmaking
1
19802000
19601976 19761980
64
2
3
4-a
19802000
4-b
Diffuse
20002002
5
Less
Diversity of
Knowledge
More
Figure 2: Evolution of Knowledge and Decision-making in Bosch Network
21
Box 2 in Figure 2 refers to the period of the transitional innovation that produced the first
mechanical distributor pump (1960-1976). It reflects both the use of more diverse knowledge
and of less centralized decision-making. The first distributor pump design required a more
sophisticated body of technical knowledge and a more diverse decision-making process. This
begins the period when the injection technology began movement across a threshold from a
simple to a complex technology. There is disagreement concerning whether the first distributor
pump was simple or complex, but it clearly represents a major design change that was critical to
the development of the complex technology represented by the electro-mechanical injection
system that would be innovated later. The transition pattern ended with the commercial success
of the distributor pump initially used on a large scale in the Volkswagen Golf.
The period represented by Box 2 remains characterized by the use of relatively limited,
primarily mechanical knowledge. It also involved relatively centralized decision-making—the
design was the product of a small number of people. The mechanical distributor pump, however,
represented a more sophisticated and complex technology than the previously dominant in-line
pump.
Box 3 in Figure 2 refers to the period after the introduction of the distributor pump in
which the incremental innovations were improving both it and the in-line mechanical pump. The
improvements during this period would be of major importance to the next transition, the electromechanical design. This period was characterized by an expansion of knowledge, especially an
increase in depth; it involved the kind of learning commonly associated with innovations that fit
the normal pattern. In summary, there was a substantial increase in the mechanical knowledge
utilized, but there was not much increase in the diffusion of the decision-making over what had
existed at the time of the initial innovation of the distributor pump.
Boxes 4-a & b in Figure 2 represent the period when the transitional innovations were
being carried out that ultimately produced the UIS/UPS, VP-44, and CRS. The period had two
phases that were distinguished, among other things, by different electronic controls: solenoid
actuators and solenoid valves. The period saw a very great increase in the diversity of
knowledge needed. Specifically, it required integrating electronic and electrical knowledge into
what quickly became an organizational network of substantial complexity. There was no longer
any question about whether the injection technology was simple or complex.
22
The period reflected in Boxes 4-a & b is particularly interesting in terms of decisionmaking. Box 4-a reflects the fact that while the diversity of knowledge needed to carry out the
transition innovation experienced a very large increase, at the same time there was a major
movement toward centralized decision-making. Active, high level management intervention was
necessary to get the self-organizing network that had been carrying out the repeated innovations
of the mechanical injection systems to link with and integrate the organizations and people who
held the electronic/electrical knowledge. The most significant event in this process occurred
with the change in leadership of K5 from a mechanical to an electronic specialist. This major
change required centralized decision-making, which involved the governing board choosing a
leader who was not a “diesel person.” The new leadership then created new organizational
relationships—multi-disciplinary teams that reported to the leader—that used organizational
processes and management actions to integrate electronic expertise into what had been a selforganizing network composed of people with mechanical expertise.
Box 4-b reflects the fact that the innovation of the electro-mechanical systems required
both diverse knowledge and diffuse decision-making. The technology that was innovated during
this transition pattern required the full participation of holders of diverse expertise. The
complexity of the technology made the existence of a single designer impossible.
Box 5 in Figure 2 represents the present period of innovation characterized by the normal
pattern, by repeated incremental innovations that produce specialized configurations of the
multiple injection system designs that are in current production. Incremental innovations are
being carried out on four different designs. The diversity of knowledge held by the Boschcentered network makes it possible to rapidly deliver a design that fits the specific needs or
desires of diverse customers. Decision-making is very diffuse and it reflects behavior that is
consistent with a self-organizing network. Thus, the location of Box 5 in Figure 2 indicates that
a very diverse knowledge base and a very diffuse decision-making process currently exist.
The Bosch Example in a Broader Context
The Bosch case study is one component of a larger study of the evolution of the
innovation patterns of thirteen technologies whose organizational networks are located in six
different countries. The results of these case studies suggest, as in the Bosch case, that managers
23
and policy-makers benefit from focusing on organizational networks, not single organizations.
To place the Bosch example in a broader context, Figure 3 illustrates the adaptation paths traced
by the knowledge and decision-making of Bosch and four other technologies studied:16 theSonyPhilips audio compact disc (CD) (Japan-Netherlands),17 the Hewlett-Packard (HP) cardioimaging technology (United States),18 the TATA Consultancy Services (TCS) software services
Decision-making Centralized
and products (India),19 and the Haier line of home appliances (China).20
Haier appliances
HP Cardioimaging
technology
Diffuse
Bosch fuel injection
systems
TCS software
technology
Period of Transition
from Simple to
Complex Technology
Less
Sony CD
systems
Diversity of Knowledge
More
Figure 3: Evolution of Diversity of Knowledge & Decision-making in Five Networks
Kash, Don E., Robin N. Auger and Ning Li, “Organizational Requirements for the Innovation of Complex
Technologies,” in John de la Mothe and Albert N. Link, eds., Networks, Alliances and Partnerships in the
Innovation Process, Boston: Kluwer, 2002, pp.165-190.
17
Kash, Don E. and Robert R. Schaller, “Innovation of the Audio Compact Disc Player,” School of Public Policy
Working Paper, Fairfax, VA: George Mason University, January 2000.
18
Kash, Don E., “Innovation of Cardio-Imaging Technology at Hewlett-Packard and HP/Philips,” School of Public
Policy Working Paper 03:2, Fairfax, VA: George Mason University, June 2003.
