Leveraging innovation to enable new business opportunities often requires taking calculated risks to adopt new technologies. While being an enthusiast or an early adopter of new technology has the potential for exciting business growth, the uncertainty of success always looms.
The Adopter Groups
From Marketing 101, we recall the technology adoption lifecycle illustration that simplifies what markets experience during product introductions.
- Enthusiasts—these are visionaries who can look beyond the risk. They see the possibilities to uncover unmet needs. They are often willing to co-develop new technology.
- Visionaries / Early Adopters—they see the opportunities for success of innovation. They want to be early, but don’t want to be first, because there may be a high risk of failure. This is the moment of truth for new technology.
- Crossing the Chasm is the moment of truth for new technology. It is at this point where the adoption of new technology either fails or crosses the chasm to go mainstream.
- Early Majority (Pragmatists) and Late Majority (Conservatives)—the more risk averse adopters who are waiting for someone else to prove the concept. They are often motivated to adopt by the shared experiences of earlier adopters such as a case study or industry forum.
- Skeptics—everyone else has already adopted new technology, so I have to do it now to keep up with the industry.
Example: Technology Adoption Curve for Digital Print
As a business, overcoming fears of adopting new technology into your operations starts with understanding the level of risk you’re willing to accept and the level of reward sought. Essential to that is understanding how end consumers will ultimately benefit or suffer from you adopting or not adopting new technology.
In a new market, some will be brave enough to be first. Then, more join in, which is why the technology adoption model can be plotted on a bell curve. Digital technology in the consumer market is a perfect example. When Apple came out with the first generation iPhone, the enthusiasts were the people waiting in line the first day (or even days before). The early side of market adoption occurred when more people came on board with generation 2 or 3 (early majority) and then even more in subsequent generations (late majority). Someone without a smart phone after release of generation X might be an example of a skeptic.
A critical question to ask when considering the adoption of a new technology: What needs to happen for your customers to get on board?
At Lubrizol, we’ve seen this fear of adopting new technology played out time and time again. In one instance, a c-level executive made it clear changing the way the company executed a major manufacturing process was scary. Changing the everyday “how,” comes with big risks and potentially big rewards. If you make an investment in new equipment, when will you see a return? How big will it be?
Asking the Right Questions
Adopting new technology brings a lot of uncertainty. Asking critical questions can help drive the right decision for your business: be it yes or no. An analytical process will help you understand the technology and what it can do for you and more importantly, what it can do for your customers.
The process also includes walking through various “what-if” scenarios. What happens if I do it? What if I don’t? What if my competitors do it and I don’t, Will I lose customers? How do I reinvent what I do, and leverage my strengths into new technology and create better value for my customers to increase their loyalty? After all, it’s about customer experience in the end.
Think about the pros and cons for every step of the supply chain. It will help assess if there’s enough value and the potential returns versus your risk.
To help a newly launched product cross the chasm, there are more questions to ask as part of the analytic process. What is the experience of the early adopter? Did they get support from the supplier? Did they stay on site? When something broke, what happened? How did the supplier help me realize my vision? How did the supplier help me deliver a better experience to my customer to make the technology successful?Lubrizol is here as a stakeholder in the value chain to help our customers—and sometimes their customers—understand the risk versus reward of integrating innovation into their operations so they can make the best decision for their business. If you’re ready to explore a potential new market or capability, let’s work together to eliminate unnecessary fear.