This paper aims to develop a conceptual decision‐making model aimed at supporting managers' selection of alternative strategic reactions to technological change.
The paper begins with a literature review of strategic reactions incumbent firms have made to technological change. This is followed by an analysis and indication of the data needed/available in the strategic reaction decision‐making process.
The ability for an organization to understand its strategic position with regard to six items: possibility of old product revitalization; extent of disruption of innovation; old market competitive position; difficulty in entering in the new market; dynamic capabilities; old core capabilities; is critical when deciding a course of action in technologically competitive markets. Therefore, the hiring of external consultants (e.g. technology experts) is advisable beyond the normal knowledge managing practices used by the organization.
The paper extends literature on technology competition proposing a model (and a multiple‐item scale) for decision‐makers of incumbent firms in order to strategize when technological competition occurs.
