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Recent Corporate Restructuring in the Japanese Semiconductor Industry: The case of M Corporation
- Restructuring is an essential process for the better competitiveness of the corporation in terms of production cost or/and product quality. The spatial importance of corporate restructuring relates to the locational changes of production processes at the global scale. In order to explain corporate restructuring processes, reference is usually made to two basic concepts: the new international division of labor, or NIDL, and the product cycle. However, both of these models, based on the behavior of multinational corporations, emphasize the reduction of production cost. They give little attention to another means of competition in industrialized economies, i.e. restructuring processes connected with product quality. It is this form of restructuring that is emphasized in this paper, which analyzes the underlying factors behind the recent restructuring trends of M Corporation, a leading semiconductor manufacturer. The research demonstrates that there were two strong characteristics of this recent restructuring. First, M Corporation withdrew from making less profitable products at intra-firm level. Second, it concentrated on more profitable technology-oriented products. The reasons that M Corporation has chosen the above restructuring methods stem from three factors: the weaknesses of competitors' production systems, the existing information infrastructure, and the corporate culture of M Corporation. The research reported in this paper will alter existing industrial location concepts.
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