Decision Making as Output and Bounded Rationality

  The classical economics theories proceed on the assumption of rational agents. Rationality implies the economic agents undertake actions or exercise choices based on the cost-benefit analysis they undertake. The assumption further posits that there exists no information asymmetry and thus the agent is aware of all the costs and benefits associated with the choice he or she has exercised. The behavioral school contested the decision stating the decisions in practice are often irrational. Implied there is a continuous departure from rationality. Rationality in the views of the behavioral school is more an exception to the norm rather a rule. The past posts have discussed the limitations of this view by the behavioral school. Economics has often posited rationality in the context in which the choices are exercised rather than theoretical abstract view of rational action. Rational action in theory seems to be grounded in zero restraint situation yet in practice, there are numerous restra

A Note of Gartner Hype Curve


Technology drives human progress. Yet it is not deterministic as believed by section of experts and practitioners. Technology is per se neutral, it is the means through which human ingenuity drives progress. There is of course excitement over the emergent technologies. Individuals as well as societies desire technology to be the catalyst in driving innovation, in making possible what they desire to want, a mechanism that occurs through a series of steps of achieving adjacent possible. Therefore in more ways than one, technology forecasting becomes critical input in planning the future tactics and strategy for any firm, individual or in aggregate terms an economy or a society. However, technology rarely emerges in an orderly fashion. More often than not, it emerges from the most unexpected of the places and at unexpected times. There are more than enough occasions when technology emerged far ahead of its time and thus failed to achieve a critical mass.

To understand technology forecasting and thus enable a tracking mechanism for firms to enable them to leverage, there needs to exist a model that predicts the same and with relative accuracy. In the context, the Gartner Hype Curve has become a sort of benchmark for all others to measure. The Gartner curve for the year 2019 is available here.

The first stage is the innovation trigger. These are those innovations that have begun emerging on the horizon. They are the infants of the innovation landscape. They track all those discoveries and inventions that have begun taking roots and are likely to evolve into adolescents and adults though not necessarily all will grow and grow at the same pace. As one reads the Hype Curve for 2019, there are numerous innovation triggers that have slowly emerged on the ascendance. The artificial tissue is just making its way. Ahead of the same perhaps marginally are developments in AR Cloud, adversarial generative networks among others. One interesting elements is autonomous decentralised organization which might see an interesting turn in fortunes in the coming years.

As with anything new or novel, there is curious and at times healthy excitement and anticipation about the possibilities the new innovations generate. The world, it seems, will absorb with abundant enthusiasm the new technologies and thus lot of interest gets diverted to these technologies. A lot of financing goes towards the further development of these technologies. Many start-ups emerge on the horizon. The Silicon Valleys will be full of discussion on the multiplicative possibles on the horizon. Therefore expectations will become inflated. The next stage in the Hype Curve is the Peak of Inflated Expectations. The peak is reached through ascending the ‘mountain’ of innovation triggers. As one examines the current developments, it is not surprising to see 5G at the apex of the peak followed by bio-chips, edge analytics, etc. 5G is of course driven by political dynamics with reference to its adoption and thus its future directions is political rather than economic.

Yet, as with many expectations, there will be a disappointment over many falling by the wayside. The reasons could be manifold, yet it is undeniable very few of these triggers that create these inflated expectations will drive towards maturity. Thus following a peak there will emerge a Trough of Disillusionment. One very good example is the further progress in autonomous driving. Graph computing, 3D sensing cameras are among other innovations that seem to be sliding down the trough with enough disillusionments. Yet these disappointments are natural. It is not possible for each and every innovation to gather momentum and find place in the mainstream. At times, the ones sliding down the trough might make a reappearance in numerous forms at unexpected times.

Out of the trough emerges a sense of enlightenment. This is the path towards the maturity. The next two stages therefore are termed slope of enlightenment where realism takes precedence over hype and expectations. The final stage is the drive towards maturity. Interestingly, the 2019 edition doesn’t talk about any technologies being in these two stages.

The Hype Curve not just talks about technologies but gives indications on the number of years before they hit maturity. As one observes the 2019 Hype Curve, 3D sensing cameras despite a drop towards a trough of disillusionment, is likely to mature in the next 2-5 years. The analysts also believe 5G will evolve to maturity during the same time horizon. On the other hand, an artificial tissue or decentralized web might take more than 10 years to drive towards maturity.  Most of the others like light cargo delivery drones, edge analytics, bio chips etc. are likely to mature over the next 5-10 years. There are possibilities of some become obsolete before plateau.

A deeper analysis of the Hype curve is understanding the trends in technology as we move along and what one can expect from these trends. These trends while indicating opportunities for entrepreneurship also point out towards the drive for firms and societies to plan for their adoption as they pursue progress.

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