UNIT 1 Introduction: It is worth while to look at the following statements related to technology management.

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When an expert states that something is possible, he is almost certainly right. When he states something is impossible he is very probably wrong. Any sufficient advanced technology is indistinguishable from magic. The only way discovering the limits of the possible is to venture a little way post into the impossible. o Immortality o Time Travel o Levitation o Invisibility o Thought transfer

Technology keeps changing. But manager have the will to pickup and choose appropriate technology. Technology choice is not merely a matter of implementing the latest innovation. Rather, managers have the ability and responsibility to choose technology that not only is efficient but protects the environment and meets the needs of society. The technology Management (Part III of this book) we broadly cover the following aspects.
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Technology Change Technology Forecast Technology Monitoring Technology Management Process Assessment Technology Life Cycle Technology Change Choice Technology Technology Transfer Technology Strategies

1.1 Definition of Technology:
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A very broad definition is that technology is the application of science and the knowledge to solve human problems. Process technology definition: Technology is a set of processes, methods, equipment, tools by which resources are transformed into products to meet human needs.

However, Gendron has provided a more comprehensive definition: ―A technology is any systematized practical knowledge, based on experimentation and/or scientific theory, which is embodied in productive skills, organization, or machinery‖.

The role of technology in fostering economic growth of nations and enhancing their industrial competitiveness has been widely recognized, through its domineering influence over industrial productivity. Further, technology has emerged as the most important resource that contributes directly to socio-economic development. Hence, technology is viewed from various perspectives: as an ‗engine for economic development‘, as a ‗strategic resource‘, and as a‘ competitive weapon‘. This necessitates effective management of technology - at both national and firm levels. Technology Management (TM), which inter alia aims at planning and developing the technological capabilities of an organization or a nation, has now occupied the centre stage of decision-making. Gaynor has provided the following description of TM: ―Managing technology is a method of operation that leverages human resources, technology and other business assets by optimizing the relationships between the technology functions of the business enterprise. It is the process of integrating science, engineering and managing with research, development and manufacturing in order to meet the operational goals of the business unit effectively, efficiently and economically. It includes managing the totality of the technology operations from concept through commercialization‖. Much of the effort since about 1980 in the area of technology management has been directed towards strategic issues i.e. how to integrate technology strategy with marketing and other corporate strategies. For example, Mitchell has developed a simple matrix linking strategic technology areas (STAs) to business areas. By ranking the value of each STA to each business area, and comparing the strength of each STA with competitors, an effective technology strategy can be developed. This type of approach has been extended by de Wet, who has developed an expanded two-dimensional matrix, linking markets, products, processes and technologies, enabling market-focused technology planning Unlike in earlier days, Technology Management has become an organized and systematic discipline. As TM embraces several interconnected issues ranging from policy planning at the national level to strategic planning at the firm level, it calls for decisions and result-oriented actions at the macro-as well as micro-levels and an effective macro-micro linkage. Macro technology management At the national level, it includes:
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Planning for the development of technological capabilities at the national level. Identification of key sectoral technology and related fields to be developed. Determining ‗make‘ or ‗buy‘ decisions, i.e., whether importation or self development is to be pursued. Establishment of institutional mechanisms for directing and coordinating the development of national technological capabilities. Design of policy measures for controls.

Micro technology management At the firm or project level, it includes:
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Responding to competitors who are using technology as a strategic weapon. Integrating technology strategy into the overall corporate strategy. Identifying and evaluating technological options and innovations and the factors relating to their success and failure. Directing research and development itself, including determination and definition of project feasibility. Monitoring and planning technological obsolescence and replacement.

Both macro and micro-technology management seek to raise economic efficiency. Micro TM is the basis for macro TM, while the latter provides guidelines and an environment for the former. Consistency among these two levels of management is essential, but institutional mechanisms will largely determine whether they are effectively combined. While macro-support could catalyze changes, the real actions have to take place at the industry level.

Technological change has been broadly defined as: ―The process by which economies change over time in respect of the products and services they produce and the processes used to produce them‖. Technology Change Electronic Manufacturing: Leaded components vs. surface mounting type. This is influenced by a variety of considerations.
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Production technology is linked to Demand / Plant capacity Principle inputs Capital investment outlay & Production cost Technology: proven or not State of the art / latest and not obsolete Flexibility ( to cater to wider range of product mix) Ease of absorption

Technology and Trade: Developed Countries Implication for Developing Countries

1. New Materials Production 2. Biotechnology 3. Communication 4. Micro Electronics Appropriateness of Technologies:

Decrease in the demand for primary commodities Natural Products are getting substituted Increased capability Improved product quality for exports

This should be evaluated in terms of the following questions
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Use of local raw material Deployment of local manpower (not very specialized manpower) Goods produced cater to basic needs (not exclusive to higher income groups only) Protects ecological balance (Ex: CO 2 emission, harmful effluents etc.)

Technological change may involve a change in the output, raw materials, work organization or management techniques - but in all cases it affects the relationship between labor, capital and other factors of production.

The technology cycle concept was introduced with in the framework, to clearly identify the basic elements of technology management. The technology flow process giving a panoramic view of technology management to enable companies develop their strategies and tactical goals for competitiveness in domestic and world markets is also given. A systems view, idealistic as it may be, is a necessity today, particularly in view of the fact that today‘s businesses are forced to operate in an international arena in order to preserve their market shares and economic stability. David Sumanth proposes a total systems approach to technology management (TSTM) through what he calls the technology cycle (TC). He contends that the management of technology in enterprises is not just a one- shot deal, but rather a continuous process involving five distinctly different phases of technology: awareness, acquisition, adaptation, advancement, and abandonment. 1. Awareness phase: This is the first phase of the technology cycle, in which a company has a formal mechanism to become aware of emerging technologies relevant to the company‘s needs. Some companies form ―think tanks‖ with engineers and scientists, who research from around the world, and gather information and put in short internal report form for the benefit of corporate strategic planners and technology policy makers.

