Management of technology Selection

1. Selection:
Understanding Technology
Evolution and Technology Strategy
Technology Management
Activities and Tools

2. Contents
 Definition
 Contextualizing “selection” within:
 The TM framework
 Technological evolution
 Strategy approaches / concepts
 Technology strategy

3. Selection Processes
1 Technology audit
2 Forecast the technology
3 Analyse and forecast the environment
4 Analyse and forecast the market/user
5 Analyse the organization
6 Develop the mission
7 Design organizational actions
8 Implementation
Strategic
analysis
Strategic
choice
Exploitation

4. TM framework and
Strategy

5. The major TM processes
Identification
Selection
Acquisition
Learning
Exploitation
Protection

6. Technology Evolution

7. Technological innovation
process is a result of:
 Inventions, discoveries
 Creativity
 Serendipitous
 A function of economic demand and growth
Complex and long process

8. The process of technological advance:
 the combination of chance events and inventions (variation),
 direct social and political action of organizations in selecting between
rival technical regimes (selection),
 as well as by incremental, competence-enhancing, puzzle-solving
actions of many organizations learning-by-doing (retention).

9. Technology develops in response to the interplay of history, individuals,
and market demand. Function of both variety and chance as well as
structure and patterns.
SO:
Technological progress constitutes an evolutionary system.

10. Retention
Variation
Selection
Technological Discontinuity
Competence enhancing
Competence destroying
Era of Incremental Change
Elaborate dominant design
Architectural innovation
Substitution
Design competition
Community-driven
Technical change
Dominant Design
A technology cycle.
(Source: Tushman and Andersen, 1997)
Era of Ferment

11.  Competence-enhancing discontinuities
significantly advance the state of the art yet
build on, or permit the transfer of, existing
know-how and knowledge.
 Competence-destroying discontinuities
significantly advance the technological
frontier, but with a knowledge, skill, and
competence base that is inconsistent with
prior know-how.

12. Technology life cycle/ S-curves
 Stage 1. Technology development
 Stage 2. Technology application
 Stage 3. Application launch
 Stage 4. Application growth
 Stage 5. Technology maturity
 Stage 6. Degraded technology

13. Strategy concepts

14. Strategic thinking
 Where are we?
 Where do we want to go?
 How will we reach to our goal?
If a ship does not know where to go, none of the winds can be helpful.
(Chinese proverb)

15. Technologies are occasionally included
explicitly in typical corporate strategy
reviews and corporate planning, since:
 Most managers are not trained in science or
engineering.
 Little knowledge on the process of technological
change.
 Limited experience and lack of adequate
frameworks.
 Technological change proceeds slowly: significant
change requires 5-10 years.
 Most firms are organized around the production
process not the technological innovation process.

16. Strategy steps
 Internal & external analysis
 Planning
 Mission
 Vision
 Values
 Strategic goals
 Strategy
 Execution
 Evaluation and control

17. Mission
Vision
Evulation
İnternal factors
Formulation
Evulation
external factors
Long-and
Short-term
objectives
Generate,evaluate,
And select appropriate
strategy
Establish functional
Units,organizational
Structures and policies
Implementation Set plans of action
And schedules
Allocate
resources
Develop performance
Measures and reward
systems
Evaluation Evaluate
results
Feedback

18. Mission
Mission: The reason behind the existence of a firm.
 HP: Technical support to the advancement and welfare
of mankind.
 Merck: To protect human life.
 Walt Disney: To make people happy.

19. Vision
Vision: Creativity and foreseeing the position of the firm
in near future.
 Nike: To beat Adidas
 Wal-Mart: To become 150 billion $ worth of by year 2002
 General Electric: To be number one or two in all
markets where it has production and services.

20. Values
Values: Expectations and norms that affect the behavior of employees
as well as their relationships
Walt Disney:
 Believe in people
 Develop and diffuse American-way of life
 Creativity
 Consistency and detail-focused

21. Strategy goals
Strategy goals needs to be:
 clear
 measurable
 aggressive but reachable
 within time-perspective

22. Strategy
Institutional Strategy:
 growth (revenue, ….)
 sustainability (market share,…)
Operational strategies:
 cost leadership
 differentiation
 focus (market, region, product)

23. Example of strategy
 Strategic goal: To become the biggest distributor for beauty products in
Istanbul
Strategies:
 To construct centers in Asian and European side of Istanbul
 To increase distributor contracts with producers
 To increase imported beauty products
 To increase sales personnel

24. Strategy implementation
 Operational plans
 Short, medium, and long-term plans
 Periodically reviewed - revisied if needed
 Written action plans
 Diffusion into the organization

25. Strategy evaluation and
measurement
 Comparison with the goals
 Finding the differences and their reasons
 Updating the plan if needed

26. Resource-based view/ Capabilities
view
& strategy

27. Strategy is the art of creating value
(Source: Normann and Ramirez, 1993)
It allows a company’s managers to identify
opportunities for bringing value to customers
and for delivering that value at a profit.
2 resources that matter in today’s economy:
* competence and
* relationships (customer and supplier)
Innovate:
Not just add value but reinvent it.

