2024-07-31 22:00:00
In this article, we return to one of the primary factors of obsolescence, constituted by the diffusion of technological progress, that is to say innovation, which can reshuffle the cards of the existing via the phenomenon of creative destruction. This diffusion of innovation is driven by economic “stimulants”: economies of scale and experience effect naturally feed the diffusion of innovation, with a complementary virtuous relay often sought in the internationalization of outlets, within the framework of an increasing specialization of companies and territories. This game of innovation and search for “critical size” then acts as a powerful factor of reorganization in the competitive field and influences the life cycle of technologies, companies and product ranges. In this sense, it weighs on the sustainability of companies and can be a factor of obsolescence.
The combination of these phenomena has been in full play since the first industrial revolution and in the post-1945 world. Growth has been driven by the progressive internationalization of economies in a context of accelerated technological development. The result is an increasingly internationalized and specialized production system, with increasingly important players who define an increasingly interdependent system. This has led to the emergence of major economic powers with an increasingly integrated domestic market, in parallel with the development of trade between these major powers. The emergence of China over the past 40 years as a new leading player in the global production system integrated into a game of exchange and growing rivalry with the United States and the European Union is an example of this. The emergence of the electronics industry and the successive movements of reorganization of production at the global level are also emblematic examples of the forces at play. From this point of view, the production system of systems and objects appears highly collaborative without all the players having knowingly acted in this direction. This has made it possible to develop the effectiveness of each major player in the system and to optimize efficiency. However, the factors of reciprocal dependence have increased significantly with the associated risks of obsolescence. In this sense, the “return to the past” towards regionalization between countries will present a technical and economic challenge in many cases.
New challenges to maintain peace and trade cooperation between major countries, as well as the climate challenge, could undermine some of the gains of recent decades and weigh on the intensity and sources of obsolescence in the future.
In the first part, we will see how the acceleration of innovation since the industrial revolution and its diffusion have had such an impact on the acceleration of obsolescence and have made modern economies globally more sensitive to the risk of obsolescence. To do this, it is interesting to note the strong historical acceleration of growth, born with the first industrial revolution, and to understand the role played by the Schumpeterian phenomenon of creative destruction induced by innovation and its diffusion. This diffusion phenomenon has been reinforced by the gains associated with the transition to scale via economies of scale and the experience effect. These gains have historically resulted in the search for increasing internationalization of markets and trade. The key is an increase in the complexity of production chains and increased specialization of producers of goods and services, a phenomenon at the source of an increase in efficiency and effectiveness but likely to increase the risk of obsolescence due to less robust supply chains.
In the second part, we will analyze the role of technical progress and innovation in History as important factors of obsolescence, with an acceleration since the post-war period (1945). This has led to a world in strong growth with a development of international trade which has seen a progressive integration of new countries into the global production system. This has also been done by the creation of integrated zones between countries with markets of an increasingly massive size. The emergence of China as a new major player is not without consequences on the level of interdependence of the global production system and on the risk of obsolescence. The evolution of the electronics sector is emblematic of an acceleration of the challenges of competition and specialization between players (companies and States), with risks of obsolescence accentuated on increasingly large sections of the economy.
In conclusion, the developments of the last decades had as their presupposition an open world and in relative peace. Furthermore, the availability of materials was considered relatively easy, within the framework of a rather internationalized exchange with a possible use of carbon reserves without consideration of climate. The new world that is emerging, with the return of war (or at least serious geostrategic tensions) and an unprecedented ecological challenge for humanity, linked to global warming, is a major challenge to manage that presupposes a form of “going backwards”, difficult to achieve and carrying proven sources of obsolescence that will have to be identified and attempted to be resolved or reduced in the years to come.
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