The Transformative Capacity of New Technologies

A Theory of Sociotechnical Change

Ulrich Dolata

• Publisher: Routledge
• Year: 2013
• ISBN:
  9781135089894
• Edition: 1
• Topic: Sozialwissenschaften
• Subtopic: Soziologie

Scientific concepts on the co-evolution of technology and society, as well as recent sociotechnical system approaches, focus on the general interrelations between technology, socioeconomic structures, and institutions. Their aim is to study and explain processes and modes of technological change. Rarely, however, have answers been put forward on the related question of processes of socioeconomic and institutional change, provoked by emerging new technological opportunities and constraints.

The Transformative Capacity of New Technologies redresses this imbalance, exploring the questions:

• how and to what extent do socioeconomic structures, institutions, and actors change under the influence of new technologies?
• how do they react to technology-induced pressures to change?
• what patterns do they adopt?

The book provides theoretical considerations as well as practical tools for analyzing and classifying exceptional periods of substantial sociotechnical change. It examines the literature on path-dependency and path-creation, on organizational and institutional change, and on sociotechnical transitions. Case studies on subjects such as the pharmaceutical industry, the music industry, the energy sector, and scientific publishing support the theoretical analysis. The book will be of interest to students and scholars of sociology, science and technology studies, work and industry studies, and management of technology and innovation.

1  The Transformative Capacity of New Technologies

An Introduction

I.

Technology is an essential element of any modern society. As artifacts, as large-scale industrial facilities, as large technical infrastructure systems, as software, methods or process technologies, technology enables and influences a diverse range of societal relations and interactions. No reproduction of economic sectors, no production process or service provision, no financial transaction, no administrative procedure, no transportation or logistical operation, no communication, no war and virtually no everyday event would be possible without technology. Technology penetrates deeply and broadly into society, structuring it and regulating it. Its influence is evident in everyday technologies, such as personal GPS equipment, in industrial production and logistics processes that are shaped and structured largely by the technologies in use, and in the computer-based stock and currency trading systems that have become central to the world’s financial markets. Technology is unquestionably a central element in structuring and regulating modern societies, especially advanced capitalist societies.

Since the mid 1970s, the underlying scientific base and technologies of modern societies have undergone rapid change. This has been due primarily to digital information and communication technologies which first appeared with the early personal computers that were, from today’s viewpoint, extremely unstable, inefficient, and limited in their functionality. Since then, these technologies have become increasingly more powerful, multifunctional, and networked, and have spread to every section of society with extraordinary vigor and dynamism. The Internet is only the most prominent example of a multitude of radical innovations within a broad cluster of technologies that have emerged over the previous three decades. They have had a sustained effect not only on our personal everyday lives, but also on manufacturing, on banking, insurance and financial services, on government administration, and on science. In addition, new biotechnologies represent a field of innovation that has emerged and established itself over the same period, and whose methods have enabled the targeted recombination of biological material. The new opportunities from genetic engineering to intervene in and recombine human and non-human organisms have a radicalism equal to that of digitalization; their scope for application has however been narrower. Since the mid 1970s, new biotechnologies have become established predominantly in medicine as new tools for pharmaceutical research, and as the main driver of new genetically engineered therapeutic agents, vaccines, and diagnostics. They have also become increasingly significant in agrochemicals, farming, and food production. Together, digitalization through information and communication technologies, and the targeted recombination of biological material through biotechnologies, represent a major scientific and technological shift that began in the 1970s and whose end is still not yet in sight.

This book examines and presents developments from these two major fields of technology (digitalization and biotechnology) to demonstrate how societal change through technology may happen, or more precisely: how substantial organizational, structural, and institutional transformations occur and proceed that are triggered or even forced by radically new technologies. What can also not be overlooked is that technology is not just an essential structural feature of modern societies; radically new technologies are also a major factor in the transformation of societies and are capable of exerting considerable pressure for change on societies’ actors, structures, and institutions.

New technologies do not just play an important role in the restructuring of existing markets or in the creation of new markets – just consider the effect digitalization, data compression, and the Internet has had on the music and media sectors. New technologies also form the basis and trigger major structural and organizational shifts in production processes, service provision, and in entire sectors (e.g. the telecommunications, pharmaceutical, and music sectors of recent decades). Existing legal and regulative frameworks usually need either realignment or rewriting to meet the distinct requirements of new technologies (e.g. copyright laws in digitalization and the Internet, and new legislation for genetic engineering, biotechnological research, and production). Furthermore, new technological developments and applications affect actors and their relationships. It is not uncommon for new actors (such as Microsoft and Intel in the 1970s or, more recently, Amazon and Apple) to engage first with radically new technologies. In doing so they may be able to disrupt existing patterns of competition and place established actors under extreme pressure to reposition themselves strategically and organizationally. At the same time, new technologies are usually so complex that single companies are often no longer able to develop, produce, and apply them. This enables and sometimes requires (as biotechnologies did in the pharmaceuticals sector) new forms of inter-organizational cooperation. Finally, new technologies are also capable of transforming everyday life and shaping new ways of communication, new lifestyles, and new consumer preferences. Household appliances have already achieved this (washing machines, refrigerators, etc.), and information and communication technologies are currently doing so (notebooks, tablets, smartphones, Internet).

