Since technology is often a component of successful value creation, companies are continually seeking to gain advantage from technological advance. In the past, technology - rich US firms have had difficulty competing in some industries-semiconductor memory chips, office and factory automation, and consumer electronics - because of their inability to convert technological advancements into competitive advantage in the marketplace. One aspect of creating advantage is to conduct continuous and incremental technological improvement in products and processes. This has been the emphasis of many US corporations, in response to lessons from Japan and increasing global competition. We, however, still do not fully understand how to evaluate and manage technological innovation.
By focusing only on continual technological improvement, one cannot ensure continued success. The engine for corporate revitalization and economic growth is developing and commercializing "extraordinary innovations" and investing in pioneering technologies. How does a firm develop extraordinary new capabilities? What is the nature of technology development in the elaboration of such capabilities? How do we evaluate the potential benefits and problems arising from our efforts to create social value from technology development? There are two dimensions to these questions. Can we a priori understand the inherent value or characteristics of pioneering technologies? To what extent can we manage pioneering technology to create value?
Technological Worth
Frequently an underlying assumption is "extraordinary innovations" or discontinuous innovations require a technological breakthrough. Pioneering technology for creating new value is more inclusive. Sometimes the value arises from technological insight, new applications of old technologies, and other times the discovery can simply be combining technologies in new ways for significant new applications. To value technological breakthrough, insight, or discovery we have to place it in context. Our evaluations must be made according to our: 1) goals or strategies for being competitive; 2) analysis of the potential richness of uses that a pioneering technological platform could have in the future; and 3) existing capabilities that can be commanded to provide value. To understand technological worth we need to make assumptions about how pioneering technology will impact our organizations and our society.
Pioneering Technology for Discontinuous Innovation
There is considerable evidence that to sustain competitiveness and survive in the long term we need to make technologically creative leaps. Often the resulting discontinuous innovations are destabilizing. Can we develop a more systematic approach to dealing with this reality?
There is an assumption that you can't plan for technology breakthroughs but we do this all the time in the budgets we allocate for R&D, in the organizations we build to conduct R&D, and in the people we hire. Can we go further than this and provide guidelines for value creation from pioneering technology? Unquestionably managing pioneering technological innovation is different than situations of continual improvement where there is much less uncertainty. But surely there are managerial tools that reduce uncertainty or help us make creative leaps.
Considering the life cycle of a discontinuous innovation (DI) project illustrates that it is profoundly different from a continuous improvement project and suggests some of the managerial issues we must ink about. It can be characterized as:
Current research indicates that conventional management techniques are unsuitable for DI but clearly the potential exists to create a more systematic approach through the integration of the managerial levers currently being employed: setting boundaries; proactively stimulating discontinuous innovation activity; evaluation and screening; creating incubating mechanisms; and supporting individual initiative.
In short, pioneering technology for discontinuous innovation requires us at the very least to make assumptions about human behavior under conditions of great uncertainty. Our goals should be no only to explore pioneering technologies but to more systematically study human behavior under conditions of pioneering technology. Only then can we employ better tools for managing technology.
We hope the articles presented in this issue and in our 1998 IEEE EMS International Engineering Management Conference (IEMC '98) - Pioneering New Technologies: Management Issues and Challenges in the Third Millennium will stimulate managers to think about managerial techniques for valuing technology and identify appropriate processes for gaining value from pioneering technology in our technologically and globally complex environment. The articles in this issue explore technology evaluation and management practices for both evolutionary and discontinuous innovation because both are important for successful technology value creation.