How to Predict the Future of Technology? Step and Wait. Step Size, Wait Times, and Growth Rates (IMAGE)

USC Marshall School of Business

How to Predict the Future of Technology? Step and Wait. Step Size, Wait Times, and Growth Rates

Caption

This chart comes from the paper titled, "Predicting the Path of Technological Innovation: SAW vs. Moore, Bass, Gompertz, and Kryder," by Gareth James and Gerard Tellis, professors at the USC Marshall School of Business and their co-authors Ashish Sood, at Emory and Ji Zhu at the University of Michigan. The paper concludes that Moore's Law does not apply for most industries, including the PC industry. The authors in the current issue of Marketing Science, offer a new model, Step and Wait (SAW) based on 26 technologies in six markets from lighting to automobile batteries. This chart averages performance improvements for by industry in terms of "steps" and "wait" times. The challenge for strategists is to invest in various technologies to beat these averages. The sweet spot is in knowing which technology to back based on predicting when a new technology is going to have a jump in performance by using the SAW model.

Credit

Gareth James and Gerard Tellis, Ashish Sood, and Ji Zhu in <i>Marketing Science</i>

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