Conceptual View of Technology Evolution and Disruptive Technology Daniel HaoTien Lee (李浩典) danieleewww@gmail.com http://danieleewww.yolasite.com/2016-mgb070.php

Five Successive Technological Revolutions, 1770s to 2000s Popular name for the period Core country or countries Big-bang initiating the revolution Year FIRST The ‘Industrial Revolution’ Britain Arkwright’s mill opens in Cromford 1771 SECOND Age of Steam and Railways Britain (spreading to Continent and USA) Test of the ‘Rocket’ steam engine for the Liverpool-Manchester railway 1829 THIRD Age of Steel, Electricity and Heavy Engineering USA and Germany forging ahead and overtaking Britain The Carnegie Bessemer steel plant opens in Pittsburgh, Pennsylvania 1875 FOURTH Age of Oil, the Automobile and Mass Production USA (with Germany at first vying for world leadership), later spreading to Europe First Model-T comes out of the Ford palnt in Detroit, Michigan 1908 FIFTH Age of Information, Computing, and Telecommunications USA (spreading to Europe and Asia) The Intel microprocessor is announced in Santa Clara, California 1971 Source: Carlota Perez 2002

The Historical S, T & A Co-evolution Process NBIC: Nanotechnology, Biotechnology, Information Technology, Cognitive Science Courtesy of Byeongwon Park 2007

NBIC Case: Life Ingredients Available for …… Four chemicals, called bases, are the essential building blocks of life, photographed here at Twist in San Francisco, Calif., on Friday, June 19, 2015. They are fed into a machine, called a DNA synthesizer, which dispenses fragments of genetic material onto a tiny silicon chip, which are stitched together into genes. Then these synthetic genes are inserted into cells and used to build products never found in nature. (John Green/Bay Area News Group) ( JOHN GREEN )

Mass Production of Genes! Takeways: Mass Production of Genes! Personalize DNA at will!

Double Nature of Technological Revolutions A CLUSTER OF NEW DYNAMIC PRODUCTS, TECHNOLOGIES INDUSTRIES AND INFRASTRUCTURES generating explosive growth and structural change NEW INTERRELATED GENERIC TECHNOLOGIES AND ORGANIZATIONAL PRINCIPLES capable of rejuvenating and upgrading mature industries A CHANGE OF TECHNO-ECONOMIC PARADIGM New engines of growth for a long-term upsurge of development A higher level of potential productivity for the whole productive system Source: Carlota Perez 1998

Disruptive Technologies A driver of leadership failure and the source of new growth opportunities Lower-risk enterprise mode Higher-risk venture(stealth) mode or Disruptive business models or Disruptive value creation Courtesy of http://www.claytonchristensen.com/

The Innovator’s Dilemma 60% on $500,000 45% on $250,000 40% 20% on $2,000 Incombent: NASA vs Entrants: SpaceX and Virgin Galactic Courtesy of http://www.claytonchristensen.com/

Disruption in business models has been the dominant historical mechanism for making things more affordable and accessible. Tomorrow(2014): Chery? Internet retail RIM Blackberry? Apple, Samsung Skywest, Air taxis? ETFs ?(exchange trade fund) Zink?, Micropojector? Linux, Android, iOS Salesforce.com? Skype?, LINE? E-Trade China, India, Turkish, Brazil Smart Phones, iPad Yesterday Ford Dept. Stores Digital Eqpt. Delta JP Morgan Chase Xerox IBM Cullinet AT&T Dillon, Read Japan Sony DiskMan Today(2008) Toyota Wal-Mart Dell Southwest Airlines Fidelity Canon, Nikon Microsoft Oracle Cingular Merrill Lynch Korea, Taiwan Cellular Phones, iPod But technology advancing are always the main thrust behind these transitions Courtesy of Clayton Christensen, Harvard U. 2008

Role Players in Technology Revolution and Evolution/Innovation Entrepreneurs/Innovators  First Follower  Second Follower Engineers Managers  Entrepreneurs/Innovators Consumers/Customer  Entrepreneurs/Innovators Financiers Entrepreneurs Infrastructure Builders  Government and Entrepreneurs/Innovators (rare cases)

What is Innovation!

