A study on the impact of technology development strategy on new venture performance in the Korean information and telecommunications industry

Abstract

This research investigates technology development strategies of new ventures in the Korean Information and Telecommunications(IT) industry. The objective of this study is to contribute to the literature on new venture study in two ways. First, we seek to investigate what kind of technology development strategies is suitable for a given environmental condition and characteristics of IT industry. Second is to provide venture entrepreneurs with a guideline on technology development strategies to establish effective strategies and further form a foothold for creating new ventures. This research analyse the impact of technology development strategy on the new venture performance in the Korean IT industry. A survey was conducted on information and telecommunication ventures that were in the business for 3~8 years. Factor analysis, cluster analysis and Two-way analysis of variance(ANOVA) were used for the analysis of the issues. To find a desirable technology development strategy for IT venture this research draws out technology development strategy using statistical methods based on questions, and examines the influence of technology development strategy on company performance according to the change of external environment for each strategic dimension. First, to investigate the relationship between technology development strategy and venture performance without considering moderating effects of environment, a hypothesis was established. Second, additional hypotheses were set up and verified to search the relationship between multi-dimensional factors - external environment and technology development strategy - and performance. We found that, on the influence of single dimensional technology development strategy choice of companies on venture performance, companies with high product radicality level had shown high performance in sales. Therefore, an IT venture needs a technology development strategy that concentrates on product with higher product radicality...