TTMG 5001 Principles of Management for Engineers Session 6: October - - PowerPoint PPT Presentation

TTMG 5001 Principles of Management for Engineers

Session 6: October 19 Fall 2011

www.carleton.ca/tim www.carleton.ca/tim/tim.pdf

Michael Weiss

weiss@sce.carleton.ca Slide 2

Session 6 objectives

Upon completion of the session, you will know about

• three perspectives that can help make decisions on how

to commercialize new products and technology

• their constructs and how the constructs are assembled

and you will be able to

• identify the objectives, deliverables, contribution and

relevance of commercialization research

• recognize how knowledge produced by one or two

authors evolves over time

weiss@sce.carleton.ca Slide 3

Agenda

• 1. Presentations of assignment 1
• 2. Questions about
• Two TTMG 5001 assignments
• Gate 0 for TIM
• Professor’s summary of assigned readings
• Questions to which we want answers and comments

weiss@sce.carleton.ca Slide 4

• 1. Presentations of assignment 1
• Assignment 1 presentations will take place during

Session 8, Nov 2 in room 4359 ME

• Make available slides to be presented before 5 p.m. on

Nov 1; professor will post slides by 6 p.m.

• Topics have been posted on TTMG 5001 web site
• Nov 2 presentations will not be graded, but Nov 23

presentations of assignment 1 will be graded

• Each presentation is restricted to 10 minutes max, how

time is used is up to the group

• Stick to the template provided
• We will prepare a list of what needs to be done so quality
• f presentations is 2X better next time

weiss@sce.carleton.ca Slide 5

• 2. Questions

TTMG 5001 Assignments

• Literature review
• Gate 0

Gate 0

• Objectives
• Deliverables
• Relevance
• Literature review
• Contributions
• Theoretical framework
• Research method
• Data acquisition
• Data analysis
• References

weiss@sce.carleton.ca Slide 6

• 3. Summary
• Session 6 assigned articles
• Objectives
• Deliverables, contribution and relevance
• Lessons learned

weiss@sce.carleton.ca Slide 7

Session 6 assigned articles

• Ferrier, W. J. 2001. Navigating the competitive landscape: the

drivers and consequences of competitive aggressiveness. Academy of Management Journal, 44(4), 858-877.

• Gans, J. S., Hsu, D. H. & Stern, S. 2002. When does start-up

innovation spur the gale of creative destruction? RAND Journal of Economics, 33(4): 571-586.

• Gans, J. S., & Stern, S. 2003. The product market and the market

for “ideas”: commercialization strategies for technology

• entrepreneurs. Research Policy, 32: 333-350.
• Miller, R., & Olleros, X. 2007. The dynamics of games of
• innovation. International Journal of Innovation Management, 11(1):

37-64.

weiss@sce.carleton.ca Slide 8

About the articles

• Provide three perspectives on commercialization
• f products and technology
• Identify perspectives, their constructs, and the

way constructs are assembled

weiss@sce.carleton.ca Slide 9

About the articles

• Provide three perspectives on commercialization
• f products and technology
• Identify perspectives, their constructs, and the

way constructs are assembled

weiss@sce.carleton.ca Slide 10

About the articles

Perspective Constructs Framework Ferrier (2001) Gans et al. (2002), Gans & Stern (2003) Miller & Olleros (2007) How competitive actions increase company performance? How a start-up decides whether to compete or cooperate with incumbents? How companies create new markets and maintain them? Internal and external factors, attack characteristics, company performance Market for ideas, market for products, asset value, complementary assets, appropriability type Games of innovation, value creation and capture exchanges, networks of agents Two stage model where factors affect attacks and attacks affect performance 2x2 matrix describing competitive dynamics Taxonomy of games of innovation

weiss@sce.carleton.ca Slide 11

Objectives

Examines the factors that drive commerciali- zation strategies

• f start-ups and

their implications for competitive dynamics Gans & Stern (2003) Examines how how companies create new markets and maintain those markets as they evolve Miller & Olleros (2007) Examines the determinants of commerciali- zation strategy for start-up companies Examines how company and industry factors affect competitive actions and how competitive actions affect performance Gans et al. (2002) Ferrier (2001)

weiss@sce.carleton.ca Slide 12

Deliverables

• Synthetic

framework for identifying the right competitive strategy for a start-up Gans & Stern (2003)

