If you are like most executives

If you are like most executives, you are trying to create the proverbial better mouse trap. A lot of companies succeed in designing the MBT Fora , but don't catch too many mice. Somebody else usually moves the mice first. How can pricing be used to control that situation better?

In Silicon Valley and in technical companies everywhere, you hear stories about how Apple and Microsoft "borrowed" from the Xerox Palo Alto Research Center. I remember that period well because our company was a beta test site for the first Xerox in-office computer networks.

The sales people kept asking us nervously about whether or not we minded paying the very high prices that Xerox was asking for the MBT Boost Shoes, STAR system. We kept saying that the quoted price was no limitation, as long as the technology worked. The sales people looked at us incredulously.

But we were serious. When the system became to crash whenever it rained (and it rains a lot in Boston), the price suddenly became much too high for us. The equipment was thoughtfully taken back by our Xerox representative.

Extremely attractive new technologies that can be the basis of improved business models usually turn out to be very price sensitive. When new technologies are first available, often the only people who can afford them are customers for whom a revolutionary way of operating is now possible for the first time.