tec change
TRANSCRIPT
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Strengthening SME CapacitiesStrengthening SME Capacitiesthroughthrough
Technology ManagementTechnology Management
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Business DefinitionBusiness Definition
Customer Functions (What)
Customer Group (Who)Alternative Technologies(How)
Ack.: Derek Abell - Defining the Business: Starting Point of Strategic Planning
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Building Competitive AdvantageBuilding Competitive Advantage
Around TechnologiesAround Technologies In the globalized world, mobility of theIn the globalized world, mobility of the
capital, communication and transportcapital, communication and transporttechnologies diminish competitivetechnologies diminish competitive
advantageadvantage Thus businesses have more difficultyThus businesses have more difficulty
finding ways of differentiationfinding ways of differentiation
The alternative is to be more and moreThe alternative is to be more and moreinnovative through use of technology ininnovative through use of technology inproducts, services and processesproducts, services and processes
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Build Competitive AdvantageBuild Competitive Advantage
Around TechnologiesAround Technologies Businesses must therefore build competitiveBusinesses must therefore build competitive
advantage around technologiesadvantage around technologies
Develop and implement TechnologyDevelop and implement TechnologyStrategy in the same way as the financial,Strategy in the same way as the financial,
marketing and operational strategy.marketing and operational strategy.
Integrate this strategy with the environment,Integrate this strategy with the environment,customers, suppliers and other relevantcustomers, suppliers and other relevant
agencies for the Firm.agencies for the Firm.
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The Value Chain andThe Value Chain and
TechnologyTechnology Competitive advantage is based on firm specificCompetitive advantage is based on firm specific
combination of scientific and technical knowledgecombination of scientific and technical knowledgeand know-howand know-how
leading toleading to
&&
embedded inembedded in
products, services and management systemsproducts, services and management systems
Technologies are embedded not only in productTechnologies are embedded not only in productbut in all the primary and support activities of thebut in all the primary and support activities of the
Firm.Firm.
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Competition and demanding customersCompetition and demanding customers
have shifted the balance to demand sidehave shifted the balance to demand side
Industry has been moving away fromIndustry has been moving away fromtraditional high volume / low variety modeltraditional high volume / low variety modelto low volume / high variety situation toto low volume / high variety situation toserve market nichesserve market niches
Further complications because of shortenedFurther complications because of shortened
product lifeproduct life(Each model change requires changes in plant(Each model change requires changes in plant
lay out, handling / transport, storage and skills)lay out, handling / transport, storage and skills)
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Customer Satisfaction throughCustomer Satisfaction through
Non-Price FactorsNon-Price Factors
The emerging trend is to move away fromThe emerging trend is to move away fromlow cost production to higher added valuelow cost production to higher added value
through non-price factors like design,through non-price factors like design,
quality and reliabilityquality and reliability
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Changing Basis of CompetitionChanging Basis of Competition
Non Price FactorsNon Price Factors
Customers DemandCustomers Demand
More varietyMore variety
More customizationMore customization
Frequent model changesFrequent model changes
High qualityHigh quality
Faster deliveryFaster delivery Better ServiceBetter Service
Advanced designAdvanced design
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Understanding the TechnologyUnderstanding the Technology
Management ChallengeManagement Challenge Traditional trade offs between price andTraditional trade offs between price and
quality or between price and choice arequality or between price and choice arereplaced by competitive prices and wholereplaced by competitive prices and whole
set of non-price factors.set of non-price factors. Quality used to be a differentiator earlier -Quality used to be a differentiator earlier -
now if you cannot offer quality, you cannotnow if you cannot offer quality, you cannot
be in the market.be in the market. Order Winning factors are replacingOrder Winning factors are replacing
Order Qualifying factorsOrder Qualifying factors
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Managing GlobalizationManaging Globalization
Managing TechnologyManaging Technology
Managing FinanceManaging Finance
Managing MarketManaging Market Managing Digital DivideManaging Digital Divide
Technology is the key asset for a
Firms competitiveness
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Interplay of Technology ElementsInterplay of Technology Elements
TECHNOLOGY
HARDWARE HUMAN RESOURCES
TECHNICALINFORMATION ORGANISATIONAL FRAMEWORK
STRATEGY:
SUPPORT THESE DISTINCT ELEMENTS TO IMPROVE TECHNOLOGY
CAPABILITY OF SMALL INDUSTRIES
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The Imperfect TechnologyThe Imperfect Technology
MarketMarket Technology is a marketable commodityTechnology is a marketable commodity
Technology transfer is a commercialTechnology transfer is a commercial
transaction between seller & buyertransaction between seller & buyer Technology ownership is protected byTechnology ownership is protected by
proprietary rightsproprietary rights
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The Technology Market isThe Technology Market is
ImperfectImperfect Critical information is closely guarded andCritical information is closely guarded and
price is determined by relative bargainingprice is determined by relative bargaining
positions of the seller & buyerpositions of the seller & buyer
A buyer with high technological capabilityA buyer with high technological capability
stands a better chance of negotiatingstands a better chance of negotiating
favourable termsfavourable terms
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Technology Creation at Users EndTechnology Creation at Users End
Successful technology upgradation processSuccessful technology upgradation processwould include acquiring the knowledgewould include acquiring the knowledge
needed to face the changes and internalizingneeded to face the changes and internalizing
the knowledge so acquired.the knowledge so acquired.
