What makes emerging technologies
so difficult for established companies?
Schoemaker:
One of the biggest challenges is the
difficulty managers have in “getting it.” For example, leaders
at Encyclopedia Britannica knew that CD-ROM technology
was making it possible to create interactive
encyclopedias, yet they couldn’t break out of their print
mindset. They lost half their revenue between 1990 and
1995. These framing traps – looking at the new world
through old eyes – lead to a variety of errors such as delayed
participation, sticking with the familiar, reluctance to fully
commit and lack of persistence.
How can managers at established firms get
better at playing this different game?
Day:
We outline four broad strategies. First, you need to
widen your peripheral vision – look outside your established
industry and pay attention to weak signals. Second,
create a learning culture that is open to diverse viewpoints,
willing to challenge the prevailing mindset and experiment
continuously. Third, you need to stay flexible through
strategies such as managing real options. And finally, you
need to organize in such a way that you provide sufficient
autonomy to these new initiatives, so they are not suffocated
under the weight of the parent company.
(George Day is the Geoffrey T. Boisi Professor, Professor of
Marketing and Director of the Huntsman Center for Global
Competition and Innovation at the Wharton School. Paul
Schoemaker is Research Director of Wharton’s Emerging
Technologies Management Research Program and Chairman
of Decision Strategies International, Inc. For more information
about the book, see the Program’s web site at
http://emertech.wharton.upenn.edu/emertech/)
