TECHNOLOGY

COMMERCIALIZATION
BEST MANAGEMENT
PRACTICES
JAMALUDIN ABU BAKAR
SENIOR MANAGER
MARDITECH CORPORATION SDN BHD

18-06-2012

MARDITECH
PRESENTATION OUTLINE

 FRAMEWORKS OF TECHNOLOGY
COMMERCIALIZATION

 CASE STUDY -- OMEGA-3 EGGS

 LESSONS LEARNED

 CONCLUSION

MARDITECH
  Although R&D is regarded crucial to economic progress & wealth
creation, R&D commercialization is still elusive and R&D findings
conversion into winning products and processes in market place is
a challenging issue
 The challenge is enormous– 13 ideas, 1 success

ATTRITION CURVE OF NEW PRODUCTS

13 IDEAS

1 SUCCESS

SCREENING BUSINESS DEVELOPMENT TESTING COMMERCIALIZATIO

ANALYSIS N

SOURCE- COOPER (1993) WINNING AT NEW PRODUCTS

MARDITECH
2. FRAMEWORK OF TECHNOLOGY
COMMERCIALIZATION

2.1 ROUTES OF COMMERCIALIZATION

 Many options to choose from
 Can be viewed from two perspectives:
 Sharing/ control of technology

 Risk/ reward Approach

MARDITECH
 TECHNOLOGY SHARING/ CONTROL APPROACH

COMPLETE
THE EXTENT OF TECHNOLOGY
3. Joint-venture
4. Making & selling with license to use
1. Publication
5. Licensing rights to make, use and sell

6. Franchising technology-based
services
2. Multiple non-
B D exclusive licenses
SHARING

A C
7. Value-added reseller
11. Making & selling end products
relationship
10. Service provider
8. Exclusive
9. Leasing equipment & components distributorship

NONE
HIGH THE EXTENT OF CONTROL OVER TECHNOLOGY LOW
UTILIZATION
Commercializing New Technologies: Getting from Mind to Market by Vijay K. Jolly (1997)

MARDITECH
 REWARD

SALE

STRATEGIC
ALLIANCE

LICENSING

JOINT VENTURE
RISK/ REWARD APPROACH

ACQUISITION

NEW VENTURES
RISK

MARDITECH
DECISION-MAKING PROCESS
 Which route to take may be a unique decision
that varies from company to company.

 To facilitate, decision making process, may use a

model developed by Sullivan (2000)
 2.2. COMMERCIALIZATION DECISION
PROCESS
RM

OWN VENTURE/
NO START-UP

Are competitors better YES

positioned to exploit
NO Opportunity to catch NO
opprtunity ?
up ?
JOINT
YES
NO VENTURE/
Are critical assets NO Are resources to build
IP asset fully STRATEGIC
available in-house ? ALLIANCE
available ?
YES
Does commercialization NO
NO Can need for specific LICENSIN
require specific IP asset be created ? G
complimentary assets?
YES NO STORE
NO Is adequate IP
Is IP protection an issue
protection available?
?
YES
Meet market needs ?
NO STORE
INNOVATIO
N
SOURCE– SULLIVAN (2000) VALUE-DRIVEN INTELLECTUAL
CAPITAL
MARDITECH
2.3. INTEGRATION OF CAPITALS/
ASSETS
 Requires integration of variety of assets:
 Intellectual Capital
 Structural Capital
 Business Assets BUSINESS ASSETS

MANUFACTURING
INTELLECTUAL
CAPITAL

DISTRIBUTION
HUMAN INTELLECTUA

SALES FORCE
CAPABILITIES
L ASSET
CAPITA RM

FACILITIES
L

STRUCTURAL CAPITAL

SOURCE– SULLIVAN (2000) VALUE-DRIVEN INTELLECTUAL CAPITAL MARDITECH

INTELLECTUAL CAPITAL MANAGEMENT: COMPOSITE VIEW
1. Intellectual Capital 3. Business Assets
Complimentary Assets
Human Capital Intellectual Assets
Manufacturing
Knowledge Drawings Marketing
Skills Distribution
Publications
Creativity
Data
Experience
Intellectual Property Intangible Assets