2. Acquisition phase: This phase involves the actual acquisition of a particular technology. To go from the awareness phase to the acquisition phase, a company‘s technology group, in collaboration with the industrial engineering group, would do a technical feasibility study, as well as an economic feasibility study, before justifying and acquiring a new technology. Companies face serious repercussions due to a rapid technological obsolescence, or through the acquisition of an inappropriate technology for their needs. 3. Adaptation phase: Good planning and preparation before acquiring new technologies ensures the expected greater economic returns. Virtually every enterprise ends up adapting an acquired technology for its particular needs. Of course, if the homework is done correctly, the transition from acquisition to adaptation becomes much smoother and less expensive. If sufficient time and effort have not gone into studying the relevance of a particular technology to a company‘s present needs, a great deal of rework and adaptation result. This not only frustrates the people acquiring the technology but also, and more importantly slows down the assimilation rate, causes major productivity losses, and results in severe quality problems. 4. Advancement phase: When capital is limited, as has become, the case for many companies today, one cannot indiscriminately purchase and abandon technologies with scarce money. Therefore, it becomes imperative to improvise the acquired technologies for one‘s home needs. For example, an automotive company, which might spend several billions of dollars to retool for new models, might have to create advancement features for its basic tooling in order to reduce the overall tooling costs. 5. Abandonment phase: This last phase of the technology cycle is probably one of the most critical ones, because this is where decisions are made concerning the obsolescence of a particular technology. Bad timing in prematurely abandoning a product could result in lost revenues on one hand, but on the other hand, waiting too long to abandon might also result in lost revenues because a customer has found a better alternative with competitor. Technology Life Cycle (TLC) The nature of a technology and its implications on firms have been observed to undergo perceptible changes over its life span. Although it is correct to view a TLC as a continuum, it is more convenient to consider it as a series of discrete stages for the purpose of better understanding and analysis. A technology typically evolves through the following stages in its life cycle‘. Figures below broadly portray the various aspects that characterize these stages.

1) Cutting-edge: This stage refers to the birth of a new technology. The primary focus of entrepreneur(s), here, is on its Research and Development (R&D) to a demonstrable form. Nevertheless, the need for financial support for R&D and for testing prototypes is also a pressing concern at this stage. Although basic research forms a major part of the effort in this stage, firms seldom do it without a specific application in mind. However, the scope of such an application may not be clearly known to the firm and the related knowledge may still be abstract. Hence, the target market, and the feasibility and viability of R&D at this stage are also uncertain. 2) State-of-the-Art: This stage in a TLC begins with the deployment of cutting edge technology to solve customers‘ problems. The customer base state-of-the art technology is usually small, but sophisticated. Hence, technical specialists are, perhaps, ideal for marketing the technology. Some of the functions, such as engineering, manufacturing, finance and administration may have begun formally while others may still be embryonic at this stage. Many other important functions are carried out with the help of hired consultants or agencies. The market witnesses a high rate of product innovations and as a result a great product diversity can be observed. The production process will be usually nonstandard. Hence, the state-of-the-art technology can respond easily to the varied market requirements, but only ineffectively and inefficiently.

3) Advanced: The gradual standardization of technological characteristics leads to rapid market expansion. The market largely consists of less sophisticated customers who seek all the benefits of state-of-the-art technology, but have no desire to develop the technical expertise needed to understand the technology. This market calls for professional marketing. The potential profits attract a large number of competitors and hence, the technology is no longer of the hi-tech variety available with only a few suppliers. A market shakeout, segmentation, and further standardization are bound to occur. A firm‘s survival in the market beyond this stage indicates its relatively efficient operations. At this stage, a part of the production system is likely to be automated, and division of labour is more pronounced. However, there is a possibility that the rapidly increasing demand may cause manufacturing and marketing capacity crises which will call for a major transformation in the organization structure. Parallelly, financial and administrative crises are also likely.

4) Mainstream / Mature: As technology enters this stage, the scope for further product innovations reduces and process technology becomes the target of innovative effort of firms. However, gradually, even the production process gets so well integrated that the possibility of any major changes in product or process technological elements will be limited and product differentiation becomes difficult. Hence, the strategic thrust shifts to efficient and economic production for minimizing costs. This may be achieved by huge capital investments or shifting the production base to the Third world. When the production costs also cease to offer comparative advantage, the competition will shift to customer service. This may help the firm to

maintain and improve upon growth momentum and market position. In this stage, the firm will be better managed by a professional management team than entrepreneur/owner. The organization will have grown in size and will call for more formal structures, communications, and systems. 5) Decline: During this stage, the scope for further improvement of the technology diminishes rapidly. The increasing marginal cost of its improvement, coupled with the functional superiority of the next generation technology, results in the older technology giving way to the new one gradually. However, it may not be easy for the new technology to wipe out the older technology one and pervade the market. The overlap between the above successive stages of a TLC makes it a continuous process rather than a set of discrete stages (Mohan Babu and Ganesh, 1997).

The TC fits within the broader technology flow process (Fig.), in which all technologies that are abandoned after being marketed, or inventions not commercialized to start with, are archived for a certain period of time, ranging from a few days to possibly several decades. Central to the TC concept is an analysis of the external and internal environment factors in each of its five phases.

Fig: The Technology Flow Process Chart One or more of these factors may be more important than the others in each of the five phases, and for each type of technology under consideration. For example, in a developing-country enterprise, the acquisition phase of the TC becomes very important because of economic considerations and limited foreign exchange to buy. Accordingly, the company may opt for selfgeneration rather than transfer of technology. In a multinational company political and cultural factors become important. For example, prior to the 1990s, some Japanese multinational companies were wise to offer their technology and know-how in India without demanding a 51 percent share, but rather settling for 45 percent, because of an understanding and appreciation for the political and cultural requirements prevalent and imposed by the Indian government. Thus, they gained entry to some vital markets well before others in the West did. All five phases of TC are equally important. Depending on the type of product and technology, the magnitude of the activities and analysis might vary with time. Technology management must be viewed as a broader umbrella for productivity and quality management.

