Building Small: In Many Industries, Economies Of Size Is Shifting To Economies Of Numbers
This trend—observable in nascent form in several industries ranging from small, modular nuclear reactors, chlorine plants, and biomass energy systems to data centers—is resulting in a switch from large to small optimal unit scale, the authors found. The shift mirrors a similar revolution that began thirty years ago in the supercomputer industry. The traditional approach to producing higher capacity and greater speed in computing was to build increasingly powerful, specialized machines with ever-increasing processing power. This came to a halt in the mid-1990s, when it became cheaper to employ mass-produced processors and high-capacity memory from the burgeoning personal computer industry. Soon, the researchers conclude, many more industries will learn to "think small" and thereby reap the benefits of this new paradigm in production.
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SOURCE Columbia Business School
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