Fundamentals of Business

Finally the stage is set for change

Finally the stage is set for change - the scope for innovation becomes smaller and smaller whilst outside - for example, in the laboratories and imaginations of research scientists - new possibilities are emerging. Eventually a new technology emerges which has the potential to challenge all the by now well established rules - and the game is disrupted. In the camera case, for example, this is happening with the advent of digital photography which is having an impact on cameras and the overall service package around how you get, keep and share your photographs.

In our chemical case this is happening with biotechnology and the emergence of the possibility of no longer needing giant chemical plants but instead moving to small scale operations using live organisms genetically engineered to produce what we need.

This model helps us in two ways.

First it is comforting to know that even disruptive change does tend to follow a pattern - and that we might learn from that.
The second is that we need to think about our response in strategic terms - this is clearly not an area where we can tinker around with the business.

Extracts from an article.
Standards, Innovation, and Survival.
The role of dominant stand standards ards in the life cycles of industries By Edwin Lee Copyright © 1986, 1994, 1995, 1998.

We're part of a highly innovative industry and the creative folks among us have a love/hate relationship with standards. Managers tend to see the benefits of standards: they reduce learning requirements and improve quality. Engineers tend to be more ambivalent because standards appear to limit their creative choices.

In 1984 I attended a management seminar at which Prof. Jim Utterback of MIT gave a talk on the life cycles of industries. He described the critical the role that dominant standards play in those life cycles. He emphasized the similarities in the life cycles of several industries including the automobile, airplane, typewriter, photography, and ice making. (He published a book on this subject in 1994: Mastering the Dynamics of Innovation Innovation, Harvard Business School Press) It struck me at the time that his analysis applied directly to the Personal Computer business in particular and to high technology in general.