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3 - Technological choices and the inevitability of errors

Published online by Cambridge University Press:  07 October 2011

Raghu Garud
Affiliation:
New York University, New York, NY
Praveen Nayyar
Affiliation:
New York University, New York, NY
Zur Shapira
Affiliation:
New York University, New York, NY
Raghu Garud
Affiliation:
New York University
Praveen Rattan Nayyar
Affiliation:
New York University
Zur Baruch Shapira
Affiliation:
New York University
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Summary

It seemed like a marvelous idea at the time: Grocery shoppers would use an ID card that, combined with the electronic scanners at the checkout line, would tell marketers exactly who bought what…. But six years later, the effort looks as if it could turn out to be one of Citicorp's biggest follies. The POS (for point-of-sale) Information Services unit has spent about $200 million, generated just $20 million in revenue at best and made a mess of relationships with many grocery chains and consumer goods producers.

Other direct marketers … saved millions of dollars in being able to see where Citicorp went wrong.

(Bleakley, 1991)

My biggest mistake was failing to get Data General into the PC business.

(Mr. de Castro, Chairman and cofounder of Data General Corp., quoted in Wilke, 1990)

Technology is a double-edged sword. While it can create wealth, it can also consume and destroy it. This duality strikes at the very heart of strategic management because technological changes offer firms some of the most important opportunities for revitalization. Entire industries can emerge from new technologies, as illustrated by the overnight delivery and video games businesses. At the same time, however, technological changes can threaten firms' very existence. New technologies can make products offered by incumbent firms obsolete, as illustrated by the audio cassette recorder's superiority over phonograph records.

Type
Chapter
Information
Technological Innovation
Oversights and Foresights
, pp. 20 - 40
Publisher: Cambridge University Press
Print publication year: 1997

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