L04 L: EVOLUTION OF DIGITAL TECHNOLOGY Flashcards
THE TECHNOLOGY ADOPTION S-CURVE
Innovators: 2.5%
Early adopters: 10%
Early majority: 50%
Late majority: 90%
Laggards: 100%
Adoption! All numbers cumulative
Industry Life Cycle Categories and Description
Development: High differentiation / Innovation key
Growth: High growth / Low entry barriers / Scaling key
Shake out: Growth slows down / Some exits / Managerial and
financial strength key
Maturity: Low growth / Standard products / Entry barriers /
Market share and cost key
Decline: Many exits / Consolidation / Price competition / Cost key
THE TECHNOLOGY IMPROVEMENT S-CURVE Events:
(1) Pioneering science
(2) Major technical obstacle overcome
(3) Sustaining mastery over technology
(4) Technology reaches its physical limits
Why to use the Technology S-curve?
(1) Understand the technology’s performance take off
- where are you on the s-curve?
- What is the rate of learning?
(2) Recognize the limits of a certain technology
- Is the learning flattening?
- Is another technology improving faster?
(3) Guide resource allocation into existing and new technologies
- Do not wait until end of s-curve with investing
- Exploration is long term, uncertain, and interdependent
WHY DO DOMINANT DESIGNS EMERGE?
(1) Packages of features that find favor of markets
(2) Dominant producer with power behind
(3) Powerful user/customer may mandate standard
(4) Industry committee may establish standard (IEEE)
(5) Groups of firms may form alliances
(6) Government regulations
Technological discontinuity
- New science, breakthrough innovation
- Revolutionary technology
- Radical performance improvement
Era of ferment
- Variation
- High technical uncertainty
- Ambiguous user preferences
Dominant design
- Selection
- Industry standard emerges
- Well-established preferences
- Economies of scale and scope
Era of incremental change
- retention
- elaboration of dominant design
- continuous, incremental innovation
- evolutionary technology
NESTED HIERARCHY OF TECHNOLOGY CYCLES
Technologies co-evolve with others
- Depend on other technologies
- Enable other technologies
Core-periphery principle
- Interdependence with other
modules
- Performance bottlenecks
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System level technology cycle
First-order subsystem technology cycle
Second-order subsystem technology cycle
Rate of major innovation
As the dominant design approaches, the rate of major innovations in product comes down from the top and flattens out.
The rate of major innovations in process increases while approaching the dominant design. Once the dominant design is found it continues to increase for a while after which it decreases again.
EVOLUTION OF COMPLEX PRODUCTS / SYSTEMS (Architectural vs Component/systemic innovation)
Major architectural innovations come down from peak as the dominant design emerges and flattens out.
Major component / systemic innovations rise before/ after dominant design has been established and then decrease again.
What happens as the core stabilizes?
AS CORE STABILIZES, PERIPHERAL
COMPONENTS MAY MOVE INTO THE CENTER
