Mastering the Hype Cycle:

How to Choose the Right Innovation at the Right Time

Mark Raskino

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Hype Frustration

“I can‟t think of anything that isn‟t cloud computing

with all of these announcements. The computer
industry is the only industry that is more fashion-
driven than women‟s fashion. Maybe I‟m an idiot,
but I have no idea what anyone is talking about.
What is it? It‟s complete gibberish. It‟s insane.
When is this idiocy going to stop?

„Larry Ellison‟s Brilliant Anti-Cloud Computing Rant‟

Wall Street Journal: September 25, 2008
Innovation Necessity

“The greatest benefits of globalization will

accrue to countries and groups that can
access and adopt new technologies.
Indeed, a nation‟s level of technological
achievement generally will be defined in
terms of its investment in integrating and
applying the new, globally available
technologies.”
US National Intelligence Council, Mapping the
Global Future: Report of the National Intelligence
Council’s 2020 Project, December 2004
Key Issues
Why do organizations repeatedly fall victim
to hype-driven innovation adoption, even
when they know about the hype cycle?

How can organizations design or adapt a

process that drives smarter adoption
decisions?

What techniques do industry leaders use

to track, prioritize, evaluate and drive
innovation into the business?
 Invention

Asimo
Reem-B

Images: world.honda.com, http://www.pal-robotics.com/

Trigger

Second MP3
player 1998
Hype

+
Collage of positive news hype clippings here
Hype

-
Hype Happens Inflated
Expectations
Expectations

Positive Negative
Hype Hype

Innovation Trough of
Trigger Disillusionment

Time
Marketing
Confirmation bias

Novelty preference

Social contagion Competitive Pressure

Irrational exuberance Overcoming inertia Imagination

Progres
s

Image: www.pressroom.ups.com/multimedia/images/technology/
Elements
Expectations due Expectations due to
to excitement engineering &
and aspiration business progress

Early
Embryonic Emerging Adolescent Mainstream

Technology Peak of Trough of Slope of Plateau of

Trigger Inflated Disillusionment Enlightenment Productivity
Expectations
 Hype Cycle
Peak of Inflated
of Innovation
Expectations

Positive Negative Plateau of

Hype Hype
Productivity
Slope of
Enlightenment

Innovation Trough of
Trigger Disillusionment
Expectations
ex· pec· ta· tion Pronunciation [ek-spek-tey-shuhn]
? –noun
1. the act or the state of expecting: to wait in expectation.
2. the act or state of looking forward or anticipating.
3. an expectant mental attitude: a high pitch of expectation.
4. something expected; a thing looked forward to.

You can find proxy indicator for expectations…

 ..Everywhere NEWS REFS Articles using the term „business model’
80000
Source: News References for “Business Model”
70000 Hype Cycle
60000

50000

40000

30000

20000

10000
Source: Gartner using Factiva.
0
1990 1992 1994 1996 1998 2000 2002 2004 2006

Foreign Direct Investment In China

Amazon stock price, 1998 to 2005
150
100
50
millions

Source:

Source: Gartner using Yahoo!

1998 2000 2002 2004
Source: Unilever
It‟s Everywhere…
Management Trends

NEWS REFERENCES
80000
News References for “Business Model”
70000
Hype Cycle
60000

50000

40000

30000

20000

10000

0
1990 1992 1994 1996 1998 2000 2002 2004 2006
Number of articles using the term business model from 1990 to 2006
Source: Gartner research using Factiva.
It‟s Everywhere…
Stock Prices

Amazon stock price, 1998 to 2005

150
100

50
millions

1
1998 2000 2002 2004

Source: Gartner and Yahoo! Inc

 It‟s Everywhere…
Macro-economics

Source: IBM
 Predictive
Gartner E-business Hype Cycle as Published in 1999
“E Is Best” We‟re not
saying Gartner
Dot.Com Share predictions are
European IPOs
Fallout infallible! Just
1999
– this is a
Investor Disillusionment
U.S. proven thinking
Christmas tool
1998 “Brick-and-Mortar” Failures

U.S. IPOs Dot.Com

Shake-out Post-Net
1997/1998
Optimized Businesses
Publicized E-Business
E-Failures “True”
“Dot.Com” E-Business
Begins Emerges
Business
Disillusionment
Internet
Web
Gartner Analyst
Alex Drobik.
 Traps
Adopting
too early
Hanging on
Expectations

too long

Adopting
too late

Giving up
too soon

Innovation Peak of Trough of Plateau of

Inflated Slope of Enlightenment
Trigger Disillusionment Productivity
Expectations

Time
 Opportunities
 Maximizing publicity value
 Imagining
 Finding your  Acquiring talent the implications
angle  Expanding a niche
Expectations

 Optimizing  Planning your  Leveraging lower

supplier purchases  Leading the
mainstream costs and risks
relationships
wave
 Getting the  Banking your
jump on experience
competitors

Innovation Peak of Trough of Plateau of

Inflated Slope of Enlightenment
Trigger Disillusionment Productivity
Expectations
Time
 STREET
Model for Proactive Technology Innovation Management

Goal: Identify and invest in the right emerging technologies and methods
early enough to gain advantage, but late enough to manage risk.

Innovation
Scope Candidates Evangelize

Track Rank Evaluate Transfer

Individual managers
Who must master the Hype Cycle?
innovating locally

Corporate
innovation leaders
Specialist emerging trends &
technologies groups
Value from the Hype Cycle tool
In an economic downturn
Be selectively
aggressive with
advanced cost cutting
innovations e.g. Cloud
Revise your portfolio
PEAK OF INFLATED mix to the new
EXPECTATIONS business risk posture
Type A Activity Zone
Type B Activity Zone

Type C Activity Zone

EXPECTATIONS

PLATEAU OF
PRODUCTIVITY
SLOPE OF
INNOVATION ENLIGHTENMENT
TRIGGER TROUGH OF
DISILLUSIONMENT Attack the
„bog of
Prevent premature diminishing
Hide early radar cancellations in the trough TIME returns‟
tracking –
(e.g. Web 2.0, RFID)
But don‟t KILL it!
 Your Next Steps
Technology Planners, CTOs, EA leads, CIOs & CEOs (of small co‟s) should…

Today (Monday Morning)

 Identify who is responsible for your company‟s innovation activities.
 Triage upcoming and recently-funded initiatives, using the hype cycle

Near Future (The Next 12 Months)

 Create your own company & industry hype cycle based on Gartner research
 Build a robust process for selectively aggressive technology innovation
 Ensure the process encourages central, business unit & grass roots initiatives
 Master the hype cycle –
an understanding of this repeating business pattern will serve you well
throughout your future career
Gartner research analysts publish over 50 different topic area
hype cycles each year, covering over 1000 technologies
 AVAILABLE WHEREVER
BOOKS ARE SOLD
WWW.HARVARDBUSINESS.ORG/PRESS

Visit
www.gartner.com/hypecycle
Mastering the Hype Cycle:
How to Choose the Right Innovation at the Right Time

Mark Raskino

Notes accompany this presentation. Please select Notes Page view.

These materials can be reproduced only with written approval from Gartner.
Such approvals must be requested via e-mail: vendor.relations@gartner.com.
Gartner is a registered trademark of Gartner, Inc. or its affiliates.