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by Herbert S Kleiman
Business Horizons ()
  • ISSN: 00076813


The innovation studied here is the integrated circuit. These components represent a major breakthrough in the miniaturization of electronic circuits. Some, without their external packaging, are now about the size of the period at the end of this sentence, yet contain up to the equivalent of twenty-six components of conventional size.[1] The need to innovate is imperative in the electronics industry, not only because of rapid advances in the underlying technology, but because the industry depends so heavily upon one customer--the federal government. The National Aeronautics and Space Administration and the military need the latest and best electronics, and contracts go to the companies promising the latest and best. ("Best" has come to mean low weight, small size, and highly reliable components-the essence of the integrated circuit.) Competition is so keen that "those companies that fall even a little behind technologically are soon out of business.''[2] The integrated circuit provides a fascinating and instructive ease study of how government and industry can combine to produce an innovation. The record is not unblemished; it has its points of controversy, its undeserving credit takers, and its wasteful programs. Still, these highlights stand out: Sales in 1965 totalled nearly $80 million with 1970 predictions running from $500 million to $1 billion Initial use in military and space programs evolved into major present and probable future activity in industrial and consumer applications Initial government development funding induced even greater expenditures by industry toward the same end The circuit will have a greater effect upon the electronics and other industries than did the transistor. The integrated circuit replaces many other electronic components. Within a small area (typically 1/16 by 1/16 of an inch), it can perform the same function that formerly required many transistors, diodes, resistors, and capacitors. It is smaller, more reliable, less p... [ABSTRACT FROM AUTHOR]

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