Technology choice is an extremely important decision and one of interest to managers in all functions. These decisions are not only technical in nature; they affect capital, human resources, and information systems. Thus, all managers are interested in the choice of technology and how it affects the business as a whole. Most business students are not going to work in factories. But, it is nevertheless important to understand factory technology and its capabilities. Investment in factory technology is a concern for finance and accounting students. Marketing students need to know how the products are made that are being marketed. Human resource students need to know how technology affects jobs and people. The focus here is on the capabilities of technology and not its details. Choice of technology should be based on a sound technology strategy. A technology strategy is aimed at obtaining the right amount and type of technological investment. A technology strategy begins with a business strategy and operations strategy that describe the vision and mission of the firm. For example, if the mission is to be a low-cost producer, the technology strategy should be aimed at developing technologies that enable low cost, and new technologies should be evaluated on their ability to lower costs. On the other hand, if the mission is to produce differentiated products, the technology strategy, the technologies developed, and the evaluation criteria should be oriented toward product differentiation. A technology strategy sets an overall framework for development of new technology to support the mission. It ensures that technologies are not merely developed and justified one at a time, or for the wrong reasons, but implemented as part of a coherent strategy over time. As a result, the technology is integrated and provides a competitive advantage not easily imitated. Many firms justify their technology one proposal at a time and do not have a comprehensive technology development strategy. A second aspect of evaluation of technology is the financial return on investment. Various methods are available such as net present value and internal rate of return to determine whether the investment provides an acceptable return on the investment. Very careful analysis is needed to ensure that the firm remains competitive and is not depleted of capital. Aversion to capital investment is a problem in some industries where management seems more aware of the dangers of too much investment rather than too little. Acceptable financial returns can be seen as a constraint on technology strategies. The technology strategy must provide at least the minimum acceptable return on investment. In addition to considering the technology strategy and return on investment, technology choice should consider the effect on human resources. For example, job choice need not be determined by the technology. The concept of a socio technical system points out that both jobs and technology should be simultaneously chosen, to achieve joint optimization. In the past, it was

often assumed that jobs were merely fallout from the choice of technology, so-called technological determinism . In other words, the choice of technology determined the jobs and the social system. Now we understand that technology choice must consider not only technology but social and human consequences as well. Technology investments should support a comprehensive technology strategy meet financial objectives and provide a socio technical system. Managers in all functions should work to develop a technology choice that considers operations, financial, human resources, marketing, and information systems perspectives. Choosing technology on a cross-functional basis wifi ensure that all these factors are properly considered. Key Points

Technology choice should be based on a technology strategy that seeks to help obtain a competitive advantage through minimizing cost or product differentiation. The required return on investment sets a minimum acceptable level that the technology strategy should meet or exceed. The choice of technology automatically determines the jobs and thus has a social and human impact. As a result, a socio technical approach should be used to jointly choose the jobs and technology at the same time. Then technology will be selected that not only is efficient but considers the impact on human resources as well. The choice of technology should consider the effects on customers, employees, finance, and the environment. A crossfunctb0naI strategy is needed to ensure that technological choices are integrated over time and help the firm achieve a competitive advantage.

UNIT 2 TECHNOLOGY FORECASTING The purpose of any type of forecasting and the proper role of the forecaster is to assist the contemporary decision-makers in the choosing of policies and making of plans that are most promising. Measurement of technology change is necessary in forecasting. Following are some of the measures through which technological changes can be visualized. Economic Indices Arithmetic indices are derived based on price variations in capital and labor in relation to the industrial output. Technological change is measured as the weighted average of the change in product prices, holding inputs constant. Patents Patent statistics have been used as indicators of technological change. They have also been used to analyze the diffusion of technology across firms or industries or countries. Patent studies are also concerned with the analysis of the innovation process itself in order to assess and evaluate the output of research activity. Rate of improvement of technology

A figure of merit for each functional capability of a technology is to be identified. For a product it could be travel speed per unit time (transport vehicles), or lumens per watt (lighting fixtures), or instruction execution rate per second (computers). For a process, it could be the efficiency of fuel utilization or reduction in waste generation. S-shaped growth curves are formulated to form a system of curves depicting advancement of technologies. In the National Context:
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Developing technological competencies so as to meet global competition and international trading imperatives. Planning for creation of sustainable comparative advantages in select technological thrust areas. Planning for the well-being of citizens with the aid of technological innovations. In the context of Business Firms: Establishing technical parameters and performance standards for new products and processes. Augmenting new product development efforts as well as improvement of existing products. Enabling better timing for new technology introduction and facilitate ‗take-to-market‘ strategy formulation. One of the main aspects of Technology Forecasting is its communication aspect. Technology Forecasting (TF) initiates and fosters the communication between various communities such as: o Science and Technology o Industry and politics o Technology and public administration o Technology and the general public.

Technology forecasts can be a short, medium or a long-term exercise. Short term forecasts are of usually a year or less, might typically deal with a single technology. Medium-term forecasts might cover a 2-10 year period. Long-term forecasts cover 10-20 years Methods of Technology Forecasting A classic example is the bold forecast that NASA made regarding the huge sun-reflecting satellites to illuminate night-shrouded areas of the earth which they predicted would be possible by the mid-1970s. Such forecasts with faulty timelines can be totally worthless to corporate planners, and worse they can turn into money pits. This brings into focus the need for employing accurate technology forecasting methods. The most appropriate choice of forecasting method depends on:
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Rate of technological and market change Availability and accuracy of information The planning horizon The resources available for forecasting.

Classification of Technology Forecasting Methods The technological forecasting methods can be classified as exploratory and normative forecasting methods. Exploratory technological forecasting starts from today‘s assured basis of knowledge and is oriented towards the future, while normative technological forecasting first assesses future goals, needs, desires, mission, etc., and works backwards to the present.. Explorative forecasting is more focused on predicting how a new technology will evolve on a pre determined curve, which is S-shaped, while the normative forecasting attempts to be more proactive. With so many choices available, each having distinct characteristics, a calculated choice has to be made while choosing a forecasting method. Some of the factors that influence the choice of the forecasting methodology can depend on the time frame for the forecast, how much precision is needed in the prediction and the purpose of the forecast.

