Alchemy: Turn Knowledge Into Gold, by Soundview Executive Book Summaries, Soundview Executive Book Summaries, March 1991.

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Redefine Recession
School for Life
Will Japan Bury the West?
 

     Traditional economics views technological advance as a byproduct of economic growth.  The Alchemist sees this from the opposite perspective: Economic growth is a byproduct of technological advance.
     Technology is progressing so rapidly that we are simply unable to make use of everything it offers us.  How many manufacturers use the latest CAD/CAM methods to design and fabricate products?  How many retailers track inventory and customer preferences with point-of-sale scanners?  Few of us question our routines with the regularity or the rigor that our fast-changing culture requires.  This is, of course, the essence of the technology gap.
     Alchemists recognize that a wide gap signifies room for growth.  They assume as a matter of course that the route currently used--even if it's presently the cutting edge--will sooner or later no longer be the best one.  They are always on the lookout for the better way that will appear.

R-I-Ts
     The better way that Alchemists search for is an R-I-T, that is, a Ready-to-be-Implemented Technological advance.  An R-I-T already exists; it's available now.  But out of ignorance or laziness, we aren't making use of it.  Some current R-I-Ts are computerized fuel injectors that haven't replaced mechanical carburetors, radial tires that haven't replaced bias-ply models, or electric typewriters that haven't replaced manual ones.
     An R-I-T is user transparent.  It's virtually the same as the product it was meant to replace.  The only thing that has changed is that a job that was more difficult is now easier.  A person who can use a rotary phone, for example, will find the push-button model easy to use.  No new skills are needed, but the user can dial faster

and more accurately.
     The implementation of R-I-Ts usually drives most start-ups.  If you're going to start a business today, it's not enough to determine that you're going to be as good as your competition.  Consumers no longer have any patience with the status quo--so you've got to be able to promise to provide your product or service better, cheaper, or faster--and preferably all three. 
     The new Alchemists stay on top of change by studying their industries to see if there exists a technology gap they can exploit.  Even if they find one, of course, technology doesn't stand still.  So how do the Alchemists get a fix on what will be happening the day after tomorrow?

B-R-Ts
     The answer lies in our Basic Research Technological advances, or B-R-Ts.  Studying and understanding the nature of R-I-Ts can help us determine what's around the corner.  By analyzing our B-R-Ts, we can preview what to expect over the next hill. 
     Real advances in technology are links in a continuing chain of innovations.  This is the multiplier effect of technology--every new development that we can identify as a R-I-T becomes the basis for an array of new technologies.  In other words, it becomes a B-R-T.  Over time, the B-R-T yields another R-I-T, and the process accelerates and widens with each cycle until it seems to be continuous.
     To see how this cycle works, let's look at the development of a particular technological advance.  A development laboratory discovered that silicon is a better semiconducter than germanium.  This discovery became the basis of a B-R-T.  Eventually, after several years of refining the development, the lab figured out a way to design and manufacture a new silicon semiconductor.  The finished products represent a new R-I-T.
     Five new companies, after learning of this R-I-T, use it as a B-R-T to develop a new finished product of their own, silicon transistors.  The development lab's R-I-T became the transistor maker's B-R-T which used it to create a second R-I-T.
     Assume each of the five companies has twenty customers who use transistors in circuit boards, TV oscillators, thermostats, and other components.  The one hundred component makers can use the silicon transistors as a B-R-T to develop new and better circuit boards, TV oscillators, thermostats, and other components, representing yet another new R-I-T.  By keeping an eye on the latest B-R-T, the Alchemist stays ahead of the game--which may be the minimum necessary to survive.
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