This book is about technological innovations. It is set against a background of contemporary technological turbulence and numerous attempts to describe the genesis of various changes in technology that have been observed. It represents an attempt to make sense of the technological dynamism that appears to be endemic to the times and to provide some plausible suggestions for managing it.

The task is not an easy one. In particular, it is a task that is complicated by the conspicuous importance of technological innovation to modern life. There is no shortage of stories of innovation. They fill biographies, the popular press, and the after-hours conversations of participants. These stories have certain similarities. Changes in technologies, practices, and products are characteristically described in terms of the triumph of the new over the old. Initially, a new idea, institution, or practice is introduced into a small part of the system. Ultimately, it becomes pervasive. The stories use the powers of retrospection to identify individual and organizational genius in this triumph of good over evil.

The obvious difficulty with these stories is not so much that they can be demonstrated unambiguously to be false as it is that even if they were false we would nevertheless construct and repeat them. The market for stories of individual and collective triumph is insatiable, and anthropomorphic biases in human storytelling and comprehension are legendary. As a result, the fact that the tales of innovation that are told seem to have a consistent structure is hardly compelling evidence for their validity.

Technological changes offer firms some of the most important opportunities for maintaining corporate vitality. Indeed, there are many well known cases of firms capitalizing on technological opportunities. For instance, Sun Microsystems was among the first few firms in the computer industry to initiate the development of RISC chips that are now revolutionizing the computer industry (Alster, 1987). 3M has reaped benefits from its Post-it Notes as has Sony from its Walkman (Nayak & Ketteringharn, 1986). There are many other instances of such “technological foresights.”

There are also several instances of firms failing to capitalize on technological opportunities. For instance, RCA, a recognized leader in broadcasting, chose not to invest in FM technology (Hughes, 1989). Xerox Corporation was among the first few firms to develop many of the elements of the personal computer that we now use but was unable to reap commercial benefits from its efforts (Smith & Alexander, 1988). There are many other instances of such “technological oversights.”

Why do such technological oversights and foresights occur? One view is that oversights and foresights are inevitable because technological outcomes are uncertain and contingent upon a match between the internal capabilities of a firm and its external environments, and because technological choices are complex and constrained by the past. These are the challenges that the chapters in this book attempt to address in an effort to develop a theory of technological innovation.

Ideas beget ideas. This adage captures both the genesis of this book and its central theme. It all began when Avijit Ghosh, then Director of the Center for Entrepreneurial Studies at the Stern School of Business, New York University, called to ask if we would be interested in exploring entrepreneurship using a technology lens. Having already spent time exploring the notion of oversights and foresights, we quickly decided that exploring entrepreneurship through a technology lens would be a fruitful endeavor, especially if it were to be a cross-disciplinary one.

Deciding to put together a collection of thought-provoking ideas on this subject, we contacted many leading thinkers from several disciplines. We were gratified by the overwhelmingly enthusiastic response. Rather than ask each author to contribute independently, we concluded that it would be productive to organize a workshop where ideas could generate ideas.

To emphasize the multidisciplinary nature of the phenomenon, we organized the workshop by major “disciplines” that we had identified (technology, marketing, decision making, organizational processes and strategy). Our strategy was to bring together leading thinkers in each of these disciplines and ask them to present their ideas at the workshop so that contributors could get a more holistic perspective. We wanted each participant to have an opportunity to benefit from this cross-pollination process. Consequently, we decided to hold each presentation sequentially. In addition to the presenters, each session had a chairperson and a discussant. We requested discussants to address papers contained in each session both individually and collectively. We kept the task of integrating the papers across disciplines to ourselves.

At the Museum of Natural History in New York, a series of panels graphically depicts natural selection at work. In one panel, a fox runs after a rabbit. In another, a tiger is poised to kill a fox. And so on.

To survive, each animal must rely on the competitive advantages stemming from its own unique abilities. Nothing else matters. Ultimately, outcomes are inevitable and determined. There is no choice in such a world. All that animals have to rely on is what they do best. Pursued by a fox, it makes a lot of sense that a rabbit should run as fast as possible. In the circumstances, it is the best thing to do. Looking at the panel, though, it is not clear that running will be enough to save the rabbit.

The inevitability of outcomes in such a naturally selected world strikes home as one gazes at a magnificent display of dinosaurs. Despite their size, and indeed because of it, dinosaurs became extinct when the earth's atmospheric temperatures soared when either a volcanic eruption occurred or a meteorite hit the earth. Helpless to adapt, dinosaurs became extinct as a species, to be replaced by others better suited to survive the changed ambient conditions.

Subsumed in the natural selection process depicted in these panels are the four challenges to a theory of technological innovation that we articulated (Garud, Nayyar, and Shapira, chapter 1, this volume). These challenges stem from the inevitability of the occurrence of technological oversights and foresights. Oversights and foresights are inevitable because technological outcomes are uncertain and contingent upon a match between the internal capabilities of a firm and its external environments.

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.

The topic of decision making spans many disciplines including both individual judgment and choice behavior and organizational decision making. In editing this volume I focused on potential linkages between the individual and organizational levels of analysis. My goal was to have authors describe their work, hoping to encourage cross pollination between the two domains in future research. Obviously, research that looked at the two levels of analysis has been attempted. In recent years researchers have shown renewed interest in work done at multiple levels of analysis. This volume reflects this growing trend and will contribute to more active interaction between researchers in the two traditions.

Editing this volume was a very demanding task and I would not have been able to do it without the help of several people. First and foremost is Don Kleinmuntz, who acted as series editor on behalf of the Publications Committee of the Society for Judgment and Decision Making. Don was very encouraging throughout the process and his comments on the chapters were invaluable. His insightful and prompt feedback was of great assistance. In addition, I discussed the contents of the book with Raghu Garud, Joe Lampel, Jim March, and Guje Sevon, and their advice is acknowledged. The discussions with doctoral students who took my seminar on Managerial Cognition also helped in thinking on the structure of the book. Julia Hough, our editor at Cambridge University Press, was very supportive and provided timely feedback at many points along the way.