Chapter 1:

Management of Technology:
An Overview
 ???
 How AirAsia, Jetstar can offer a fly with lower
price in Airline industry?
 How cellcard( 栅元卡 ) or ebay( 易趣 )
generate income?
 How ANZ Royal Bank penetrate to Cambodia
market?
 Why Kodak failure in film competition?
 How 5 stars hotel sale their service world
wide?
2
 ???
 How Cambodia government provide a visa to tourist
via electronic system?
 How ATM help bank operation?
 How Internet help tour operation and travel agency
to maximize their profit?
 How IBM and Intel sell products online?

All answers will discuss through this course.

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 Introduction
 Technological change is one of the most important sources of change in the
economy.
 The capacity for science and technology in some countries is not been
adequately translated into innovative and dynamic business organization. The
economy remains largely dependent on natural resources, traditional
processing and manufacturing and, for the most part, on imported
technologies.
 A sound scientific and technological base is essential to economic growth in a
competitive international environment.
 With the increasing impact of globalization on business, the scope for
competition is no longer limited by national boundaries or by the definition of
a particular industrial sector.
 Management of technology, innovation and information have also emerged as
key requirements for success in the 21st century enterprise.
 Thus, proper management of technological change, particularly at the
productive enterprise level, has become the most important consideration for
development. 4
 Definition of Technology
 All the knowledge, products, processes, tools,
methods, and systems employed in the creation of
goods or in providing services. [MOT, Tarek M. Khalil
p.1]
 The application of science and engineering to the
development of machines and procedures in order to
enhance or improve human conditions, or at least to
improve human efficiency in some respect. [MS. IT
Dictionary]
 Technology is the technical means people use to
improve their surroundings.
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 Differences between science and
technology
 Science is the study of why natural
things happen the way they do.
 Technology is the use of knowledge to
turn resources into goods and services
that society needs.
 Science and technology affect all
people.

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7
 Why study technology?
 People create technological devices and
systems to satisfy basic needs and
wants.
 Technology is responsible for a great
deal of the progress of the human race.
 Technology is the tools to gain
competitive advantage.

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 Application of Technology

 Technology – linked to improvements in

standards of living
 Enhancement of economic prosperity for
countries, industries and businesses depends
upon the effective MOT
 Technology creates wealth
 Application of technology, not just its
development, is a key to success in the
competitive global economy.
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 Technology and Business

 The goal of an organization is to achieve a

set of objectives
 Pool of knowledge available to society

 Technology adds value to the assets of a

company
 Conversion of resources into goods and

services

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 Classification of Technology

 New technology
 Emerging technology
 High technology
 Low technology
 Medium technology
 Appropriate technology

11
 Management

Process of:
 Planning
 Organizing
 Coordination & Leading and
 Controlling

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 What is MOT ?

 MOT is an interdisciplinary field that

integrates science, engineering, and
management knowledge and practice. [MOT,
Tarek M. Khalil p.7]
 Management of technology refers to the
design and use of the means needed within
organizations achieve economic and social
objectives through technological innovation.

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 Management of Technology
(MOT)

 An interdisciplinary field

NATURAL
SCIENCE

SOCIAL
SCIENCE
ENGINEERING
MOT

INDUSTRIAL
BUSINESS PRACTICE
THEORY

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 The roles of MOT

MOT field helps nation and firms to answer the

following question:
How technologies is created?

How it can be exploited to create business

opportunity?
How to integrated technology with business strategy?

How to use technology gain competitive advantage?

How can technology improve the flexibility of

manufacturing and service systems?

When to enter and abandon technology?

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 Management of Technology:
an entrepreneurial perspective

 Technology itself does not produce commercial results. It is its

application that brings commercial benefits. Such application
comes about due to the activities of “entrepreneurs”.
 Any economy needs “ paper entrepreneurs” and “Product
Entrepreneurs”
Paper entrepreneurs - Trained in law, finance ,
accountancy etc.. manipulate systems in novel ways:
 Establishing joint ventures, holding companies, finding tax
shelters, investing in commodities; going public, etc.
Product entrepreneurs - Engineers and scientists involved
in production, researchers and designers, production
managers, and businessman in produce goods and services
people want.
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 Three important factors