It is not necessary to go back as far as the Industrial Revolution, which at its core was a sociotechnical revolution, to understand that radical technological shifts are essential factors influencing societal transformation. This doesn’t mean, of course, that new technologies are first socially constructed and formed, and then, when they are complete, exert an unambiguous and inevitable pressure on social change (on economics, on politics, and on civil society). Transformation through technology is not at all deterministic: it is neither a linear process nor is its outcome definable ex ante.

At the beginning of a period of major sociotechnical change there is initially not much more than rough and unfinished blueprints. Huge expectations and aspirations exist for emerging new technological possibilities that are initially vague and whose social consequences are highly uncertain. A tentative and erratic search then takes place on how the new technologies might be further developed and applied, and what new or realigned patterns of social organization, structures, and institutions might be appropriate. Such a period of substantial transformation is not characterized by social actors, institutions, and structures simply adapting to clearly defined requirements from new technologies. The new technologies themselves also undergo further development, become honed, modified, or even completely overhauled. The process of sociotechnical search and selection can span up to two or even three decades and may end in an exceptional shift of the technological, organizational, structural, and institutional features of society or societal subsystems. The technologies that have triggered or compelled this transformation have meanwhile undergone similar radical changes and may in the end be hardly recognizable from their vague beginnings as rough blueprints.

II.

The general interrelationship between technological and socioeconomic change is to be found in the various concepts on technology’s co-evolution or co-construction with the social (society, industry, user, markets, and so on) as well as in the recent literature on sociotechnical systems and transformations. In one way or another these concepts pose the question as to “how technology is shaped by social, economic, and political forces alike; and how, in the same process, technologies and technology systems shape human relations and societies” (Rip and Kemp 1998: 328; also Geels 2004, 2005a). Although this literature takes into account the mutual influence of technology and society – or, more specifically, between technology, socioeconomic structures, and institutions – it still focuses on the analysis and explanation of technological change. When reference is made to social transformation then it is mainly done to accentuate changes to socioeconomic conditions, changes that are economically or politically desirable or necessary and which aim either at increasing the efficiency of technological innovations or at constructing and producing new technologies in a more sustainable way (Werle 2012; Dolata and Werle 2007a).

In contrast, answers are rare to the second part of Rip and Kemp’s question: i.e. the processes of socioeconomic and institutional change provoked by emerging new technological opportunities and constraints. When are new technologies able to destabilize established organizations, structures, and institutions and trigger or compel social change to take place? How does transformation associated with new technologies proceed and bring about change to socioeconomic conditions? Is it possible to identify typical patterns, pathways, and variants of such technology-induced periods of transformation? In short: how can we explain social transformation through technology, and how can we analyze it without resorting to technological determinism?

This is what the following is all about: it is not technological change itself that is analyzed and explained but rather the associated organizational, structural, and institutional transformations. The book aims therefore to investigate the processes of socioeconomic transformation triggered and significantly shaped by the emergence of radically new technologies. It is not about stable, orderly, and unambiguous sociotechnical constellations, but about organizations, structures, and institutions that are under pressure from new technologies that no longer match their profiles. Organizations, structures, and institutions become dysfunctional, enter a state of crisis and have to undergo substantial change to remain legitimate and to avoid obsolescence. It is therefore not of interest here to analyze how a sociotechnical field or system functions in a given situation but rather how it undergoes significant change and how this change then proceeds; in other words, how to understand and explain sociotechnical dynamics that disrupt the normal course of things.

How can this be done? The book presents a theoretical framework suited both to analyzing and explaining socioeconomic transformation triggered by new technologies. The framework comprises three associated concepts that I introduce briefly in Chapter 3 and explain in Chapters 4 – 6.

The first concept addresses the distinct influence that radically new technologies can have on socioeconomic transformation. The central idea is that new technologies with fundamentally new properties are not capable of being simply integrated into existing socioeconomic constellations. Instead, to fully exploit the technologies’ innovative potential, a greater or lesser degree of organizational, structural, and institutional change is required. I refer to this impact of technological change on social constellations as the transformative capacity of new technologies (Chapter 4).

Distinct socioeconomic changes can however not be derived from this. A new technology and its properties do not determine how pressures for change are handled nor the way and extent to which the technologies bring about socioeconomic readjustment and renewal. These are genuine social processes that are central to the second concept. This concept addresses how the transformative potential of radically new technologies, which are initially unfinished, ambiguous, and open to different visions and uses, is anticipated, engaged, and dealt with. The central idea of this concept is that the dynamics and typical paths of technology-induced transformations actually depend on adaptability: on the capability of the institutions and actors involved to perceive, adopt, and further develop new technologies that are path-deviant. I refer to coping with technology-induced pressures to change as sociotechnical adaptability (Chapter 5).

