The document discusses the S-curve model of technological innovation. The S-curve model describes how new technologies typically emerge and disrupt established technologies over time. Companies associated with established technologies face difficult choices when a new technology emerges: abandon their current business for the new technology, focus on improving the existing technology, or hedge their bets by investing in both. While investing in both seems logical, there are practical challenges to this approach. The document provides lessons on how leaders of current technologies often do not lead the next generation of technology, and how new technologies have advantages like focus and flexibility that benefit attackers seeking to disrupt incumbent technologies.

1. The S-Curve@WisnuDewobroto

3. The S-Curve
• The course of successful technological
innovation is often described through an S-
shaped curve like..

4. The S-curve : An
Established Technology and

5. Terminology...

6. Companies associated with the established technology

7. Advocates of the emerging technology...

8. Lessons

9. Lesson 1: Defenders Face Difficult
Choices
• Abandon the business they already
own, with all its cash flow and
certainty, in favor of the rival
technology
• Hold onto what they have and
work hard to make it better, or
useful to more customers
• Hold onto the existing business
and begin investing in the new
technology as a hedge against the
future

10. Lets Discuss

11. • Abandon the business they already own, with all its cash flow and
certainty, in favor of the rival technology
• Hold onto what they have and work hard to make it better, or useful
to more customers
• Hold onto the existing business and begin investing in the new
technology as a hedge against the future
Which one is the best choice for your company? why?

13. Option 1
• The first is the most difficult and is almost
always impractical. How could any company
afford to walk away from its current
investments in skills and physical assets?
• Dropping everything to jump onto the new
S-curve would be financial suicide in most
cases

14. Option 2
• Is the easiest choice for decision makers. In
the short run it produces no severe
disruption, and it is quite possible that
improvements to the current technology
may extend its competitive life for a
number of years.
• In the long run, sticking with an aging
technology almost guarantees that the
company will experience declining fortunes

15. Option 3
• Often the most promising course of action.
• The company can continue to operate the
existing business and serve current
customers as the new business develops.

16. The choice seems logical?

17. However...

18. It has Practical Problems...

19. The company may not have the competencies to develop
new technology...

20. The culture of the organization may not welcome the new
technology

21. Existing customers may pressure the company to stay in
old business

22. Comparison of Management concerns for
New and Mainstream Business

23. New Business
“Innovation, Risk taking,
Market acceptance”

24. Mainstream Business
“Control, Predictability, Operating
efficiency, Profit margins

25. Lesson 2: Leaders in One Generation of
Technology are Seldom Leaders in the Next

26. Defenders can enlist various strategies to
defeat upstart technical challengers ...

27. Leapfrog the attacker’s technology!

28. Acquire the attacker!

29. Lesson 3:Attackers Enjoy Important
Advantages
New technologies and innovative business
models are often introduced through small,
entrepreneurial firms...

30. Here are the most important for
Attackers!

31. An undivided focus.
“Managers of startup companies spend little time on
internal operations and people issues:There are very few of
either. Instead, they devote most of their attention to
development of the new technology or business model”

32. An Ability to attract talent.
“Capable technical and managerial talent are often
attracted to new ideas with promising futures..”

33. They are not captive of powerful customers.
“Many established companies fail to make the leap to the
new technology because powerful customers persuade
them to continue doing what they are doing”

34. Little bureaucracy.
“Small entrepreneurial companies are unencumbered by
the bureaucracy that burdens their larger rivals.That makes
them them fast and flexible”

35. No Need to protect investment in unrelated skills or
assets.
“Established companies can find many reasons to not adopt
new technology or business models....”
We can’t sell it
through our exising
distribution network

36. The question is :
“Where do you stand on the S-Curve?”

37. “Is your company being challenged by a new technology?

38. Decline?
• Get on board the rival technology -
perhaps by acquiring the innovator
company
• Leapfrog the rival technology with
something better
• Look for a breakthrough that will give your
technology a lease on life
• Stick with your current technology, but
expand it into different markets

39. Limits to these lessons!
• S-Curve is a useful thinking tool for
managers
• But use it with this important caution :
• Nothing about this paths is preordained
• Not every innovation overcomes its
established rival