Delphi Method The Delphi method, which is subjective in nature, is arguably the most popular forecasting tool in vogue. Though statistical or model-based forecasting techniques are preferred over expert opinion techniques, there are two scenarios where subjective (or intuitive) methods are found to be relevant.

When there is no precedent - mostly in the case of new technology forecasting where expert opinion is the only possible source of forecasting or in situations where the impact of factors which were previously considered to be relevant have lost their strength. Ethical evaluation is required – instances where ethical issues are more important than technical and economical issues.

The basic idea of a Delphi survey is to interview experts on a topic. But the exercise is not restricted to collection of opinions but also to provide each expert the facility review based on the recommendations of his/her peers. This exercise contains a minimum of 2 stages in which the outcomes of the first round of interviews are provided back through a controlled feedback to the experts during the second round.

The Delphi method has three unique characteristics that differentiate it from other methods such as committee approach and brainstorming. Anonymity: During the Delphi procedure, a member does not know the specific contributions of the other members. In most cases a person would not even know who the members of his/her group are. This methodology has its unique benefits. It avoids any bias of opinion owing to the reputation of other members. The anonymity also provides the experts an opportunity to revisit their articulated opinions, without the fear of embarrassment, when they encounter any evidence contrary to their expectations. Iteration with controlled feedback: The survey coordinator extracts responses which are deemed relevant to the topic and these are sent back to the group. This sort of mediation throughout the process ensures that biased opinions are not pushed by merely repeating or restating them over and over again. The Delphi process involves the following steps:
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Identify the subject in which the Delphi survey is to be conducted. Recruit a group of experienced people who can prepare the questionnaire for forecasting the technological developments. During the first round the questionnaire is then distributed among experts to address all possible aspects of the issues. These participants are asked to forecast events or predict trends regarding the issue. The responses are collected and all opinions including the extreme ones are taken into cognizance. In the second round, results of the first round are sent back to the participants and it contains a consolidated list of all the responses. The participants are then asked to forecast the possible occurrences enlisted in each of the responses. In the third round, all the responses are sent back to the participants. This time, along with the inclusion of statistical details, they are also asked to reevaluate their responses. After the end of the third round, the moderator processes the response by combining it with similar responses, summarizing lengthy ones, etc. The questionnaire for the fourth round contains the responses, the statistical information and the summary of points for modifying the forecasts, if any. Here the participants are required to provide reasons for any change in a given forecast value. At the end of the fourth round, the moderator collects and summarises the results and comes out with forecasts, the degree of disagreement and a summary of critical issues for each forecast. The Delphi method is mostly used in the following contexts: o To determine critical factors that might impact the development of technology. o To forecast statistical estimates on the progress of a particular technology over a specified duration. o When forecasting cannot be made using other methods. o To evaluate the chance of a particular event occurring under given conditions.

An improved Delphi method has been used to pool the knowledge at 100 experts working online around the globe to forecast breakthroughs in all fields of science and technology. Results show

that major advances are under way everywhere which are likely to transform business and society ever the next 20 years. TechCast Method The TechCast method consists of five phases. Phase 1: scanning We first do extensive scanning of the scientific literature, media, internet. interviews, and other sources to accumulate background data.

Figure: TechCast Method. Phase 2: analysis Next we organize the scanning data into a ―breakthrough analysis‘ consisting of a definition of the event to be forecasted, data points, and trends. Breakthrough analyses are considered especially valuable because they summarize the best available knowledge on any technology in a concise and convenient format. Events, or milestones‖, are precisely defined adoption levels to be forecasted for each technology. We usually use the 30 percent adoption level, but other adoption levels are used where they seem appropriate. The 30 percent level is of particular interest because emerging technologies are usually entering the economic mainstream at this point. Data points summarize available information on the present adoption level of each technology, any forecasts that are available, estimates of economic demand, and other relevant facts. Cons consist of trends opposing the adoption of the technology. Cons can take the form of limited technical performance high cost, political obstacles, lack of social acceptance, limited business development, and other factors.

Pros comprise trends driving the technology. They typically describe technical breakthroughs, business investment, examples of successful adoption, changes in government policy, statements by prominent authorities and the like. Phase 3: survey The experts work online to integrate all this information using their judgment to provide the most accurate estimates possible. We strive to enlist the most competent authorities with advanced degrees, extensive publications, relevant experience, and breadth of knowledge. Experts are asked to focus on areas they feel most knowledgeable about. Phase 4: results The system automatically aggregates these estimates to forecast the ―most likely year‖ each technology will reach its adoption level, the ―experts‘ confidence‖ in this forecast, and the likely ―market size .” Other variables can be forecast as well. These data are presented on the website in various formats that enhance analysis and comprehension, such as the bubble charts providing a ―strategic analysis‖ for each field of study. Delphistudies are considered reliable if they include a dozen or more experts, and these results surpass that criterion considerably, usually running about 50 or more data sets. Phase 5: iterations Experts‘ comments and new background information are incorporated in an updated breakthrough analysis, and this process is repeated every year or so to ‗track‖ the forecast over time, allowing us to extrapolate the best possible forecast. ―Arrival‘ dates are also noted to evaluate the accuracy of forecasts. TechCast analyzes the results to identify which qualities produce more accurate experts. Typical results Figure 2 presents a summary of the forecast results organized by seven fields. The major conclusion of this work is that breakthroughs are appearing in all fields that will transform industries, the way organizations work, and society itself. We also present results more fully by organizing them into bubble charts that illustrate a three types of data for each field. Figure 3 illustrates the results for selected emerging technologies that are considered especially strategic. Accuracy The obvious question raised by Delphi forecasts of this type is: ―How accurate are the results?‖ TechCast has been using this method for 15 years on a variety of projects, and