Thus stress has to be on the process ofThus stress has to be on the process of
technology creation at the level of the usertechnology creation at the level of the user
rather than transfer of technology,rather than transfer of technology,
production techniques or equipment.production techniques or equipment.
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Technology Creation at Users EndTechnology Creation at Users End While transfer of technology puts the emphasis onWhile transfer of technology puts the emphasis on
the supplier, technology creation process puts thethe supplier, technology creation process puts theemphasis on the user by trying to solve a specificemphasis on the user by trying to solve a specific
problem in a given context.problem in a given context.
The supplier can deliver information and services,The supplier can deliver information and services,the user has to know his precise requirementthe user has to know his precise requirement
Thus in the technology creation process the role ofThus in the technology creation process the role ofthe user is much increased and the role of thethe user is much increased and the role of thesupplier is relatively reduced.supplier is relatively reduced.
Ack: J.D. Bandt (CNRS, France)Ack: J.D. Bandt (CNRS, France)
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Innovations DriveInnovations Drive
CompetitivenessCompetitiveness
Three dimensions around whichThree dimensions around which
developments take place in a commercialdevelopments take place in a commercial
entity :entity :
Product: new or modified,Product: new or modified,
Market: new or existing,Market: new or existing,
Technology: new or existingTechnology: new or existing
Each change in one or more of the
three dimensions will be an innovation
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The Value Chain andThe Value Chain and
TechnologyTechnology
M
AR
G
I
N
Ac
tivitie
s
Firm Infrastructure
Human Resource Management
Technology Development
Procurement
Inbound
LogisticsOperations
Outbound
Logistics
Marketing
and Sales
Service
M
A
R
G
I
N
Su
ppor
t
Primar
y
Acknowledgement - UNIDO: Guidelines for the Formulation of
Technolo Strate ies for Hi-tech Com anies
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The Dynamic Nature ofThe Dynamic Nature of
TechnologyTechnology Developing a Technology Strategy isDeveloping a Technology Strategy is
complex due to ever changing nature ofcomplex due to ever changing nature oftechnology.technology.
SimultaneousSimultaneous MARKET PULLMARKET PULL &&SCIENCE PUSHSCIENCE PUSH ensure rapid changes inensure rapid changes intechnology in various sectorstechnology in various sectors
Pace of technological change is dictated byPace of technological change is dictated byhigh investment in R&D in developedhigh investment in R&D in developedcountriescountries
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The Dynamic Nature ofThe Dynamic Nature of
TechnologyTechnology
Hitting a moving target Hitting a moving target
Dimensions of the challenge:Dimensions of the challenge:
Range of factors is increasingRange of factors is increasing
Price remains importantPrice remains important
Increasing non-price factorsIncreasing non-price factors
Changing pattern of key factorsChanging pattern of key factors
Firms need to be agile, able to react andFirms need to be agile, able to react andkeep up with changeskeep up with changes
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Managing TechnologyManaging Technology
The treeThe tree
draws on its rootsdraws on its roots
the underlying knowledge basethe underlying knowledge base
and develops branchesand develops branches
the structured arrangement of technological knowledgethe structured arrangement of technological knowledge
on which fruiton which fruit
new products, processes and servicesnew products, processes and services can growcan grow
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Key TrendsKey Trends
Emergence of major new fieldsEmergence of major new fields BiotechnologyBiotechnology
IT & Communication technologyIT & Communication technology
New MaterialsNew Materials Micro machines / nano technologiesMicro machines / nano technologies
Integration and blurred boundariesIntegration and blurred boundaries Integration within activitiesIntegration within activities
Integration between activitiesIntegration between activities Integration between processesIntegration between processes
Integration between organisationsIntegration between organisations
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Key Trends (contd.)Key Trends (contd.)