Innovation Focus on Value Innovation is the creation and delivery of new customer value in the marketplace with sustainable value for those producing it Not just collaboration or teamwork Not just entrepreneurship Not just R&D and knowledge creation Not just creativity

Technology and Complexity Complexity: individual elements reacting to the collective pattern they create Evolution is part of this Q. Does the collective of technology evolve? Courtesy of W. Brian Arthur

An observation Technologies are constructed from existing technologies © 2009 W. Brian Arthur

How a technology is structured Base concept or principle “the method of the thing” (i.e. the idea of some effect in use) E.g. principle of a clock is to count the beats of some stable frequency A base assembly (a combination that achieves this) Ancillary systems and parts to make this work © 2009 W. Brian Arthur

Jet engine (GE J47) © 2009 W. Brian Arthur

Real powerplant--A Rolls Royce turbofan © 2009 W. Brian Arthur

The process of invention Distilled down, it really is seeing a principle, and putting together the ways to make this work from functionalities that already exist … plus solving the subproblems this creates © 2009 W. Brian Arthur

We can say …  Novel technologies are constructed from existing technologies … These offer themselves as components—building blocks for the construction of further technologies © 2009 W. Brian Arthur

So in real life we may wish simplicity over complexity! But complexity is growing exponentially in our modern life!

Technology complexity actually help life for simplicity or otherwise?

“To attain knowledge, add things every day “To attain knowledge, add things every day. To attain wisdom, subtract things every day. — Lao Tzu”

Subtraction Is the Hardest Math in Product Design

“Simplicity is about subtraction”

The Laws of Subtraction: How to Innovate in the Age of Excess Everything

Abstraction is key to creativity– so lead to technology innovation, evolution, and revolution….

Abstraction shifts: The concept of new work is based on the fact that in today’s complex and changing world, all fields of work will sooner or later face one or more abstraction shifts. This means that the content, relevance, execution and output of work become redefined and shift to a higher level of development. At the same time, some types of work unavoidably become irrelevant and cease to exist.

In general, companies have two ways of successfully coping with the change: they can either gradually evolve their business model or make a radical move to new business sectors. Car manufacturers have chosen the evolutionary road, combining branding and design to technological progress. In turn, Apple is a prime example of radical change and expansion, now operating not only in hardware manufacturing, but also in the fields of media, content production, and software development.

Drinking to Toast: A mundane story: drinking has evolved from the primitive quenching of thirst to the traditional consumption of liquids to the modern refinement of drinks and finally to the futuristic form of a toast. An abstraction shift happens at each transition point. These evolutionary shifts can be intentionally exploited when drafting new models for work, business and systemic solutions, thus creating a competitive advantage and long term success.

Breakthrough Innovation: where it comes from? Optimism: hopefulness and confidence about the future or the successful outcome of something. Pessimism: a tendency to see the worst aspect of things or believe that the worst will happen; a lack of hope or confidence in the future. Read more: https://www.linkedin.com/today/post/article/20140825195748-7374576-the-counterintuitive-trait-that-will-make-you-significantly-more-successful?trk=prof-post#ixzz3C8fKBeUX Credulous: having or showing too great a readiness to believe things. Skeptical: not easily convinced; having doubts or reservations. Read more: https://www.linkedin.com/today/post/article/20140825195748-7374576-the-counterintuitive-trait-that-will-make-you-significantly-more-successful?trk=prof-post#ixzz3C8g4Cw22

ref. http://www. businessinsider

Says psychologist David Dunning  “We cannot recognize the best among us, because we simply do not have the competency to be able to recognize how competent those people are." And unfortunately, genius has another problem: true geniuses—and breakthrough ideas—often sound crazy. It doesn't matter if the glass is half full or half empty if you think you can make a better glass. -- Genius, it turns out, has less to do with the size of your mind than how open it is. Read more: https://www.linkedin.com/today/post/article/20140825195748-7374576-the-counterintuitive-trait-that-will-make-you-significantly-more-successful?trk=prof-post#ixzz3C8hyZAee

Assignment for next week "Taiwan's Value Chain Disruption in ICT Industry” refer to reference material in the course website. "Technology Pioneers of Early-Stage” refer to reference link in the course website. Prepare for 10min. presentation and 5min. Q&A for each of above topic