Identify and discuss the four categories of technology in terms of their competitive value. Give an example for each.

Question

What will be an ideal response?

Answer 1

Answer: Student answers and examples will vary but should demonstrate accurate knowledge of the four categories of technology in terms of their competitive value. One technique for measuring competitive value uses four technology categories: emerging technologies, pacing technologies, key technologies, and base technologies. Emerging technologies are still under development and thus are unproved. They may, however, significantly alter the rules of competition in the future. Managers should monitor emerging technologies but might not invest in them until they are developed more fully. Pacing technologies have yet to prove their full value but have the potential to alter the rules of competition. When first installed, computer-aided manufacturing was a pacing technology. Its potential was not fully understood, but companies that used it effectively realized major speed and cost advantages. Key technologies have proved effective, and provide advantage because not everyone uses them. They continue to provide some first-mover advantages. A key technology for Intel is a powerful proprietary processing chip. Eventually, alternatives to key technologies can emerge, but until then they provide a major competitive edge that prevent threats from new entrants. Base technologies are commonplace in the industry; everyone in the industry must have them. Thus, they provide little or no advantage. Managers have to invest merely to ensure their organization's continued competence.