STUDENT- PGDMINSTITUTE OF MANAGEMENT STUDIES, NOIDA

Prepared by –1.RAVISH ROSHAN (atulravish@gmail.com),9968009808 (m

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Management of TechnologyManagement of Technology

Technological evolutionTechnological evolution

Management of technologyManagement of technology

It is defined as the know-how, physical It is defined as the know-how, physical equipment, and procedures used to equipment, and procedures used to produce products and services. produce products and services.

Support network -- A network comprised of Support network -- A network comprised of the physical, informational, and the physical, informational, and organizational relationships that make a organizational relationships that make a technology complete and allow it to technology complete and allow it to function as intended. function as intended.

MOT MOT

CASE LET OF – seven eleven, JapanCASE LET OF – seven eleven, Japan

Question for discussion --- explain how Question for discussion --- explain how seven eleven has done the development seven eleven has done the development and innovative use of technology to make and innovative use of technology to make distinctive competence.distinctive competence.

Management criteria for effective Management criteria for effective innovationinnovation

Early in the corporate era, it may have been Early in the corporate era, it may have been easy to believe that technological stability was easy to believe that technological stability was the normal condition and technological the normal condition and technological innovation the occasional.innovation the occasional.Motorola corporation used the transistor to Motorola corporation used the transistor to expand its position in consumer electronics and expand its position in consumer electronics and then, by integration backwards, gained a then, by integration backwards, gained a significant new role as competent supplier.significant new role as competent supplier.Here we can identify management criteria which Here we can identify management criteria which effectively discriminate between profitable and effectively discriminate between profitable and unprofitable new technologies.unprofitable new technologies.

Determinants of successDeterminants of success

It could be found in technology and business It could be found in technology and business contexts.contexts.In technology, the determinants would depend In technology, the determinants would depend on appraisal of quality and significance of on appraisal of quality and significance of innovative concepts– like it must be new and innovative concepts– like it must be new and must be good.must be good.Hence there must be embodiment for the new Hence there must be embodiment for the new device, a product or system, which is waiting for device, a product or system, which is waiting for it.it.And so, Operational consequences of new And so, Operational consequences of new technology on manufacturing, marketing, and technology on manufacturing, marketing, and distribution must be considered.distribution must be considered.

Balancing old and new constraintsBalancing old and new constraints

Three questions turn out to be crucial –Three questions turn out to be crucial –What fundamental technical constraints limiting the prior What fundamental technical constraints limiting the prior art are lifted ? --- this is the key technical challenge. art are lifted ? --- this is the key technical challenge. Identify the core physical constraints underlying the Identify the core physical constraints underlying the previous technologies that have been lifted by the new previous technologies that have been lifted by the new invention and assess the significance of lifting those invention and assess the significance of lifting those constraints. constraints. Example – aircraft engine. In the piston engine, upper Example – aircraft engine. In the piston engine, upper limit in compression ratio is set to be the detonation of limit in compression ratio is set to be the detonation of the fuel charge in the cylinder. A turbine engine has no the fuel charge in the cylinder. A turbine engine has no such limit. It is possible to have higher compression ratio such limit. It is possible to have higher compression ratio in turbine engine that makes it successful. in turbine engine that makes it successful.

Balancing … cont’dBalancing … cont’d

What new technical constraints are inherent in the new What new technical constraints are inherent in the new art? …. The first question had to do with credit side, and art? …. The first question had to do with credit side, and this question determines the debit side. This reflects this question determines the debit side. This reflects what fundamental constraints limits the effectiveness of what fundamental constraints limits the effectiveness of innovation.innovation.Example– in jet engines, the wake efficiency of aircraft Example– in jet engines, the wake efficiency of aircraft propulsion system depends on the ratio of velocity of propulsion system depends on the ratio of velocity of rearward stream of air to the forward velocity of the rearward stream of air to the forward velocity of the aircraft; the lower the ratio , the more efficient the aircraft; the lower the ratio , the more efficient the propulsion. A propeller, moving a large amount of cold propulsion. A propeller, moving a large amount of cold air slowly, has a higher wake efficiency than a jet engine air slowly, has a higher wake efficiency than a jet engine moving a small amount of hot air rapidly, so a new moving a small amount of hot air rapidly, so a new constraint exists.constraint exists.

