Gbm unit-03 (global technological enviornment)

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By :

Prof. Amit Kumar

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“A student pursuing management education from IILM-

Graduate School of Management, for example may find

himself or herself placed in a firm located in a totally

different country. Knowledge about international

business keeps the youngster mentally prepared to

accept assignment in an alien environment. Forewarning

is definitely forearming, for the fresh management

graduate”.

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Importance of this course

Global Business Management

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Course: Global Business Management

1. Globalization

2. Global Trade & Theory

3. Global Technological Environment

4. Global Economic Environment

5. Global Political-Legal Environment

6. Foreign Direct Investments

7. Regional Economic Integration

8. Strategy and Structure of International Business

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Global Business Management

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Global Business Management Global Technological Environment

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04/18/23

Contents

• Opening Case: Videocon, Tata, RIL• Science & Technology• Classification of Technology• The Technology Cycle• Technology Transfer• 'Moonlighting Strategy’ for Technology Transfer


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Opening Case

Now, Indian companies are looking to globalize and they need to have long product pipelines. This is simply not possible without an in-house

research program.


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Opening Case: Videocon

Years ago, Videocon had a 'commodity' approach to the market, but with margins moving towards the high-end

technology differentiating market, the company has changed tack.

The company has set up R&D centers in the last one year in Japan, Italy, China and India. Infact, R&D

spends for the company, as a percentage of sales, have moved up from 1% to 4%.


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Opening Case: Tata Group

Tata Group's desire to develop advanced building materials. These materials might mitigate the usage of settel in construction. This will need

builders and consumers to use such materials.

This is clearly long-term play, and the group is spending close to Rs. 300 crore in this research.


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Opening Case: Reliance

RIL subsidiary, Reliance Life Sciences, which has set up in 2001, is working on novel proteins and still in early stages of development. The company

is also developing a wide-range of cell-basedtherapies for regenerative medicine.


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Technological Environment

• Fast moving and changing environment.

• Technological environment like its counterparts-political and legal, and cultural-wields considerable influence on international business.

• Technological advances can affect materials, components and products, manufacturing business processes, administration and distribution systems.


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Technology is powerful, but remember the other two dimensions:

Technological Environment

Economic: Is the technology cost effective? Behavioural: Will customers really use it?

http://clip-art.easy-interactive.com/image.php?GID=3688&SIM=0&TRM=technology&COL=1&BAW=1&GIF=1&JPG=1&EPS=1&WMF=1

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Science & Technology


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Features Science Technology

In pursuit of Knowledge Socio-economic gains

People involved Scientists Engineers

Agencies Involved Research Institution Industrial establishment

Funding Mostly government Industry

Motivation To satisfy curiosity To bring out need

satisfying products

Domain Public Private/Secret

Impact Discontinuous Continuous

Time span Uncertain Evolutionary

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Technology helping the dialogue between a company and its customers

• Technology has helped market research - complex sets of data can be input and analysed quickly and safely.

• Database technology allows the storage, retrieval and maintenance of detailed customer profiles and the creation of personalised customer marketing offers.

• Information sharing and communication between company and customers.

• Means of ordering goods and services.


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• Proprietary Technology: Technology protected by patents or secrecy agreements that provide a measurable competitive advantage

• Known Technology: Technologies that may be common to many organizations but are used in unique ways

• Core Technologies: Technologies that are essential to maintain a competitive advantage

• Leveraging Technologies: Technologies that support several products, product lines, or classes of products.

• Supporting Technologies: Technologies that support the core technologies

• Emerging Technologies: Technologies that are currently under consideration for future products or processes

Classification of Technology


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The Technology Cycle

Following classification, technology management involves

carefully implementing five stages:

1. Awareness

2. Acquisition

3. Adaptation

4. Advancement and

5. Abandonment.



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The Technology Cycle: Awareness

• This is the first phase of technology cycle in which a company has a formal mechanism to become aware of emerging technologies relevant to company's needs.