Figure 1

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analysis of these results show that the variation among forecasts averages ±3 years, with standard deviations averaging 4.3 years The field of knowledge management (KM) offers a useful perspective for understanding the rationale underlying this methodology. From a KM view, this approach can be understood as a ―learning system‖ conducted by a ―community of practice‖ to ―continually improve‖ results. This process of gathering background information, organizing it into a coherent analysis, surveying experts and using results to improve the system allows the experts to continually learn and thereby approach a ―scientific consensus.‖ Some contend that methods that rely on expert judgment are subjective, whereas quantitative methods are more precise. The fallacy of this argument lies in seeing that quantitative methods also involve large amounts of uncertainty because of underlying assumptions that must be made to conduct any quantitative analysis. The TechOast approach is superior because it subsumes quantitative forecasts into the analyses provided to experts, and then allows their considered judgment to resolve the uncertainty that remains. “For the first time in history, knowledge-the very heart of scientific progress-is being harnessed systematically on a massive scale.” This consensus can be in error, of course. But it represents a synthesis of the best available background information and authoritative knowledge to produce the best possible answer to a tough question. Experts may have their own bias, naturally, but it is usually distributed normally, washing out in the aggregate results. As Figure 1 shows, if the present uncertainty is defined as 100 percent, we have found through experience that this process reduces uncertainty to about 20-30 percent. The outcomes can he seen as ―good enough to get decision-makers into the right ball park‖ Recommendations Almost all organizations require technology forecasts to conduct their strategic planning. This is especially true of IT, health care, media, defense, and other fields that are changing constantly and facing upheavals. We outline here a simple but effective approach to managing technological change. The first requirement is to develop a method to develop forecasts or locate other sources, and then make a point of tracking the most critical trends overtime. Pooling the knowledge of a sample of the organization‘s best minds online would be especially convenient and useful. This type of system can also be valuable for developing an organizational consensus on identifying key technologies analyzing critical issues, framing scenarios, and evaluating strategic alternatives. We suggest a strong focus identifying ―disruptive technologies‖ and studying how to protect your present capabilities from possible threats, while also finding opportunities it may offer.

Promising new ventures should be selected and incubated in autonomous units freed from the normal organization constraints and supported by resources and advice. Some will almost certainly fail, so launch many projects forming a portfolio of investments that can do well on average. Plans for new ventures can he guided by the earlier forecasts to suggest feasible project timetables. Whatever the method, good managers should develop some type of well thought out plan to forecast and adapt to the wave of technological change that is upon us. There may be uncertainty about specific breakthroughs, but there is very little uncertainty that we are going to see plenty of technological change over the planning horizon. Technology Vision 2020 Government of India has constituted a unique institution called the Technology Information, Forecasting and Assessment Council (TIFAC) in 1988 under the chairmanship Dr. A.P.J Abdul Kalam. Its major task was to look ahead at be technologies emerging worldwide, and pick those technology trajectories which were relevant for India and should be promoted. In its tasks, TIFAC networked various stakeholders: the government, industries, users, scientific and technological, institutions, financial institutions and intellectuals. It is against this background that the TIFAC Governing Council met on 24 November 1993 with its forty members drawn from industry, R&D establishments, academic institutions, government departments and financial institutions and debated how TIFAC could contribute to national development. An intense discussion took place about India ‘s past and present technological performance and what could be feasible in the future. It was realized that technology is the highest wealth generator in the shortest possible period if it is deployed in the right direction. Technology strengthens the political, economic and security structure of the nation. For India , technology had to be the vision for the future. Technology can help transform multiple areas such as education and training, agriculture and food processing, strategic industries and infrastructure in various fields. It is on this basis that the task forces and panels of the Technology Vision 2020 were constituted. India ‘s needs and core competencies: What is a core competency? Put simply, it means that in certain areas we have some inherent strengths whereby we can show a much better output and better results in shorter time. More enabling environment or due to better experience. India ‘s human resource base is one of its greatest core competencies. Indians not only have a great learning capability but most of them also have an entrepreneurial and competitive spirit. The Generation of the vision-How was it done? There were about 500 persons active in the panels and task forces.

The objectives of the task forces and panels were to a) provide directions for national initiatives in science and technology to realize a vision for India upto 2020; b) provide a strong basis for policy framework and investment for R&D in the government and the private sector; and c) Contribute to the development of an integrated S&T policy both at the state and national levels. The major long-term national assessment and forecasting exercise was constituted into seventeen panels and task forces.. Of these, ten were headed by experts from industry, five fro R&D institutions and two from the government. Each force had a chairperson, a co-chairperson and a coordinator. The studies employed various techniques of forecasting like brainstorming sessions, preparation of perspective an scenario reports, Delphi rounds, nominal group technique in some cases, subsequent workshops, etc.. The task forces and panels addressed the following questions:
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Are there areas where India has a strong technology base? What are the technologies which can dramatically change Indian social or economic conditions or which have specific advantages? What are the spin-offs from the technologies developed? What is the focus on in-house and indigenous technological development? What should be the actions, strategies and policies which will be implemented in the future to secure a competitive advantage in the world market. Which are the technologies that would come into the future in a big way by 2010, 2015, 2020 and 2025 respectively?

Which are the technologies that would become obsolete or disappear by 2000, 2005, 2010 and 2015 respectively? The cross-linkages and input flow between various panels and task forces were maintained through chair persons coordination and the staff. At the subsequent TIFAC council meetings, several task forces and panels presented their findings from the reports. During the 23rd TIFAC council meeting held on 18 April 1996 in New Delhi, it was decided to widely disseminate the reports with the help of industry, industry-associations, government departments, agencies, organizations and other interested groups in these areas so as to formulate some action- oriented projects during the Ninth Five Year Plan (1997—2002) for realizing this Technology Vision for India. The perspective and scenario reports of the panels, Delphi responses and Nominal Group Technique (NGT) rankings formed the basis on which the vision and action reports were finalized, and suggestions were also formulated for policy

Technology Monitoring Major steps involved in technology monitoring are:
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Scanning Filtering Analysis and Development of forecast

Scanning The idea behind scanning is to collect as much information that is available on the particular field of technology. The information could cover the following aspects:
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Research plans and developments Environment of the technology Support of various governments for the technology Human skills and capabilities Social and ethical issues Benefits of the technology

Filtering In most cases, not all the information captured on the technology would be relevant for a particular forecast. Hence, based on the forecast required, the necessary information is identified through filtering of pertinent data. Analysis and Development This methodology is relevant in situations such as developing Research and Development. Long Range Business Planning Since the 1990s technology forecasting activities under various names have gained popularity in the corporate world. Both large and small companies today depend on TF to survive. Large companies have been using TF to streamline R&D efforts and plan for new product developments while smaller companies survive on technological innovation through use of proper TF methods. TF is directly linked to the corporate strategy of the firm. Corporate strategy basically deals with product/service delivery, customer interactions and also competitive market forces. Long-Range Business Planning can be formulated at various levels:
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Organisational level – It deals with the firm‘s purpose of existence. It aims to answer questions like ‗What are we providing‖, ―What is our mission, values etc?‘ Company level – This level deals with determining product lines or considering business which the company should enter into, develop or divest.

