THE RELATIONSHIP BETWEEN NEW TECHNOLOGIES AND STRATEGIC ACTIVITIES
Jim Lawlor
Last modified: 2007-09-08
Abstract
THE RELATIONSHIP BETWEEN NEW TECHNOLOGIES AND STRATEGIC ACTIVITIES
Purpose of Paper
The objectives of this paper are to describe a means of recognising a new technology, to provide a framework for understanding the relationship between technology and strategy, and to describe strategic activities characteristic of a new technology industry.
Related Work
Several authors such as Porter (1983) and Rosenbloom (1985) have recognised the unique nature of new technologies, while others including Schumpeter (1942/1976) and Christensen (1997) have described its influence on existing industries. But Ehrnberg (1995) highlighted the lack of clarity surrounding the concept of technological discontinuities, a difficulty which complicates research in this area. Within strategy, the work of Porter and Mintzberg (1987) can be used to represent the differences between planned and emergent strategic perspectives.
Design/Methodology/Approach
Initially an understanding of the term new technology is developed by drawing together the diverse strands of previous work in this area. Then the relationship between technology and strategy is characterised, resulting in four classes of relationship being described. A case history of the stent industry then provides an instance of the new technology class, and the strategic activities of the stent industry are described. This case was drawn from a variety of commercial, academic and related sources, and the relative importance of the primary issues was validated by a small number of semi-structured interviews with industry personnel.
Findings
The stent industry exhibits internecine competition internally, with ruthless and volatile competitive activities being the norm. Externally it must co-operate with existing structures, markets and regimes, but it needs to adjust these over time to prosper. This apparent conflict manifests itself as subversive incrementalism.
Stent technology is not in a position, more than two decades after its introduction, to eliminate previously established technologies such as heart by-pass surgery. So the findings from this research do not support the concepts of creative destruction or disruptive technology.
Research Limitations/Implications
Limitations include necessarily editing a large volume of material into a limited word-count.
While the concepts of subversive incrementalism and internecine competition may be immediately helpful to new technology managers, they are developed solely from this research and should be more comprehensively validated against other new technology industries. Also, the point at which the new technology becomes established and ceases to be new could be investigated more thoroughly.
Practical Implications
The creation and introduction of a new technology is not simply an issue of technological effectiveness. Success requires technology champions to advocate the technology in its early stages, and to educate its potential users during its introduction.
The introduction of a new technology doesnt necessitate the destruction of an existing one. They can work alongside each other for periods of several decades. The new technology industry needs pre-existing structures, regimes and industries to achieve success.
New technology firms forge relationships with other firms, and their abilities to manage these relationships, often between different cultures and technological spheres, is key to success.
New technology managers should maintain realistic market expectations. Overstating the abilities of the new technology to gain or maintain marginal market share can be detrimental in the longer term as an ineffective technology can lead to loss of market share for a particular firm, and a general loss of confidence in a new technology.
Originality/Value of the Paper
This paper provides a means of defining the term new technology. Managers are provided with a conceptualisation of the relationship between new technologies and strategies. Entrepreneurs, managers or otherwise, get an insight into the value of their activities as technology champions and market educators.
It also provides a case study of the stent industry which is an empirical account of the creation and introduction of a new technology by a developing industry. This case dissents from some accepted theories and may require a re-evaluation of the treatment of new technology. The case history can be used as a basis for subsequent research.
Finally, policy makers may find a useful guide to the types of strategic activities pursued by new technology industries, which may help them to encourage the best aspects of these industries and ameliorate the worst.
References
Christensen, C. M. (1997). The Innovators' Dilemma: when new technologies cause great firms to fail. Boston, Harvard Business School Press.
Ehrnberg, E. (1995). "On the definition and measurement of technological discontinuities." Technovation 15(7 September): 437-452.
Mintzberg, H. (1987). "Crafting Strategy." Harvard Business Review 65(4 July-August): 66-75.
Porter, M. E. (1983). The Technological Dimension of Competitive Strategy. Research on Technological Innovation, Management and Policy. R. S. Rosenbloom, JAI Press. 1: 1-33.
Rosenbloom, R. S. (1985). Managing Technology for the Longer Term: A Managerial Perspective. The Uneasy Alliance: Managing the productivity-technology dilemma. K. B. Clark, R. H. Hayes and C. Lorenz. Boston, Harvard Business School Press.
