Science/Technology Push Technological Development Science Push - - PowerPoint PPT Presentation

Science/Technology Push

Science Push

Technological Development

Market Pull

Market Pull

Incremental Technological Improvement

Market Need Development Manufacturing Sales

Demand-Pull Innovation Science-Push Innovation

Basic science Design & Engineering Manufacturing Sales Marketing

Consequences of Partial Understanding

• f the Innovation Process

 Seeing innovation as

a linear 'technology push' process or one in which the market can be relied upon

to pull through innovation

 Seeing innovation simply in terms of major

'breakthroughs' and ignoring the significant potential of incremental innovation

Electric bulb first introduced in 1880 80% fall in process cost in 16 years

 Seeing innovation as product or process only

without recognizing the interrelationship between the two

Combined Effect of Technology Push & Market Pull

Science Push Market Pull

Idea generation

Needs of society and the market place State of the art technology and production

Research, design & development Prototype production Manufac- turing Marketing & sales Market place New technology New need

The Coupling Model

Integrating Technology Push and Market Pull to Stimulate Innovation

Opportunities for Technology Push Opportunities for Market Pull Innovation

• Scientific discoveries
• Applied knowledge
• Recognized needs
• Intellectual capital

(Scientists & engineers)

• Market demand
• Proliferation of

application areas

• Recognized needs
• Opportunities for

increased: profitability, quality, productivity

• Entrepreneurs

What’s the Connection?

 Perfect Eyesight  High Fidelity Music  Retail Revolution

Throwing Light

Progress in Transportation

1750 1850 1950 2050 10-7 10-6 10-5 10-4 10-3 10-2 10-1

Horse Carriage Trains Automobiles Propeller Aircraft Jet Aircraft Chemical Rockets Nuclear Rockets

Fraction of velocity of Light

Technology S-Curves

• Graphical

representations of the development of a new technology

• Compare some

measure of performance with some measure of effort

• The relationship

between effort and performance is typically S-shaped Technology improves slowly at first Then accelerates Then tapers off

Natural Limit of Given Technology

Era of capital intensity and financial domination Era of process improvement and manufacturing domination Era of product of innovation and engineering domination

Technical Advance Time Technology Maturation

Technology Lifecycle/ S-curves

• Stage 1. Technology

development

• Stage 2. Technology application
• Stage 3. Application launch
• Stage 4. Application growth
• Stage 5. Technology maturity
• Stage 6. Degraded technology

Radical and Incremental Technological Change

• Most technological innovation is

incremental, and involves

• small improvements to existing

technologies

• Some technological innovation is

radical, and involves

• fundamentally new ways of solving a

problem

S-Curve of Technology Evolution

Stage 1 Stage 2 Stage 3 Stage 4 Technology Evolution refers to the changes in performance characteristics of a specific technology over time Time

Emergence Rapid Improvement Declining Improvement Maturity

Stages of Evolution

• Emergence
• Technology has come into existence but

shows little improvement in its performance characteristics

• Rapid Improvement
• Performance characteristic improves at an

accelerating pace

• Declining improvement
• Pace of improvement declines
• Maturity
• Further improvements become very difficult

to achieve

Business and Innovation

Why Is Progress Slow ?

• Long gestation period
• Want of relevant design or production

know-how

• Execution into new products requires

special tools, processes and fixtures

• Learning Curve
• Technology Limits

Technological Improvements Along an S-curve

• Tend to be incremental, building on

prior developments, and taking place within an existing paradigm

• Usually done by established firms:
• they have existing technical,

market, and organizational capabilities

• they have an existing customer

base

• they have access to internal cash

flow to invest

Shifting S-Curve Example

Traditional Switching VOIP

Who Shifts the S-Curve?

Usually new entrants because:

• Incumbents have no incentive to introduce the

new technology

• Incumbents have investments in existing

technology

• Products based on the new technology

cannibalize incumbents’ sales

• Managers at incumbent firms do not see the

new technology as a threat

• Incumbent firms can improve the performance
• f their old technologies
• Incumbent firms face organizational obstacles

to changing their core technologies

Why incumbent Firms Fail in the Face of Architectural Innovation

• Often lack the right external linkages to gather

information about a new technology architecture emerging in an industry

• Often lack the capacity to recognize the value of

information about architectural innovation that is presented to them

• Often have difficulty making use of information

because adopting an architectural innovation typically requires a company to restructure

Assignment # 3 Opportunity Now!

Key Sectors for “Opportunity Now” Exercise

• Food
• Clothing
• Housing
• Transportation
• Energy
• Communication
• Healthcare
• Entertainment

The Innovation Opportunity Grid

Break- through Substan- tial Incre- mental Product Process Strategy