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CHAPTER 7: MANAGING ORGANIZATIONAL KNOWLEDGE - Coggle Diagram
CHAPTER 7: MANAGING ORGANIZATIONAL KNOWLEDGE
7.2 TECHNOLOGY DEVELOPMENT AND EFFORT REQUIRED
Demand-Side
How customer respond to innovation
Innovation Adoption Lifecycle
A model that explains how different types of customers adopt new innovations over time
Innovators/ Tech Enthusiasts - 2.5%
Early Adopters/ Visionaries - 13.5%
Early Majority/ Pragmatists - 34%
Late Majority/ Conservatives - 34%
Laggards/ Skeptics - 16%
1.Innovators (2008-2012)
: Tesla Roadster, attracted innovators despite expensive, limited charging infrastructure and posed range anxieties.
2.Early Adopters (2012-2015)
: Tesla captured the EA with the introduction of the Model S.
3.The Chasm (2015-2017)
: Tesla faced skeptisim about cost, battery reliability, and limited charging stations.
4.Early Majority (2018-2020)
: Tesla gained traction among the EM with the affordable Model 3.
5.Late Majority (2020-2023)
: EVs became more normalized, along with improved accessiblity and incentives.
6.Laggards (2023-beyond)
: laggards began transitioning while EVs become more and more standardlized.
The Chasm
a critical gap represents the challenging transition period between the
Early adopters
and the
Early majority
introduced by Geoffrey Moore in his book "Crossing the Chasm"
Product Lifecycle
A model that outlines the stages a product goes through from its introduction to its eventual decline in the market
Introduction
DVD Player
1.Introduction (Late 1990s)
: While DVD players were expensive, they were introduced as a new way to watch high-quality movies at home.
2. Growth (Early 2000s)
: DVD players became more common in households globally
3. Maturity (Mid-2000s)
: DVD players reached peak popularity. but the market was saturated and price competition intensified.
4.Decline (Late 2000s to 2010s)
:With the rise of Blu-ray players and streaming services like Netflix, DVD players entered the decline phase.
Growth
Maturity
Decline
Takeoff
a stage where a product experiences a rapid
surge in sales and popularity
Supply - Side
How firms and technologies co-evolve
Industry Lifecycle
A model that describes the stages of growth and evolution an industry goes through from its formation to its eventual decline
Decline
Embryonic/ Ferment/ Introduction
Ride-hailing Industry
1.Introduction (2009-2012)
: Lauched by Uber in 2009, the industry was small and relatively unknown.
2.Growth (2012-2016)
: More and more new entrants joined, like Didi (China) and Ola (India)
3. Shakeout (2016-2019)
: Companies faced challenges like regulatory, labour issues,...
4. Maturity (2019-Now)
: Growth slowed down, companies began diversifying services, such as food delivery.
5.Decline (Future)
: Not yet but may face difficulties like autonomous vehicles or laws
Growth
Shakeout
a stage when the rate of growth slows, and competition intensifies
Maturity
Diffusion process
refers to the
spread
and
adoption
of a
new product or innovation
among consumers within a market over time.
Technology Lifecycle (S-curve)
"Out with the old and in with the new"
a model that describes the
progression of technology or innovation over time
, from slow initial growth to rapid acceleration, and eventually slowing down
7.4. DEVELOPING INNOVATION STRATEGY
Fast follower/defensive
develop improved versions of the original
Agile in manufacturing, design and development and marketing
->Respond quickly to those companies that are first into the market
.
Xanh SM, a Vietnamese startup, has taken a more environmentally friendly approach to ride-hailing compared to Grab by exclusively using electric vehicles
Without any in-house R&D, their response would have been much slower
Cost minimisation/imitative
Being a low-cost producer
Dependent on achieving economies of scale in manufacture
Requires exceptional skills and capabilities in production and process engineering.
Walmart
is a low-cost producer with massive economies of scale.
Leader/offensive
A monopoly of the technology.
The product is launched into the market before the competition.
