Crossover of technological performance predicts adoption

TECHNOLOGICAL CHANGE

Many detailed studies of specific instances of technological change show that three distinct but interactive elements always play a role. These are scientific knowledge discovery, creative invention and product/service/system development which is essentially about integrating the invention into the socio-economic system. These studies also show widespread “spillover” of knowledge from one invention to another (in different technological domains), from one field of science to another and from many different fields of science to many diverse technological domains. This reality leads many to believe -somewhat correctly- that prediction of all the specific aspects of a key technological change is not feasible. However, if we examine the question at a higher level, we find that this widespread “spillover” is an important determinant of the major regularity that our method exploits. This regularity is that each technology has a fundamental and constant % change in improvement per year. The core of our methodology is to determine the timing at which one product, system or service is overtaken by a novel one because these constant rates of improvement are greater for key technology in the novel product vs. the target or existing product based upon its key technologies.

Figure 1 gives this core concept in graphical form. Identifying a technology “just” when it’s about to take-off in the S-curve model of diffusion and investing significantly in product development, marketing/ sales at that time, can allow a firm to gain market share quickly and establish a “dominant design”. In addition, there is evidence that faster improving technologies are also adopted at a faster rate during their infancy. This can allow for more accurate estimates of expected sales during the infancy of a technology and can provide a guide for creating realistic technology development and sales roadmaps.