Page 39 - DMGT501_OPERATIONS_MANAGEMENT
P. 39
Unit 2: Product and Service Design
2.3.2 Technology Lifecycle Notes
Statistical regularities show that the product lifecycle can be used to forecast the way the product
attributes, demand, production and competition will change as the product matures. A related
and more useful concept is the technological lifecycle. This links market growth and technology.
Figure 2.2: Technology Lifecycle
B
A
MARKET
VOLUME
Product B
Process
A
Technology Application Application Mature Technology
Development Launch Growth Technology Substitution
TIME
It has been seen that technological change generally follows the course described by the
'technology lifecycle' graph. By plotting the market volume over time for any industry, one can
identify the changes in the industry. This is called technological aging of the industry. This
exercise can be carried out both for the product as well as the process and has been depicted in
Figure 2.2. When a new industry based on new technology is begun, there will come a point in
time that one can mark as the inception point of the technology.
Lets us discuss the various phases of technological aging/lifecycle by taking up the example of
the automobile industry. In 1887, Gottlieb Daimler manufactured the first gasoline-powered
automobile.
Phase I: Technology Development
1. Then the first technological phase begins with the rapid development of the new technology.
This phase is called the Technology Development phase. In the case of the automobile, it
would be from 1887 to 1902, as experiments with steam, electric and gasoline powered
vehicles were conducted.
2. This is an exciting time, because product improvements continue and improved processes
for producing cheaper, better products are innovated.
3. This is the time of eliminating weak competitors.
Example: In 1909 there were 69 auto-manufacturing firms in USA. Only half the firms
survived by 1916.
LOVELY PROFESSIONAL UNIVERSITY 33
