The Technology Life Cycle
Predicting the Growth and Decline of an Innovation
Every product has a life cycle. However, technology products – by their nature – seem to grow, mature and decline at a faster rate than other types of product.
If you've just developed a new technology, how long do you think it will give you a competitive edge? And have you looked at what you can do at each stage of its life cycle to maximize your profits?
In this article, we'll explore this, and we'll see how you can shape your strategy and investment priorities accordingly.
About the Model
The Technology Life Cycle*, shown in figure 1 below, illustrates the typical life cycle of an innovation, from conception to decline. It helps you understand the commercial gain that you may be able to get from a new product, and predict when you'll be able to generate significant profits from it.
There are four phases in the Technology Life Cycle:
- Phase 1: Research and Development.
- Phase 2: Ascent.
- Phase 3: Maturity.
- Phase 4: Decline.
In phase one, the company invests in internal research and development of a new product, and in phase two, we see its initial launch and...