New organisational conceptsNew organisational concepts
Cellular organisationCellular organisation
Lean ManufacturingLean Manufacturing
IncreasingIncreasing
rates of change in technologies and productsrates of change in technologies and products
expenditure on R&Dexpenditure on R&D
linkages and alliances to coop with complexitylinkages and alliances to coop with complexity
Parallel rather than sequential developmentParallel rather than sequential development
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Technology MappingTechnology Mapping
Can use
but need
to keep
track of
best
sources of
supply
Invest in
R&D
MUSTMAINTAIN
Keep
close
watch
Keep
watching
Basic Proprietary Pacing Emerging
Possible future
products /
processes
Planned new
products /
processes
Core products /processes
Basic / Generic Technologies, Proprietary Technologies,Basic / Generic Technologies, Proprietary Technologies,
Pacing Technologies and Emerging TechnologiesPacing Technologies and Emerging Technologies
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Managing TechnologyManaging TechnologyIn order to grow organisations do not just have toIn order to grow organisations do not just have to
build technological competence they are alsobuild technological competence they are alsohave to learn how to do this effectively.have to learn how to do this effectively.
What are the best ways for acquiring andWhat are the best ways for acquiring and
deploying knowledge?deploying knowledge? How can it be done with a high chance of success?How can it be done with a high chance of success?
How can the learning processes around anHow can the learning processes around an
organisation be integrated and captured?organisation be integrated and captured?
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Managing TechnologyManaging Technology
Concept
Reflection
Experience
Experiment
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Tools and mechanisms for effectiveTools and mechanisms for effective
learning of technology managementlearning of technology management
Pilot projectsMeasurement
DocumentationTraining and
development
Project evaluation
Designed
experiments and
simulations
Formal planning
reviews
Structured audits
R & D activitiesNew structures
and processdesigns
Benchmarking
Capture
experience on
video, via diaries
project records,etc.
Sharing
experience via
display, direct
exchange, etc.
Testing and
prototyping
Theories and
models
Post project
reviews
ExperienceExperimentConceptualiseReflection
Ack:- Learning Cycle (Kolb & Fry)
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Impact of Technological ChangeImpact of Technological Change
Technological change allows firms toTechnological change allows firms to
produce the same rate of output using fewerproduce the same rate of output using fewer
inputsinputs
Technological change may be input neutral,Technological change may be input neutral,
labour saving or capital savinglabour saving or capital saving
Single most source of economic growth inSingle most source of economic growth in
the USA has been Technological Changethe USA has been Technological Change
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Response Strategy to cope withResponse Strategy to cope with
ChangeChange Positioning :Positioning :
Is the SME dependent on a single largeIs the SME dependent on a single largecompany?company?
Is the SME dependent on a large number ofIs the SME dependent on a large number ofsmall customers?small customers?
Is the SME vulnerable from a supplierIs the SME vulnerable from a supplierperspective?perspective?
What are the risks and the opportunities to thisWhat are the risks and the opportunities to thisposition being engendered by the newposition being engendered by the newcommercial context as identified?commercial context as identified?
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Response Strategy to cope withResponse Strategy to cope with
Change (Contd.)Change (Contd.) ProcessesProcesses
What is the process that is used in the manufacture of theWhat is the process that is used in the manufacture of theproduct?product?
Do we clearly understand it?Do we clearly understand it?
Is there a different way of achieving the same end result?Is there a different way of achieving the same end result? What are the elements and chemicals used in itsWhat are the elements and chemicals used in its
manufacture?manufacture?
What are the environmental resources used?What are the environmental resources used?
Is there a licensing implication in the process?Is there a licensing implication in the process?
Are there risks from the stakeholder circle?Are there risks from the stakeholder circle?
Is the process amenable to change?Is the process amenable to change?
What type of precaution, prevention and elimination ideasWhat type of precaution, prevention and elimination ideascould be generated?could be generated?
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Response Strategy to cope withResponse Strategy to cope with
Change (Contd.)Change (Contd.) ProductsProducts
What product is the company making?What product is the company making?
Is that product environmentally acceptable?Is that product environmentally acceptable?
Are there short-, medium-, or long-term risks inAre there short-, medium-, or long-term risks in
the continuation of this product?the continuation of this product?
Should this product be re-designed to takeShould this product be re-designed to take
account of the environmental issue?account of the environmental issue? What are the risks and what are theWhat are the risks and what are the
opportunities presented?opportunities presented?
