Sustainable technology management and development

and Management of technological innovation

Chapter 7 of SBDChapter 1 of MTI

Technology

Is a complex term that includes art, science, engineering, devices, methods, and know-how thet are applies in a beneficial manner.

It usually take the form of product and processes that can be used to create solutions.

In particulary it is true for hardware and software applications.

Technology innovation

Is a subset of strategic technology management and the systematic creation of new-to-the-world technologies that are superior to their predecessors and the improvements of exisisting technology platforms and portfolios.

Strategic Technology Management

Technological innovation is an important strategic issue today.

Recently, extensive analyses of automotive suppliers and industrial manufacturers. The findings suggest there are considerable strategic risks associated with the management of new technologies.

Patented technologies and the ability to create value-added features using those technologies are valuable differentiators which contribute to high profit margins. However, technology that remains static can not maintain a premium position in the marketplace.

example: As seen with anti-lock brake systems and airbags, even the most advanced technologies will eventually become commodity items.

The market entry phase New-technology suppliers should reinvest

profits from the current technology into the next-generation technologies.

In the innovation phase, suppliers should strategically reposition the current technology to focus on the emerging low-cost commodity phase.

Those who fail to recognize the different phases and adjust their management approach over time will suffer the consequences.

Over the last five years, some well-known suppliers sold or spun-off their automotive business units in the face of general under-performance, compared to non-automotive operations.

Among them are A. O. Smith, Rockwell, Allied-Signal, ITT, United Technologies and Cooper Industries.

For conglomerates, divestiture of an unprofitable business is a luxury that other suppliers do not have.

These suppliers have no alternative: to improve or to die.

If the 1990s was the decade of turmoil in the automotive industry, the first decade of the twenty-first century will be one of survival.

This is not a doomsday prophecy but simply a stricter application of the Darwinian theory. As the competition extends and intensifies globally, automotive suppliers should be more aware of the changes in the environment in which they operate; accurately assess the implications of those changes; and position themselves accordingly.

The window of opportunity for a new technology is considered to be about 10 years, depending on the technology. Within this ten year window, there are three product phases, namely:

Phase 1 -  Market Entry phase - rapid market penetration to gain economies of scale

Phase 2 - Innovation phase - technological change to drive down cost while adding features

Phase 3 - Commodity phase - process driven phase where manufacturing cost control is essential for survival

Strategic technology managementManaging technological

changeTechnological forecasting and

assessmentStrategy for innovation

Technological innovation

Technology: couse or solution?

Stability or change?

Technology life cycle:Is a time based theory of technological change that use the S curve to depict the development and growt of a technology

PERFORMANCE

TIME

introduction

leveling

Exponential growth

Overview

Construct for managing changeType of development projects

…changes…

Innovative strategic action

Creative strategic actions

Hierarchy of innovation and integration

Convergence of balanced technological and product attributes

ValueQualityLow costsPerformanceDurabilityReliabilityComfortAestheticsEsteem

Market attributes

Innovationattributes

MarketSocialTechnologicalEconomicEnvironmental

Stakeholderattributes

Ultra Clean No WasteRedployHigh EfficiencyLove NoiseConservationRecyclableLean

What is management of technological

innovation and why is it important? MTI

R&D

EFFICIENCY

EFFECTIVENESS

OPERATIONS AND

PROCESS

TECHNICAL INVESTIME

NT

BUSINESSUNCERTAINTY

NEW PRODUCT

DEVELOPMENT

COMMERCIALIZATION

PROCESS

COLLABORATION

…

…see you next lesson!