15nm
Value Creation in Product Development
Product
Definition
Fundamental
Technologies
Product
Implementation
Markets
Technologies
... The Way It Is Today
e.g. Microsoft, Sony,
Acer, Cisco,  Dell
e.g. Xilinks,
       Intel, 3M
Disruptive
Technology
$ ROI
Disruptive
Business Model
Source: Stan Shih, Acer, 1992
…The so-called “Stan Shih smile.” Nowadays, significant value is accrues to companies who can develop and protect an important, fundamental new technology—companies like Intel with its process & device technologies and x86 architecture, Xilinks with their FGPAs or 3M, for example. At the other end of the spectrum, significant value accrues to companies who can identify and address important new markets—who build the right thing at the right time and can create a franchise; “technology as fashion,” for example.
Of course one still definitely needs a great team to get the job done, but the most substantial portion of the ROI can be attributed to owning and protecting critical new technologies and in understanding and executing against the market and business issues of the time.
Now I know most of you are familiar with the work of Harvard Business School Professor Clayton Christiensen, well known for his important book “The Innovators Dilemma” and his concept of a “disruptive technology.” Well, just as a technology can be disruptive, so can a new business model—a new approach to markets, a new way of financing or distributing products and services, a new way of integrating existing markets, and so on. I use the term ‘business model’ in its broadest possible interpretation.
In fact, I believe that the real disruptive opportunities of this time we are in lie more to the left of this image than to the right—that we should be spending more time thinking about disruptive business models and the creation of new categories of products and services, new distribution and support models, and so on—than the opportunities that lie purely on the right.
Moreover, if we can actually include the entire spectrum in our thinking—from technologies to markets and the methodologies that get us there—we have the chance to really make a difference. Throughout this presentation, I will argue that in ICT research and development we should organize ourselves with this goal in mind. To maximize the potential impact of our work, it is more important than ever to consider the application of our research to modern products, systems, and services.