Technological knowledge versus market force?

In order to innovate and bring that innovation to the market you both need (innovative) market force and (innovative) technological knowledge, but the ‘philosophical’ question could be what is more primary ‘power’ or ‘knowledge’.

The fact that it is possible to gain market force easier due to possibility to gain a (customer rather than company) crowd fast via social media does not deny the importance of market force, but only confirms it besides the fact that market force is more than being able to communicate to a crowd what your product is. Market force is the ability to really bring your product to the market and let people and companies buy your product (or service).

In this blog I will describe a case in which it is convincing to day the market force is more important and a case in which the technological power is more important. That makes the question what is more primary, the market or technology, unanswered. Therefor I am (‘forced’) to look away from the empirical data and use reason and transpose myself to the domain of philosophy.

Reasons will be given that technology is more primary. However important market research is technological research (that may definitely be inspired by scientific research) and technological methods to innovate, like the rules (are rather principles) of TriZ, are more important in order to innovate. Technological innovation will lead to market force and innovation.

 

CASE 1.0. Market force over technological power

case 1.0

When mobile phones were introduced in the eighties they were mainly used by business people for they or their companies could afford not only the phones, but the relatively high subscription fees, that allowed you to call for X minutes, to mobile operators. Adjusting the technology a little bit and adjusting the market strategy revolutionary by getting rid of the subscription fees and allowing people to pay for the actual use of the infrastructure of mobile operators. Not only business people, but in general all people could make use of the mobile phone. This ‘prepaid strategy’ really opened, or created, the market for mobile phones and once that market was created, money earned, smartphones could enter the market. If the smartphone was introduced in the eighties it would probably a very short life. In other words the prepaid telephone is more innovative than the smartphone.

 

CASE 1.1. Market force over technological power

The game computer, for example the Nintendo, is technological quite advanced compared to games played on a game board. The Nintendo Wii, in which your physical movements are projected into the game in order that you do not have to play with a game console, is even more advanced yet never took of market wise. People like people more than computers and the Xbox, which is less advances than the Wii for players still were dependent on game consoles, was and is a success for Xbox (Microsoft) had a better perspective on the market than Nintendo.

case 1.0b

CASE 2.0. Technological knowledge over market force

This case describes the online market of web shops. In the beginning when web shops were popping up everywhere and a buying customer could not know whether to trust a selling web shop and vice versa the credit card companies could act as intermediaries. If either a buyer by not paying or the seller by not delivering acted criminally the credit card company could pay the victim. Therefor the price per payment transaction must be very high for the credit card companies acted as insurance. Not only high but dependent on the amount to be paid as you would expect from an insurance. Buying a new sofa of 2000 euro and you could be charged 50 euro (or more) as a merchant by the credit card company.

When the online market evolved and good web shops assembled themselves via trusts that would regulate the market (by handing out marks of good and decent behaviour to its members) the whole idea of a buyer getting cheated on got to be more an idea of the past or a very small chance. The credit card companies however did not change the (especially high) fee for merchants to accept payments from buying customers although the market itself changed.

When you do a credit card payment what technologically happens is that an amount is pulled from your account as a buyer by the credit card company (when it receives a sign via the merchant) and the credit card company then takes that amount and pushes it to the merchant (minus the fee). That are quite some steps (even if you do not take inconsideration that your credit card account is connected to your bank account) to do a payment and each step may have a security breach making that the payment fee is still high even if you would make a fixed price.

The Dutch payment method iDEAL is a push payment that allows customers via an automated credit transfer initiated by a simple password and secure code to directly pay from their bank account to that of the merchant who will get a real-time notification when the payment process is completed (and is secured by the Dutch banks of really getting paid the next day when all the payments are settled so the merchant can immediately start with shipping the products to the customers). That simple technological idea got loose of a whole infrastructure and allowed better service due the ‘real-time’ element. And for the final kill they presented merchant with fixed prices of this payment method that was only dependent on the volume of payments a merchant was expected.

 case 2.0

A philosophical perspective stating that technology is more primary than the market

However convincing these cases we have to take into account that there are different products, namely products that are more ‘marketisch’ (clothes etc.) and that are more technological (phones and game computers etc.) and that markets themselves develop once they are created into markets in which competitors compete in the field of technology (and service). Our empirical data, the cases, are not freed from ambiguity and if the cases would be clear(ed from all further embedment in a historical context etc.) we have no empirical backup to reason that market force is more important in all cases or technological knowledge is more important. And if all cases would point out that market force more important, but that I lack the power to interpret the data, I would still argue against the data and say that technology defines innovation more than market force.

When innovating we do not ask what is more primary so answering that question does not enable one to do more and better innovations, but giving an answer may help you to be able to reflect better on the process of innovating and understand innovations better. Especially when you are an investor or customer the ability to reflect on innovation can be important.

Step one is to define the quarters in the schemes more clearly than just by the vertical and horizontal axes. These definitions (see scheme below) already make it clear that technological knowhow is more important than market force when you innovate. A technology is more fundamental than a perspective on how to use that technology in order to gain a market. You can invent technology without having a market, but having a market without any technology, that is product or service to sell, is impossible. The soul can live without the body, but not vice versa (although the soul may not know and develop itself without the body, so technology cannot be developed without a market).