19
Kash, Don E., “TATA Consultancy Services: A Case Study,” School of Public Policy Working Paper, Fairfax,
VA: George Mason University, February 2003.
20
Kash, Don E., “Haier Company Innovation in Household Appliances,” School of Public Policy Working Paper,
Fairfax, VA: George Mason University, November 2001.
16
24
The adaptation paths shown in Figure 3 illustrate the unique combination of knowledge
and decision-making processes required for the innovation of each technology. More
importantly, however, the figure shows that even for complex technologies, there are times when
centralized decision-making is needed. This is particularly important when the technologies are
new or experience major change, as during the transformation and transition innovation patterns
(i.e., during the development of first-of-a-kind technologies and during major technology
redesigns). Thus, it is during these periods that company managers need to be most actively
involved. These patterns require leaders to guide and facilitate the innovation process. More
broadly, it is also during these periods of substantial change that public policy makers should
focus their attention and efforts.
During the normal pattern, the innovation of complex technologies and simple
technologies differ in their knowledge and decision-making requirements and processes. For
complex technologies, incremental (normal pattern) innovation is facilitated by networks that
self-organize to access and synthesize the diverse body of tacit and codified knowledge needed
to rapidly carry out these innovations. This is particularly important because incremental
innovations are the most financially beneficial to the innovators.
For simple technologies, centralized decision-making is possible even during the normal
pattern. Successful centralized decision-making requires decision-makers to have understanding
derived from extensive codification of the needed knowledge and/or the range of tacit
knowledge needed to make informed decisions. The movement of a technology from simple to
complex typically requires major efforts to codify existing tacit knowledge. As the complexity
of the technology increases and the rate of its innovation increases, this codification response
becomes less and less adequate. It is at this point, then, that only networks will suffice.
Conclusions
Bosch diesel fuel injection systems provide an illustration of the technological and
organizational co-evolution associated with the innovation of complex technologies. The case
offers insight into the evolution from a simple mechanical system to increasingly complex
25
electro-mechanical systems. At the same time, the organization responsible for carrying out the
innovation has evolved from a small specialized Bosch group to an international alliance-based
network comprised of suppliers, end-users, universities and several Bosch organizations.
One consistent characteristic of the Bosch organization suggested by a review of the
injection technology history is that Bosch is very good at incremental innovations and systems
know-how. Repeatedly the organization has demonstrated special skill in fitting new product
designs to the market. This is done primarily by carrying out incremental innovations and
putting major emphasis on production and servicing innovations that either structure or quickly
respond to the market. In the contemporary period this means being able to rapidly deliver
specialized systems that meet the needs of customers. Contemporary innovation success requires
being able to produce a unique injection system for the new engine modifications that user
companies are carrying out on a repeated basis.
The absence of the “not invented here” syndrome is particularly striking. The selforganizing network clearly learns from any source and exchanges knowledge with its network
partners. In addition Bosch has used the innovation of a very wide range of specific fuel
injection systems, for example the unit injector, to create competition within its own diesel fuel
injection network. Each of the major designs is to some extent in competition with the others.
The result of this is that the different injection systems compete with each other for market share.
There are thus powerful incentives to make incremental innovations. There are also powerful
incentives for driving the learning of the network as a whole. The existence of the multiple
injector system networks centered in the DS division creates a situation where learning in one
injection system network gets rapidly transferred to other injection system networks. This is
clearly evident in the development of improved process technologies. Where it has high volume
production, Bosch seeks to have two manufacturing plants to assure a continued supply in case
of difficulty at one plant. One of the benefits of this approach is that the plants contribute to each
other’s learning.
Bosch is a high trust organization. The Bosch culture appears to limit the incentives for
opportunistic behavior both on the part of individuals and organizational units. Several
observations about the high trust character of the Bosch network are warranted. First, there is
substantial emphasis on the specialized skills of people and organizations in the Bosch network.
It appears generally correct to characterize the Bosch network as one composed or organizations
26
and people who perceive their identities in terms specialized in-depth knowledge and skills as
opposed to generalists. Second, there appears to be substantial competition among the people
and organizations that make up the network and with other networks in Bosch in their pursuit of
technology innovations. Third, Bosch appears to have a culture that allows it to gain the benefits
of the incentives that come from competition within the network and company and also the
benefits that come from cooperation and pursuit of a shared set of goals.
The Bosch-centered network has developed a capacity whereby engine designers and
manufacturers who are competitors are willing to share their knowledge with Bosch because they
have confidence that their proprietary knowledge will not be communicated to other competitors.
This has two benefits. First, it allows for rapid joint innovation between Bosch and the engine
producers. Second, it allows for Bosch to enjoy the range of learning that comes from innovative
interactions with a range of engine producers. The generic learning that the Bosch network
acquires from carrying out innovations with many engine producers flows back to all engine
producers. The pattern of cooperation and competition could not work without trust.
Specifically, the ability to carry out transition pattern innovations, those that have
involved new designs and require the integration of new core capability knowledge, has been
facilitated by the atmosphere of trust. It is commonly a major management challenge for
companies to carry out the innovation of technologies that require merging previously separate
but equal bodies of technical knowledge, e.g., the first innovation of electro-mechanical
technologies. Merging diverse technical communities involves the merging of separate
technical/organizational cultures. The Bosch trust environment appears to have made the major
change in the organizational network necessary to carry out the innovation of electro-mechanical
technologies work more smoothly than often occurs.
27