Human resource issues related to disruptive technology.

• Author: Mitchell, Margaret E.

Abstract

Christensen's (1997) analysis of disruptive technology is complemented by an analysis of specific human resource issues related to disruptive technology. Relevant changes in the field of human resources are presented along with a description of the following human resource functions: job design, organizational design; recruitment, selection, and placement; rewards; training and development; and organizational change and development. These specific human resource functions must be designed carefully if a firm wants to increase the likelihood that disruptive technology will be developed and/or implemented. Human resource systems can significantly affect disruptive technology. These effects occur through identifying disruptive technology as an organizational goal, encouraging the development and implementation of disruptive technology, rewarding employees for actions related to disruptive technology, and providing an organizational climate that facilitates development of disruptive technology. Both the intended and unintended effects of specific human resource practices must be considered. Also, firms must be prepared to accept the development of unsuccessful new technologies if they want to encourage the development of new technologies, some of which may become disruptive technologies.

Introduction

Christensen (1997) describes an innovator's dilemma, which concerns the adoption of technologies so new and dramatically different they are characterized as disruptive technologies. These disruptive technologies change the nature of their industry and the viability of firms not using the disruptive technologies. Although these technologies may result in worse product performance initially, they are associated with later successes due to advantages such as lower cost, simpler operation, smaller size, and greater convenience. Also, this success results in the eventual obsolescence of other previously dominant technologies. Competing firms may eventually fail without the relevant disruptive technology, even when such firms have previously dominated their industry. Examples of such disruptive technologies include those seen when the production of personal desktop computers was introduced into the computer industry, which was dominated by firms focusing on mainframe computers; the transistor replaced vacuum tubes and transformed the electronics industry; and production of small off-road motorcycles successfully challenged the market dominated by powerful over-the-road motorcycles (Christensen).

Disruptive technology, which also has been referred to as digital disruption (Six ..., 2002), has been found more frequently in the past 100 years than in any other time in history. Disruptive technology is expected to continue to occur in the future, most likely at an accelerating rate (Six).

Christensen (1997) distinguishes between disruptive technologies and sustaining technologies, which may be characterized as either incremental or discontinuous. The distinguishing features of sustaining technologies concern their relationship with product development. Sustaining technologies, which account for most technological advances in a specific industry, improve performance of established products. These improvements are made along performance dimensions historically valued by the industry's mainstream customers. Their use generally contributes to a firm's success even when these technologies are very difficult (Christensen).

Technology may be categorized as disruptive or sustaining, but all types of technology depend on human resources for development and implementation. The necessary human resources may be found in employees of a specific firm implementing the technology, or they may be found outside the firm through various competing organizations, entrepreneurs, or independent agents.

Christensen's (1997) analysis of specific innovations and technologies provides valuable insights concerning the development and implementation of disruptive technologies. However, he includes minimal information on human resource issues related to these technologies. In this paper, Christensen's analysis is complemented by an analysis of specific human resource issues related to disruptive technology. Relevant changes in the field of human resources are presented along with a description of the following human resource functions: job design; organizational design; recruitment, selection, and placement; rewards; training and development; and organizational change and development.

Relevant Changes In The Field Of Human Resource Management

The field of human resource management has changed during the past century. The changes are not so dramatic as those observed in technology. However, these changes are significant enough to affect the role of technology in specific firms. Also, many of the changes are closely linked to technological changes, so the role of human resource management in disruptive technology should be considered.

One relevant change in human resource management concerns the greater importance of human resource departments in determining the direction of firms. For example, the human resource consulting work of C. Ingrain, chair and Chief Executive Officer (CEO) of Aon Consulting, lead Ingrain to conclude that human resource departments are assuming a more strategic role within business. This greater strategic role also is related to a greater focus on the bottom line (Technology ..., 2002).

Human resource development is seen as part of the larger system that includes organizations, the economy, and society. As those systems change, human resource professionals consider the changes needed in the field of human resources. Changes relevant to technology include the following: creating synergy between research and practice, leveraging technology, effectively managing learning and knowledge, fostering lifelong learning, and recognizing the importance of human capital (Short, Brandenburg, May, & Bierema, 2002). In fact, Short and his colleagues emphasized the importance of human capital by referring to it as "the true bottom line."

James' (2002) analysis of human resource practices indicated that most human resource practices employ an operations mindset that fails to consider the differing needs of employees who work in different stages of the innovation process. A clear appreciation of these differing human resource needs is required in order to properly time the introduction of breakthrough innovations. Firms must simultaneously balance the need to stay ahead of the competition (in order to facilitate future success) with the need to introduce incremental innovation that will maximize profits (for current success). These two needs, which at times conflict, represent a clear challenge for anyone working in high-tech industries.

These changes in the field of human resource management have meant that human resource professionals are greatly concerned about their ability to add value to their organization, and one clear way to add value is by maximizing the value of the organization's human capital. This concern is related to technology in two ways: (1) using technology to optimize employee performance, and (2) using the human resource management function to maximize the likelihood that employees will develop and implement technologies contributing to the organization's success. This latter concern (maximizing the likelihood of developing and implementing technology) is most closely related to the issue of disruptive technology. Human resource systems must encourage employees to create the best technologies (including disruptive technologies) for their employers. Also, human resource systems must encourage the adoption of disruptive technologies that will facilitate the long-term success of the organization.

Issues For Specific Human Resource Functions

Job Design

Job design can be used to identify jobs in which employees are more likely to develop new technologies and/or consider implementing disruptive technologies. These goals can be facilitated by incorporating them into the design of individual jobs. If new technology development and innovation are specified as goals of the job responsibilities, employees are more likely to focus on these goals.

Job design for engineers and scientists, who are the main source of new technology, provide an excellent opportunity for modification. Today's engineers and scientists perform work that is essentially technical. They identify needed information and solve specific problems that may lead to the development of new products (Farris & Cordero, 2002). If these scientists and engineers are going to develop disruptive technology, they must see their work as part of a larger picture. Technical work related to solving specific problems is necessary, but an understanding of development, implementation, application, and business issues would make scientists and engineers more likely to develop disruptive technology.

The disruptive technology associated with the transistor provides an excellent example of the importance of the value of this type of understanding. Bell Labs, as part of their research for the telephone company, developed the transistor to replace the bulky, fragile, and inefficient vacuum tube. This technology, for which Bell Lab scientists won the Nobel Prize in 1956, was developed to amplify electrical current and improve communication over telephone lines (Travers, 1994).

Ibuka, founder of the Sony Corporation, paid Bell Labs twenty-five thousand dollars for a license to develop the transistor for products such as radios, which required higher frequencies than those used over telephone lines. In 1953 Mascarich, Vice President of Licensing at Western Electric (parent company of Bell Labs), told Ibuka that Western Electric scientists did not believe that the transistor was useful for this purpose. Western electric scientists saw the transistor as a power source for...