Step two in arguing that technology is more primary than the market is by making use of an analogy in which the definitions are paired with the elements of playing in which it is clear what is the hierarchical order of the elements (see scheme below). Clear maybe after a little pondering, but clear! By making one part of the analogy clear the other part will become clear if you connect both elements in the correct way.

In identifying ‘the technological product X’ with the player and realising that although the player plays the game in which he finds himself while playing and is bound by the rules of the game a player is also outside the game for a player can play the ‘game’ of inventing new games (with rules). 

A genius move makes you wonder about the rules and whether they are still applicable (is a smartphone a phone or a smart computer with telephone functionality?) in that game (making phones), but I would argue that the applying the rules is like serving a master and although the servant (employer!) may be more creative than the master (the CEO) the master is still the one who rules (so yes a smartphone is a phone).

case 3.0

Intermezzo on the power of imagination

Immanuel Kant (1724-1804) with his book the ‘Critique of pure reason’ as of the founding fathers of modern Western thought put it in terms of and understanding, with its timeless categories, as the master and the power of imagination as the servant that had to translate the sensible perceptions in time to the timeless categories making the power of imagination a faculty that encompasses both the timeless and time. Kant knew that the workings of the power of imagination, the ‘geni’, was somehow connected more than the other faculties with the eternal soul for something that can translate time to the timeless is neither time nor timeless thus is eternal. The servant is higher than the master and like a good King who serves his people more than vice versa. Because Kant was a slave to the logical timeless understanding he did not speak about a soul as an eternal soul, but only talked about the soul as an idea that can regulate and constitute our moral lives.

End

 

If the application of a rule in lower in the hierarchy than the rule and the rule is connected with having a new perspective on a product and is thus connected with the market aspect the gold and brons medals in this competition are still hold by technological knowledge and only the silver medal is giving to the market. I believe that servant and master should trade places and that the servant gains the silver medal. If you believe differently you believe that ‘befehl ist befehl’ and you are failing. Rules are not self-explanatory and need to be applied. In a genius move the rules may be actually questioned rather than be taken face value.

 

Intermezzo on a genius move in science

Compare a genius move within the rules of classical science of nature with the interpretation by Lorentz and Fitzgerald of the Michelson–Morley experiment (that was published in 1887) that resulted in the measurement of the speed of light as being the same from all moving object whatever their own speed in all directions. In classical science of nature the rule was that an ether existed for as waves need water to move so light needs ether to move, but with the experiment no ether could be found, but to keep the idea of the ether alive the interpretation of Lorentz and Fitzgerald stated that we have to abandon the rule that moving objects have the same size compared when they are moving less fast. In this genius move a rule is abandoned, as children often do when playing, and that is only possible if you step out of the game, become a player (a real scientist rather than someone who just blindly follows rules by applying the rules as other apply them). In a genius move one makes the rules as one goes along and one touches on that what is outside all games and is the source of all games, but it is still a move. The real genius, Albert Einstein, founded a new more fruitful, rich game that explained more and better and thus a more truthful game.

End

 

Intermezzo on the power of imagination as the power of a community

It is the servant realises he has creative power, the ability to cultivate, and therefor recognizes himself or herself as a soul and the soul is higher than the soulless master. This is along the lines of the thought of Hegel (1770-1831) who developed his philosophy mainly in discussion with the thought of Kant. The idea that the servant (the power of judgement) trades places with the master (understanding) inspired Karl Marx (1818-1883) to write ‘Das Kapital’. Hegel did not speak so much of the power of imagination, that is revealed as ‘reason’ (and you need reasons to apply a rule), as a faculty that belongs to an individual, but spoke of it as an ‘objective spirit’ meaning society, a community, intersubjectivity, in general.

That intersubjective community is in essence something that even precedes technology and that the market from which technology and thus the market can be born. The intersubjective community is not technical in essence (even if every relation between humans would be mediated by technology). Intersubjectivity is shown in everyday practical doings like asking someone to hand you over a phone or hammer. Heidegger (1889-1976) and Wittgenstein (1889-1951) (on whose work Alan Turing (1912-1954) enabled to build a computer that cracked the code of the Nazis (what proves once again against ordinary believe that philosophy (the mother of science (the father being religion)) does have very practical consequences)) are proponents of reasoning that technology is built on everyday live (although it can distort everyday live).

End

 

In hierarchical order we have placed the technical product on top, than defining new technical functionality of that produc, then a new perpective on the product within a market and than the technical enhancements.

One could react that the question about what is more primary is asking about what is more primary the chicken or the egg. I can prove that the chicken is more primary, but that will exceed the limits of this blog. The chicken and the egg have at least one thing in common, namely that they can both be eaten. We both need the market and technology and when I speak about that technology is more primary (for it can create a new market which vice versa is harder to imagine) I most certainly to not denounce the market or say it is inferior. On the contrary the market not only is a test of technology, but makes companies earn money to innovate (and make products cheaper). The heart is not inferior to the brain and with all your heart one should innovate!

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