This research project will conduct two complementary studies that focus on generational technology change at both industry and organization levels of analysis. One will analyze an important, common, but neglected kind of innovation, where several generations of product technology co-exist in a market. The hypotheses to be tested will illuminate how multiple generations affect the emerging variety of firms and patterns of competition over time and help explain why such markets are heterogeneous. The tests use hazard-rate estimation and other event-history methods and inclusive archival data for US software products and their developer firms over 10 years.
A complementary study at INSEAD of the European software market, funded separately from NSF, enables comparative and joint analysis. Still, this study ignores ways that individual firms adapt to generational technological change. Firm-level adaptation is important to theory of organizational innovation and to improving managers' capabilities to cope with complex, turbulent markets. Therefore the second complementary study will be of change inside a firm covering the same products and time period using case studies to describe in-depth the evolution of organizational forms and strategies. The cases highlight co-evolution with technology and the market of organizational units, product-line scope, firm boundaries, and dynamic capabilities. They are developed with the funding and cooperation of a corporate partner, Microsoft Corporation.
Both studies are theoretically linked to evolutionary theory, technology change, and organizational theory literatures. Both are preceded by technical analysis of software product-technology and its evolution. Together, these complementary projects will produce more complete prescriptions for managers and researchers and make strong contributions to theory and management of innovation.