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Response Strategy to cope withResponse Strategy to cope with
Change (Contd.)Change (Contd.) TechnologiesTechnologies
Have technologies moved on?Have technologies moved on?
Is there an opportunity to innovate withIs there an opportunity to innovate with
technology?technology?
Is there room to modify existing technologies?Is there room to modify existing technologies?
Could these technologies be better used?Could these technologies be better used?
Is operator training adequate?Is operator training adequate?
What are the risks in opportunities?What are the risks in opportunities?
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Response Strategy to cope withResponse Strategy to cope with
Change (Contd.)Change (Contd.) CompetitorsCompetitors
Who are the enterprises competitors?Who are the enterprises competitors?
Who are the local, national and internationalWho are the local, national and international
competitors?competitors? What are these competitors doing?What are these competitors doing?
Are they designing products and processes for theAre they designing products and processes for the
environment?environment?
Are they marketing their products in an innovative way?Are they marketing their products in an innovative way?
Are they driving down costs through environmentalAre they driving down costs through environmental
innovation?innovation?
What risks do I face in comparison to my competitors?What risks do I face in comparison to my competitors?
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TECHNOLOGY CLIMATETECHNOLOGY CLIMATE
Uniform measures for technologyUniform measures for technologyupgradation may not succeed even in theupgradation may not succeed even in thesame sector of industry as measures adoptedsame sector of industry as measures adopted
at different places can yield different resultsat different places can yield different resultsdue to technology climate being differentdue to technology climate being differentfrom one region to another and from onefrom one region to another and from onesector to another. In a supportivesector to another. In a supportive
technology climate, better results would betechnology climate, better results would beobtained than in a less supportive climate.obtained than in a less supportive climate.
li i lQ li F i D l
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Quality Function DeploymentQuality Function DeploymentAllocating Design & Mfg. Resources to FeaturesAllocating Design & Mfg. Resources to Features
Most Valued by CustomerMost Valued by Customer
313
15
0
50
8
70
42
80
48
336
0
70
20
10
100
42
64
30
329
30
0
30
20
90
35
64
60
Total
50103Feature 8
01007Feature 7
10465Feature 6
45102Feature 5
710910Performance 4
6657Performance 3
10888Operating Cost
85106Price
Competitor Bs
Score Total
Competitor As
Score Total
Your Product
Score Total
Customer
Weightage
Product Feature
Ack. QFD Institute
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Accessing New TechnologiesAccessing New Technologies
Literature shows eleven ways to access new technologiesLiterature shows eleven ways to access new technologies
2.2. In-house R&DIn-house R&D
3.3. Non-equity R&D joint venturesNon-equity R&D joint ventures
4.4. Equity R&D joint venturesEquity R&D joint ventures
5.5. Equity R&D consortiaEquity R&D consortia
6.6. Sub-contracted R&DSub-contracted R&D
7.7. License purchaseLicense purchase
8.8. Patent purchasePatent purchase
9.9. License swapLicense swap
10.10. Specialists recruitmentSpecialists recruitment
11.11. Firm take-overFirm take-over
12.12. Joint take-overJoint take-over
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Science Technology Innovation
Best of Institution-Industry Linkages
Key Factors of Change
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R&D labs &
Institutions
Technology
Innovation
Industry
Best Practices
Industry-Institution Linkages
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PROBLEMPROBLEM
How to introduce market oriented behavior into theHow to introduce market oriented behavior into the
R&D system?R&D system?
RESULTING INRESULTING IN
Improvement in the level of commercialization ofImprovement in the level of commercialization of
R&DR&Dresultsresults
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IMPROVE THE LINKAGES BETWEENIMPROVE THE LINKAGES BETWEEN
PRODUCTION SECTOR AND R&DPRODUCTION SECTOR AND R&D
INSTITUTIONS THROUGHINSTITUTIONS THROUGH
Establishment of technology promotionEstablishment of technology promotioncenters.centers.
Increased participation of end users in theIncreased participation of end users in thedecision making process .decision making process .
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Develop / Improve linkages between basic &Develop / Improve linkages between basic &
applied research through cooperative relationshipapplied research through cooperative relationship
with industrial enterprises.with industrial enterprises.
Combine the production capabilities (engineeringCombine the production capabilities (engineering
/tech) of the enterprises with the intellectual/tech) of the enterprises with the intellectual
capabilities of research organizations.capabilities of research organizations.
Developing Technology LinkagesDeveloping Technology Linkages
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Establish applied research companies to take up contractEstablish applied research companies to take up contractresearch for private companies.research for private companies.
