This paper discusses 1) the generic forces that drive the evolution of diversified
industrial corporations and their implications for the corporate technology base, 2) the
changing role of the central R&D lab in the context of these forces, and 3) the role of
management of technology in promoting dynamic coherence in diversified - and highly
decentralized - corporations. The line of argument in the paper is illustrated by an indepth
case-study of Danfoss, a Danish multi-divisional corporation operating within
mechatronical markets.