The Hype Cycle

Hype Cycle

Every year Gartner publishes its Hype Cycle. If you’ve been to any business presentation at a conference there is a very good chance you’ve seen this model and heard how technology will disrupt the market you’re in (and probably put you out of business). 

Not to be taken too seriously but it is a tool you should have in your business management arsenal, especially when you’re involved in strategic planning or key account planning. 

For those who don’t know, the Hype Cycle is a diagram that depicts the stages of a technology’s life cycle, from inception through maturity and onto broad use.  Gartner is an information technology (IT) research and consulting firm, they invented the hype cycle as a branded tool. The stages of the hype cycle are frequently utilised as benchmarks in marketing and technology reporting. Business managers can use the hype cycle to help them make technological decisions based on their risk tolerance. Each step of the cycle has its own set of threats and opportunities.

In the Hype Cycle there are five overlapping stages: 

  • Technology Trigger: A technology is conceived at this stage. Prototypes may exist, but there are rarely practical goods or market studies. The potential generates interest in the media and, in certain cases, proof-of-concept demonstrations. 
  • Peak of Inflated Expectations: The technology is put into practise, particularly by early adopters. Both good and unsuccessful deployments have received a lot of attention. When it’s at the peak you tend to hear about it on the nightly news and soon reality has to kick in. 
  • Trough of Disillusionment: Flaws and shortcomings in technology lead to disappointment. Some manufacturers fail or discontinue their products. Continued investments in other producers are predicated on satisfactorily resolving challenges.
  • Slope of Enlightenment: As the technology’s potential for new applications becomes more widely recognised, a growing number of businesses implement or test it in their surroundings. Some manufacturers continue to make new generations of items.
  • Plateau of Productivity: The technology has gained widespread adoption; its market position and applications are well-understood. For evaluating technology companies, standards emerge.

Gartner claims to publish more than 100 Hype Cycles for various different disciplines. The one that gets the most publicity is the one for Emerging Technologies. 

This is what it looks like without the items on it.

Hype Cycle Model

And this is a copy of a recent one published by Gartner.

The way to interpret this chart is to look at the timescale in the key. This gives us an estimate of when the technology will reach the Plateau of Productivity. Avoid investing in a technology just before it’s about to fall from the Peak of Inflated Expectations as we can have capital tied up in a venture/technology which would have been better if deployed elsewhere. I’d argue the best time to commit to an emerging technology is when it’s climbed up the Slope of Enlightenment somewhat, that way we have missed out on the huge volititialy .

In the example above you can see that Gartner (correctly!) assumed that NFTs were about to fall from the Peak of Inflated Expectations, giving it a timescale of 2-5 years until it reaches widespread adoption; it will be worth checking back in 2027/8 to see if their prediction was correct. 

Remember though – it’s just someone’s opinion and that may well be written with an agenda in mind. While powerful, this tool shouldn’t be used in isolation. 

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