Ability to adopt price-skimming policy or penetration policy
Demand a significant R&D activity and marketing resources
Involve element of education about the new product
Market segmentation specialist/traditional
meeting the precise requirements of a particular market segment or niche.
Vegan Baking
- targeted market is vegetarian
Lefty
: shop for left-handed people
7.3 INNOVATION, COMPETITION AND FURTHER INNOVATION
Innovation Life Cycle Phases
Transitional Phase
Standardisation of design
2007, Apple’s touch-screen design, combined with an app-based ecosystem, set a new standard
Emergence of process innovation
Specific Phase
contraction of competitors
By the 2010s,focusing on aspects like camera quality, battery life, and minor software improvements.
As competition narrowed, companies focused on production efficiency and cost reduction rather than revolutionary design changes
era ofincremental innovation
Fluid Phase
explosion of differnt designs
In the early 2000s, smartphones were an experimental field with no standard design
companies like BlackBerry, Palm, and Nokia led with various models featuring keyboards, styluses, and unique operating systems
era of radical product innovation
Dominant Design
Achieving a standard design is valuable for monopoly advantage
In the 1980s, Microsoft released Windows as a graphical extension of its MS-DOS operating system
By partnering with hardware manufacturers and using intellectual property protection, Microsoft has ensured widespread adoption of its software
Collect monopoly rents, providing imitation can
be limited, possibly with the use of intellectual property rights
Radical innovation
To draw on new technical and commercial skills
Internal dimension
Requires new knowledge/resources
Apple’s release of the first iPhone in 2007 combining an iPod, phone, and internet communicator in one device
The iPhone redefined the smartphone industry, making touchscreens. Competitors had to adapt quickly or risk being outpaced
May disrupt or replace existing competencies
External Dimension
Brings significant technological advancements
Netflix’s shift from DVD rentals to online streaming in 2007 was a radical innovation that transformed entertainment consumption
This move fundamentally changed the industry, rendering traditional video rental models obsolete and forcing competitors like Blockbuster out of the market
Renders existing products uncompetitive or obsolete
To employ new problem-solving approaches
forces them to
ask a new set of questions
Incremental innovation
Reinforcing the
capabilities of established organisations
Internal dimension
Builds on existing knowledge and resources
Coca-Cola’s strategy of releasing new flavor variants like Vanilla Coke or Cherry Coke involves incremental innovation
By slightly modifying the classic formula, Coca-Cola can cater to diverse consumer preferences without radically changing its brand or production process
Enhances the firm’s existing competencies
External Dimension
Involves modest technological changes
These improvements, like lane-keeping and automatic braking, enhance driver assistance without requiring a complete overhaul of existing vehicle models
Tesla’s ongoing software updates to its Autopilot feature
Existing products remain competitive
7.1 TECHNOLOGY TRAJECTORIES
The acquisition of firm-specific knowledge:
useful and applicable.
The resource-based perspective (RBP)
depend on 2 principles
These differences are relatively stable.
The differences between firms based upon the way they manage
resources how they exploit them (Nelson, 1991)
Developing firm-specific competencies
The ability to use its assets to
perform value-creating activities
Due to the growing knowledge of the benefits of sugar-free beverages, Coca-Cola and PepsiCo have launched sugar-free versions of their carbonated drinks.
Converting intellect, knowledge and technology into things that customers want.
Competencies and profits
The ability to generate profits from its technology assets
Dynamic competence-based theory of the firm
Consider both the external and internal environments as dynamic
The external environment is constantly changing as different players maneuver themselves
Company’s internal environment is also evolving
Dynamic competences enable innovation
Dynamic capabilities that relate to the innovation of
the way innovation is pursued
Acquiring technological knowledge need
take time
people
experiments
learning
Exploit technology knowledge or opportunities would be chosen based on
Firm’s level of technology, skills developed,
intellectual property, managerial processes and its routines.
Changing environment characteristic
levels of technology
market conditions
societal demands
