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Revista del IEEE 6

330 Journal of the Spanish Institute for Strategic Studies N. 6 / 2015 In the same way, if the process of selecting firms is not functioning correctly, by rewarding or penalising firms according to their performance, then the efficiency of the sector can be compromised. This is almost certain to occur, as the major difficulty in finding an alternative supplier for the product means that the imposition of sanctions is not easy to apply if it has a major impact on profits and ultimately on the survival of the company. In the end, this would reduce the efficiency of the acquisition process. An example of this could be when a firm supplying a key product fails to carefully manage its resources, relying almost on the certainty that, should it incur losses, the government would come to its rescue. Such was the case of Rolls Royce, which had to be nationalised in 1971 when the development of the RB211 engine surpassed the costs forecasted. The selection mechanism itself could tend towards the discrimination alluded to in the phrase: success breeds success. In effect, the selection process may not choose the best solution when one firm offers better initial features yet, having the second solution potential for greater performance but requiring a lengthier development-apprenticeship process until it materialises, which means it could be easily discarded.43 This problem is likely to occur when an option is the first to appear on the market and develops more, thus managing to better adapt to the needs of the user, as we can observe in figure VII where one sees the second technology, with lower initial performance levels than the first, already in an advanced stage of development, which after some time ends up reaching a superior performance. This means that if one does not opt for the second technology, it is probable that this more valuable option will never triumph. 43  This is a further example of path-dependence similar to the one described at the outset of the article. http://revista.ieee.es/index.php/ieee


Revista del IEEE 6
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