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    Presentation Lecture 7 Strategy and Technology

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    sadif sayeed
    The document summarizes key points from lectures on strategy and technology, including how technical standards can lead to format wars, the advantages and disadvantages of being a first mover, how disruptive technologies can cause paradigm shifts, and strategic implications for established companies and new entrants when facing disruptive technologies. Network effects, lock-in, and pioneering costs are discussed in relation to standards and innovation.

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    Presentation Lecture 7 Strategy and Technology

    Uploaded by

    sadif sayeed
    14 views13 pages
    The document summarizes key points from lectures on strategy and technology, including how technical standards can lead to format wars, the advantages and disadvantages of being a first mover, how disruptive technologies can cause paradigm shifts, and strategic implications for established companies and new entrants when facing disruptive technologies. Network effects, lock-in, and pioneering costs are discussed in relation to standards and innovation.

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    The document summarizes key points from lectures on strategy and technology, including how technical standards can lead to format wars, the advantages and disadvantages of being a first mover, how disruptive technologies can cause paradigm shifts, and strategic implications for established companies and new entrants when facing disruptive technologies. Network effects, lock-in, and pioneering costs are discussed in relation to standards and innovation.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    14 views13 pages

    Presentation Lecture 7 Strategy and Technology

    Uploaded by

    sadif sayeed
    The document summarizes key points from lectures on strategy and technology, including how technical standards can lead to format wars, the advantages and disadvantages of being a first mover, how disruptive technologies can cause paradigm shifts, and strategic implications for established companies and new entrants when facing disruptive technologies. Network effects, lock-in, and pioneering costs are discussed in relation to standards and innovation.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 13

    Lecture 6 Takeaways

    • Fragmented Industry (scale economies, brand loyalty, barriers to entry)


    • Consolidating Fragmented Industries (value innovation, chaining, franchising,
    horizontal merger)
    • Customer Groups (innovators, early adopters, early majority, late majority,
    laggards)
    • Product Life-Cycle and Crossing the “Chasm”
    • Factors that Accelerate Customer Demand (relative advantage, complexity,
    compatibility, trialability, observability)
    • Strategies to Prevent New Entrants (product proliferation, limit pricing)
    • Strategies to Manage Rivalry (price signaling, non-price competition, capacity
    control)
    Lecture 7
    Strategy and Technology
    Technical Standards and Format Wars

    • Technical Standard
    • Benefits of Standards
    • Format Wars
    Network Effects and Lockout

    • Network Effects
    • Locked Out Technology
    First-Mover Advantages

    • Exploit network effects


    • Establish industry standard, increasing switching cost
    • Develop cost advantages (economies of scale, experience curve, learning
    effects)
    • Gain greater firsthand experience with and knowledge about customers
    • Secure important channels (suppliers, retailers, distributors)
    First-mover Disadvantages

    • Incur pioneering cost (e.g. educating customers)


    • Provide improvement opportunities to second movers because of mistakes
    • Fall in the “chasm”

    https://www.youtube.com/watch?v=w3FuTpWbmCQ
    Technological Paradigm Shifts
    • Technological Paradigm Shifts
    • Technological S-curve
    • Disruptive Technology

    https://www.youtube.com/watch?v=yUAtIQDllo8
    Disruptive Technology

    • Revolutionize the industry structure and competition


    • Established companies are aware of incoming technologies
    • Established companies listen to customers
    • Manager-dominated businesses see niche markets unprofitable
    • Network of suppliers and distributors
    Strategic Implications of Disruptive Technologies

    • For Established Companies


    Invest in New Technologies
    Acquire Emerging Businesses (Google)
    Encourage Change. Cash-generating Managers Consuming Most Funds
    Multiple Business Models (autonomous operating division)

    • For New Entrants


    No Worries about Customer Base, Relationships, Network of Suppliers and
    Distributors
    Focus on Developing and Improving the Disruptive Technology
    Target the Mass Market Eventually
    Partner or No Partner??
    Lecture Takeaways

    • Technical Standard and Format War


    • Network Effects and Locked Out Technologies
    • Winning Format Wars (supply of complements, killer applications,
    razor-blade strategy, cooperate with competitors, license format)
    • First-mover Advantages and Disadvantages
    • Technological Paradigm Shifts (S-curve)
    • Disruptive Innovation
    • Strategic Implications of Disruptive Innovation (for established companies
    and new entrants)

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