The Innovation Engine

Sometimes, being first to market is critical to success. This is absolutely true regarding, the personal computing industry.  The computer industry is nearly 40 years old. It has contributed considerably to the growth of the information economy.  

The accumulation of knowledge and innovation are key drivers of commercial success in the information age.  Companies in the USA, dominated the first 30 years of the industry. Why? 

Step 1: Embed Intrinsic Capabilities & Skills in Universities  

In 1972 Robert Noyce invented the microchip. Unleashing one element of the Trinity, (speed) increasing data processing power.

Over time, innovation in chip design lead to;

• An increase in the number of transistors that could fit on the tip of a micro-processor

• The scaling of computing know-how and new product                    development for microchip processors and computer                      components.

  This facilitated the emergence of the second universal law              (scale)

Step2: Unleash the Creative Potential of the Working Population

Although the personal computer was pioneered by Apple Computers.  The introduction of a modular open system by IBM with standard interfaces. Ushered in the era of the personal computer. IBM’s innovation became the de-facto common standard adopted by the world. 

Firms,  operating within the PC industry,  exploited the advantages of leveraging economies of scale, to create global supply chains.

Specialised in key market segments of the PC industry, and became the beneficiaries of falling costs.  The cost savings were passed onto the consumer, in the form of lower PC prices.

Facilitating  rapid user adoption of the PC around the globe. Incentivising, organisations incumbent within the PC industry to innovate along multiple paths.

The Hardware Evolution

Perpetuating Innovation in Hardware, Software and Semi-Conductors

The evolution of hardware was another factor that drove innovation in software. In fact innovation in hardware, software and semi-conductors fed off each other to drive innovation across the computer industry. 

Leading to the emergence of the desktop, the laptop personal computers, and pc servers. These innovations provided the gateway to social media platforms, and online marketplaces.  

STEP 3: EXPAND GLOBALLY & REAP THE REWARDS

In the 1980's US firms appropriated 80% of the market share of the personal computing industry. By the 1990's that figure was still 60% of the total market worldwide.   

It seems that the embedding of the intrinsic capabilities & skills, necessary to compete in the personal computer industry. Within universities, R&D departments of organisations and the working population. Created an unfair advantage, for US tech companies, competing in the information age.

In 1996, the top 5 firms, by market share, measured by sales revenue in the personal computer industry were all from the USA.

Ten years, later companies, from Asia had made inroads into the top 5.  However, the top 2 positions, were still occupied by US firms.    

By 2001, Microsoft, would eventually surpass IBM as the dominant player in the computing industry with the Windows Operating System. Intel became the major supplier of semi-conductors for PC related products. 

This was, in part due to the introduction of Wintel in the early 1990’s. Wintel is the integration of Microsoft's Windows Operating System with Intel’s Microprocessor.  Attracting new component manufacturers into the market like Dell, and Compaq. 

In 2017, the top 5 organisations are HP (USA),  Lenovo (China), Dell (USA), Apple (USA)  and Asus (Taiwan). 

Citations

Mittan, R Shane, (2010) Apple Western Michigan University

Laurus James, (2008) Spending Moore’s Dividend.  

Dedrick J, and Kraemer K (2008) Globalization of Innovation. The Personal Computing Industry.