PERF RMANCE 04 - The Performance Portal - Ernst & Young

Use discipline to select
technologies
For firms facing rapid technological
change, knowing which technology to back
need not be a guessing game or a purely
creative exercise. We provide a framework
for informed decisions as shown in Figure
7. The framework consists of identifying
the levels of innovation, the competing
technologies at each level, the dimensions
of performance on which to compare
them and the patterns of evolution on
each dimension.
Our study has shown that some prior beliefs about
technology evolution and selection are wrong. It
refutes the “confirmed wisdom” that technology
evolution patterns follow simple successive S-shaped
curves. Rather, patterns of evolution are complex,
on multiple dimensions and only partly predictable.
Importantly, firms need to invest in, or
at least monitor, a portfolio of technologies in
order to appreciate which technology to back.
Figure 7. Suggested tellis/sood framework for technology selection
1. Do not rely on simplistic models such as the “S-curve.”
2. Identify the different levels of innovation (platform, design, or
component?).
3. Identify the competing technologies at each level.
4. Identify the dimensions of performance on which to compare them.
5. Follow the patterns of evolution on each dimension.
6. Continuously monitor a portfolio of technologies in order to
appreciate which technology to back.
7. Be ready to change technologies if one seems to be improving
faster than others.
Note: The tellis/sood framework for technology evaluation study examined the
evolution of all the technologies in seven markets. The study used data from as early
as 1879 to 2001.