Navigating Emerging Technologies: Strategies for Tomorrow

1. Emerging Technologies What will tomorrow hold?

2. What is Emerging Technology? • The Knowledge Base is expanding • The Application to existing markets is undergoing innovation • New markets are being tapped or created Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

3. Contrasting Emerging vs. Established Technology Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

4. Contrasting Emerging vs. Established Technology Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

5. AM Radio – 1920’s B&W TV – 1940’s Color TV – 1950’s FM Radio – 1960’s Cable TV – 1970’s 1980’s CD Players PC’s Cell Phone 1990’s Pager Internet Satellite TV Technology Adoption • Passively Watch • Wait for others to take the risk • “Fast-Follower” Strategy • “Winner-take-all” Market By 1998, one study found that the top 5 percent of all web sites garnered more than 74 percent of all traffic – Wysocki- “Outlook No. 1 Can be Runaway even in a Tight Race,” – Wall Street Journal 6/28/99

6. Creative Destruction • Mechanical calculator -> Electronic Calculator • Telegraph -> overnight delivery -> fax -> email • Radio -> TV -> Cable -> Internet

7. Coping with uncertainty • “Epistemic Risk” • “the risk of not knowing what one does not know” – Jurgen Habermas • Analyze the situation • Develop a strategy • Continue to learn • About various components • Acknowledge multiple futures

8. Priority Issues of Emerging Technologies Management • Evaluation of Emerging Technologies • Designing Managing Alliances • Strategies for Participating in Emerging Technologies • Developing products for really new markets • Designing organizations to compete in Emerging Technologies • Managing intellectual property • Evolution of Emerging Technology-base industries Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

9. The Importance of Project Risk Management • Project risk management is the art and science of identifying, assigning, and responding to risk throughout the life of a project and in the best interests of meeting project objectives • KPMG study found that 55 percent of runaway projects did no risk management at all Schwable, Kathy Project Management – Course Technology, 2002

10. The Importance of Project Risk Management • Risk management is often overlooked on projects, but it can help improve project success by helping select good projects, determining project scope, and developing realistic estimates • Study by Ibbs and Kwak show how risk management is neglected, especially on IT projects Schwable, Kathy Project Management – Course Technology, 2002

11. What is Risk? • A dictionary definition of risk is “the possibility of loss or injury” • Project risk involves understanding potential problems that might occur on the project and how they might impede project success • Risk management is like a form of insurance; it is an investment Schwable, Kathy Project Management – Course Technology, 2002

12. What is Project Risk Management? The goal of project risk management is to minimize potential risks while maximizing potential opportunities. Major processes include: • Risk management planning: deciding how to approach and plan the risk management activities for the project • Risk identification: determining which risks are likely to affect a project and documenting their characteristics • Qualitative risk analysis: characterizing and analyzing risks and prioritizing their effects on project objectives • Quantitative risk analysis: measuring the probability and consequences of risks • Risk response planning: taking steps to enhance opportunities and reduce threats to meeting project objectives • Risk monitoring and control: monitoring known risks, identifying new risks, reducing risks, and evaluating the effectiveness of risk reduction

13. Categories of Risk • Market risk: • Will the new product be useful to the organization or marketable to others? • Will users accept and use the product or service? • Financial risk: • Can the organization afford to undertake the project? • Is this project the best way to use the company’s financial resources? • Technology risk: • Is the project technically feasible? • Could the technology be obsolete before a useful product can be produced? Schwable, Kathy Project Management – Course Technology, 2002

14. Success Criterion Points User Involvement 19 Executive Management support 16 Clear Statement of Requirements 15 Proper Planning 11 Realistic Expectations 10 Smaller Project Milestones 9 Competent Staff 8 Ownership 6 Clear Visions and Objectives 3 Hard-Working, Focused Staff 3 Total 100 Information Technology Success Potential Scoring Sheet Table 10.3 Schwable, Kathy – Course Technology, 2002

15. Managing ET • New management techniques could be required • New products / new features / new customers / new markets / new thinking • “Some of the most successful players in ET have not managed uncertainty as much as navigated and exploited it” Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

16. Managing ET • Managing High Uncertainty • Keeping Pace • Developing New Competencies

17. Management Strategies • Strategic Planning • Financial Analysis • Marketing Strategy

18. Lessons Learned • Incumbents are at a disadvantage • Knowledge assets outweigh physical assets • Understand how the customers use technology • Learn from experiments • Don’t go for the big market all at once Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

19. Lessons Learned • Understand the role of government • Use partners • Use flexible planning • Employ new strategies for financial assessment

20. Decisions under Uncertainty What state of nature will ultimately prevail? Decision Posture Technology Succeeds Technology Fails* Aggressive Stance (Commitment and Option Creating) Passive Stance (Wait and See) Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

21. Failures reasons • Technology did not work • Technology could not be scaled up to a commercial viable production rates • A better technology superseded it • “One of the greatest uncertainties controlling new technologies is the invention of yet newer one” – Nathan Rosenberg Stanford economist • Technology is ahead of its time Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

22. Managing ET Keys • A strong commitment but keep your options open • Balance commitment with flexibility • Winners are often pioneers, but most pioneers fail • Build “settlements and supply posts” along the way – Alfred Sloan General Motors • Strategies should be built on existing competences but separation is often required for success • Competition is intense and brutal and yet winning requires collaboration. • Managing alliances and partnerships Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley

23. References • Wharton on Managing Emerging Technologies, Day and Schoemaker, Wiley, 2000. • Schwalbe IT Project Management - Course Technology, 2003.