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OM0009 – Technology Management

OM0009 – Technology Management

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Published by Mujif Rahuman

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Published by: Mujif Rahuman on Nov 09, 2010
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Masters in Business Administration-MBA Semester IVOM0009 – Technology Management – 2 CreditsBook ID: B0893Assignment Set-1 (30 Marks)Name: Mujif Rahuman M.Register No: 520828621
1. Discuss various Technology Acquisition alternatives. List the importantpoints to be kept in mind while managing an acquisition of technology.
Technology Acquisition Alternatives:
1. Develop Technology in-house
The company has to estimate the financial costs of the required R&D and its opportunity cost of thatchoice. Its impact on the direction of, and the commitment to, other research projects is also relevant. Inaddition to this, the company has to assess the suitability of its staff and equipment for the new project.Among the risks, it has to face are blocking patents. However, the developed technology can becustomized to its precise requirements.
2. Buy the firm that has the Technology
The investment here could be substantial and great care is needed in the evaluation of the prospectiveacquisition. Also, it is important that
following the purchase, that the operations can be effectivelyintegrated and that there is no undue loss of key staff.
3. Enter into joint ventures
The costs are shared but so are the benefits of the new technology. Where the risks are high and the costsheavy, membership of a research consortium becomes a more attractive option. There is also the co-development of new products or processes, such as between a key supplier and a major customer.
4. Enter into research contract
R&D contracts can be placed with research associations, universities or consultants. The company has toconsider the costs and the nature of control of the project. There is the risk of know-how loss.
5. Obtain license for use of Technology
This is essentially the purchase of access to proprietary technology. It can be anything from the right touse a particular patent to a complete package, which includes know-how agreements, commissioningassistance for new plant and processes and the provision of updated designs and other technicalinformation.
6. Education and training
Soft technologies with a strong management dimension e.g. JIT, Quality circles, or Kaizen can beacquired through training programmes. However, the underlying experience, which makes thesetechniques more effective, is often achieved through personal contacts between companies.
The following are important points
to be kept in mind while managing an acquisition of technology
1. The role and management of technology within the company needs to be assessed, especially itscapability of managing the transfer activity.
2. The allocation of appropriate staff to the transfer and application of the technology. The projectmanager must be at senior level while his colleagues need to have engineering application and changemanagement skills.3. The corporate objectives, capability and the technology transfer track record of the prospectivetransferor need to be considered. Effective technology acquisition is often based on a longer-termrelationship.4. Clear technical and contract specifications are essential. Because of the nature of the technology and itsintegration in intellectual property, the transfer constituents vary in type and character. Where the transfer is from a different culture, special attention has to be given to detail and the meaning of language.5. Contract negotiations can be onerous. They require diplomatic skills and careful record-keeping.6. Because of the nature of its acquisition, transferred process technology needs to be handled with evenmore care than indigenous technological change. It is important that all affected company staff appreciatethe nature and reasons for the acquisition.
2. What are the ten tenets? Discuss. With the help of examples, show how wehave become /are becoming servants of technology.
Ten Basic Tenets for the Management of Technology (MOT)
A tenet is a principle based on observation, intuition, experience, and in some cases, empirical analysis.Ten tenets, proposed in available literature, are presented below as guiding principles for an enterprise tooperate within a technology cycle (TC) framework. David Sumanth in his work (1988) proposed a totalsystems approach to technology management (TSTM) what he called the technology cycle. He contendedthat the management of technology in enterprises is not just a one-shot deal, but a continuous process,involving five distinctly different phases of technology, namely,
(of marketable inventions)
(by self-generation or transfer)
, adaptation
(by minor modifications of acquired technologyfor specific needs)
, advancement
(innovation involving major modifications of acquired technology)
,and abandonment
(of obsolete technology)
The tenets recognize that short-term treatments of any issuein general, and technology management in particular, are at best sub-optimizations, and so, will not leadto more long- Lasting solutions in adapting and advancing technology. Let us take some time now todiscuss these principles in detail.
1.Value diversification is a poor substitute for MOT 
Value diversification refers to the improvement of stockholders' investments in a company through quick-fix solutions on paper, such as mergers, acquisitions, and other stock-enhancing strategies. Unfortunately,this traditional approach to value enhancement results in mostly short-term gains and long-term pains.Every company ought to identify core technologies and core competencies, and then hone them to get themost
out of those for innovating products and/or services. When IBM acquired ROLM Corporation manyyears ago, IBM was trying to complement its core technologies in mainframe computers and personalcomputers with the core technology of ROLM, communication systems. Unfortunately, this did not work out very well, and IBM eventually sold ROLM. In the early 1980s, McGraw-Hill, whose coretechnologies are in publishing, books, journals, and related products, went into the personal computer  business with Odyssey with a totally different core technology that didn't work, either.

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