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TECHNOLOGY TRANSFER AT THE U.S. NATIONAL LABORATORIES

A Framework for Evaluation

BARRY BOZEMAN

Syracuse University

MAUREEN FELLOWS

College of Environmental Science and Forestry, State University of New York, Syracuse

INTRODUCTION
In general, the process of commercializing intellectual In the rush to bring technology down from the fed-
property is very complex, highly risky, takes a long time, eral laboratory shelf to industry’s bench, only limited
cost much more than you think it will, and usually fails. attention has been given to assessment of particular
(U.S. Congress, Committee on Science and Technology,
approaches and local effects. Systematic assessment of
1985, p. 12)
technology transfer effectiveness in government frame-
Although the government laboratory role in domestic work for technology transfer and, related, lack of con-
technology transfer is not new (Harding, 1947), it has sensus on the meaning of technology transfer. For the
recently been the focus of renewed attention. Interest in most part, opinions about the success of technology
technology transfer accelerated after the passage, in transfer policies is more a result of casual observation
1980, of the Stevenson-Wydler Technological Innova- than systematic inquiry.
tion Act (1980). As a result of this Act and a series of Our paper focuses on technology transfer at a special
subsequent technology transfer policy initiatives, the and, in some respects, unique set of government labo-
federal laboratories have turned from relatively dispas- ratories, the Department of Energy’s multiprogram na-
sionate purveyors of basic and applied science to more tional laboratories, Brookhaven National Laboratory,
aggressive technology salesmen. The customary role of to illustrate technology transfer activities and prob-
providing research in the public domain has been sup- lems (Technology and Information Policy Program,
plemented by experiments in patenting, licensing, em- 1985). From this backdrop, we develop an evaluation
ployee spin-offs, and limited partnerships. framework.

THE NATIONAL LABORATORY SYSTEM: TRADITION AND TRANSITION

The U.S. Department of Energy multiprogram labora- of $4.4 billion, the multiprogram laboratories consti-
tories are among the largest federal laboratories. With tute a major source of basic and applied science in the
more than 40,000 employees and a total budget in excess U.S. of research and development (R&D) institutions

The authors gratefully acknowledge the support of the U.S. Department of Energy’s Division of Material Science who provided funds to support
the case studies presented in this paper. An earlier version of this paper was a report of the Technology and Information Policy Program’s
Workshop on Technology Transfer. Contributors of the workshop included William Burke, Mark Gregor, Sallie Hinz, Leo Kotas, Phillip
Schuller, James Sullivan, and Jon Thomson. Each provided case study information used here. Our colleague Walter Meyer provided valu-
able advice and contributed to the case analysis and interviews.
Requests for reprints should be sent to Barry Bozeman, Syracuse University, Technology and Information Policy Program, The Maxwell
School, 103 College Place, Syracuse, NY 13244-4010.

