The Business of Modularity and the Modularity of Business

This thesis deals with the concept of modularity, which is used in many different fields of research and applications. The objective of this dissertation is to investigate how and to what extent business networks can use modularity to become more customer-responsive and flexible. For this purpose, a theoretical framework on modularity has been developed, which focuses on three dimensions of doing business: designing products, business processes and supply chains. The central proposition is that a concurrent, modular design in these three dimensions increases the performance of inter-organizational business networks in general and a mass-customization strategy in particular. This proposition was validated in a number of empirical settings. First, the applicability of a business modeling approach, called Modular Network Design, was validated in the air cargo industry. Second, it was investigated how the Dutch building industry applies modularity in order to mass-customize newly built houses. Third, a survey was held among numerous customizing organizations, dispersed all over the world, which led to more understanding about the relationship between business modularity and organizational performance.