 

Strategic Business Unit level – This deals with developing strategic business units – its goals and objectives and the means to achieve it. Functional level – It incorporates decisions like devising R&D and marketing strategies.

With respect to technology, the above strategic perspectives aim to address the issues:
 

How can technology provide sustainable competitive advantage? How can technology meet the business objectives of the firm?

The following form the basic premise as firms establish linkages between technology and business objectives:
  

Technology provides a base to define the range of business opportunities and options viable for a firm. It can provide a sustainable competitive advantage to the firm. Business strategies can be channelised using technology.

The key aspects covered by Technology Forecasting in this business context are:
   

Environment analysis and monitoring of global trends in order the identity developments that may influence at the firm level or the industry level. Set time horizons for each of the R&D activities based on the time horizon of the firm‘s strategy. Compilation of information on trends that might provide an opportunity or impose threat on the firm in the future. Evaluates the direction of the existing R&D strategy and suggests realignment, if necessary.

Technology strategy formulation has occupied centre-stage of long-range corporate planning owing to the emergence of technology as a competitive weapon and the need to grapple with global market forces through effective deployment of technologies in organizations.

Technology Management Process assessment The effective management of technology as a source of competitive advantage is of vital importance for many organizations. It is necessary to understand communicate and integrate technology strategy with marketing financial, operations and human resource strategies. This is of particular importance when one considers the increasing cost, pace and complexity of technology developments, combined with shortening product life cycles. A five- process model provides a framework within which technology management activities can be understood identification selection, acquisition exploitation and protection. Based on this model, a technology management assessment Procedure has been developed, using an ―action research‖ approach.

The impact of technology as a source of competitive advantage for manufacturing industries is widely accepted by practitioners, governments and academics. In order to realise this competitive advantage, it is vital to understand both the specific technologies, and the ways in which organisations can best manage technology. These issues are of increasing importance as the pace of technology development and its complexity increase. The rising level of activity in the area of technology management studies is an indication of these trends This paper describes the application of a technology management process assessment procedure, which aims to identify and assess technology management processes in manufacturing organizations. The procedure includes a high-level strategic overview, where the impact of segmented technology areas on business areas is assessed. Specific technology-business areas are then assessed in more detail, to evaluate the effectiveness of operational technology management processes, leading towards the development of practical improvement plans. Gregory (1995) has proposed that management of technology is comprised of five generic processes (see Figure 1): 1. 2. 3. 4. 5. Identification of technologies which are (or may be) of importance to the business. Selection of technologies that should be supported by the organisation. Acquisition and assimilation of selected technologies. Exploitation of technologies to generate profit, or other benefits. Protection of knowledge and expertise embedded in products and manufacturing systems.

Gregory‘s framework has the advantage of being quite generic, encompassing all technology management activities in the firm.

Skilbeck and Cruickshank (1997) have extended Gregory‘s five-process model, linking the framework to business activities within a systems context, and identifying three levels within the organisation where technology management processes apply: 1. Corporate level (network view): how to manage technology across a diverse range of businesses. 2. Business level (external view): how to gain competitive advantage through technology.

3. Operational level (internal view): how to optimize internal processes to manage technology effectively. A technology management assessment procedure (TMAP) has been developed which is based on this model. This paper describes the application of the TMAP procedure in a manufacturing organisation. Technology management process assessment A technology management assessment procedure has been developed which is based on the fiveprocess model of Gregory (1995). The method provides a structured procedure for a top-down investigation into technology management practices in a business unit. The assessment procedure is comprised of three workshop-based stages (see Figure 3): 1. Strategic overview, where the business unit is segmented in terms of business and technology areas. The impact of each technology area on each business area is assessed in terms of value, effort and risk. The strategic overview is similar to methods developed by Mitchell (1985) and de Wet (1996), enabling appropriate technical and business areas to be identified for further assessment. 2. Process overview, where recent, current and future activities are charted for selected technology-business segments. These activities are characterised in terms of the Gregory fiveprocess framework, and assessed in terms of the effectiveness of inputs, process and outputs. Identification of strengths and potential weaknesses enables specific process areas to be identified for more detailed analysis. 3. Process investigation, where specific process areas are mapped in detail, in order to identify areas of good practice, together with barriers and problems, and areas for possible improvement. Emerging technologies in automobiles and IT

Unit 3 Transfer of technology Strategic Objectives In today‘s rapidly changing technological environment, there is a greater need for proper implementation and supervision of new technologies. Today‘s enterprise not only have to the competitive in domestic markets, but increasingly so in global market arena. Therefore, the issues of technology transfer and the methodologies to achieve successful technology transfers need to be considered to improve the competitive capability and cope of with competitive pressures. Okko and Gunasekaran (1994) defined technology transfer as ―the spread of technology from one culture, country, or region to another.‖ Johnsrud states ―Technology transfer is an internal or intra organizational technology management problem,‖ With more countries emerging as free-enterprise economies, there has been a dramatic increase in the rates of technology transfer from the developed to the developing economies. At the same time, the economic capital of the developing economies has become scarce, thus making it necessary for a careful analysis of technology investments before they are made. Strategic objectives Companies in several countries cited the following strategies in technology transfer. The reasons as well as the combinations of reasons provide insights into the strategic motivation for engaging in technology transfer. Key Strategies Access: To gain access to world markets as company‘s global strategy Saturate: Existing markets saturated Materials & labour: Access to cheap labour & material Links: To benefit from foreign partner links Barriers: To overcome trade barriers Cost: To use standard technology more cheaply Policy: To take advantage of favourable policies