65
66 BARRY BOZEMAN and MAUREEN FELLOWS

(U.S. Department of Energy, 1986). These laboratories, property. Still, if the Ames role statement is not entirely
usually referred to as the “national laboratories,” in- appropriate for other multiprogram DOE laboratories
clude Ames Laboratory, Argonne National Laboratory, it is generally representative.
Brookhaven National Laboratory, Lawrence Berkeley The impact of technology transfer policies on the
Laboratory, Lawrence Livermore National Laboratory, national laboratories can be interpreted in any of several
Los Alamos National Laboratory, Oak Ridge National ways including a means of revitalizing the laboratories,
Laboratory, Pacific Northwest Laboratory, and Sandia an effort to generate new resources, or as a rethinking
National Laboratory. of the basic role of the national laboratories. Perhaps
Government research laboratories have a long history the fundamental question is whether the increased
in the United States, but the multi-program national focus on technology transfer and development is a
laboratory is an institution of recent vintage. The Man- “neutral” increment to labs’ traditional activities or a
hattan atomic bomb project demonstrated the potential disruptive competitor.
effectiveness of focused, team-oriented “big science”
Recent Evolution of the National Laboratories
and the national laboratory seemed an especially appro-
With the advent of the Reagan administration, the
priate means of exploiting nondefense applications of
national laboratories were hit by a two-pronged attack.
nuclear research. The national laboratories grew under
First, it was argued that the sizable investment in
the umbrella of the Atomic Energy Commission and
energy, particularly alternative energy sources, was not
began early in their histories to diversify. Even as early
as easily rationalized in an era of oil glut. Second, a
as the late 195Os, the national laboratories could be
President who campaigned on a platform of private
adequately described as diverse, multidisciplinary re-
sector initiative and who sought to systematically dis-
search installations. By that time the 8 labs were viewed
mantle “big government” (including an attempt to
not only as a means of mining the rich scientific vein of
decommission the Department of Energy) was not a
nuclear physics, but as national scientific assets sup-
strong supporter of the national labs.
porting research in many disciplines.
As any institution faced with a crisis environment,
Despite the variance among federal laboratories,
the national laboratories sought adaptive strategies.
there is little risk in asserting that basic science activities
One major strategy was, in a sense, forced upon them
that have traditionally dominated the national labora-
(though not as entirely unwilling recipients). The “pri-
tories are still at the forefront. Technology develop-
vatization” and private sector focus of the Reagan ad-
ment and transfer has, for the most part, been viewed
ministration suggested (and public policy required) a
a poor cousin. The role statement of the Ames Labo-
strategy of cooperation with industry and service to
ratory is illustrative in that it reflects the traditional
industry.
basic research thrust of the national laboratories.
A snapshot of today’s national laboratories depicts
a set of organizations in flux, identifying new oppor-
The Ames Laboratory’s role is to conduct basic research
tunities and reconsidering their role in the Department
in the . . sciences which underlie energy generating and
other technologies essential to national interests. The La- of Energy, the federal government and the scientific
boratory’s role differs from the general university role in community. The original mission of the Lawrence
that the Laboratory will conduct mission-oriented, inter- Livermore National Laboratory was to develop ther-
disciplinary and collaborative research . . . (and) from monuclear explosives. Yet, today, the laboratory has
industrial research because the Laboratory conduct opens
one of the most important capabilities for the recovery
research that is not expected to support a viable commer-
cial enterprise within 5-10 years. (Ames National Labora- of oil from shale deposits and gas from coal deposits.
tory, 1984) Increasingly, the national labs are becoming spawning
grounds for technology-based start-ups. From Oak
This role statement does not precisely fit other national Ridge’s inception during World War II until 1980, 20
laboratories. For example, Oak Ridge National Labo- companies started up with technology developed at the
ratory has for several years been more involved than lab (Blanchard and McDonald, 1986). In the following
most national labs in research work with considerable four years there were more than 30 such spin-offs.
short-term commercial potential. For example, Oak Other national laboratories are, likewise, jumping on
Ridge welcomes private sponsorship of proprietary the commercialization bandwagon. The issue is how to
R&D. A number of companies, including Cobalt, Ho- be market savvy and, at the same time, scientifically
mogeneous Metals, and Universal Cyclops, are paying sound (Bozeman & Crow, 1985; U.S. Congress, Com-
the lab to develop a new class of alloys with a unique mittee on Science and Technology, 1985).

NATIONAL LABORATORY TECHNOLOGY TRANSFER POLICIES

Perhaps the major policy impetus to an expanded role Stevenson-Wydler Technological Innovation Act
of technology transfer at federal laboratories is the (1980). Prior to this act, federal agencies (with the
 A Framework 67

exception of NASA) were not explicitly required to en- and inventions produced by federal laboratories or with
gage in technology transfer activities. The Stevenson- federal funding have been in the public domain. The
Wydler Act directs the agencies “to ensure the full use reasoning was that tax dollars financed the research
of the results of the nation’s federal investment in and, thus, private parties should not be allowed special
research and development.” To implement this, the law claim to publicly supported work. While this practice
creates an elaborate procedure: it calls for each federal may have served some fairness principle, it seemed not
lab to set up an Office of Research and Technology to serve technology transfer. The Bayh-Dole Act
Application to identify ideas and technologies with altered rights of disposition such that small businesses
commercial potential. Once found, information about and non-profit organizations (including universities)
those concepts is to be sent to a newly organized Cen- could retain title to inventions produced by themselves
ter for the Utilization of Federal Technology at the with federal funds. Additional patent amendments were
Commerce Department’s National Technical Informa- enacted in 1984, including provisions expanding the
tion Service. NTIS is responsible for collecting and dis- commercial authority of the national laboratories (Uni-
seminating information about federally funded R&D to form Patent and Procedures Act of 1983, 1984).
possible users. Policy and institutional changes suggest that federal
Under the Act, federal agencies which operate or laboratories, including those traditionally driven by
direct laboratories are required to make available at basic science, are beginning to include technology
least 0.5% of the agency’s R&D budget to support transfer as a significant part of their mission. But,
technology transfer functions of the ORTA’s. The lab- descriptions of policies and institutions provide only the
oratories have also been affected by Section 13 of the roughest outline of actual practice. In part this is be-
Act which enables personnel exchanges among federal cause, as those involved in technology transfer are fond
laboratory, industry and university scientific and tech- of saying, technology transfer is most often people-
nical personnel. Section II allows for cooperative to-people (Schmitt, 1984). Just as important, the sub-
research and development agreements where royalties stance of Stevenson-Wydler, Bayh-Dole, and the
will pass through to the laboratories rather than the various patent amendments does not always mirror
treasury. practice. For example, some of the programs under
In a recent amendment to the Act, the federal lab- Stevenson-Wydler have not been implemented because
oratory Consortium for Technology Transfer was funding has not been made available. And there is great
formally established within the National Bureau of variance among the laboratories in their attitudes and
Standards (Federal Technology Transfer Act of 1986). interests concerning technology transfer. Even now,
The Consortium is not new. Since 1971 it has been 49% of the federal laboratories have only one part-time
engaged, on an informal basis, in moving R&D tech- person assigned to technology transfer functions and
nology developed specifically by federal labs to local only 26% have an articulated in-house set of policies
governments and commercial companies. Before the and procedures for technology transfer.’ Perceptions
recent change provided by the amendment, the Consor- of barriers to technology transfer continue. The need
tium was a loose federation of technology transfer for systematic evaluation of technology transfer policies
agents representing 11 federal agencies and the major- and activities is becoming more and more apparent.
ity of federal laboratories, including the national labs. However, the evaluation of technology transfer is com-
The consortium includes more than 100 representatives plicated by the absence of an evaluative framework.
from federal laboratories, including the ORTA direc- The next section uses cases developed in a study of
tors, and is chiefly concerned with developing commu- technology transfer at Brookhaven National Labora-
nications networks to facilitate technology transfer. tory (BNL) to construct a conceptual framework for
The Bayh-Dole Act of 1980, has also had a note- the assessment of technology transfer (Technology and
worthy effect on technology transfer practices and poli- Information Policy Program, 1985).
cies of federal laboratories. Traditionally, R&D results

