Clash of Dominant Design and Public Policy

1
Clash of Dominant Design and Public Policy

• PPA-730-1

2
Dominant Design

• May establish industry standard
• May be market responsive .particularly with
  limited OEM markets
• Tends to influence structural context of firms
• Tends to influence production marketing
• tends to limit organization capacity to deal
  with entrepreneurial initiatives

3
Missed Opportunities

• May not be result of poor management
• May result from assessment of market environment
  captured by current strategy
• - and implemented in a structural context

4
New Product Development

• Can be core competence enhancing
• Can also be viewed as competence destroying --
  but vested internal interests
• Role of top management becomes critical in such
  situations

5
Entrepreneurs in Large Organizations

• Tougher environment than small firms
• Entrepreneurs tend to explore boundaries of
  firms
• - competencies
• - capabilities
• - opportunities
• Middle level managers play critical role
  advancing initiatives w/ current strategy

6
Product Characteristics

• Is it embodied in multiple products, or
• is it a retail product?
• Does it require process improvement or process
  innovation?
• Is the originating firm affected, or customer
  markets?
• Is it seamless, transparent or evident?

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Senior Management Response

• Support for technological innovation can be risky
• Extant customer base not a good source for market
  feedback -- particularly OEMs
• Difficult to reliably forecast demand
• Must rely on track record of mid-level management
  in championing innovation

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..but

• Firms that want to be technology leaders have to
  routinely advance entrepreneurial opportunities
• Must be willing to commit resources before
  sufficient market forecasts
• Must be able to confront challenges of product
  substitution
• Inherently top management challenge

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Imperatives for change

• Technological change or innovations provide
  opportunity for redefining key relationships
  within the industry
• - other competitors
• - customer base
• Often intertwined with other forces
• - political
• - regulatory

10
Public Policy Influence

• Multiple policies may be consistent
• But may also pose conflicting goals given current
  industry practices
• Active or passive stance in reconciling the
  conflicting methods?
• State public policy goals and leave industry to
  solve the problem, or
• Prescribe methods of accomplishing goals