Strategic Options for Old-Technology Firms

Strategic Options for Old-Technology Firms

What should be the strategic response of old-technology firms when a promising new technology shows up? Typically firms respond by either
1. Fighting the new technology, or
2. Trying to make a transition to the new technology.
Ron Adner and Daniel C. Snow recommend a third strategic option in their article worth reading "Bold Retreat - A New Strategy for Old Technologies" in the Harvard Business Review of March 2010:
3. Bold retreat. Proactively give most of the established market to the new technology and instead pursue either a:
3a. Retrenchment to a niche of the traditional market (where the old technology has some advantage over the new technology), and/or
3b. Relocation to a new market (where the old technology has some advantage over the new technology).
Main advantages of a bold retreat strategy are that it may allow the firm to continue to make money on a smaller scale. This may give it a later option to invest in another growth opportunity. Drawbacks are the need for a significant organizational change process and a tough communication job to explain this strategy to current stakeholders.

		Comments Sort by date Sort by rating Rating
		0 ernest agbenohevi Consultant, Ghana
	Strategic Options in case of Disruptive Innovations It seems to me that NEW TECHNOLOGY FIRMS intending to reduce the cost of production and hence increa... Sign up

		0 Lee Buan Heng Manager, Singapore
	Strategic Options for Old-technology Firms It seems we need to have strategic options to prevent disruptive innovations in financial product, i... Sign up

		0 Kirk C. Heriot Professor, United States
	Disruptive Technology? It would seem to me that this "theory" would be contingent on the strategy the firm is presently emp... Sign up

		0 Thomas Shehu, Nigeria
	Strategic Options to Withstand the Technology Advancement Change is basic in human's life, likewise technology change is basic in the life of companies. The b... Sign up

		0 Jim Kaiser Entrepreneur, United States
	How Do You Know the New Tech Has Legs? Today there are many new technologies hitting the street - social media, cloud computing, etc. Does ... Sign up

		0 Julio Villafuerte Student (MBA), Peru
	Examples of Third Strategic Option Do you have examples of companies that have applied the third strategic option recommended by Ron Ad... Sign up

		2 Jaap de Jonge Editor, Netherlands
	Examples of Companies with Bold Retreat Strategy Clearly you have to consider old technology companies to find examples of bold retreat strategies. T... Sign up