Competitive: To improve competitive capability and meet Competitive pressure through development of technological capability

Profits: To increase profits Market: To develop new domestic markets and facilitate international expansion. Cost: To reduce the transaction costs, notably tax advantages Policy: To take advantage of favourable policy Attraction: To increase attraction to foreign investors Government: Arranged by the government

A defensive approach would be to limit technology transfer or to protect important elements of technology. Alternatively, foreign firms may develop long-term relationships with technology recipients. The above discussion of strategic objectives raises questions regarding alternative sources of technology and the risks & rewards related to technology transfer. Ability to supply advance technology, competence in established / proven, reputation and experience in technology transfer also need to be considered. With more advanced technology, the value of the technology and the cost of losing exclusive possession of proprietary knowledge of it are greater Assessment of capabilities and resources Where technology transfer is not simply a one-off sale, foreign firms will have a longer-term interest in the success of the technology transfer. They will therefore be concerned about the capability of the acquirers to absorb and use the technology profitably. They will also want to know what resources are available for transfer. It is generally found that ―managerial knowhow‖, ―level of technological development‖, ability to learn, access to capital, Infrastructure support, Access to international technical and commercial information, Quality of currently used equipment to be the most important aspects for the success of technology transfer. Assessment of Business Environment: Micro environmental factors like political & economic situation, legal regulations, and linguistic problems, cultural and institutional factors may affect business prospects in general or have more specific effects on business transactions. The following are the Micro-environmental obstacles to technology transfer

Institutional o Excessive bureaucracy

Unsatisfactory management Low industrial performance Differences o Commercial habits o Language o Technical systems Efficiency o Time-consuming negotiations o Inconvenient communications o Insufficient information Legal aspects o Unsatisfactory protection of technology o Inadequate legal regulations o Restriction of profit repatriation

o o

Technology transfer and Related Issues The Process of Technology Transfer The government & industry must identify what fields of technology are needed to achieve its economic goals. Generally speaking, three factors have to be taken into consideration: 1. 2. 3. similarity; contrast; Complimentary

The important task is to look for alternative technology at home, that is, to look for a domestic re-engineering enterprise with a potential to develop the needed technology. Second, if such enterprises cannot be found at home, its social and economic costs have to be appraised first before seeking technology transfer. Generally speaking, technology can be gained in three ways: 1. Purchasing production techniques; 2. Transferring production techniques; 3. Developing one‘s own techniques. Developing new techniques costs more money, but it makes the greatest contribution to social and economic developments in the long run. Transferring production techniques costs money at the beginning yet makes less of a contribution than developing one‘s own techniques; however, it is more than purchasing new techniques. Purchasing techniques will be subjected to foreign control in some way and will do little good for industrial upgrading.

Elements and stages of Technology transfers The various elements of process of technology transfer are human resources, information, resources, and capital (see Table I). In terms of the human resource element, the process involves the exchange of technicians. The technology provider must send technicians to instruct the technology receiver, or the receiver must send technicians abroad to learn the know how. In terms of the information element, the provider has to give the receiver information about the development or design of the technology, manufacturing skills, and marketing skills. In terms of the resource element, the provider must not only sell the receiver machinery and equipment, research equipment and materials, and production materials, but also Elements of Technology Transfer Elements of transfer Human resources Methods of transfer Technician exchange Mechanism Know-how training


Patents Technological & Administrative books

Design and development skills Production and administrative skills Manufacturing technology & marketing skills

Methods of development Resources Trade of machinery and and experiment equipment

Methods of production Trade of research equipment &material

Trade of production material


Joint venture

Share of ownership

Industrial co-operation

Complying with the contract

familiarize the receiver with the methods of development, experiment, and production. As for the capital element, both sides can transfer technology either through joint ventures or industrial cooperation. The primary importance is the compliance of the contract and share of ownership by both sides (e.g. the department stores co-managed by Taiwanese and Japanese enterprises). Among the four elements, human resources is the most important because it plays a key role in how new technology is acquired and how old and new technologies are integrated during the process of technology transfer. In other words, human resources is the main interface of technology transfer. To make the technology transferred take root at home, technology exchange has to be transformed into technology exchange through human involvement. In addition to being achieved through the direct exchange of information between the technology provider and receiver, technology exchange is also achieved in four ways: 1. 2. 3. 4. reading professional journals or books; attending academic conferences, especially international ones; taking field trips; using academic networks.

The skills and information acquired in indirect ways can serve as references to those acquired through direct transfer; otherwise, investment of a huge amount of capital may only serve unknowingly to acquire technology that is out-of date. The Development of Human Resource in Technology Transfer The most important interface in technology transfer is human resources, therefore the key point in technology transfer is how to transform human resources into an idea interface. The development of human resources in technology transfer can be conducted in two ways: 1. from a macrocosmic point of view, the training is done through project-based learning; 2. from a microcosmic point of view, the training is done through self-development.

Of course, self-development is still indispensable in project-based learning. To conduct the technology transfer into technology exchange, the technology receiver has to organize a learning group to learn the ideas and methods of the technology provider. Without systematic learning, the receiver will find himself actually benefiting nothing from technology transfer. Generally speaking, of the two ways of training, the more systematic way of training is through project-based learning, which undergoes five stages: Confrontation The approach is to sort out the similarities and differences of the new and old systems in terms of their operating theory and rules. This can be achieved by:
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applying experience and rules to evoke technological principles and process methods of the production system; pointing out the meanings and shortcomings of the theory and methods in practice; sorting out the principle and structure of the original operating system or functions.

Identification of the Problems The approach is to analyze the themes. This can be achieved by:
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analyzing the goals and mechanism of the production or operating system; analyzing the process of the interaction of different mechanisms and writing them down as operation steps;

Design of New Functions The approach is to adapt to the new principles and rules. This can be achieved by:
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finding out the operating principles and rules of the new technology; pointing out the effective parts of the operating system and production functions.