• Videocon come-up with plasma and LCD at low price.

• Some companies form 'think tank's' with engineers and scientists.



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The Technology Cycle: Awareness

• Some companies form 'think tank's' with engineers and scientists, who research from around the world, and gather information through computer bulletin services, journals, magazines, books, conferences and international product exhibitions.

• The information is synthesized and put in short internal report for the benefit of corporate strategic planners and technology policy makers.



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The Technology Cycle: Acquisition

This phase involves actual acquisition of a particular technology. To go from the awareness phase to the acquisition phase, the company's technology group , in collaboration with the industrial engineering group, would conduct technical feasibility study, as well as economic feasibility study, before justifying and acquiring a new technology.



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The Technology Cycle: Adaptation

Virtually every enterprise ends up adapting an acquired technology for its particular needs. If the

homework is done correctly, the transition from acquisition to adaptation becomes much smoother

and less expensive.



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The Technology Cycle: Advancement

When capital is limited one can not indiscriminately purchase and abandon technologies with scare money. It becomes imperative to improvise the acquired technologies for one's home needs. Companies like, Lincoln Electric have taken this thinking to a new height.



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The Technology Cycle: Advancement

Lincoln Electric is the world leader in electric arc-welding equipment, and generates most of the process technologies internally, eventually patenting them because it can not find equipment among the vendors.

For the most part, it advances technologies through the efforts of its design and development engineers.



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The Technology Cycle: Abandonment

This last phase of the technology cycle is the most critical because decisions are made concerning the obsolescence of a particular technology. With the rapid discarding of existing technologies, timing for new technology is critical for survival.



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The Technology Cycle: Abandonment

• Bad timing in prematurely abandoning a product could result in lost revenues and on the other hand, waiting too long to abandon might also result in lost revenues because customer may find a better alternative in competition.

• There does not seem to be an easy formula to make the selection, but it can be done with greater input of information from different areas of the company, such as R&D, Marketing and Production.



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• What is it that is transferred in the name of technology?

Technology is transferred through published materials (such as journals and books); purchase and sale of machinery, equipment and intermediate goods, transfer of data and personnel; and interpersonal communication.

• Technology transfer comprises five categories:

Technology Transfers


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Technology Transfer comprises five categories:1. International Technology transfer: Generally, such transfer

take place between developed and developing countries.2. Regional Technology transfer: transferred from one region

of a country to another.3. Cross-industry or Cross-sector technology transfer:

example is transfer of technology from the space program to commercial application

4. Inter-firm technology transfer: transferred from one company to another. Example is transfer of CAD and CAM machines from the machine tool manufacturing firm to a furniture making firm.

5. Intra-firm technology transfer: technology is transferred within a firm, from one location to another. Intra-firm transfer can also be made from one department to another within the same facility.

Technology Transfers


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Seoul- every Friday evening, dozens of young and middle-aged men leave their offices in Tokyo, head for the airport, and arrive here in south Korea a few hours later. They are Japanese engineers who have come to spend the weekend quietly moonlighting at Korean companies.

A 'MOONLIGHTING' Strategy for Technology Transferred

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Among them are engineering professionals, partners in technical firms, and employees of major Japanese corporations. Some are exporting their skills on the sly without the consent of their bosses. Some of these engineers are working at big personal risk.


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Their Korean sponsors range from small auto-parts makers to the biggest conglomerates. They typically meet the Japanese at the airport, put them up in a good hotels, provide interpreters, and pay them equivalent of US $250 a day. Some even lend the Japanese money to help buy houses back in Japan.


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The moonlighting engineers are just a small part of a large Korean strategy. South Korea desperately wants

to go high-tech but is badly lacking in the plans, people and processes needed to get there alone.

'We're very weak in design technology', say Yu Hee Yol, the head of technology transfer at the Ministry

of Science and Technology, 'SO WE IMPORT WHAT WE CAN'T CREATE'.


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Gbm unit-03 (global technological enviornment)

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