The Modular Squad Building success one piece at a time.

When the founders of Palm Computing set out to create what wouldbecome history's hottest computer gadget, they didn't go italone. Instead, they wrote detailed specifications for a hand-heldelectronic organizer called the Pilot--then they invited othercompanies to create parts of the product that eventually sold morethan 1 million units in its first 18 months.

One company that contributed to the project was The WindwardGroup, a 75-person software developer in Los Gatos, California,that created desktop applications with a link to the Pilot."We decomposed the system into chunks which we developed ontheir behalf," president Doug Engfer explains.

The system benefits both Palm and those who build the piecesand, in many cases, sell them independently, says Donna Dubinsky,president of Palm Computing, now a subsidiary of networking giant3Com Corp. "The metaphor that springs to mind is the RussianMatreshka dolls, where each layer takes from the layer above andgives to it as well," she says.