Selecting Technologies for Constantly Changing Applications Markets: This Methodology Using Tear-Down Analysis and Strategic Evaluation Can Forecast Technological Trends and Prioritize Technologies for Investment

By Lee, Chun-Teh | Research-Technology Management, January-February 2010 | Go to article overview

Selecting Technologies for Constantly Changing Applications Markets: This Methodology Using Tear-Down Analysis and Strategic Evaluation Can Forecast Technological Trends and Prioritize Technologies for Investment


Lee, Chun-Teh, Research-Technology Management


In a high-tech industry like electronics, the ability to accurately forecast future demand as well as choose those technologies that match a firm's competitive strategy and position will significantly affect the firm's competitive advantage. However, forecasting and selecting advanced technologies are complicated decision processes. Many technology-valuation approaches have been published, including quality function deployment (1), analytical hierarchy process (2), Ackoff's interactive planning process (3,4), integrated process (5), multi-level evaluation framework (6), and discounted cash-flow methods (7,8). Kakati explained how strategic myopia might understate the benefits obtained from new technologies and presented a strategic evaluation method (9).

The aforementioned approaches contribute to understanding the problem and provide a framework for general technology selection and/or product design decisions; however, they are not quite suitable for industries/ technologies like semiconductors, optoelectronics and nanotechnology that exhibit a technology flow (the technological path from end products to raw materials) that is driven by constantly changing applications markets. These industries use a variety of sophisticated production technologies to serve many applications markets that can change constantly and swiftly. To be competitive in such an applications-driven environment, firms must have a strong marketing capability to forecast sophisticated technological trends and to identify many newly emerging applications markets and products. Strong technological and manufacturing capabilities are also required to develop and fabricate the products that can successfully compete in the market.

In this paper, I first describe an application-oriented methodology using strategic evaluation and tear-down analysis--analysis performed by tearing apart system products into components and then components into raw materials--to forecast technological trends and to select technologies for investment. The next section uses the semiconductor industry to illustrate the validity of the methodology for technology valuation. An application to the real world is then presented, followed by implications and limitations of the methodology.

The Application-Oriented Methodology

Similar to Salo's multicriteria methods (10), the proposed methodology is driven by goals, adopts scores and weights to compute overall performance measures of different options for investment, and deals with high uncertainties and complex interdependencies. To accommodate the complexities of technologies that are driven by rapidly and constantly changing application markets, the unique features of the proposed methodology are its application-oriented approach driven by tear-down analysis along the supply chain of the industry and the adoption of a technology prioritization method based on market attractiveness and competitive position.

The market attractiveness represents attractive opportunities for the organization, and the organization's competitive strategy/position indicates the organization's strengths and capabilities relative to the market segments' needs and competitive situation. The methodology places little emphasis on detailed manufacturing variables because they are often not well understood before the new technology is developed. Manufacturing (e.g., operational capability and efficiency) and financial (e.g., margins and costs) variables are simply treated as variables of the organization's competitive position.

The methodology consists of five major evaluation stages with complex interdependencies:

1. Formulate competitive strategies through a SWOT--strengths, weaknesses, opportunities, threats--analysis to achieve the organization's mission and goals.

2. Segment and target applications markets starting from end applications markets.

3. Perform tear-down analysis on target segments and along the supply chain of the industry. …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Selecting Technologies for Constantly Changing Applications Markets: This Methodology Using Tear-Down Analysis and Strategic Evaluation Can Forecast Technological Trends and Prioritize Technologies for Investment
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.