Promote horizontal linkages among firms - adoptPromote horizontal linkages among firms - adopt
consortium approach for setting up common R&Dconsortium approach for setting up common R&Dfacilities.facilities.
Competing enterprises within and across national bordersCompeting enterprises within and across national borders
are forming strategic alliances for joint R&Dare forming strategic alliances for joint R&D.(European.(Europeannetworks like ESPIRIT for information technology, RACEnetworks like ESPIRIT for information technology, RACEin telecom, BRITE in manufacturing technology, EUREKAin telecom, BRITE in manufacturing technology, EUREKAin high technologyin high technology))
Developing Technology LinkagesDeveloping Technology Linkages
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Encourage inter company strategic alliances extending toEncourage inter company strategic alliances extending todeveloped countries. e.gdeveloped countries. e.g
Singapore govt. initiated Digital Media Consortium bringingSingapore govt. initiated Digital Media Consortium bringing
together three public research institutes and three local multimediatogether three public research institutes and three local multimedia
companies to collaborate with Media Lab at MIT,USA.companies to collaborate with Media Lab at MIT,USA.
Power PC Consortium in Taiwan collaborating with Motorola &Power PC Consortium in Taiwan collaborating with Motorola &IBM to develop personal computer products using Power PCIBM to develop personal computer products using Power PC
microprocessor.microprocessor.
Network RNetwork R&D systems in the region to disseminate&D systems in the region to disseminateinformation at national level about new technologies forinformation at national level about new technologies for
small &medium enterprises.small &medium enterprises.
Developing Technology LinkagesDeveloping Technology Linkages
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Create dedicated web portals facilitatingCreate dedicated web portals facilitatingtechnology searchtechnology search
DDevelop suitable entrepreneurial courses for scientists andevelop suitable entrepreneurial courses for scientists andresearch personnel.research personnel.
Encourage secondment of research personnel toEncourage secondment of research personnel toindustryindustry particularly during commercialization ofparticularly during commercialization ofresearch projects.research projects.
Establish Science & Technology parks and businessEstablish Science & Technology parks and businessincubators.incubators.
Developing Technology LinkagesDeveloping Technology Linkages
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TTechnology blending can create new markets.echnology blending can create new markets. (Integration(Integration
of newly emerging technologies with traditionalof newly emerging technologies with traditional
technologies)technologies)
Legal framework - no linkages can work without strongLegal framework - no linkages can work without strong
government support.government support.
Reward risk takers and utilize the dynamism of privateReward risk takers and utilize the dynamism of private
sectorsector
Developing Technology LinkagesDeveloping Technology Linkages
International Cooperation InitiativesInternational Cooperation Initiatives
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International Cooperation InitiativesInternational Cooperation Initiatives
Identify strong and viable Indian Enterprises andIdentify strong and viable Indian Enterprises andplay upon their strengthsplay upon their strengths
Thrust is on sustainablepartnerships
and not on one-way transactions
I t ti l S t I iti tiI t ti l S t I iti ti
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International Support InitiativesInternational Support Initiatives
Strengthening the present activities:Strengthening the present activities:
Exchange of Business/Technology missionsExchange of Business/Technology missionswith various countries.with various countries.
Facilitating Enterprise to EnterpriseFacilitating Enterprise to Enterprisecooperation, JVs, Technology Transfer &cooperation, JVs, Technology Transfer &other forms of sustainable collaboration.other forms of sustainable collaboration.
International Partner Institutions
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Small Business Corporation (Formerly known as Small & MediumIndustry Promotion Corporation - SMIPC), South Korea
Bundesverband Mitteistandische Wirtschaft (BVMW), Germany
Confederation Of Small Industries (CONFAPI), Italy
Israel SMEs Authority , Israel (Formerly SBAI)
Taipei World Trade Center (TWTC), Taiwan
Social Fund for Development (SFD), Egypt
Proposed model for PDTCs Fostering Industry Institution
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Regional Pole
or Technology
Management
Center
Project 1 P 2 P 3 P n
Technology
Pole I
Technology
Pole II
Technology
Pole n
Universities
Research Labs
High TechCompanies
Training
Fund
Mobilization
Govt./Localbody relation
Specialized projects
Data & Information
Center Intranet
Proposed model for PDTCs Fostering Industry-Institution
Linkages
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AcknowledgementAcknowledgement
Material in this presentation has been takenMaterial in this presentation has been takenfrom various UNIDO publications includingfrom various UNIDO publications including
UNIDO - ICS Trieste Manual onUNIDO - ICS Trieste Manual on
Technology ManagementTechnology Management