A TYPOLOGY OF TECHNOLOGY TRANSFER ACTIVITIES

ATBROOKHAVENNATIONALLABORATORY
Perhaps the greatest obstacle to effective assessment of sify activities viewed by the national laboratory and
technology transfer is that the term technology transfer DOE personnel as falling under the general heading of
has so many uses. No effective assessment is possible in
the absence of some agreement as to what is being
‘The results of FLC survey of 69 technical facihties of nine federal
assessed.
agencies are reported in Eugene Stark’s (1985) testimony before the
Case studies recently undertaken (Technology and House Subcommittee on Science, Research and Technology, Hear-
Information Policy Program, 1985) permit us to clas- lngs on Technology Transfer, May 21, 1985.
68 BARRY BOZEMAN and MAUREEN FELLOWS

technology transfer. A list of (partly overlapping) mentation needs in basic research led to technology
“technology transfer” activities includes: development and, shortly thereafter, transfer.
The suppliers were motivated to accept the contract
1. Transfer of physical technology (i.e., a technologi- to produce the needed wire for BNL uses. BNL and
cal device or prototype), other research labs would be able to use their product
2. Transfer of a technological process and product, to conduct further research, thus creating new markets.
3. Provision of technical assistance, Through this process a technical manufacturing capac-
4. Resource sharing and “brokering,” ity was established in industry for the production of
5. Transfer of know-how, superconducting alloys and wire. This became impor-
6. Knowledge transfer. tant later when new product applications, such as med-
ical MRI, were recognized.
The case studies discussed briefly below make clear
In this case of apparently successful transfer of phys-
that the various transfer activities are not neatly separa-
ical technology, BNL researchers made no extraordi-
ble. Though each of the cases is presented as typifying
nary effort to find commercial applications for their
one or another transfer type, each includes more than
work. The three small firms supplying the alloys facili-
one type transfer activity.
tated the technology utilization by seeking to stimulate
Transfer of Physical Technology: market demand beyond the federal labs. The MRI
The Case of Superconductivity Research producers were all high technology firms, and as such
By the early 1970s it became apparent that supercon- kept up with the developments occurring at the labs.
ducting magnets were feasible and research began at The role of BNL and the other labs was in perfecting
BNL on this topic. A collaborative effort began be- the technology. Once this was done, the private sector
tween BNL metallurgists and high energy physicists to employed the technology on its own. This is the way
develop suitable superconducting magnets. Significantly national laboratory technology transfer is “supposed”
(for later technology transfer), magnetic fusion re- to work. But rarely are conditions so felicitous. Con-
searchers also saw the utility of such magnets for sider the case of the superconducting transmission line.
“holding” of superheated plasma and, thus, contributed For several years BNL has undertaken scientifically
to the research. promising research in the area of superconducting
The design and construction of superconducting transmission lines. The focal project, funded by DOE,
magnets to be used in state-of-the-art machines for high sought to develop a 60 Hz AC superconducting line
energy physics and magnetic fusion research required which, with no electrical resistivity, could be an ideal
relatively large amounts of alloys with which to work. means of transmitting electrical power and would elim-
Three small firms were already involved in supercon- inate the need for AC-DC converters. Early in the
ducting technology, through the Small Business Inno- research the chief technological barrier to the develop-
vation Research program started at DOE in 1978. ment of the line when a means of minimizing AC loss
These firms were: Intermagnetics General Corporation, 60 Hz transmission was perfected through a technique
Supercon, and Magnetics Corporation of America. of smoothing superconducting wire surfaces where AC
These firms were contacted to produce the needed wire. loss occurred.
In the earlier efforts, niobium titanium (NiTi) was Given the “technological sweetness” of the resulting
needed for extrusion into wire for the magnets. Later device, BNL sponsored conferences and meetings with
work used niobium tin (Ni3Sn) for this purpose as well. the electrical utility industry to keep them informed of
This fabrication was done with explicit lab instructions BNL work on this project. Industry representatives,
to meet the required specifications, and the firm’s consultants, and others were invited to several meetings
research roles were quite limited in the development of and conferences sponsored by BNL in an effort to pro-
the alloys. The first large scale commercialization of mote technology transfer for the transmission line.
superconducting technology occurred in 1981. Busi- Interest in the technology has been minimal. The
nesses involved in magnetic resonance imaging (MRI) OPEC oil embargo of 1973 initiated the “Energy Cri-
employing conventional copper magnet methods recog- sis” of the early and mid 1970s and set off the energy
nized the potential for the use of superconducting mag- conservation movement directed at all forms of energy.
nets with NbTi wiring towards the development of The accompanying slump of electricity demands was
non-invasive diagnostic tools which exceed the capabil- and still remains a major factor blocking the transfer of
ities of the CAT scanner. The stability of magnetic field the transmission line technology to the utilities.
provided much improved resolution while posing no
ascertainable potential health risks. Transfer of Technological Process:
Typical of BNL transfers of physical technology, the The Case of Polymer Insulation
initial motivation came from interests related to basic A need for an effective insulating material arose during
research and knowledge transfer. In this case, instru- research aimed at developing superconducting transmis-
 A Framework 69

