Question

In an essay of 3-5 paragraphs: A prime example of the negatives effectives of "Path Dependency" is the QWERTY keyboard layout, which persists in usage despite there being far more efficient ways to organize a keyboard. Path Dependency can also be used to maintain a sustainable competitive advantage. Identify a firm and product that has used path dependency to its advantage and discuss how this was accomplished.

Answer 1

Path dependency describes the continuing usage, based on previous interest or use, of a substance or procedure. A organization can persist in using a product or procedure even though there are newer, more effective alternatives. Route dependence exists when moving down an already defined course is always faster or more cost-effective than constructing a brand new one.

In the context of the historico-institutionalist approach to political science, academics define path dependence. The idea behind the strategy is that organizations improve less than expected, and hinder development. The explanation for the lack of progress is that politicians are making predictions, taking conservative choices and not learning from experience.

Path dependence within organizations can affect approaches, often to the detriment of the company. Most businesses, for example, have a core product or program which establishes their market position. Over time, competing products and methods which provide more attractive or lucrative opportunities can emerge on the market. Dependence on the road may lead to a unwillingness to engage in forward-thinking technologies. For example, the advent of digital imaging posed such a challenge to the producers of camera films.

There were two film formats in the 1970s-VHS and Betamax. The two models fought vigorously for market domination for a number of years.For reasons about which even today analysts differ, VHS began to win the battle in the 1980s. For a variety of reasons VHS 'limited lead increased over time.

The bandwagon effect: video cassette producers in Europe and North America turned to the VHS format as they expected it would be bound to win the fight for quality – provided that its lead was beginning to expand.
The changeover snowballed because more and more of them were going over.
– Network Externality: the term refers a product's importance to a network, based on how many users use it, or how extensive a network is.