• Results of a

cluster analysis

• f survey

responses

• Taxonomy of

games of innovation Miller & Olleros (2007)

• Results of

identifying factors related to commerciali- zation outcomes

• Model for start-

up choices and payoffs

• Two-stage model
• Results of testing

eight hypotheses using data on 224

• bservations of

competitive actions undertaken by firms in 16 industries using focal firm- year as the unit of analysis Gans et al. (2002) Ferrier (2001)

weiss@sce.carleton.ca Slide 13

Contribution

A representation of competitive attacks as an ordered, uninterrupted sequence of repeatable action events and a method to measure competitive attacks (previously strategy had been defined as an event and not as a sequence of events) A framework to examine how internal and external factors affect competitive attacks and how competitive attacks affects company performance (previously the internal and external variables were related directly to company performance) Ferrier (2001)

weiss@sce.carleton.ca Slide 14

Contribution

A representation of competitive attacks as an ordered, uninterrupted sequence of repeatable action events and a method to measure competitive attacks (previously strategy had been defined as an event and not as a sequence of events) A framework to examine how internal and external factors affect competitive attacks and how competitive attacks affects company performance (previously the internal and external variables were related directly to company performance) Ferrier (2001)

weiss@sce.carleton.ca Slide 15

Contribution (continued)

Identify six games of innovation around value creation

• exchanges. Three games focus on market creation: patent-

driven discovery, systems integration, and platform

• rchestration. Three games focus on market maintenance:

cost-based competition, systems extension and engineering, and customized mass production (previously the innovation management process was viewed as uniform) Miller & Olleros (2007) Strategies that a start-up should pursue (previously there was no taxonomy for competitive strategy that included the market for ideas) Gans & Stern (2003) Finding that patent ownership increases willingness to cooperate and VC funding increases likelihood of acquisition (previously there was no empirical evidence of the existence

• f a market for ideas)

Gans et al. (2002)

weiss@sce.carleton.ca Slide 16

Relevant to researchers and students because

Provide good examples of contributions that introduced new ideas that affected the way academics thought about a domain, and good examples of how this thinking evolves Define constructs and relationships that can be used to undertake research that explain how wealth is created and how the wealth created is distributed across economic agents Provide examples of the different types of ways you can contribute to the identification of constructs and assembly of constructs Miller & Olleros (2007) Gans & Stern (2003) Gans et al. (2002) Ferrier (2001)

weiss@sce.carleton.ca Slide 17

Relevant to researchers and students because (continued)

Provide a good example of using cluster analysis to detect patterns in the data that lead to new insights Miller & Olleros (2007) Provides a good example of method to undertake research without actually testing hypotheses Gans et

• al. (2002)

Provides a structure that relates X, with the consequences of X and the factors that constrain and enable X (antecedents). This is elegant and can be used to develop domain models Ferrier (2001)

weiss@sce.carleton.ca Slide 18

Relevant to researchers and students because (continued)