Schumpeter, J. (1942/1976). Capitalism, Socialism, and Democracy. London, Allen and Unwin.
Purpose of Paper
The objectives of this paper are to describe a means of recognising a new technology, to provide a framework for understanding the relationship between technology and strategy, and to describe strategic activities characteristic of a new technology industry.
Related Work
Several authors such as Porter (1983) and Rosenbloom (1985) have recognised the unique nature of new technologies, while others including Schumpeter (1942/1976) and Christensen (1997) have described its influence on existing industries. But Ehrnberg (1995) highlighted the lack of clarity surrounding the concept of technological discontinuities, a difficulty which complicates research in this area. Within strategy, the work of Porter and Mintzberg (1987) can be used to represent the differences between planned and emergent strategic perspectives.
Design/Methodology/Approach
Initially an understanding of the term new technology is developed by drawing together the diverse strands of previous work in this area. Then the relationship between technology and strategy is characterised, resulting in four classes of relationship being described. A case history of the stent industry then provides an instance of the new technology class, and the strategic activities of the stent industry are described. This case was drawn from a variety of commercial, academic and related sources, and the relative importance of the primary issues was validated by a small number of semi-structured interviews with industry personnel.
Findings
The stent industry exhibits internecine competition internally, with ruthless and volatile competitive activities being the norm. Externally it must co-operate with existing structures, markets and regimes, but it needs to adjust these over time to prosper. This apparent conflict manifests itself as subversive incrementalism.
Stent technology is not in a position, more than two decades after its introduction, to eliminate previously established technologies such as heart by-pass surgery. So the findings from this research do not support the concepts of creative destruction or disruptive technology.
Research Limitations/Implications
Limitations include necessarily editing a large volume of material into a limited word-count.
While the concepts of subversive incrementalism and internecine competition may be immediately helpful to new technology managers, they are developed solely from this research and should be more comprehensively validated against other new technology industries. Also, the point at which the new technology becomes established and ceases to be new could be investigated more thoroughly.
Practical Implications
The creation and introduction of a new technology is not simply an issue of technological effectiveness. Success requires technology champions to advocate the technology in its early stages, and to educate its potential users during its introduction.
The introduction of a new technology doesnt necessitate the destruction of an existing one. They can work alongside each other for periods of several decades. The new technology industry needs pre-existing structures, regimes and industries to achieve success.
New technology firms forge relationships with other firms, and their abilities to manage these relationships, often between different cultures and technological spheres, is key to success.
New technology managers should maintain realistic market expectations. Overstating the abilities of the new technology to gain or maintain marginal market share can be detrimental in the longer term as an ineffective technology can lead to loss of market share for a particular firm, and a general loss of confidence in a new technology.
Originality/Value of the Paper
This paper provides a means of defining the term new technology. Managers are provided with a conceptualisation of the relationship between new technologies and strategies. Entrepreneurs, managers or otherwise, get an insight into the value of their activities as technology champions and market educators.
It also provides a case study of the stent industry which is an empirical account of the creation and introduction of a new technology by a developing industry. This case dissents from some accepted theories and may require a re-evaluation of the treatment of new technology. The case history can be used as a basis for subsequent research.
Finally, policy makers may find a useful guide to the types of strategic activities pursued by new technology industries, which may help them to encourage the best aspects of these industries and ameliorate the worst.
References
Christensen, C. M. (1997). The Innovators' Dilemma: when new technologies cause great firms to fail. Boston, Harvard Business School Press.
Ehrnberg, E. (1995). "On the definition and measurement of technological discontinuities." Technovation 15(7 September): 437-452.
Mintzberg, H. (1987). "Crafting Strategy." Harvard Business Review 65(4 July-August): 66-75.
Porter, M. E. (1983). The Technological Dimension of Competitive Strategy. Research on Technological Innovation, Management and Policy. R. S. Rosenbloom, JAI Press. 1: 1-33.
Rosenbloom, R. S. (1985). Managing Technology for the Longer Term: A Managerial Perspective. The Uneasy Alliance: Managing the productivity-technology dilemma. K. B. Clark, R. H. Hayes and C. Lorenz. Boston, Harvard Business School Press.
Schumpeter, J. (1942/1976). Capitalism, Socialism, and Democracy. London, Allen and Unwin.
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