 The creativity factor

 The timing factor

 Managing changes
 (1) Creativity Factor
 Two key performance indicators : Invention and
innovation
 Novelty( 神奇，过程和系统的新颖性 ) of artifact, process
and system
 Imagination, passion, inspiration and incident discovery
 Useful product and service
 Market determination and customer evaluation
 Technological innovation
 Ignite from the technological/market insights
 Follow to acquire necessary and complementary knowledge,
 Transform all the stuff into workable procedures, physical
product, perceived service
 Diffuse them to the targeted customers,
 Cause some economic/social impacts
 Types of innovation
 Radical innovation( 激进的创新 )
 Paradigm shift( 模式转变 )
 Incremental innovation( 渐进式创新 )
 Kaizen
 Routine innovation( 常规创新 )
(rationalization and reengineering)( 合
理化和再造 )
 Linkage between science and
technology
 Scientific discovery
 Technological innovation
 Intermediated by invention/innovation
intention
 Tested by market and customer
appraisal
 Innovation cycle

Invention

Improvement,
Scientific discovery Breakthrough Technological innovation
& benefit
feedback

Touchstone of Market
 Engines of innovation
 Creativity: a purposeful idea by rearranging
some new or existed ideas
 Stimulated by unsatisfactory situations
 Permissive circumstances for creativity
exploitation
 Interested and interesting work design
 Communication and dialogue
 Encourage to take risk and uncertain venture
 Allow the failure consequence
 Incentive: award and compensation
 Searching for the creative
personnel
 The capability of systemic expression
 Quick response of associative ideas
 Novel idea
 Identify some interesting informative source and content
clearly
 More curiousness
 Confront and embrace problems
 Unbending character
 Prudential conclusion
 Be interested in the analytical and explorative tasks
 Trace the intellect-consuming events
 Bringing innovation to market
 Product definition: the persuasive/compelling
value
 Market positioning: tracing the market evolution
and segmentation
 4Ps marketing strategy
 Product package, price mix, promotion campaign,
distribution path
 Technology gap between suppliers and
demanders
 Pricing strategy: market penetration or capital recovery
 (2) The Timing Factor
 First mover vs. second movers
 Industry creating and customer education
 The technological trajectory
 Competitive dynamics
 DAT vs. CD; LD vs. VCD; CDMA vs. GSM; PHS vs. PDC
 Monitor the product life cycle
 Continuous improvement: product family and
cash management
 Credit of commitment and pre-announcement
 Leaders vs. followers
 When imitation is easy, markets don't work well, and
the profits from innovation may accrue to the owners of
certain complementary assets, rather than to the
developers of the intellectual property
 Leader and winner
 Leader but loser
 Follower but winner
 Follower and loser
 Laggard

 The need, in certain cases, for the innovating firm to

establish a prior position in these complementary assets
 To be the market leader
 Reputation
 Preempt positioning
 Define the industry
standard
 Earlier return from
learning effects
 Deterrence advantage
 Higher profit
 Loyal customer
 Attaining more
appreciation and support
 Massive investment
capital for pioneering
R&D and market research
 Continuous income flow
for improvement
 Bearing the uncertainty
and failure disaster
 The lock-out risk of
investment
 Lure many competitors; a
target of knock-out; a
benchmark of imitation
 Technology generation & new
vision
 The continuous stream of
competitors/substitutes
 (technology) Paradigm shift
 Market (behavior) changes
 Industry (process) transformation
 Watch out for the New/emerging
technology and its impacts
 Cannibalization
 Sustainability
 (3) Managing changes
 Productivity
 Effectiveness
 Competitiveness
 Technology foresight
 Market insight
 Strategic planning & implementation
The Concept of ‘Fit’
Three perspectives (Alder 1989)
 Business and technology strategy

 Technology poster and functional

decision making practice

 Synergy between decision making

practices
Technology Strategy Field
Consists of
 Particular dimensions of technology policy

that is related to business strategy

 Integrative models that prescribe fit between

technology policy and business strategy

 Empirical links between technology strategy

and business strategy

Business Competitiveness &
Technology Strategy
Manager should (Clark, 1989)
 Understand their technological base

 Take an international perspective

 Discipline their business function around

the production function

 Integrate all business functions

 Focus on time as the critical factor

Strategic Technology
Management Process
 3 Key areas (Betz 1993)
 Identification and development of a
firm’s technological capabilities
 Products/processes that provide
competitive advantages
 Integration of areas one and two
Technology and Business
Outcomes
 Technology is critical to business outcomes
 Characteristics of best practices include
 Championship of technology issues
 Adequate levels of technological competence
 Selection of the structural for of the unit
 Coupling between a technology function and
others
 Extent and timing of technology control
 Technology transfer mechanisms
Technology Strategy &
Leadership
 Technology strategy plays an important
role in enabling firms to achieve their
leadership position
References:

Dosi, Giovanni (1982), “Technological paradigms and technological

trajectories: A suggested interpretation of the determinants and
directions of technical change,” Research Policy, 11(3), pp.147-162.
Teece, David J. (1987), “Profiting from technological innovation:

Implications for integration, collaboration, licensing and public

policy,” Research Policy, 15(6), pp.285-305.