Post on 04-Dec-2014
description
MGMT S-5016 * MASI * ALVINA * SA DON * VERDONCK * NG *
TEESE’S PROFITING FROM TECHNOLOGICAL
INNOVATION
David J. Teese
EMI Cat Scanner
RC Cola
Complimentary Assets
1
2 Imitability
Imitability
Appropriability
Regime
Dominant Design
Appropriability Regime
Most important dimensions: nature of technology and efficacy of legal mechanisms.
TRADE SECRETS
COPYRIGHT
PATENTS
LEGAL INSTRUMENTS
Nature of Technology
Product Process Tacit Codified
Tight A.R - ex. Coca Cola (trade secret)Weak A.R – ex. Bottled water industry
Dominant Design
Pre-paradigmatic stage and paradigmatic stage
Competition amongst firms manifests itself in competition amongst designs
One design or a narrow class of designs begins to emerge
Once a dominant design emerges, competition shifts to price and away from design Competitive success then shifts to a whole new set of variables
Innovation is not necessarily halted once the dominant design emerge
Dominant design is of great significance to the distribution of profits between innovator and follower
Dominant Design
Dominant Design: Examples
Most of the early PDA companies failed, even if they had innovative and sophisticated product designs. Palm emerged as the winner of PDA
Videotape format war between Betamax and VHS, where VHS became the video standard
Examples of Dominant Design
War of currents between Direct current and AC power
Microsoft Windows in the PC operating system
COMPLIMENTARY ASSETS
“ Assets, infrastructure or capabilities needed to support the successful commercialization and marketing of a technological innovation ”
CRM SOCIAL
MEDIA
VALUE
CHAIN
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Porter’s Value Chain Model
Innovation
Competitive
Manufacturing
Distribution
Service
Complementary
Technology
Other
Other
Contractual Mode
Contractual Mode
• Inexpensive• Ideal with Strong
Appropriability• Gain from Partner
Pros
• Difficult to form Partnerships
• Bad PartnersCons
Apple
Apple Vs. Samsung
http://www.youtube.com/watch?v=Z19vR1GldRI
Apple Vs. Samsung
Integrated Mode
Innovation
Competitive Manufacturi
ng
Distribution
Service
Complementary
Technology
Other
Other
Integrated Mode
• Scalability• Ideal with Strong
AppropriabilityPros
• Expensive• Need a lot of
Complementary Assets
Cons
Google.com
Google.com
Google has spent north of $23.5 Billion in acquisitions Motorola for $12.5 Billion DoubleClick for $3.1 Billion YouTube for $1.7 Billion Waze for $1.3 Billion Android for $50 Million
Google Engineers – “Googlers”
Google.com
Implications
Research according to Strategy
Co-specialized assets make or break an innovation
Forging links within the Industry
Try to keep the Manufacturing in-house
A story of Dell
ASUSTeK slowly took upon itself the responsibility of manufacturing Dell’s laptops, and eventually usurped them
Conclusion
REGIME OF APPROPRIABILITY
DOMINANT DESIGN
COMPLIMENTARY ASSETS
CONTRACTUAL & INTEGRATED MODE