sion line at BNL. This material was needed to exclude great as one mile. The principal investigator, Dr. Carl
the entry of environmental heat into the liquid helium Flateau, had an interest in furthering the development
coolant layer of the line. The Kraft paper insulation and commercialization of the technology but funding
that had been the predominant material used for many was cut soon after a workable device was produced.
years on conventional ambient temperature long dis- During a period of seven years after this funding cut
tance transmission cables was prone to brittleness and Flateau periodically consulted on a variety of projects
frequent breaks. related to this robotics work including nuclear applica-
Work at BNL lead to a synthetic polymer tape as tions and the manipulator arm of the space shuttle even
well as a new wrapping technology which both met though he was not working on robotics for BNL. BNL
insulation requirements and reduced AC loss. In a facilitated his consulting activities, however, by provid-
sense then two technologies, a product and a process, ing full institutional support on legal considerations
have been developed. BNL had as a result another and encouraging consulting as long as it did not inter-
product, the insulation tape, and process, the wrapping fere with the scientists’ regular duties.
technique, which could be transferred to the utility As Flateau was consulting for the Los Alamos
industry. National Laboratory (LANL), LANL decided to ac-
Currently the Empire State Electric Energy Research quire an arm built to the specification recommended by
Corporation (ESEERCO), an organization funded by Flateau and solicited bids for the construction of the
the six New York State electrical power utilities, is arm. After seeking procedural and legal advice from
funding a collaborative development effort to demon- BNL, Flateau submitted a bid on behalf of his (at the
strate and assess the actual commercial and technical time nonexistent) corporation which did not yet exist.
potential of the polymer tape insulation and the wrap- Flateau won the contract, created a new corporation,
ping technique. and within two days left BNL in good standing.
Many of the same actors that were involved in devel- Interviews at BNL revealed considerable variation in
opment of the transmission line technology are also staffs’ view about BNL’s role in respect to employee
involved in development of this product, the tape, and spin-offs. Some felt that employee spin-offs of the type
process (the wrapping technique). Many of the same illustrated in this case are quite desirable and in many
approaches to transfer are taken here, including confer- respects the ultimate technology transfer success. Others
ences, informal meetings, publication, and circulation felt that such activities are destructive to the long-range
of technical reports. Why is the study of the transmis- objectives of BNL or that it is unfair for BNL scien-
sion line a study in “nontransfer” whereas this case tists, all of whom are public employees, to exploit their
illustrates transfer of both product and process? Ac- position in this manner.
cording William Marcuse, director of the BNL Office
of Research and Technology Applications, the market Resource Sharing and Brokering: Research at
for the synthetic polymer tape insulation may be in the the National Synchrotron Light Source
5 to 10 million dollar per-year range. The major differ- The National Synchrotron Light Source (NSLS) at
ences between the transmission line situation and that Brookhaven National Lab represents the cutting edge
of the polymer insulation situation is a greater incentive of science and technology. It is a truly national facility
for the utility industry to invest in the new technologies. used simultaneously by major universities, government
laboratories, and industry in an amazing range of
Transfer of Know-how: applications from telecommunications to biomedical to
The Case of the Remotely Operated Arm high energy physics research. AT&T, IBM, Office of
BNL and other national laboratories concern them- Naval Research, Johns Hopkins Medical Center, and
selves with the transfer of know-how, usually the kind BNL staff work side-by-side on ports connected to the
of technological know-how embodied in individuals. ring that provides the highest speed controlled light
The transfer of know-how most often takes the form of available in the world. Transfer of knowledge and tech-
arranging for university or industrial scientists to work nology takes place among ports, disciplines, and insti-
for a period at BNL and then return to their original tutions. BNL makes policies for sharing the resource
work site with additional know-how gained during their but also acts as a technology broker using both formal
BNL stay. The case of the remotely operated arm is an and informal mechanisms to bring users together.
interesting exception to the normal patterns for trans- The functional research units at the NSLS are
ferring know-how. referred to as participatory research teams (PRT). The
The remotely operated arm is one of the major tech- members of any particular PRT do not do identical
nological innovations produced in recent years by BNL research but they use the same basic techniques and
staff. The arm is an enhancement to robot technology equipment setup. There are two methods of creating a
in that it enables the operator to “feel” what the robot PRT. The first is a formal method by which the lab
is touching and to operate the arm from a distance as strategies what type of research and techniques it will
70 BARRY BOZEMAN and MAUREEN FELLOWS

