The machine tool industry and the effects of technological change

Abstract

Rather long reinvestment cycles of about 15 years have created the notion that innovation in the machine tool industry is of incremental nature. But looking at its recent history, the integration of digital controls technology and computers into machine tools have hit the industry in three waves of shocks since 1955. Most companies underestimated the impact of the new technology. This chapter summarizes the post-war history of the machine tool industry since the invention and introduction of numerical controls and analyzes the disruptive character of this new technology on the market. About 100 interviews were conducted with decision-makers and industry experts who witnessed the development of the industry over the last forty years. A connection between radical technological change, industry structure, and competitive environment is established in this chapter. A number of important occurrences and interrelations are revealed that were previously overlooked in other studies. Qualitative findings from the questionnaire survey are included here. A historical perspective is used in this chapter to describe the machine tool industry as the object of this research In addition, it attempts to apply the technology shock framework established in chapter 1 to shocks that happened during the history of this industry. Section 4.8, which is based on a Delphi study (Arnold, 2002), takes on a future oriented perspective. It shows that technological changes that potentially have the effect of a shock can be expected for the machine tool industry in the future as well. This prognosis section emphasizes the relevance of the research for practical use.