Provide good examples of how frameworks are built Provide interesting suggestions for future research Miller & Olleros (2007) Gans & Stern (2003) Ferrier (2001) Gans et al. (2002)

weiss@sce.carleton.ca Slide 19

Relevant to TMT and project managers because

To create and capture value you need to design the right

• rganization and implement the right strategies

To create and capture value you need to do much more than just develop a product or a technology. If you don’t do the other things, you may create wealth but capture little of it To understand your position relative to other economic agents, you need to know what to measure and how to measure it To design a competitive strategy, you can use a checklist to ensure that your company is doing the right things Miller & Olleros (2007) Gans & Stern (2003) Gans et al. (2002) Ferrier (2001)

weiss@sce.carleton.ca Slide 20

Relevant to TMT and project managers because

To create and capture value you need to design the right

• rganization and implement the right strategies

To create and capture value you need to do much more than just develop a product or a technology. If you don’t do the other things, you may create wealth but capture little of it To understand your position relative to other economic agents, you need to know what to measure and how to measure it. To design a competitive strategy, you can use a checklist to ensure that your company is doing the right things Miller & Olleros (2007) Gans & Stern (2003) Gans et al. (2002) Ferrier (2001)

weiss@sce.carleton.ca Slide 21

Lessons learned – General

• You can contribute to the literature in various ways:

test hypotheses (Ferrier, 2001), use formal logic and empirically examine relationships (Gans et al., 2002), and describe frameworks (Gans & Stern, 2003; Miller & Olleros 2007)

• Various perspectives within one stream compete

before there is a dominant design and establishing a dominant design takes a long time

weiss@sce.carleton.ca Slide 22

Lessons learned – Ferrier (2001)

• Method to identify the factors that contribute to

company performance

• TMT diversity decreases attack duration and

increases attack complexity

• When designing a TMT you need to decide whether

you wish to see fast or robust decisions

• Actions can be organized into six categories: pricing

actions, marketing actions, new product actions, capacity-related actions, service actions, and overt signaling actions

• Attack volume and attack duration increase

performance

weiss@sce.carleton.ca Slide 23

Lessons learned – Gans et al. (2002)

• A market for ideas exists in addition to the market for products
• Start-ups make their money selling their ideas to the incumbent firms in

economic environments where (i) incumbents can protect their intellectual property, (ii) entrants face high relative investment costs and (iii) brokers (eg VCs) are available to facilitate trade

• Start-ups compete with incumbents with products in economic

environments where (i) intellectual property protection is weak and (ii) investment costs for new entrants are low

• Firms that control intellectual property are more likely to pursue a

cooperative strategy

• VC funded firms tend to be acquired as opposed to sell licenses

weiss@sce.carleton.ca Slide 24

Lessons learned – Gans & Stern (2003)

• There are two drivers of start-up commercialization strategy:

excludability environment and complementary asset environment

• If the start-up cannot preclude effective development of the

innovation by the incumbent and the incumbent’s complementary assets do not contribute to the value proposition

• f the new technology, start-ups should invest in complementary

assets and compete with incumbents in niche markets

• If the start-up can preclude effective development of the

innovation by the incumbent and the incumbent’s assets do not contribute to the value proposition of the new technology, value will be distributed between start-up and incumbent based on technological leadership

weiss@sce.carleton.ca Slide 25

Lessons learned – Gans & Stern (2003)

• If the start-up cannot preclude effective development of the

innovation by the incumbent and the incumbent’s complementary assets do contribute to the value proposition of the new technology, existence of the start-up depends on whether or not the market for ideas exists

• If the start-up can preclude effective development of the

innovation by the incumbent and the incumbent’s assets do contribute to the value proposition of the new technology, start- ups should contract with established firms. Start-ups depend on their bargaining power

weiss@sce.carleton.ca Slide 26

Lessons learned – Miller & Olleros (2007)

• There are no generic rules and practices for managing

innovation: instead context, accumulated knowledge, and product specificity call for distinct dominant logics

• Clusters of interdependent firms that contribute to building a set
• f interacting products organize into games of innovation
• Games group complementary agents: focal firms, competitors,

suppliers, regulators, universities, agencies and VCs

• Games persist but industries and companies go into cycles of

birth, growth, and maturity and migrate between games

weiss@sce.carleton.ca Slide 27

• 4. Questions to which we want

answers

• How can we measure captured value?
• Frameworks for how competitors can cooperate

weiss@sce.carleton.ca Slide 28

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