pursue in the future and then sends out invitations to their findings through the same channels. There is con-
scientists to participate in research of common interest. stant communication between X-18A and the other
The second is an informal method by which a small ports on the ring. Equipment is shared between ports.
group with common interests gets together and then In addition to the daily interaction between ports there
contacts other potential researchers for a strategy meet- is daily interaction between the administrators of the
ing. At the meeting a core group is formed. Each per- light source and individual ports. This interaction is
son in the core group is assigned responsibility for a two-way with the beam administrators advising the
specific portion of the project. In a few cases the PRT ports on how to solve problems and the ports giving the
is composed by a single research organization. administrators information that will ultimately lead to
The PRT at port X-18 consists of members from the improvement of the light source.
Purdue University, Iowa State University, The Univer-
sity of Missouri, The University of Illinois, North- Provision of Technical Assistance: The Case
western University, and Argonne National Lab. Purdue of Three Mile Island Corrosion Research
has the primary contract with Brookhaven. Other Stress corrosion cracking in Inconel (a nickel-based
members of the PRT have made essentially equal com- alloy that also contains chromium and iron) tubing has
mitments to the port in terms of time and resources. been a widespread problem in pressurized water nuclear
The majority of the funding for the port comes from reactors. A particularly acute Inconel corrosion prob-
Department of Energy grants. A smaller portion of lem occurred in 1981 at TM1 reactor number one. Fol-
funding comes from the National Science Foundation lowing a scheduled maintenance shutdown, numerous
and university grants. cracks began to appear in the Inconel tubes of the reac-
The governing body of the PRT (formed only two tor’s heat exchanger. This cracking resulted in leaks,
months before our case study) is an executive council allowing radioactive primary water to contaminate
that meets twice annually to set policy and procedure clean secondary water. The utility needed to remedy the
for the PRT. A fixed schedule is produced with each situation as rapidly as possible to avoid a costly shut-
member of the PRT being allocated time in one to two down that would involved replacing a large amount of
week blocks. tubing.
The first two years of the operation of X-18 consti- Several researchers in the BNL corrosion group had
tute a commissioning period during which time the been studying corrosion cracking in stainless steel, a
PRT members are allowed to use 100% of the beam metal quite similar to Inconel. Sulfate anions, particu-
time. After the two year period 25% of the beam time larly thiosulfate were known to cause corrosion crack-
at X-18 will be researched for general purpose research ing in both Inconel and stainless steel tubing. Although
as designated by Brookhaven. At the present time the TM1 operators and NRC officials originally believed
port is utilized approximately 90% of the total avail- that existing valves prevented thiosulfate from con-
able beam time. Dean Chapman, a researcher from taminating the Inconel tubing in the reactor’s heat
Purdue, has been the on site administrator of the port exchanger, consultation with the corrosion group estab-
during the set up stage. He will remain on site to lished that thiosulfate was in fact the problem. Re-
administer the port and orient new users to the use of search was subsequently undertaken at BNL which
the facilities. determined that the same treatment used in the group’s
No proprietary research is done at X-18A. This is a basic research on stainless steel would also inhibit cor-
necessary condition for the PRT to continue to receive rosion of the Inconel tubes. By adding lithium hydrox-
funding from the Department of Energy. At NSLS, ide in a 20 to 1 ratio to the thiosulfate in the tubing, the
much of the transfer of knowledge is informal. Re- contaminant became sufficiently diluted to inhibit crack-
searchers at the port are encouraged to obtain new ing. The corrosion group presented a formal report to
information from other researchers, meetings and jour- the NRC, and the treatment was then applied success-
nals. The researchers are encouraged to disseminate fully at the TM1 reactor.

