Diffusion of innovation

From CEOpedia | Management online
Revision as of 15:35, 22 May 2020 by Sw (talk | contribs) (Infobox update)
Diffusion of innovation
See also

Diffusion of innovations is a theory developed by Everett M. Rogers, who was a communication specialist and a sociologist and also, he introduced the term “early adopter”.

According to him: Diffusion is the process by which an innovation is communicated through certain channels over time among the members of a social system. It is a special type of communication, in that the messages are concerned with new ideas.

The aim of his study was to understand how easy or difficult is getting a new idea adopted. That is because there is a gap between what is known and what is actually put in use. Many innovations require plenty of time to get adopted by the majority of the society so it is important to research and evaluate the process that could speed up the diffusion of an innovation.

Five Adopter Categories

People who adopt an innovation earlier and those who adopt it later have different characteristics, so it is crucial to distinguish these differences when promoting an innovation. Five adopter categories have been established to have a clearer view on the market segments:

  1. Innovators- Those people who are the first to try new ideas. It is the smallest segment because they must be in control of substantial financial resources in case of an unprofitable innovation and need to have a decent technical knowledge. Risky and daring are his or her main attributes. His or her role is very important: launching the innovation in the social system from the outside of itself as a gatekeeper in the flow of new ideas.
  1. Early adopters- Generally people that holds leadership positions. The main role of this adopter is to decrease uncertainty about a new innovation by adopting it. It means that he/her tries to maintain his/her position as a trustworthy intermediate for potential adopters who asks for advice. That is because the early adopter is seen as not being too far ahead of the average individual.
  1. Early majority- They make a very important conjunction with the diffusion process by adopting the innovation just at the right moment, when they are sure that it will make profit. They are rarely leaders, but they are the one who can say that they made the best investment.
  1. Late majority- Skepticism is the main characteristic of this category as they will not adopt an innovation if most others in their social system will not as well. They have to be sure that the innovation will be a good adoption. They are not risk takers and so generally they have a lower social status than early adopters.
  1. Laggards- Being one step behind the other adopters is their way of doing things. That means that they are mostly traditional and very suspicious of changes. Most of the time, when they adopt an innovation, this can not be called that way anymore because a new idea has already entered the market and so it makes their innovation an old thing. Laggard can be considered as a derogative description, but it also may be affected by the social status and, as a consequence, by the limited resources.

Five Attributes of Innovations

Another list of five, in no particular order, is made by E. M. Rogers, but this time considering some attributes that an innovation has in the eyes of the adopters. These will help us in predicting the future rate of adoption of an innovation. The rate of adoption indicates how fast an innovation might be adopted.

  • Relative advantage- How an innovation is seen as more useful and beneficial for the adopters. If it is worthy to replace the old innovation with the new one.The relative advantage of an innovation is positively related to its rate of adoption.
  • Compatibility- How much an innovation will meet the needs of potential adopters, how it is consistent with existing values and so if it fits the time and space of the current social system. The compatibility of an innovation is positively related to its rate of adoption.
  • Complexity- The level of difficulty in understanding and usage of the innovation. The complexity of an innovation is negatively related to its rate of adoption.
  • Trialability- How much an innovation can be tested and experimented before actually being adopted. The trialability of an innovation is positively related to its rate of adoption.
  • Observability- How much the outcome of an innovation is perceptible to the social system. The observability of an innovation is positively related to its rate of adoption.

Consequences of Diffusion of Innovations

The consequences of the diffusion of an innovation are very difficult to judge. They can be positive, negative or both. It all depends from the point of view. For some an innovation could be life-changing in a positive way, for others it could be useless or even lead to very serious negative after-effects. They can be called direct and indirect consequences. The first ones are changes noticeable immediately after the adoption of the innovation; the second ones are only noticeable to an individual or a smaller social system as a straight consequence of the direct ones.

References

Author: Alexander Gagliani