Simulation The approach is to test the operating procedures and production functions.
 

Simulation of the new system to serve the conditions; Whether the handling approaches and the production system comply with the goals and mechanism of the production system or the operating procedures.


The approach is to formalize the transferred technology. This involves appraising the operating effectiveness of the new system and then analyzing the conditions of its integration and application to select applicable themes; Stages of technology transfer Confrontation Tasks of the trainees Finding out the problems of the original system

Identification of the problems

Developing mechanical analysis

Design of new functions

Sorting out the functions and operating logics of the new technology

Making a structural analysis of the operating system Simulation


Assembling and maintaining the functions of the operating system

Important: Technology transfer usually requires training, but the technology receiver will never catch up with the provider if the training is inefficient or ineffective. Therefore, the key issue of technology transfer is how to establish the methods of learning technology and change the system of thinking of the trainees. Moreover, the degree of technology transfer is interrelated with the attitude of the trainees. Those who have no willingness to learn cannot efficiently absorb the technology transferred to them. In addition to methods of technological exchange, methods of and time for training must be provided in the contract; the trainees must get down to the bedrock so that the technology transferred can take roots and be regenerated

Technology Transfer applied to the concept of PLC According to Vernon (1966) the product life cycle can be divided into three stages: new product stage/design, growth, mature product stage and standardised product stage. In the new product

stage & growth state, the product is manufactured in the home country and introduced into foreign markets through exports. In the mature product stage, as technology becomes sufficiently routine to be transferred and a firm s export position becomes threatened, the firm is induced to produce abroad, generally in other advanced countries. Finally, as the product becomes completely standardised, production will be shifted to low-cost locations in developing countries. Vernon pointed out that due to globalisation the environment has changed. This change has weakened the power of the life cycle theory, although the age of technology may be correlated with the form of transfer, especially for large-scale projects. Firms invest large amounts of resources in research and development (R & D) with the intention of creating a unique competitive advantage. Their first move will be to export goods having the technology content of the latest generation. It appears that brand new technologies may be positively related to foreign direct investments and mature technology with licensing. From the theory of the product life cycle developing countries can mainly obtain standardised technology through licensing agreements. Dunning (1995) points out that the only way in which developing countries can obtain advanced technology is through foreign direct investment. Moving back up the product cycle Amsden (1989) has pointed out that if industrialization first occurred in England on the basis of invention, and if it subsequently occurred in Germany and the USA on the basis of innovation, then it occurs now among ``backward countries on the basis of learning. Learners do not innovate (by definition) and must compete initially on the basis of low wages, state subsidies, incremental productivity and quality improvements related to existing products. The shop floor tends to be the strategic focus of firms that compete on the basis of borrowed technology. It seems that the product cycle in developed countries is along the route: research - development design - production. In developing countries, it is along the route: production - design development - research. The basis of the first route is innovation. It needs a large number of highly qualified scientists, engineers and technologists and is sustained by large R & D spending. The second route is a learning and accumulation route, which is based on the transfer, absorption and adaptation of existing knowledge. Learning is also enabled to create new technology and new products to suit market needs. In this route, R & D is carried out mainly to facilitate learning, and focuses on the technology that is excluded by foreign firms. Overall, technological progress in developing countries relies heavily on imported technology and thus on an internal capacity to absorb foreign knowledge. FDI (through wholly foreignowned companies and joint ventures) and licensing agreements are major channels for importing technology. Points to be noted in Technology Transfer: Normally many small scale industries / entrepreneurs depend on outsiders for technology as they can not afford to have in house Research & Development, long gestation period and cost involved in R&D Transfer Of Technology (TOT) should take of the following points

      

The nature and extent of support provided by collaborators in the areas of design, manufacture, equipment selection & stabilizing the process for specified output, adequate training of personnel, performance guarantee of the plant, productivity Future updated technologies will be provided Price of technology is onetime licensing fee and or royalty fee on turnover Providing scares / critical inputs Any restriction to export (specific countries) Export assistance Level of equity participation if TOT is backed by financial collaboration Conditions for termination of agreement and force major situation (natural calamities, change of government policies

UNIT 4 Competitiveness In a free-market economy, the generic goal of industrial firms is competitiveness, Competitiveness i.e the ability to get customers to choose your product or service over competing alternatives on a sustainable basis. Competitiveness as defined above is measured by
   

Market share trends over time, and can be described in terms such as increasing, decreasing, or stable. Sustainability: competitiveness must be built on a sustainable basis. Profitability: A certain threshold of profits is necessary for any firm to be able to compete on a sustainable basis. Customer focus

If we ask why customers choose the products or services that they do, a number of generic reasons come to mind: The price is lower. The quality is higher. Availability is sooner, or more dependably just in time. Customer service is better. Attractiveness is greater. Awareness is greater. The stability of long-term relationships is important. There are other social, psychological, and ideological reasons.

Creating Competitive Advantage Using the value-chain analysis, firms can create competitive advantage in at least three ways: 1. By placing greater or lesser emphasis (allocation of resources, management time and attention) on specific activities than competitors do 2. By performing specific activities better (better management, more highly trained people, better maintained equipment) or differently (using an alternative-presumably new or improved-technology) than competitors do 3. By managing linkages among activities better than competitors do Technology Choice The decision of which technology will be used to perform a specific value-chain activity corresponds to a major element in what Porter calls technology strategy. The technology choice for the activity should obviously correspond to the competitive advantage being pursued by the firm, taking into account the qualifications. i.e., the low-cost technology should be chosen by the firm pursuing a low-cost, low price advantage; the high performance technology for the high performance advantage, high price and so on. Managing Linkage: Value chain activities are interdependent. Better coordination of linked activities can be source of competitive advantage. Ex: Linkage between manufacturing, system testing, after sales service, warranty claims administration etc. Any organization has its own unique value chain, upstream suppliers (of inputs) and down stream distribution channel and customers (of out puts). The concept of linkages can then be extended to interrelationships between supplier or customer value chain activities and the value chain activities of the organization.