A CONCEPTUAL FRAMEWORK FOR ASSESSING TECHNOLOGY TRANSFER

The BNL case studies underscore the point that govern- The “Out-the-Door” Model of Transfer Success
ment laboratories are involved in diverse transfer activ- Figure 1 depicts the “out-the-door” model, including
ities. We argue that an assessment of technology the categories of variables entailed in assessment by this
transfer activity must cope not only with the fact that model’s criterion. The assumption of the out-the-door
technology transfer modes differ but that criteria for model-that transfer equates with success-reflects the
transfer success differ. In this section we identify realities of policy-making and evaluation more than the
classes of variables that seem to us to moderate trans- personal views of parties involved in technology trans-
fer success. fer. The evaluation of technology transfer entails signif-
 A Framework 71

Transfer Technology Technology Technology

Agent Product Mechanism Recipient

Transfer

Figure 1. “Out-the-door” definition of effectiveness.

icant problems and, by default, leaves the out-the-door energy demand and only indirectly related to the tech-
model as the only measure of success. Other approaches nical advantage of the new product sometimes play a
to assessing technology transfer require a considerable central role in commercial success.
understanding of the dynamics of technology transfer From another perspective, however, the market
as they relate to commercial success and the flow of model is appropriate for the laboratory. If government
business at the laboratory producing the technology laboratories are serious about their technologies having
product or process. Moreover, the laboratory has some an impact on industry, then they can attempt to
significant role in the actual transfer of the technology, develop greater expertise in sizing up the market for a
but it often has little effect on developments that occur technology.’
after the transfer. For example, in the remotely op-
The Political Model of Transfer Success
erated arm case, Dr. Flateau’s company initially faced
Many of the individuals we interviewed during our case
serious problems in developing adequate venture capi-
studies made oblique reference to the use of technology
tal. The technology “worked,” it had been transferred,
transfer as a rationale for greater political support and
neither BNL nor LANL could contribute to the res-
a few were more direct in this observation. Figure 3
olution of the venture capital problem. Thus, it is un-
depicts the reasoning behind this model.
derstandable if, from a laboratory perspective, the
Three possible avenues to political reward are
out-the-door model of technology transfer is substi-
depicted here, some are more realistic than others. In
tuted for market model.
the least likely of results, the laboratory is rewarded
because the technology it has transferred has consider-
The Market Model of Transfer Success
able national or regional socio-economic impact (mag-
The market model (Figure 2) is quite similar to the out-
netic resonance imaging may be such an example), the
the-door model, except for one critical element: the
laboratory’s role in developing and transferring the
assumption that transfer success requires that the trans-
technology is recognized by policy superiors in the
ferred product or process be commercially viable and
legislative or executive branch, and additional funding
contribute at some point to the firm’s profitability. Vir-
increments are received. This is an unlikely event
tually everyone interviewed agreed that commercial suc-
because few technologies have such impact, because the
cess is the acid test of the government laboratories’
laboratories role may be lost sight of (particularly if the
transfer to industry. And in seat-the-pants assessments
made by individuals the market model dominates. Still, ‘Several laboratories have already begun to do thi\. In mformal
there is the problem that the laboratory has little direct remark? made at the Matwal Sciences Director’s Meetmgs at Sandra
control of the diverse factors that control market suc- NatIonal Laboratory m October, 1985. the Director of the Oak Ridge
cess, such factors as the capitalization of the firm, the National Laboratory Oftice of Research and Technology Apphcations
described ORNL’s actiwtier m market astes?ment of technology.
firm’s manufacturing capabilities, its marketing savvy,
ORNL has contracted wrh wch orgamzations as Stanford RrsearLh
and so forth. Likewise, as was demonstrated in the Inxlrute to assess the market potential of ORNL-developed technol-
superconducting transmission line case, environmental ogles. The problem here is that the assessments are time-consummg
factors beyond the firm’s control (such as reduced and costly (beginmnp at about $35,000).
72 BARRY BOZEMAN and MAUREEN FELLOWS

Figure 2. Market definition of effectiveness.

