Today’s market is highly competitive and there are new technologies that are constantly being released. Many companies today are on the active lookout for technologies that would be the next big thing. Moving on to the next big idea can make a business have an edge over other businesses. However, new technologies come with new investments that could also be highly risky. One wrong investment may result in a failure that amounts to several years in testing and development and legal battles that could drive a company to bankruptcy. In order to find the best choice, companies should make a decision by asking questions regarding the risks with the new technology, what the competition is doing, how the software will be applied, and what additional information will be used to make a better decision.
Case Scenario
The given case involves two options of investing in software technology. The first investment is a low-risk one with guaranteed profits while the second investment is a high-risk investment with the possibility of high profits. Given such a scenario and as the CEO of the company, I would opt for the low-risk investment option. The low-risk investment option will also be supported by the board members who are more interested in the progressive long-term growth of the company. They would also opt for an option that has guaranteed profits in the long run. Most of the individuals in the R&D and the information technology section of the company would opt for the high-risk option. Such an option involves the adoption of the latest technology and software.
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Every company should consider what new technology and innovation are being applied by their competitors in order to understand the general movement of the industry. One example of poor adoption of technology can be seen through the photography manufacturing company Eastman Kodak. Eastman Kodak had been the industry leader in the manufacture of cameras but failed to adopt digital cameras. The company failed to consider that the general nature of the photography industry was towards cameras. According to Prenatt (2015), Kodak’s leadership ignored the competition posed by digital photography after its invention. The period of complacency by the company allowed it to be overtaken by the competitors. When making the decision of adopting highly risky technology or not, one should thus consider the general movement of the market and its competitors in order to make the right decision.
The application of the new technology to the company would be a critical aspect to be considered. The new technology should be applied in a way that enhances the operations of the company. One of the examples of a failure of adoption of new technology was undertaken by Amazon when it introduced Amazon Fire Phone in the year 2014. The company strived to venture into the mobile industry but was highly unsuccessful as it was a new branch of the company which did not complement the company’s operations. Hartung (2015) observed that company leaders should make decisions that complement the company’s business operations for any venture or initiative to be successful.
In conclusion, there are several considerations that a company should make before undertaking any innovative venture. The risks should be weighed by taking into consideration the opinions of individuals from the R&D and the financial and operations together. The company should consider the risks and consider the steps the company can undertake to reduce them. Additionally, the company should consider the new opportunities presented and how it would help for the future and the growth of the company. The members should then be presented with the information so that they could vote on the best decision and way forward.
Reference
Hartung A. (2015). The Reason Why Google Glass, Amazon Fire Phone and Segway All Failed. Retrieved from https://www.forbes.com/sites/adamhartung/2015/02/12/the-reason-why-google-glass-amazon-firephone-and-segway-all-failed/#6f198e28c05c
Prenatt, D., Ondracek, J., Saeed, M., & Bertsch, A. (2015). How Underdeveloped Decision Making and Poor Leadership Choices Led Kodak into Bankruptcy. Inspira: Journal of Modern Management & Entrepreneurship , 5 (1), 01-12.