Such far-reaching sociotechnical transformations do not occur abruptly, as sharp breaks over the short term. What might after one, two, or even three decades appear as a radical sociotechnical shift is in fact the outcome of a longer, non-linear, and often erratic process of search, struggle, discontinuity, and readjustment that has been shaped and molded by numerous related changes. The third concept focuses on the peculiarities, dynamics, and variants of such enduring periods of transformation. By dint of this concept, an entire period of technology-induced change can be analyzed as a successive process of organizational, structural, and institutional readjustment that occurs between path-dependent continuities and radical breaks. I refer to this typical course of substantial change as gradual transformation (Chapter 6).

I substantiate and discuss the three theoretical concepts and relate them to each other against a background of the technology-induced transformation of business sectors. This is not without reason. A much more detailed analysis into the differing socioeconomic effects of major technological shifts, and the possible paths and variants of path-deviant transformations, is available from the meso level of business sectors than, say, from the meta level of entire societies or economic systems. Even in times of continuity and stability business sectors – automotive, pharmaceuticals, music, telecommunications, energy, etc. – are to a considerable extent shaped and influenced by the development, production, and application of technology. Substantial changes to their underlying technologies inevitably have consequences for their organizational, structural, and institutional constitution. Examining technology-induced change to business sectors reveals fairly clearly the capacity that a new technology has for transforming a sector as well as the sector’s distinct ability to perceive, adapt, and cope with the potentials of this technology. A comparative approach to different business sectors soon shows that the transformative capacity of a specific new technology (e.g. the Internet) can vary significantly between sectors and creates sectoral-specific pressures for change. Moreover, this pressure to change can be perceived, adapted, and coped with in a variety of ways. In short, focusing on sectoral change reveals a range of options, variants, and possible paths of sociotechnical transformation. This introductory chapter is therefore followed first by a conceptualization of business sectors as sociotechnical fields (Chapter 2).

III.

I have been working on technology and (sectoral) transformation since the mid 2000s, beginning in 2005 with a research project funded by the German Research Foundation (DFG) and conducted at Bremen University’s Research Center for Sustainability Studies (artec). At the time, “adaptability” was referred to as “governance flexibility,” and there was no mention of ideas such as “gradual transformation.” My work in this area made particular progress with my deepening involvement with the Max Planck Institute for the Study of Societies (MPIfG) in Cologne. I regularly attended the MPIfG as a visiting research affiliate, and from the beginning of 2008 as a senior researcher, before transferring to the University of Stuttgart in the autumn of 2009 and becoming the head of the department of organizational sociology and innovation studies at the institute for social sciences. The countless discussions at conferences and with the colleagues at the institutes in Cologne and Stuttgart were very inspirational – especially the sustained and intensive work and exchange I had throughout that time with Raymund Werle. However, as is always the case, I take sole responsibility for everything written here.

I have kept the text short and succinct so that it can be finished within a single reading. This should be possible even for those who normally only read the introduction – hoping that it will reveal all that the book has to say. To be honest, it doesn’t.

2 Technology and Sectors

2.1 Business Sectors as Sociotechnical Fields

Before examining how technology can bring about sectoral transformation, we need to clarify what a sector is, what technology can be, and how the two are related. This is the intention of this chapter. I will begin with three introductory definitions.

Business sectors such as the automotive, bank, music, or pharmaceutical sectors of course have specific economic cores, but these are embedded in and influenced by their wider social environments. An economic core of a sector is characterized by specific business activities (research and development, production, distribution, services, etc.), modes of exchange (markets, networks, competition), and actors (companies). However, from a sociological aspect, a business sector is to be seen as more than merely a branch of industry. Sectors are influenced and structured through actors, environments, and regulatory frameworks that go beyond the mere economic. These include political actors, government agencies, the whole range of media institutions and associations, academic and public research institutions, social movements and communities, consumers, and politically informed individuals all of which can considerably influence the structuring and future course of business sectors in one way or another: by shaping the conditions for research, production, markets, and company activity in both normative and regulative ways; by non-economic actors providing services (e.g. firms collaborating with academic research institutes); by public discourse and protest; or by the purchasing decisions made by individual consumers.

Institutional research has analyzed such entities as organizational fields (DiMaggio and Powell 1983; DiMaggio 1986; Powell and DiMaggio 1991), inter-organizational fields (Leblebici et al. 1991), societal sectors (Scott and Meyer 1991), or as strategic action fields (Fligstein and McAdam 2011, 2012). Paul DiMaggio and Walter Powell (1983: 143) provide the standard definition:

By organizational field, we mean those organizations that, in the aggregate, constitute a recognized area of institutional life: key suppliers, resource and product consumers, regulatory agencies, and other organizations that produce similar services or products. The virtue of this unit of analysis is that it directs our attention not simply to competing firms … or to networks of organizations that actually interact … but to the totality of relevant actors.

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