Dilemma between new and existing technologies: Separation and coexistence of old and new technologies in the Television Development Division of Sony Corporation
Regarding R&D management for long-term coexistence of new
and existing businesses within a company in technological transition,
development of high technology introduces conflict between existing low and medium technologies (LMT).
One solution, organizational separation of old and new technologies, can render the technological
resources of separated R&D groups mutually inaccessible, thereby possibly necessitating duplication
of investment costs. That situation might be prevented by brief coexistence of separate groups during
a transition period.
Nevertheless, existing businesses based on LMT often retain large markets despite the success of new businesses. In the television business described herein, a technological shift began in the late 1990s to replace conventional CRT televisions with flat panel displays (FPD), including LCDs and plasma display panels (PDPs). Today, despite great interest in FPD televisions, global shipments in 2006 included 130 million CRT televisions and 46 million FPD televisions. Varying unit prices prevent a simple comparison, but CRT televisions constitute a large, fiercely competitive market.
Continued coexistence of old and new businesses demands the contradictory conditions of independence of the two R&D groups while using mutual resources. Sony's case has revealed a single technical development division serving both old and new R&D groups, providing similar new technology for product development while co-ordinating these divisions' interests. The technical development division integrates technological and product development to integrate developed technologies into downstream product development.
This integration process, so-called integration of old and new R&D technologies, incorporates lower divisions' technology and expertise into technological development, thereby enabling multiple downstream product development groups to acquire technology and expertise through technology that is integrated with that of other product divisions.
The process' implications include the following.
New businesses use existing business technology; existing businesses can incorporate new technology.
Viewing technological changes as diversification, existing and new businesses can increase opportunities through co-operation.