ADMS 1000 Lecture Notes - Lecture 1: Dominant Design, Creative Destruction, Technological Evolution

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Chapter 7
Compare and contrast the different stages of the industry lifecycle model.
Introduction phasehigh fragmentation
entrepreneurial
high degree of innovation
many small competitors
lots of R&D
customers willing to pay a premium
uncertainty about the market
lack of legitimacy
Growth phasea dominant design
shakeout (firms exiting)
products appeal to wider market
economies of scale
lower prices
growing sales
new entrants
Maturity phase Slow growth
Markets saturated
Competition intensifies 强烈竞争
Profitability
Price-conscious consumers
Incremental improvements (“new and improved”)
Lots of advertising
Price wars
Decline phase Declining sales due to one or more of the following:
Changes in demographics
Shifting consumer tastes
Technological substitution
Identify and describe the key drivers of industry evolution.
Customers competition critical functional areas products technological development
organizational structure and strategies.
Analyze how competitive forces change during the lifecycle.
Identify and explain the key success factors for organization at each stage of the industry
lifecycle.
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Consider how and why competitors choose downsizing and its implications for business.
Maintain a leadership stance
Pursue a niche strategyfind another segment that not in decline phrase
Harvest profits
Exit early
Consolidate mergers and acquisitions
To minimising Losses
Identify and explain different types of innovation.
Radial innovations
create a whole new industry (such as automobiles or wireless phones have done). These
innovations are often referred to as discontinuous because they do not continue to build on the
previous technological regime, but instead mark a shift to a completely new technology.
Incremental innovations occur when a company makes relatively minor improvements or
modifications to an existing product or practice in the hopes of differentiating it from the
competition. It is also a way to extend the life cycle.
Compare and contrast the relationship between technological evolution and industry
evolution. Technological evolution is expression of creative destruction and is have close
connection with capitalism Industry evolution refers to cumulative change in industry
characteristics, notably the processes of firm entry, exit, and growth.
Describe the key features of technology lifecycle models.
The Abernathy-Utterback model forms the basis for most of the work that has followed on the
technology life-cycle concept. It states that technologies evolve from a fluid phase through a
transitional phase to a
specific phase. When a new technology is initially introduced, it is still in a state of flux and there
are a lot of technical as well as marketplace uncertainties. These discontinuities trigger an era of
ferment, a period of substantial product-class variation that ends with the emergence of a
dominant design.
A dominant design allows for the standardization of parts and the optimization of organizational
processes for volume and efficiency; therefore, in the specific phase, competition is based more
on price than product features. Once a dominant design emerges, future technical progress
consists of incremental improvements that elaborate on the standard.
The era of incremental change (usually coinciding with the industry maturity stage) is a much
longer period of relative stability and equilibrium. These long periods of incremental change are
punctuated by technological discontinuities.
Discuss the concept of technological S-curves.
may be seen as composed of four phases:
1.The research and development (R&D) phase (sometimes called the "bleeding edge") when
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incomes from inputs are negative and where the prospects of failure are high
2.The ascent phase when out-of-pocket costs have been recovered and the technology begins to
gather strength by going beyond some Point A on the TLC (sometimes called the "leading edge")
3.The maturity phase when gain is high and stable, the region, going into saturation, marked by
M, and
4.The decline (or decay phase), after a Point D, of reducing fortunes and utility of the technology.
Examine business process redesign and its connection to technology.
is a business management strategy to help company continuous development the process is
about change and adapt new things such as technology or idea.
Chapter 8
Provide a definition of globalization. What are the pull factors and push factors that encourage
global activity?, globalization may be considered as a process involving the integration of
national economies and the process of generating a single world economic system
A process involving:
the integration of national economies.
the generation of a single world economic system.
the expansion of the degree and forms of cross-border transactions.
the growth in direct foreign investment
in regions across the world.
the shift toward increasing economic
Interdependence.
What are the channels of global business activity? What are some ways businesses can go
global?
Exporting and Importing
Outsourcing/Offshoring
Licensing and Franchising Arrangements
Direct Investment in Foreign Operations - Foreign direct investment (FDI)
Joint Ventures and Strategic Alliances
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