0 Commercial
success

I 1 I I

I
I
Increased
Funding t
I
_........._....
i
I
Policy
Superior c
I
1---11---
1
I
I i i I
--------

Transferr . . . . . . . . . . _..._..Y& ,...__. _._ ___I 4,

Agent
t
--.---------- Indicates important steps not depicted
- - - - - - Represents Actor
- - - - - * Represents Outcome

Figure 3. Political definition of effectiveness.

impacts are long after the transfer and development technology transfer, if they are taken from other lab-
activity) and, most important, budgeting processes oratory activities, must be balanced against forgone
rarely work in that manner. It is also possible that the opportunities. Many of the people we interviewed,
transfer recipient, the firm benefiting from the product especially bench-level scientists, expressed some concern
or process (or know-how or resource) will communicate that the national laboratories are being deflected from
its satisfaction to policy-makers and, in turn, policy- their (in their view) most important mission-produc-
makers will reward the laboratory. This is perhaps a bit ing basic research for the public domain. Figure 4
more likely but, again, is inconsistent with the usual depicts the opportunity cost model.
patterns of budgetary policy-making and agency-level The model views laboratory goals in terms of three
resource allocation. activities, technology transfer, knowledge transfer (i.e.,
The most important claim for the political model is generation and dissemination of fundamental scientific
that the laboratory will be rewarded for the appearance knowledge), and “other,” which might include adminis-
of active and aggressive pursuit of technology transfer, trative support, capacity-building, and, generally, the
apart from any particular transfer successes. This does, development of “scientific infrastructures.” The oppor-
in fact, seem plausible, even if the direct returns are tunity cost model is clearly the most difficult to imple-
impossible to gauge. ment in any systematic manner. Some of the problems
it poses include: (a) determining the net benefit of basic
The Opportunity Cost Model of Transfer Success research (a classic problem still unresolved by science
Technology transfer success is only one of the goals of policy analysts), (b) analytically separating the obvi-
the national laboratories and the resources spent on ously intertwined activities of science, scientific support
 A Framework 13

Lab Technology
Resource Transfer
Utilization Activity

K Y
Figure 4. “Opportunity cost” definition of effectiveness.

and technological delivery, (c) determining a wide vari- in the discussion of the relation of knowledge transfer
ety of potential interaction effects. Thus, we present the to technology transfer, one must consider the lab’s
opportunity cost model not as a candidate for system- technoscience niche. What we mean by that is that
atic evaluation design (the state-of-the-art does not some laboratories do some things well and others poorly
enable such sophisticated design), but as a set of as- and technology transfer is likely to be more successful
sumptions which must somehow be reckoned with. if the approach taken is consistent with the niche. Thus,
We feel that the cases presented above demonstrate most of the national laboratories are positioned to
(if any further demonstration were necessary) that basic derive technology transfer success from projects (such
science is often salutary to technology transfer. How- as polymer insulation or the remote-operating arm) that
ever, our cases do not shed light on the contribution of are ancillary to basic research or (such as magnetic res-
technology transfer activity to basic research. In light onance imaging)- flow directly from basic research.
of the fact that hundreds of industrial and government This option is not available to most laboratories (since
laboratories are involved, first and foremost, in pro- most are not significantly involved in basic research).
ducing technological innovations, and that only a rel- Also, a focus at the national labs on technology trans-
ative few are contributing significantly to basic fer activities that complement basic scientific research
research, there is some potential at least for technology means that the technoscience niche of the laboratories
transfer activities to disrupt the unique and essential is not dramatically changed.
contributions of the national laboratories.
Transfer Type
Transfer Contingencies The transfer type (e.g., physical device, know-how) is
Table 1 presents our framework for assessing technol- a major contingency in determining approach and suc-
ogy transfer activities in government laboratories. The cess of transfer. The point, obvious as it seems, is
model recognizes the need for more than one criterion worth underscoring if one considers that policy-makers
for evaluating transfer success and identifies factors and many laboratory personnel often fail to distinguish
that seem to us likely determinants of transfer success. (in discussion and policy deliberations) among transfer
Most of the categories of variables require little elabo- types. The term technology transfer is used ambigu-
ration at this point, but some have particular implica- ously and this ambiguity can confuse efforts to evalu-
tions within the national laboratory context. ate or enhance transfer effectiveness.

Characteristics of the Transfer Agent Transfer Product Attributes

Laboratories of different types, different transfer Three characteristics of the transfer product seem espe-
agents, require different approaches to technology cially important to assessment. With proximity to com-
transfer. One expects that government laboratories will, mercial application we ask that question “how much
as a result of their government status and the legal con- additional development work is needed to bring the
straints implied, differ from private agencies in their product to the market?” This is not a distinction
transfer activities. However, there is much variance between basic science and applied and development
among government laboratories and even among the stage. During the last few years it has become clear
small set of national laboratories. As we implied above that some categories of basic research are amenable to
74 BARRY BOZEMAN and MAUREEN FELLOWS

