Lecture 3 Apr 8, 2008

1. Discussion of chosen technologies

2. Lecture Technology and Market Acceptance

3. Case for Thursday

Technology and Market Acceptance

• Because something can be made does not mean that it should be made or that anybody will buy it

How do you know if someone will want to use your

technology?

Grand Challenges of the 21st Century

Grand Challenges of the 21st Century

Discover a methodology for moving Technology efficiently from a University or Industrial

Laboratory to commercial exploitation

This methodology is much more complex than any technology

Technology driven vs Market driven

• Technology Driven- we have a technology- now what do we do with it. – What examples can you think of?

• Market driven- we have a need- what is the best way of satisfying it, i.e. what is the solution (partial or complete) to a problem.– Name some unresolved problems

The Triangle-One way of looking at the business risk of moving into a new

technology

Market

TechnologyCompany

What are these “markets”?

Describe the “pieces of a business”

• Mfg• Logistics• RandD• Sales• Marketing• Human resources• Financial• Top management• Public relations• Corporate relations

Consider “Business to Business”. . .

How does Technology Development fit into Business Processes

There are three Business Processesall people and activities in the company couple into

one or more of these processes

1. Strategic- Answer the questions and implement

the answers- What do we wish to be? Who are our customers? What is our value proposition? What are our products? How do we bring these products to the customer? What are our competencies? Who are our competitors? Who are our partners? How do we adopt to changing business conditions? Etc., etc.

• Strategic Processes– How does technology couple into this

process?• IT companies• Advanced statistical marketing• Feedback from customers• Investment in technology prediction products• Decision making• Organizational software• Communications technology

How does Technology development fit into Business Processes (cont.)

2. Design/Development- Define the product, Design the product, Transfer the product to manufacturing, Support the product– How does technology couple into this process?

• Modeling prototyping CAD• Testing software and hardware• Task management• Data management• New technolgy for the product

How does Technology development fit into Business Processes (cont.)

Make/Market- Take an order, make the product, ship the product, collect the money– How does technology couple into this

process?• CAM• Quality Control• Inventory Control• Distribution • Packaging

How does Technology development fit into Business Processes (cont.)

Relationship Between Business Processes

Design Development

Make/Market

Strategic

Product Life CycleDesign/Development + Make/Market

Transition to

Mfg

IntegrateandTest

DetailedDesign

SystemsDesign

Product Concept

TechnologyReadiness

Market Needs

Manu-facture

Research

Support

Technology Life Cycle

• A Initiation• B Early Growth• C Fast Growth• D Maturity

A B

C

DCapability

Time

Product Life Cycle

• A Initiation• B Early Growth• C Fast Growth• D Maturity

A B

C

DVolume

Time

Product/Technology Platforms

TechnologyPro

duct

A

Produ

ct B

Produ

ct C

Produ

ct D

Product Life Cycle• Where do you invest?• Where do you reap?• Where does manufacturing process

change the most?• Where should you invest in a new

product?• Where are the largest profits earned?• Where are there the most competitors?• Where should you get out of the

business(kill the product)?

• Where is cannibalization (replacing an “obsolete” product) a good idea?

• Where is it a bad idea?A B

C

D

Technology Life Cycle

Capability

Time

A

B

Technology Life Cycle

Capability

Time

A

B

Response of A to B

What are examples of a successful defense by A?

• That is responding to a threat from a new technology by refocusing on current technology. Use a sufficiently large R&D expenditure to keep ahead of the new technology.

Theory of Dominant Design

• In the initial phase of a technology’s evolution, there are many contending products or designs. These “precipitate” into a dominant design which drives out competitors.

• Some examples:

– QWERTY keyboard

– IC Automobile Engine

– Operating Systems

• IBM mainframe

• Wintel PC

– TV

– VCR

– Palm

– Others?

• Is this one example of “first mover advantage”

Technology Life Cycle

• How do you know where in the cycle you are?

Technology Life Cycle

Capability

Time

Fastgrowing

Where are the following technologies on the curve?InternetNuclear powerGas TurbineQuantum ComputingSemiconductor ICAir TransportMechatronicsMajor appliancesTVGenomicsSolar PowerWireless communicationElectric VehiclesHome constructionSpace transportFactory AutomationSpeech RecognitionMachine Translation

Maturity

initial

Strategic inflection point

How do you survive a technological discontinuity?

• Premise: All Industries are subject to technological obsolescence• These attacks come from competitors and are linear and to some

extent predictable• Many attacks come from outside the industry you are in. They could

be far-out technologies which are not targeted at the present customer base. There are many of these and most are harmless.

• But some will be a direct threat to the companies survival• To judge which is which subject the technology in question to two

tests– Is it competence destroying? – Is the discontinuity a substitute or does it create a broadened product

Technology Management

• Summary of some thoughts on technology– Innovation driven by social/political and technological

change– Technology driven vs market-driven

companies/products – Process as the defining activity of companies– Product life cycle– Technology “s” curves

• As the class evolves, we will develop these further

Claire McCloudfrom Syllabus

Claire McCloudPrimary objective: To determine what qualities and skills are

necessary to manage a High Technology firm.There are many questions going through Claire's mind? I would

like you to address the following:1. What issues should Claire be considering in her decision to

accept or decline the General Manager's position?2. What are the possible consequences to Claire of saying no?

What are the possible consequences of saying yes?3. What does Claire need to know about the technology to do her

job effectively?4. What are OWS's strengths and weaknesses?5. What are Claire's strengths and weaknesses?6. What are the most immediate long and short-term issues Claire

should address?7. Should Claire take the job?