MGM102H5 Quiz: Managing Innovation and Change.docx
Document Summary
Paradigm shift occurs when a new technology or business model comes along that dramatically alters the nature of demand and competition. Firms have to develop new strategies to survive. First, the established technology in the industry is mature and approaching or at its natural limit. Second, a new disruptive technology has entered the marketplace and is taking root in market niches that are poorly served by established companies that use the established technology. Third, a company develops a new business model that is radically different from that used by competitors, enabling it to capture more demand. Paradigm shift increases as technology approaches its natural limit. When a technology approaches its natural limit, research attention turns to possible alternative technologies. Eventually one of those alternatives might be commercialized and replace the established technology. This creates an opportunity for new suppliers and distributors to enter the market to serve the new entrants.
