Seminar on Technology Strategy
Session 6 : Incumbent vs. Latecomer
ODI-OM 석사 1학기 이상민
Kim, Bae, and Yang (2014).Government roles in evaluation and arrangement of R&D consortia. Technological Forecasting and Social Change
The purpose of the paper is to study the role of government in forming and coordinating R&D Consortia. The paper mainly explores two aspects of government involvements. Firstly, the timing of evaluation of participation in a consortium and secondly, the form of the consortium. The paper suggests a computational model based on genetic algorithms. As a result, the paper reveals that when explored in terms of timing and evaluation, the continuous evaluation is superior to early evaluation. Also, the timing and evaluation affects the form of the consortium. Then, the paper introduces the form of “pyramid arrangements”, which refers to the form of arrangements in R&D consortia. The result of the paper reveals the tension and reconciliation between diversity and selection. The diversity and selection are interdependent as more accurate selection reduces diversity while more diversity reduces the performance.
After reading the paper, I learned more about the basic concepts of the variation, selection, and retention model. Especially as the paper mainly talks about the variation and selection part of the evolutionary process, I thought that the model might have some important contribution to the perspective of variation, selection and retention. Also, by adopting the genetic algorithms, the paper developed a visual model of the consortium forming and arrangement process. As the model is designed precisely, it successfully represents the logic of the paper. However, I was curious about the part the paper deals with uncertainty. In the business environment, there are various kinds of uncertainty and each of them might involve different characteristics and aspects. I thought that even though the model contains the factor related to uncertainty, it might be difficult to explain the specific part of them. The paper should have been more persuadable if the function of the model contained more factors related to uncertainty.
Jiang, Tan and Thursby (2010). Incumbent firm invention in emerging fields: Evidence from the semiconductor industry. Strategic Management Journal, 32
The paper argues that incumbent firms have several reasons to invent new technology in early emerging field. The purpose of the paper is to explain why some incumbent firms are successful in an emerging field before it affects the dominant design. Also, the study reveals the reason why some incumbent firms perform better than others in inventing new technology during the early stage of emerging field. The authors allege that the incumbent firm becomes successful at the invention in the emerging field by overcoming two challenges. 1) The recognition of how an emerging field well impact the existing dominant design. 2) Maintaining the current core competency while keeping up with the emerging field’s development at the same time. The result of the paper found that some incumbent firms invest in exploring novel technological areas, knowledge from diverse partners and scientific knowledge. According to the paper, this activity of investment leads the firm to more invention and success. Knowledge gained as a result of these activities enhances the incumbent firms understandings of how the field in infant stage can affect the current industry and provides some crucial keys to be successful in that situation.
While reading through the paper, I recalled some cases that I read when I was in undergraduate school. It was some cases about the failure of incumbent firms in the time of technology change or introduction of the new technology (paradigm shift). The reasons of the failure of firm in the cases were very similar to the points that were introduced as obstacles to overcome for incumbent firms to be successful in the paper. In addition, the paper points out the importance of the knowledge acquirement of the firm Thus, by reading the paper, I learned about the strategy which might be crucial to the incumbent firms in industrial environment related to new technology in emerging field and thought that the suggestion of the paper might be adapted to the case what I recalled. However, although the paper might have some contributions, I found that control variables used in the data analysis might have some problems related to time lag.
Gao (2014). A latecomer’s strategy to promote a technology standard: The case of Datang and TD-SCDMA, Research Policy, 43
This paper explores the strategies related to achieving the technology standard used by latecomer. To do so, the paper uses the case example of Datang, a local Chinese firm. The main question brought up by the author is that how could a latecomer promote a technology standard. By using case study method, the paper tries to answer following research questions : 1) What are the strategies used by Datang to promote TD-SCDMA, 2) Are theses strategies similar or different from those used by MNEs, 3) How to make sense of the similarities or differences. The paper builds its argument on two streams of literature to answer the research question. In addition, the result of the paper gives some implication in terms of two concepts : Late comer disadvantage and transitional institutions.
The paper revealed very practical results by deeply exploring by adopting the method of case study. I learned about the importance and the implications related to technology standard strategies and the difference and similarities of strategies in terms of firm size(local vs MNE). However, as it is also referred in the paper, it is very difficult to generalize the strategy to other industry rather than the telecommunication industry. Not only just industrial settings but also the environment surrounding the industry should have been considered.