Balancing… cont’dBalancing… cont’d

How favorable is relief of the former How favorable is relief of the former weighted against the stringencies of the weighted against the stringencies of the latter ? …… the net of the first two latter ? …… the net of the first two questions with respect to any inventive questions with respect to any inventive concept is a qualitative technical balance. concept is a qualitative technical balance. The comparisons can’t be quantitative The comparisons can’t be quantitative because they are not necessarily of similar because they are not necessarily of similar characteristics; so this is highly characteristics; so this is highly judgemental balance, but it can be judgemental balance, but it can be technically quite meaningful. technically quite meaningful.

Putting innovation in contextPutting innovation in context

The management criteria here is to analyze the embodiment in The management criteria here is to analyze the embodiment in which the new technology will go to the market. which the new technology will go to the market. The first question …. Is the end product enhanced by additional The first question …. Is the end product enhanced by additional technology and components required to make use of innovation ? technology and components required to make use of innovation ? …… this calls for analysis of the changes which must be made to a …… this calls for analysis of the changes which must be made to a product if the innovation is to be used. product if the innovation is to be used. Example – every radio must have a power supply, an RF section, an Example – every radio must have a power supply, an RF section, an IF section, an audio section. The transistor penetrated the IF section, an audio section. The transistor penetrated the automobile radio as a replacement for the output power tube, but automobile radio as a replacement for the output power tube, but the RF and IF sections were unaffected by the presence of the RF and IF sections were unaffected by the presence of germanium power transistor instead of an output power pentode; germanium power transistor instead of an output power pentode; however because the output stage no longer required 300-volts B+ however because the output stage no longer required 300-volts B+ plate potential, it was possible to eliminate the unreliable vibrator plate potential, it was possible to eliminate the unreliable vibrator power supplies as soon as RF and IF tubes requiring only 12-volts power supplies as soon as RF and IF tubes requiring only 12-volts B+ potential were developed. These hybrid radios were much more B+ potential were developed. These hybrid radios were much more reliable , but they could not have succeeded without 12-volt tube reliable , but they could not have succeeded without 12-volt tube development.development.

Innovation in context… cont’dInnovation in context… cont’d

Is the inventive concept itself diluted or Is the inventive concept itself diluted or enhanced by the embodiment required ? enhanced by the embodiment required ?

Here now analyze the effects on the innovation Here now analyze the effects on the innovation itself of the changes required for its use in the itself of the changes required for its use in the product. There are favorable cases where the product. There are favorable cases where the additional art surrounding the new invention additional art surrounding the new invention enhances its value. This is very happy situation. enhances its value. This is very happy situation. But there are many cases where the But there are many cases where the embodiment surrounding the new art dilutes it. embodiment surrounding the new art dilutes it.

Cont’d Cont’d

The third question is – does the additional The third question is – does the additional embodiment offer opportunity for further embodiment offer opportunity for further inventive enhancement ? ….. Once more inventive enhancement ? ….. Once more balance is needed, this time between the balance is needed, this time between the value added to a product and that value added to a product and that subtracted from it by the requirements of subtracted from it by the requirements of the innovation. Does the new innovation the innovation. Does the new innovation on balance decrease the acceptability of on balance decrease the acceptability of the product into which it is incorporated ? the product into which it is incorporated ? Or does it add more punch ? Or does it add more punch ?