TABLE 1
A FRAMEWORK FOR ASSESSING POLICY CHANGE TRANSFER CONTINGENCY

Defmltlons of Transfer Product

Effecttveness Transfer Agent (Lab) Transfer Type Attnbutes

Out-the-Door Technosctence mche Sclentlfic knowledge Proximity to commercial

application
Market Mission Physical technology
“Directness” of commercial
Opportunity Costs Funding resources Technological design
application

Potential breadth of
Scientific and techmcal Technological know-how application
capabilities
Resource sharing
Entrepreneurial capabilitIes

Communications and
boundary-spannmg

Organization design

PolItIcal constraints and

resources

Transfer Recipient
Transfer Mechanism Attributes Market Contingency

Open literature Scientlflc and technical Demand for product

capabIlIties
Patent Substttutabillty of
Capital and payback products, resources
License
Innovation capacities Life cycle positron of
Informal person-to-person
existing products
Manufacturing
Personnel exchange
capabllltles Appropriateness of
On-site symposia and product
Marketing capabllltles
demonstrations
Geographic locatlon
Start up by lab personnel
Dlverslty

rapid conversion to viable commercial products. Bio- breadth of applications. Our interviews with BNL
technology work comes to mind: today’s genetic engi- scientists indicated that there was sometimes great
neering breakthrough is tomorrow’s wonder drug. What interest among the scientists in technologies which
is particularly important here is the need for applica- seems to have very narrow applications. Such cases are
tions engineering. In the case of the superconducting usually not ideal candidates for laboratory investment
transmission line a considerable degree of applications in the promotion of transfer.
engineering was required. This inflated the level of
investment required and the increased the uncertainty- Transfer Mechanism
a deadly combination in light of the curtailing of en- Since the early days of the Atomic Energy Commis-
ergy demand. The directness of commercial application sion, the national laboratories have been involved in
is a similar concern. The question here is “is the trans- licensing. Recent legislation has somewhat reduced the
fer product to be applied within the development do- barriers to labs’ use of this particular transfer mecha-
main or in an entirely new context?” In the case of the nism. However, the returns to laboratories from their
Three Mile Island corrosion research the direct applica- licensing activities have been minimal, in fact less than
tion was within the domain of nuclear reactor technol- $500,000 during the past three decades.3 The level of
ogy. But there are also potential applications in other effort has not been matched by the returns. However,
domains such as the development of anti-corrosion personnel exchanges and informal person-to-person
materials for consumer application. In most cases, the contacts are by most accounts low cost effective means
movement from one domain to the another great11 of technology transfer.
complicates the transfer process, but of course it can
also greatly expand the value of the transfer. Thus, a ‘Reported during dn mformal meetmg of ORTA director5 and pat-
third of these inter-related factors is the potential cnt attorney\ at Sandia National Laboratory, October. 1985.
 A Framework 15

Transfer Recipient Attributes cess. If there is little demand for the product, if cheaper
The national laboratories do not have any formal substitutes are available, or if the economic returns
mechanism for evaluating the likelihood of any partic- from the product cannot be fully captured (due to pub-
ular transfer recipient’s having the wherewithal to lic goods characteristics of the product), then there is
develop a commercially viable product from a quality high “fizzle out” potential. Much of the basic research
technology transferred by the lab. Naturally, ORTA of the national laboratories leads to little commercial
directors and others make informal assessments of advantage because the knowledge is of sufficient breadth
potential transfer partners but this is not the same as that no one firm can appropriate benefits through the
systematic evaluation. Since the likelihood of success market. This point brings into question a strategy based
(at least by the market model) is at least as dependent on patents. Even if patents are awarded to a firm the
on the firm’s activity as the lab’s technology, this is patent may not be a sufficient protection against other
often a major weakness in technology transfer activities firm’s reverse engineering activities. This explains why
and a major complicating factor in any assessment some seemingly desirable technologies have not lead to
effort. a clamor for patent rights. Many firms are more inter-
ested in developing their own technologies and protect-
Market Contingency
ing them as trade secrets.
A quality technology matched to a capable and well-
heeled firm does not inexorably lead to transfer suc-

CONCLUSIONS
We feel the framework we have developed for assess- that are more than window dressing, and, particularly
ing technology transfer provides a realistic guide to the important, ensure that technology transfer meshes with
requirements for valid evaluation of transfer success. the traditional strengths of the labs, it is time to begin
However, it also underscores the complexities involved to develop more sophisticated understanding of the
in making determinations about the effectiveness of nature and determinants of transfer success. The devel-
technology transfer policies and particular transfers. In opment of cases is useful for enterprises, such as ours,
our view, the tendency of DOE and laboratory officials that aim to suggest a scheme for interpretation or
to rely almost entirely on hunches, conventional wis- guidelines to assessment. But different, more broad-
dom, and the “out-the-door” model of success is under- based approaches will be required to shed any light of
standable. However, if the labs seek to ensure the technology transfer success.
effectiveness of their transfer activities, devise policies

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