Class_9_Dom_designs_inno_cycles_Presentation

Class_9_Dom_designs_inno_cycles_Presentation - Dominant...

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Unformatted text preview: Dominant designs and standards Era of ferment emergence of the dominant design a) Competition Output b) Innovation a) # firms & designs b) Scale of operation c) Equipment & employees a) Cost b) Process c) Few and similar d) Large e) Specialized & automated a) Features b) Product c) Many and different d) Small e) General & skilled time The history of the bicycle The Walking Machine The Velocipede or Boneshaker The High-Wheel Bicycle The High Wheel Tricycle The Highwheel Safety The Hard-Tired Safety The Pneumatic-Tired Safety The Kids' Bike Technology cycle stages Radical innovation/discontinuity (often outside the existing industries) 2. Variation: Era of ferment 3. Emergence, selection of dominant design Retention: Era of incremental change 1. – – Enabling technologies Materials: Steel alloys (now: zirconium, titanium, aluminum alloys, carbon fiber) Pneumatic tires for cars Why do dominant designs emerge? Increasing returns to scale – Learning to produce – Learning to use (user preferences) – Complementary goods, technologies – Scale of production (recall early auto industry) – Scale of R&D – Network externalities (AEM 322) Do dominant designs always emerge (in all industries)? Pharmaceuticals? Apple vs. “IBM­compatible” computers? Switches on table lamps? Furniture? Formats for High Definition DVD? Dominant designs and technological standards DD are not always the single standard DD are not always proprietary – Windows, Mac OS, Linux De facto industry standard vs. de jure standards – E.g. Windows vs. IPv6 – Bicycle design; 4 wheels on cars What are the benefits of standards/dominant designs? Downsides? Summary: Implications of technology cycles for firms’ survival Discontinuities can be… Competence­enhancing Competence­destroying – IT in cars – Cassette player to reel­to­reel magnetic tape recorder (“8 track”) makers – – CD in music storage Calculators to slide­rule makers Biotech for pharmaceuticals? Management over the technology cycle 1. 2. 3. 4. – Place your bets – Entertain multiple options Discontinuity Ferment – Try to get in your own IP/innovation Standardization/dominant design(s) Incremental change What are the respective strategies? – Improve and prepare for the next wave Strategies for competing over the technology cycle 1­2. Discontinuity, ferment – Invest in multiple technologies, features, designs R&D alliances, minority investments, “skunkworks” operations: allow for BUSINESS MODEL INNOVATION Alliances to drive adoption of own technology; industry associations to foment own IP for standards Focus on process innovation, growth, new markets Invest in gathering information about other industries, technologies that are potentially disruptive 3. Standardization/dominant design(s) – 4. Incremental change – – ...
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