The study's leaders that have adopted several highly visible leading-edge technologies view them as key to their primary business strategies. Such companies generally believe that a considerable amount of risk is almost always worthwhile.

Early Adopter
Alaska Air Group Inc. in Seattle, the parent of Alaska Airlines and Horizon Air, views itself as a technology leader. "Alaska Airlines has made a strategic decision to adopt technology on an early path," says Robert Reeder, VP of information and communication services. "We are not afraid to be out on the bleeding edge."

Alaska Airlines was a very early adopter of E-commerce. In 1995, it implemented an IP network connecting all its operations, and became the first airline to sell tickets via the Internet. More recently, the company pioneered the use of self-service electronic kiosks for passenger check-in and ticket purchases; more than 1 million passengers used those systems last year. The airline is now experimenting with handheld devices for airline staff that combine phone, bar-code, and Internet capabilities for a multitude of potential uses, such as checking misrouted luggage.

The airline views technology as key to its business strategy in the turbulent airline industry, where its biggest struggle in recent years has been competition from low-priced rivals such as Southwest Airlines Inc. "We're looking for ways to differentiate ourselves in a crowded market," Reeder says. For example, Alaska Airlines says its investment in automated ticketing and check-in services appeals to busy business travelers, who may be willing to pay a higher fare for the sake of such conveniences.

Being a technology leader isn't for the faint of heart. Reeder admits that some cutting-edge technology investments have flopped. Alaska Airlines recently experimented with kiosks within airports, at which travelers would check in by waving a smart card containing personal traveling information in front of an infrared reader. But the systems too often failed to complete transactions. Deciding that the technology was not yet ready for widespread use, Alaska Airlines recently dropped the program. "We're allowed to take some risks and be aggressive in what we attempt," Reeder says of senior management's willingness to let the airline's IS operations experiment with new technologies.

Tech-aggressive companies may be willing to take risks because they've generally had good experiences with innovative technologies, according to the study. For example, only 30% of leaders have suffered financially, lost important customers, or were late to the market with products or services because of adopting new technologies, while 59% of laggards said they have had at least one such experience. Meanwhile, 34% of leaders said there have been many instances when they've gained financially or competitively because of leading-edge technologies, and 51% reported some instances in which they've seen clear benefits.

While some companies are more willing to take risks with leading-edge technologies, the study shows that slightly more than half are not. In all, 41% say there's been no change in their tolerance level in the past 18 months, while 12% say they have a lower tolerance level.

James Cash, a Harvard Business School professor and InformationWeek columnist who sits on the board of Cambridge Technology Partners Inc. and other companies, questions whether there's a trend toward the adoption of leading-edge information technology at a faster pace. "My gut feeling is that's not the case," Cash says. He notes that IT managers have been burned in recent years by difficult or failed projects, such as ERP implementations, and have become leery of embracing new technology.

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