28. Core competence
 Not only performance improvement but also opportunity creation.
 Performance improvement includes quality, costs, cycle time, logistics,
and productivity, while
 opportunity creation consists of growth, new business and market
development, strategic direction.

29. Core competencies are:
 The collective learning in the organization,
especially how to coordinate diverse
production skills and integrate multiple
streams of technologies.
 The organization of work and the delivery of
value.
 Communication, involvement and a deep
commitment to working across
organizational boundaries.
 Does not diminish with use.

30. 1 2 3
Business
1
Core product 2
Core product 1
Competence
1
Competence
2
Competence
3
Competence
4
4 5 6
Business
2
7 8 9
Business
3
10 11 12
Business
4
Source: Prahalad and Hamel, 1990

31. 3 Tests to identify core
competencies. Core competence
(Source: Prahalad and Hamel 1990)
1) provides potential access to a wide variety of markets.
2) should make a significant contribution to the perceived customer
benefits of the end product.
3) should be difficult for competitors to imitate.

32.  Embedded skills that give rise to the next generation of competitive
products cannot be rented in by outsourcing and original equipment
manufacturer supply relationships.
 the costs of losing a core competence can be only partly calculated
in advance.
 core competencies take time.

33.  Core products are the components or subassemblies that actually
contribute to the value of the end products.
 Well-targeted core products can lead to economies of scale and
scope.

34. Technology strategy

35. Business Goals
Objectives
And
Need-driven
Expectations
Environmental scanning
• innovations and
competitive
assessment
Technology
awereness
of
marketable
inventions
Business
strategy
and planning
Technology
forecasting
and
planning
Technology
design
development
and
advancement Technology
Adoption and
introduction
Ongoing
improvement in
the innovation
and technology
management process
Technology
obsolescence
Managing the
individual and
organizational
consequences
of technology
Assessment of
technology
outcome
dimensions
Technology
implementations,
project monitoring,
and control
• Intervention
• Internal and external veritable
• Trade-off analysis
• Justification for new ideas
• Corrective action loops
• Product strategy
• Science
• Industry analysis
• Functional strategy
• Market and
manufacturing
analysis
• Productivity
• Employment
• Quality of working
life
• Organizational
impact
• Human factors
• Product quality

36. Types of industries
(1) well defined boundaries & competition by price and the perceived
quality is stable over time
(2) well defined boundaries & competition by price and perceived quality
changes over time
(3) weakly defined boundaries & competition by the ability to generate
new product/market combination.

37. Types of strategy
 Performing better than competitors on an already
existing dimension of competition
 Establishing a new dimension on which to compete
 Creating a new product/market combination

38. T Strategy for dynamic competition
** Take into consideration the
constituent technologies embodied
into the product and the production
process used to manufacture it
** Extend the technology analysis to
the whole value chain.
** Formulating a technology strategy
means defining the 'trajectory' by
which technological resources are
accumulated, acquired and used

39. Some possible technology strategies: (source:
Chiesa, Giglioli and Manzini, 1999)
 Competence deepening
 Competence fertilizing
 Competence complementing
 Competence refreshing
 Competence destroying

40. Example of a Strategy Tool used in audits:
S W O T Analysis
Internal
Analysis
External
Analysis
Strenght
Weakness
Opportunity
Threat

41. External analysis
 Focuses on the identification of the value perceived by the customer and
its evolution.
 Demands could be not only the satisfaction of existing needs but also the
creation or the explicitation of latent or non-articulated needs.

42. Internal analysis
 Identifying the competence and skill base
 Benchmarking skills against other firms
 (the breadth addresses the range of applicability of a
certain skill, whereas the depth addresses the degree of
appropriability of a skill)
 Identifying the critical skills

43. (S)
 What are the strength areas?
 Where are the best performances?
(W)
 What could be improved?
 What are the weaknesses?
 What could be prevented?
 Be realistic
 Consider the views of
others
Self-Assessment
SWOT

44. (O)
 Changing technology
 changing markets
 changing government policies
 changing life-style
What new opportunities arise?
(T)
 What is the position of competitiors?
 What are the risks of change?
SWOT

45. Always leave Blank
STRENGTHS (S)
1.
2.
3.
4. List Strenghts
5.
6.
7.
8.
WEAKNESSES (W)
1.
2.
3.
4. List Weaknesses
5.
6.
7.
8.
OPPRTUNITIES (O)
1.
2.
3.
4. List Opportunities
5.
6.
7.
8.
SO STRATEGIES
1.
2.
3.
4. Use strengths totake
5. Advantage of opportunities
6.
7.
8.
WO STRATEGIES
1.
2.
3. Overcome
4. Weaknesses by taking
5. Advantage of opportunities
6.
7.
8.
THREATS
1.
2.
3.
4. List Threats
5.
6.
7.
8.
ST STRATEGIES
1.
2.
3.
4. Use strengths to
5. avold threats
6.
7.
8.
WT STRATEGIES
1.
2.
3.
4. Minimize weaknesses
5. And avoid threats
6.
7.
8.

46. Identification
Operations plan Development
Plan
Production plan
Acquisition plan
Exploitation plan
Marketing plan
Financial plan
Implementation
Measurement and
evaluation
Gap analysis/
Value analysis
Selection: Strategic choices
Outputs
Business
strategy
Learning
Protection plan