What will sell and what won’tWhat will sell and what won’t

Does the product incorporating the new Does the product incorporating the new technology provide enhanced effectiveness in technology provide enhanced effectiveness in the marketplace serving the final user ? ….. The the marketplace serving the final user ? ….. The Pilkington float glass process represents a Pilkington float glass process represents a substantially more effective way of making plate substantially more effective way of making plate glass by casting the glass against molten tin glass by casting the glass against molten tin instead of grinding the surfaces; there are instead of grinding the surfaces; there are dramatic cost savings. But smooth glass is a dramatic cost savings. But smooth glass is a smooth glass, and there is no increased smooth glass, and there is no increased effectiveness resulting from its use in windows. effectiveness resulting from its use in windows. The process is a perfect example of innovation The process is a perfect example of innovation which made no change at all in marketplace.which made no change at all in marketplace.

Cont’dCont’d

Does the operation reduce the cost of delivering Does the operation reduce the cost of delivering the product or service ? …… taken together, this the product or service ? …… taken together, this question and the earlier one are really the question and the earlier one are really the scissors of supply and demand, the first dealing scissors of supply and demand, the first dealing with demand, the second with supply. If the with demand, the second with supply. If the answer of both the questions is no, we can answer of both the questions is no, we can forget the whole thing; but if yes, then there forget the whole thing; but if yes, then there need be little market uncertainty. The need be little market uncertainty. The challenging case is one where one of these is challenging case is one where one of these is positive and other is not.positive and other is not.

Cont’d Cont’d

Does latent demand expansion or price elasticity Does latent demand expansion or price elasticity expansion determine the characteristics of the expansion determine the characteristics of the new market ? …… when the factor driving a new market ? …… when the factor driving a market area is lower price per unit, market market area is lower price per unit, market expansion by hundreds of percent is hard to expansion by hundreds of percent is hard to obtain. Major expansion in revenue is much obtain. Major expansion in revenue is much more likely when the change in the market is more likely when the change in the market is driven by a dramatic change in product driven by a dramatic change in product effectiveness. This question , of course, effectiveness. This question , of course, determines the quantitative business balance.determines the quantitative business balance.

Creating and applying technologyCreating and applying technology

Applying new technologies is an ongoing Applying new technologies is an ongoing challenge at all firms. It is the process, challenge at all firms. It is the process, which is aimed at creating and applying which is aimed at creating and applying technologies to improve firm’s products, technologies to improve firm’s products, processes, and services. The innovation processes, and services. The innovation process focuses technical and scientific process focuses technical and scientific efforts on better ways to meet market efforts on better ways to meet market needs. This can be achieved by R&D. needs. This can be achieved by R&D.

Technology fusionTechnology fusion

It is the process of combining several existing It is the process of combining several existing technologies and scientific disciplines to create a technologies and scientific disciplines to create a hybrid technology. hybrid technology.

Two important factors here …. The market Two important factors here …. The market should drive the R&D process, not the other way should drive the R&D process, not the other way round. Second, companies intelligence round. Second, companies intelligence gathering abilities to monitor technological gathering abilities to monitor technological developments both inside and out side the developments both inside and out side the industry. This concept is called Intelligent industry. This concept is called Intelligent Monitoring System.Monitoring System.

Which technologies will add to the Which technologies will add to the Core competencies ?Core competencies ?

Achieving strategic fit, whereby chosen Achieving strategic fit, whereby chosen technologies help achieve current technologies help achieve current corporate and operations strategies, isn’t corporate and operations strategies, isn’t enough. New technologies can build new enough. New technologies can build new production capabilities that form the basis production capabilities that form the basis for new strategies, leading a long term for new strategies, leading a long term path to improvement. It does so by path to improvement. It does so by developing a set of core competencies developing a set of core competencies and technologies that enable the firm to and technologies that enable the firm to adapt quickly to changing opportunities. adapt quickly to changing opportunities.

Finally , a question for discussionFinally , a question for discussion

Discuss how increased internet use of Discuss how increased internet use of business to business interactions would business to business interactions would affect customer – supplier relationships .affect customer – supplier relationships .