Lecture 5 – Technology Exploitation

Technology
Exploitation/Utilization/development
• The process of exploitation is concerned with
generating profit or achieving other benefits
from technology.
• Exploitation can be defined as the utilization
of new technology or scientific developments
to improve the performance of products,
services or manufacturing processes.
 Technology
Exploitation/Utilization/development
• Exploitation of technological capability is more than
just commercialization, since the expected benefits
might be build up through effective and efficient
implementation, absorption and operation of the
technology.
• If there is not a fully working product/process/service
at hand, there will be no commercialization activity.
So the exploitation activity includes three sets of
sub-processes: commercialization/marketing,
technology transfer and utilization.
 Commercialization/marketing
• Commercialization is the process of introducing
a new product or service into the market.
• The definition of innovation clearly indicates
that the commercialization process turns an
invention into an innovation, a sellable product
or service in the marketplace.
• Many companies are good at producing
inventions but not all their inventions are put
into use.
 Commercialization/marketing
• The first task is to decide on the
commercialization method; to a large degree,
this is made at the strategy level.
• Technology exploitation can take one of three
possible routes:

1. In-house development: the production and

distribution of technology are carried out within
the company.
 Commercialization/marketing
2. Joint commercialization: production and
distribution are carried out in collaboration with
other organizations through joint ventures or
other forms of alliance.
3. Selling technology: can take place at any stage
of technology development, including idea,
prototype, patent and license sales.
• Making an similarity to the make-buy-collaborate
decision, the exploitation activity is involved with
a make-sell-collaborate decision.
• Exploitation options refer to selecting a different
business model for the commercialization of
technologies.
• In other words, exploitation requires strategic
thinking.
• Commercialization is directly related to earning
revenue from sales, derived from a set of
processes, particularly marketing, since
successfully introducing a new product or service
into the market requires advertising, distribution
and selling of a product or service.
• The company's exploitation task involves selling
the products that are based on technologies
developed in-house or acquired externally.
• This is why the marketing of technological
products and services is highly critical.
 Technology transfer
• Technology transfer is the process by which the
technology, knowledge and information developed
by a creator is applied and utilized by an applier.
• Creators might be an individual, an R&D department
within a company, another commercial developer
company, a partner company doing collaborative
R&D, a non-profit organization or a government
agency.
• The applier might be a manufacturing department
of the company where technology is developed
internally or cooperatively, it might be a commercial
company, a competitor or the government.
 Technology transfer
• The transfer of technology from creator to
applier is frequently the point at which the
system breaks down. It therefore needs to be
managed well.
• The following factors affect the success of
technology transfer:
– High level of technical understanding where transfer
is done.
– Feasibility findings of the technology are high.
– Advanced development activities overlap with the
new technology.
– Growth potential from technology application is
high.
– The existence of an sponsor of the transferred
technology.
– The existence of advanced technology activities in
a development laboratory to complement the
transferred technology.
– External pressures from competitors and markets
enforcing the companies quick adoption.
– Need for Joint programmes between technology
developer and technology buyer.
 Technology transfer processes
• Transferring a technology can he considered as a
stand-alone project, so project management steps
are the usual activities that need to be carried out.
• However, four specific managerial tasks are
considered here in some detail :
– 1. Determining the transfer method, actors and timing.
– 2. Pre-transfer activities
– 3. Transfer activities.
– 4. Evaluations and improvements.
Determining the transfer method, actors and
timing
• Before a technology transfer decision is made,
the maturity of growing technologies needs
to be assessed prior to incorporating the
technology of interest into a system or sub-
system.
• Generally speaking, when a new technology is
first invented or conceptualized, it is not
suitable for immediate application.
 Determining the transfer method, actors and
timing
• Once the decision is made to transfer a technology,
there are a number of possible methods that can be
used, informal and formal.
• Informal processes include technical information
exchange through published material, in the form of
printed or electronic information exchange through
published material, in the form of printed or electronic
media, meetings, symposia, individual exchanges or
reverse engineering.
• Formal technology transfer approaches are based on
legal arrangements between the participants in the
transfer process.
 Pre-transfer activities
• Before the technology transfer starts, there might be a
number of adjustments to physical facilities and
workforce.
• Depending on the location of the technology transfer, in
an existing or new portion of the enterprise, there might
be new installations or changes needed for the incoming
technology to function.
• The new technology might work with special inputs that
might not be available in the premises of the receiver
organization and it might take time to acquire them. So
the pre-transfer phase should consider all inputs and
make a procurement plan accordingly.
 Transfer activities
• Physical installations and adjustments take
place mainly before the transfer process starts,
although further changes may be needed after
technology is transferred in-house, depending
on whether problems occur and to
accommodate unexpected application needs.
• These installations may necessitate additional
site arrangements such as updating electricity
and building and transport infrastructure.
 Transfer activities
• After physical installation, tests are carried out at
different levels and, depending on the results,
new sets of arrangements are undertaken.
• Other actions are needed during the actual start-
up of the new technology, involving migration
from the old process to the new .
• If the company has the luxury of setting up the
new equipment in a new area, it can keep
material flowing to the old process until the new
one is run-ning smoothly.
 Evaluations and improvements
• When full production starts, feedback starts to flow
either from internal production departments or
from markets/customers, which creates another
round of evaluation and improvement activity.
• This is why, in the days immediately following the
start-up, a process of refinement and improvement
of the new technology takes place in order to fine-
tune the operations involved in the new technology.
• The process is monitored closely and any
substandard performance is identified, the cause
isolated and the problem rectified
 Evaluations and improvements
• There are difficulties in measuring the success of
technology transfer.
• The level of technological innovation, the level of
application and the purpose of transferring the
technology play a role in determining the
effectiveness of technology transfer.
• The evaluation might be carried out in any
combination of the following effectiveness
dimensions: benefits, procedure, availability, capacity
and supply. The complexity is clearly observed in
some of the measures used in technology transfer
evaluations
 Evaluations and improvements
• Once the evaluation is done, a plan for
improvements may need to be designed.
• Next to the evaluation, all documentation in the
technology transfer process can be screened to
discover the best ways of finding out what needs
to be done to improve the results, which might
include factors other than those relating to
technology transfer.
 Evaluations and improvements
• An important aspect of improvements is change
management.
• Transferring the commitment and enthusiasm of
those who are creating a new technology to those
who will develop and apply it can be challenging.
• Naturally, the degree of challenge depends on
whether top management of the recipient firm of
a new technology is supportive of transfer or not,
as well as if the recipient firm is unclear about
what it really wants from the company originating
the new technology.