Technology Shocks: Origins, Managerial Responses, and Firm Performance

by Heinrich M. Arnold

Overview

Radical technological changes (so-called "technology shocks") frequently disrupt the competitive market structure. New entrants appear, industries need to be redefined, incumbents lose their positions or vanish completely. Fast moving industries - like the often quoted example of the semiconductor industry - have preferably been analyzed for these phenomena. But do the findings hold for industries with longer development cycles like the global machine tool industry?
Here, multivariate analysis is used to find out what management needs to focus on in order to lead companies through the technology shocks. The research for this book builds on in-depth interviews with 100 experts and decision makers from the machine tool industry involved in technology shocks and statistical analysis of detailed quantitative surveys collected from 58 companies. In several instances the results challenge classical teaching of technology management.
Adrian J. Slywotzky - US top selling business author and one of the most distinguished intellectual leaders in business - comments:
"In Technology Shocks, Heinrich Arnold develops a very useful model for analyzing technology shocks, and for focusing on those factors that will enable a company to navigate through these shocks successfully, and repeatedly. Although this work is focused on technology, its thinking has useful implications beyond technology shocks. It provides ideas that managers can use to protect their firms when they are faced with any type of discontinuity, technology-based or not".

Product Details

ISBN-13:	9783790800517
Publisher:	Physica-Verlag HD
Publication date:	08/13/2003
Series:	Contributions to Management Science
Edition description:	Softcover reprint of the original 1st ed. 2003
Pages:	264
Product dimensions:	6.10(w) x 9.25(h) x 0.36(d)

Table of Contents

1 Frameworks to capture technology shocks: an attempt to integrate current streams of thought.- 1.1 Introduction.- 1.1.1 Introducing technology shocks.- 1.1.2 Characterizing technology shocks at the firm level.- 1.2 Frameworks.- 1.2.1 Innovation of product properties.- 1.2.2 Change in product’s value proposition.- 1.2.3 Effects on organizations’ competence.- 1.2.4 Differentiation between consumer and investment goods.- 1.2.5 An optimized framework to identify technology shocks.- 1.3 Patterns of technology shocks and the product life cycle.- 1.3.1 Literature focusing on technological change.- 1.3.2 The theory of the product life cycle (PLC).- 1.3.3 The various phases of the PLC.- 1.3.4 Conclusion - do technology shocks cause a PLC-like pattern?.- 1.4 Implications for research.- 2 Success factors for surviving technology shocks.- 2.1 Introduction.- 2.2 Main theoretical and methodological streams.- 2.3 ‘When Darwin strikes’: success factors for overcoming technology shocks.- 2.3.1 Company attributes prior to the shock.- 2.3.2 Strategic decisions in reaction to the shock.- 2.3.3 Operational decisions in reaction to the shock.- 2.3.4 Factors with no significant impact on success.- 2.4 Implications for research.- 3 Research gaps and methodology.- 3.1 Introduction.- 3.2 Need for additional research.- 3.2.1 Additional success factors for future empirical analysis.- 3.2.2 Designs of existing research and their limitations.- 3.2.3 Investigating complex industries.- 3.3 Goals and approach of the research process.- 3.4 The pre-tests.- 3.5 Making the questionnaire available.- 3.6 ‘Top management still not online’.- 3.7 The necessity of networking.- 3.8 ‘Going beyond the fruit fly’ implications for research.- 4 The machine tool industry and the effects of technological change.- 4.1 Introduction.- 4.2 The machine tool industry after World War II.- 4.3 The availability of information about the industries’ recent history.- 4.4 Location of invention, role of national research programs, and no advantage for first movers.- 4.4.1 The first years of a new technology.- 4.4.2 Machine tool manufacturers get involved - what happened to the pioneers.- 4.4.3 National programs for developing a new technology.- 4.5 Patterns and extent of technological change: between shock and evolution.- 4.5.1 Three waves of technological innovation.- 4.5.2 Innovation of product architecture.- 4.5.3 The technology’s disruptive effect on companies’ capabilities and the loss of competitive advantage.- 4.5.4 Change in the product’s value proposition and order of magnitude improvement in value for users.- 4.5.5 Technological change in the machine tool industry and the technology shock matrix.- 4.6 The Japanese success story.- 4.7 External factors.- 4.8 The next wave — trends and future technological changes.- 4.9 Implications for an analysis of technology shocks in the machine tool industry.- 5 Descriptive analysis.- 5.1 Company data and technology shock waves.- 5.1.1 The original set of variables.- 5.1.2 Companies involved and coverage.- 5.1.3 Differentiating success and failure.- 5.1.4 The ‘Zombie’ phenomenon - or why counting market exits does not always work.- 5.1.5 Defining the shock waves and expanding on the characteristics of the 4-stage wave pattern.- 5.1.6 Number of firms under observation.- 5.1.7 The importance of the second shock wave.- 5.2 The manager’s mind - the perceived importance of success factors for the survival of technology shocks.- 5.2.1 Importance ratings of success factors.- 5.2.2 Ranking by importance of companies’ attributes.- 5.2.3 Ranking by importance of strategic decisions.- 5.2.4 Ranking by importance of operational decisions.- 5.2.5 Overall ranking with suggestion of special focus.- 5.3 Secondary findings from the analysis of importance ratings.- 5.3.1 Differences between winners and losers.- 5.3.2 Specific characteristics of the German firms — the largest national group of companies in the sample.- 5.3.3 Differences depending on the size of companies.- 5.4 Conclusion on manager ratings.- 5.5 Managing technology shocks - determinants that distinguish winners from losers.- 5.5.1 Methods to compare ‘winners’ and ‘losers’.- 5.5.2 Strength of technology shock and effects of product types.- 5.5.3 Significant differences in attributes of ‘winners’ and ‘losers’.- 5.5.4 Significant differences in strategic decisions of ‘winners’ and ‘losers’.- 5.5.5 Significant differences in operative decisions of ‘winners’ and ‘losers’.- 5.5.6 ‘Early’ and ‘late’ losers.- 5.6 Summary of the descriptive analysis.- 6 Multivariate analysis.- 6.1 Introduction of scales.- 6.1.1 Correlations and scales of company attributes.- 6.1.2 Correlations and scales of strategic decisions.- 6.1.3 Correlations and scales of operative decisions.- 6.2 Differences of the scales’ means between winners and losers.- 6.3 ‘Early’ and ‘late’ losers.- 6.4 Determining causal relations through multivariate analysis.- 6.5 Displaying survival.- 6.6 Analyzing the determinants of survival.- 6.6.1 Multivariate analysis of the variables that represent company attributes.- 6.6.2 Multivariate analysis of the variables that represent strategic decisions.- 6.6.3 Multivariate analysis of the variables that represent operational decisions.- 6.7 A combined model of managing technology shocks.- 6.8 Summary of the multivariate results.- 7 Conclusion and outlook.- Appendix of chapter 1.- Appendix of chapter 3.- Appendix of chapter 4.- Appendix of chapter 5.- Appendix of chapter 6.- List of figures.- List of tables.- Abbreviations.- References.