Patents Reputation
Copyrights Brands
EARNINGS
Trade Goodwill
RM
secrets
2. Structural Capital Trademarks
Organisational Asset
Structure Physical Assets
Procedure Financial SOURCE: SULLIVAN
(1998), Profiting From
Routines Plant Intellectual Capital p. 92
Culture Buildings

MARDITECH
MARDITECH EXPERIENCES
LICENSING JOINT CONSULTANCY
VENTURES/
START-UPS
Omega-3 & selenium Registered new Food processing/
(designer) eggs variety paddy seeds products
Foliar Fertilizer New variety chilli Crop cultivation
formulation seeds
Production of biotech Traditional Livestock
enzyme Convenience Food
Production of Plastic knapsack- INTERNATIONAL
pesticide residue bio- sprayer CONSULTING---
sensor •Nigeria
•Syria
•Afghanistan
•Zimbabwe
•Qatar
•Uganda
MARDITECH
 Factory system developed / upgraded

Tacara Sdn. Bhd Centrifugal Process Sdn. Bhd. Mentari Corporation Sdn. Bhd.
- Semi refined carrageenan - Fruit Juice, Puree - Pastry based products

YBH Products Sdn. Bhd. -

Nada Food Sdn. Bhd. - Noodle, Sal’s Food Industries Sdn.
Fruit Juice, Fruit Cordial
Kuey Teow Bhd. - Retort Pouch Products
MARDITECH
CASE STUDY : OMEGA-3 EGGS
EVENTS
 IRPA PROJECT: 1994-1996
 PUBLIC DISCLOSURE:
 Wong, H. K. (1997).Specialty Eggs for the Health Conscious,
Proc. Asian Food Technology Sem. ‘97 (6-7 Oct 1997)
 NEGOTIATION WITH 4 INTERESTED PARTIES: 1998
 LICENSING AGREEMENT: LTK Melaka Sdn Bhd. 1st
August 1998
 UPSCALING FROM 300 LAYERS TO 10,000 LAYERS
 LAUNCHING – 14 JULY 1999
 LTKM BHD SECOND BOARD LISTING – 28TH MARCH
2000
 NEW PRODUCT AGREEMENT – OCTOBER 2003

MARDITECH
INTEGRATION OF ASSETS

BUSINESS ASSETS

INTELLECTUAL

FACILITIES- 200 HA

RAEDY LOGISTICS
MANUFACTURING
CAPITAL INTELLECTUA
HUMAN RM

SALES FORCE–
CAPABILITIES–
L ASSET –

DISTRIBUTION
CAPITAL- IRPA 12

READY TEAM
PROJECT
- LTK + 1994-1996 MI
MARDITE L.
CH +

FARM
MARDI

STRUCTURAL CAPITAL
LTK MELAKA SDN BHD, going to second board ‘LTKM
BERHAD’

SOURCE– SULLIVAN (2000) VALUE-DRIVEN INTELLECTUAL MARDITECH

CAPITAL
STRUCTURAL / BUSINESS ASSETS

MARDITECH
GOODWILL/ LOGO AS INTANGIBLE
ASSETS

• LICENSED BY MARDITECH
• HALAL LOGO
•VEGETARIAN LOGO

MARDITECH
THE RESULT

MARDITECH
LESSONS LEARNED
 Exploiting unmet customer needs
 RM 997.01 million (1999) ex-farm value
 300 eggs per capita consumption, among world
highest
 Using technology to re-position ‘commodity‘
products
 From eggs to ‘designer eggs’, customised tray, tagline
‘friendly to your heart’, customer education
 Synergizing/ syndication of assets through
‘technology licensing’
 Derivative new product developments/ innovative
to be competitive
MARDITECH
‘UNEXPECTED’ MARKET RESPONSE
 ‘Me-too’ products from 10 competitors after 1
year in the market, through
 own-trial
 Foreign licensing
 Free riders of other ‘omega-3’ products
 Powdered/ infant milk
 Soyabean drink

MARDITECH
CONCLUSION
 Integration of three main assets are vital for
success of technology commercialization
 Intellectual assets
 Structural assets
 Business assets
 Frameworks and tools available to assist
management to plan and execute technology
commercialization
 Need to pre-empt / prepare for market response

 Technology licensor/licensee as strategic,

synergistic and long term relationship

MARDITECH