How Does Competition Affect High-Tech Firms Time-to-Market Decision?

Abstract

In fast-paced industries such as high-tech industry, time-to-market is

one of the key strategic decisions to be made. With competition, firms

not only need to consider market readiness but also should try to

optimize new product launch timing by balancing the tradeoff between

advantages and disadvantages of becoming a pioneer. Would a firm

compete head-to-head by accelerating the project, or wait and then

follow-up quickly after uncertainties clear up? The current paper

illustrates how we can examine this issue by introducing an empirical

modeling approach based on duration analysis. Specifically, a hazard

function approach is taken to analyze time-based competition, and the

proposed model demonstrates for the first time in the marketing

literature the possibility to capture the relational structure between two

competing hazard rates. Though the empirical question could not be

answered due to data availability, a Monte-Carlo simulation study

assures the usefulness of the model.