Technology Life Cycles, S-Curve of Technology Evolution

The technology life-cycle (TLC) describes the commercial gain of a product through the expense of research and development phase, and the financial return during its “vital life”. Some technologies, such as steel, paper or cement manufacturing, have a long lifespan (with minor variations in technology incorporated with time) whilst in other cases, such as electronic or pharmaceutical products, the lifespan may be quite short. The technology life cycle is concerned with the time and cost of developing the technology, the timeline of recovering cost, and modes of making the technology yield a profit proportionate to the costs and risks involved.

The technology life cycle can be broken down into following distinct phases/stages:

Stage Technological Stage Features
I Technology Development Basic Technology
II Technology Application Technology + Application
III Application Launch Technology + Application + Product Launch
IV Application Growth Technology + Application + Rise in Product Sale
V Technological Maturity Technology + Application + Fall in Product sales
VI Degraded Technology Minimal Product sales + Loss of application + Alternative Technology

Stage I: Basic technology is developed in the research & development centre.

Stage II: Various applications of new technology are explored & planned.

Stage III: Products, services & processes based on these applications are launched in the markets. At this point of time, usually they are not fully developed. A number of alternate products, services & process designs emerge & compete with each other.

Stage IV: Based on feedback & requirements of markets, market –oriented applications are offered. This is the period of consolidation when the emphasis is on standardization, manufacturing efficiencies &economies of scale of mass production. This leads to rise in product sales.

Stage V: Technology reaches its maturity stage & rate of innovation slows down. While further development slows down. While further development is affected by diminishing returns & rapid increase in development costs, market become price competitive & growth begins to level out.

Stage VI: Many applications of the existing technology lose relevance due to arrival of some alternative new technology. At this point of time, there are minimal sales of products/ services based on remaining surviving applications considered somewhat useful by the markets.

S-CURVE OF TECHNOLOGY EVOLUTION

ne of the most famous concepts in Innovation is the Innovation S-Curve, the technology life cycle. This framework, which operates alongside the Bass Model, is used to determine performance in regards to time and effort. It assists in determining the level of maturity of the industry / product.

As a result, when evaluating a product or an industry, it is crucial to understand where it is on the S-curve due to the many implications that result out of that such as the possible risks and pitfalls that are associated for certain phases on it.

S-Curve
S- Curve

4 Major Phases

When looking on the technology life cycle, we can distinguish among 4 different stages: Ferment, Takeoff, Maturity, Discountinuity. Positionning a new industry/ product assists professionals to determine what is the potential of it and also decide on a certain innoation strategy that will fit best for it.

The-S-Curve-with-Disruption

Era Of Ferment – This phase is in the beginning of the S-Curve pattern of innovation. It is when the product/ industry is completely new. As a result a dominant design in the market hasn’t been established yet. Therefore, the competition between the various players in the industry is fierce. As a result, usually at this stage most of the resources are spent on research and development .

Takeoff – In this phase, due to the ability to overcome a major technical obstacle or the ability to satisfy a demand of the market, the product/industry have been adopted by the early majority and manged to cross the chasm and a dominant design has been established already. Hence, the market will be characterized with a rapid growth in production, and the product will move quickly towards a full market acceptance.

Maturity – Here, the product is adopted  almost completely by society and is usually approaching a physical limit. Due to the strong competition among the major players in the market which is clearly defined at this stage, most of the resources at this point are spent on improving the production processes and making them cheaper. Therefore, oftentimes the products at this stage become completely standardized and the innovations at this stage are concidered incremental.

Discontinuity –  At this phase the innovation occurs, as a new S-Curve pattern can rise. Since the previous product/ industry reaches an era of maturity, there is an opportunity for a new product to appeal to the innovators segment in the population and they will start a new product life cycle which is usually considered as the Disruption.

2 thoughts on “Technology Life Cycles, S-Curve of Technology Evolution

Leave a Reply

error: Content is protected !!
%d bloggers like this: