These are concepts borrowed from Computer Science.
Analyzing a system (Complex Systems) and breaking it down into its constituent parts. Complicated systems (Complex Systems) are able to be modeled but complex systems are intertangled and modeling is always imperfect (Map is not the territory).
Taking your decomposed system and creating a taxonomy of parts that are interchangeable. Think of Lego. Each piece has a common interface that allows you to mix and match different types of pieces. This is useful for building complicated systems.
Modularization is being used in modular homes, auto manufacturing, software engineering, and hardware engineering.
To decompose a House would be to think of the constituent parts, plumbing, electrical, framing, foundation, dry wall, insulation, siding, etc. Since Systems are fractal, it’s possible to decompose a system into systems, and then break those systems into their own systems. Stop decomposition when you reach an understandable and useful result.
To modularize a system, we would take a decomposed sub-system and build it so that it functions as a black box. We can hide all the complexity in the box, and then we only care about its inputs and outputs. We don’t care as much about what is happening inside the box. Unfortunately due to Entropy, a black box is never completely isolated and there are usually side effects to as Boundaries are an abstraction that allows us to reason about a system, but that don’t actually exist..