Chapter 8-9

Chapter 8

Commercializing Emerging Technology

This chapter discusses the need to expand beyond the technology itself when bringing new developments to market. There is more than simply mastering the technology or new development.

The example used throughout the chapter was the printing industry and Mergenthaler’s Story.

There are three challenges of commercialization. Each of these three challenges have a variable impact on organizations depending on the technology that is evolving. Some markets and some companies will have to focus on one or all more than other evolving technologies.

Change in Complementary Assets
Change in Customers
Changes in Competition

The chapters closes with the three hurdles of emerging technologies. This section was particularly interesting because it seems to bring together the entire point of the chapter. The first hurdle is deciding whether to invest in new technology. The second hurdle deals with the organizational challenges that arise as a result of overcoming the first hurdle. Then comes the commercialization of the technology. Many companies tend to work on the first hurdle the most. Many will even move on to the second hurdle as they move from one technology to another. If they are successful in both hurdles, then many companies can fail to overcome the last hurdle and find new challenges that can lead to disaster.

 
Chapter 9

The first chapter of Part III of this book. Part III is entitled Making Strategy.

This first section and this chapter discusses Disciplined Imagination.

Notes about music. Strategy development in emerging technology requires creative thinking in many ways. Creative thinking is compared to the Arts and specifically music. The classical style of music is very structured and many rules to follow. If anyone were to write a new classical symphony today, it would require you to follow the rules of a classical symphony that were set in place hundreds of years ago. If a symphony is not developed using those specific classical rules of a symphony, it could still be a symphony, but not a classical one. Both developed symphonies would in essence be a ‘symphony’, but if one did not follow the rules, it would be completely different.

Maybe I will be more successful in managing new emerging technology because of my creative side that seems to get caught up with all the rules of the classical era of music! On a side note I did my undergraduate degree in music theory and composition. When dealing with business and organizational changes it would be logical to me that the rules and traditional way of doing business will change with emerging technologies. Companies that are willing to make changes in their organizational design will have a better opportunity to meet the growing demands of the changes that arise with new technology developments. Companies that rely on traditional ways of thinking and traditional forecasting for their new customers will have a more difficult time staying ahead of the needs of customers and the changes in the technology.

“…in situations of uncertainty, strategy making must be an art.” A direct quotation from the book says a lot about what is new about strategy making for many companies. Thinking about strategy must change with the new technologies that will affect all companies and all markets. A relation to the previous chapter when dealing with customers and assets and competition. All three must be thought of in new ways for companies to succeed. A developed ‘disciplined imagination’ is necessary as businesses change with emerging technology.


Further research:

http://www.exeloncorp.com/ourcompanies/peco/

PECO as an example has both electric and natural gas customers. It is difficult to use much of their information to compare to Idaho Power because IPCO only has electric customers. PECO also has millions of customers, rather than 425,000 at IPCO. They have a distinct advantage because they have many more customers to use as examples and have more ability to implement changes. In many discussion at IPCO, there are questions about what PECO has done and we look to them for potential ideas to avoid problems.

PECO has similar challenges related to rates and have designed their rates around a better price to match the kwhs to the time of day which they were used. Right now IPCO bills their customers for usage that has been used in a 30 day period. With upgrades to their billing and the metering infrastructure, it is now possible for PECO to bill a ‘time-of-use’ rate that varies based on what time of day the usage fell. To make that possible it is necessary to have more data from the meter than just a monthly reading. This required a change in their strategy and disciplined structural changes within their organization to make these things happen.

Discussion Question:

What other types of changes will PECO and IPCO face as new technologies develop?

Does the shift to a more national-wide integrated electricity grid sound like “un-deregulation”?