Intraorganizational Alignment and Innovation Processes: Philips and Transistor Technology

The Dutch company Philips succeeded in producing transistors early on. By the early 1950s, it had acquired a strong position in the European semiconductor market. However, by the end of the 1950s, it was being surpassed by competitors. In response to the developments in solid state electronics, Philips' management adjusted the company's research, development, and production capabilities, enabling the firm to bring point-contact and layer transistors onto the market and to develop its own high-frequency transistor. When demand for industrial transistors increased, Philips was unprepared, leaving it without an entr�e to this new market. The company's exclusive contracts with IBM not only …