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Types of Technologies
Why Technology has become a critical issue?
International product Life Cycle theory Phase1: Export of local innovation to other markets
Ex: TVs invented by American and European companiesstarted selling in other markets in Europe.
French company, which introduced electronic telephoneterminal, started exporting to other European markets.
Phase 2: Market grows and continues to grow and demand issatisfied by local production
Phase 3: Exports by innovator starts decreasing. Demand forthe new goods in less economically developed countries isrising. Demand is satisfied by earlier followers
Phase4: Product or service is no longer an innovation. Less
developed countries starts making the product moreeconomically and exports to innovating countries
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Global Competitiveness Ranking 2006Ranking 2007
Business Competitiveness
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Technology
Technology can be defined as all knowledge,
products, processes, tools , methods, and systemsemployed in the creation of goods or in providingservices
Classification of Technology
New Technology: A new Technology is anynewly introduced or implemented technology thathas an explicit impact on the way a companyproduces products or provides services.
Ex: Computer software for drawing replacingmanual drawing, Selling products through internet,
ATMs in Banks.
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Emerging Technology:An emerging Technologyis any technology that is not yet fullycommercialised but will become so within five years.
Ex: Superconductivity, Digital Studios. High Technology: High Technology refers to
advanced or sophisticated technology Ex: PSLV in satellite launching, Cryogenic
technology, Genetic Engineering, SoftwaredevelopmentHigh Technologies Company has following
characteristics Employs highly educated people ( Scientists and
Engineers) Its technology is changing at faster rate than other
industries It competes with technological innovations High level of R&D expenditure
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Low Technology: Low Technology refers totechnologies that have permeated large
segments of human society. Ex: Digital Technology, Computer Chips
manufacturing, Generic drugs.
Low Technology Companies have followingcharacteristics
Employ people with relatively low level of
education or skill Use manual or semiautomatic operations
Low level of R&D expenditure
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Codified and Tacit Technology:Technology can be preserved and effectivelytransferred among users if it is expressed in
coded form. Engineering drawing expressing shape,
dimensions and tolerance about a product
Tacit Technologyis nonarticulatedknowledge. There is no uniformity in the wayit is presented or expressed to a large groupof people. It is usually based on experiencesand therefore remains within the minds of itsdevelopers. Knowledge is transmitted bydemonstration or observation followed by
assimilation by those who seek knowledge.
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Technology TransferDefinition: Technology transferis a process that permits the flow of technology from a source to a
receiver. The source in this case is the owner or holder of knowledge, while the recipient isthe beneficiary of such knowledge. The source could be an individual, a company, or acountry.
Categorises of Technology Transfer International Technology Transfer:Transfer is across national boundaries. Ex: Technology from industrialised countries to developing countries. Regional technology Transfer:Technology is transferred from one region of
the country to another.
Ex: Transfer of Technology from Mumbai to Bangalore Cross-Industry technologytransfer: Technology is transferred from one
industrial sector to another. Ex: Transfer of Technology from space program to commercial
applications. Inter firm technology transfer:Technology is transferred from one firm to
another. Ex: Transfer of computer aided manufacturing machines from an
automobile manufacturing firm to furniture producing firm. Intrafirm Technology transfer:Technology is transferred with in a firm from
one location to another. Ex: Transfer of Technology from a companies Bangalore division to its
Pune location
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Channels of Technology Flow
General Channels: Technology Transfer is done unintentionallyand may proceed without the continued involvement of the source.Information is made available in public domain with limited or norestrictions on its use. This information is harnessed by users andapplied to their purposes.
Examples of such channels are education, training, publications,conferences, and Study missions
Channels of
Technology Flow
General
ChannelsReverse Engineering
ChannelsPlanned Channels
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Reverse-Engineering Channels: Transfer inwhich no active contribution from the source.Here receiver is capable of breaking the code oftechnology and capability to duplicate it in somefashion.
Ex: Compaq developed its first PC using reverse
engineering. Compaq had all componentsneeded for PC except ROM-BIOS Chip. Thistechnology was owned and protected by IBM.Compaq engineers did reverse engineering of
the chip to make similar chip and made the PC.Compaq sold 47,000 PCs (IBM compatible) infirst year worth $111 Million!
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Planned Channels: Transfer is doneintentionally according to a planned process andwith the consent of the technology owner.
Types of Planned Channels:
Licensing (Purchase of right to utilise thetechnology)
Franchise (Sale of technology with continualsupport)
Joint Venture
Turnkey Projects
Foreign Direct Investment (FDI) Technical Consortium and joint R&D Projects
(Consortium between France and England todevelop supersonic Planes)
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High tech is technology that is at the cuttingedgethe most advanced technology currentlyavailable. The adjective form is hyphenated:
high-tech orhigh-technology. (There is alsoan architectural style known as high tech).
There is no specific class of technology that ishigh techthe definition shifts over timeso
products hyped as high tech in the 1960s wouldnow be considered, if not exactly low tech, thenat least somewhat primitive. This fuzzy definitionhas led to marketing departments describing
nearly all new products as high tech.(Source: Wikipedia)
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High tech sectors
Aerospace technology
Biotechnology
Information technology Nanotechnology
Robotics
OECD also classifies industries. OECD has two different
approaches: sector and product approaches. The sectorapproach classifies industries according their technologyintensity, product approach according to finishedproducts. Further analysis from OECD has indicated thatusing research intensity as only industry classification
indicator is also possible. The OECD does not only takethe manufacturing but also the usage rate of technologyinto account. The OECD's classification is following(stable since 1973):
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Industry name Total R&D-intensity (1999, in %) ISIC Rev. 3
High-Technology
Pharmaceuticals 10.46 2423
Aircraft & spacecraft 10.29 353
Medical, precision & optimal instruments 9.69 33 Radio, television & communication equipment 7.48 32
Office, accounting & computing machinery 7.21 30
Medium-High-Tecnology
Electrical machinery & apparatus 3.60 31
Motor vehicles, trailers & semi-trailers 3.51 34
Railroad & transport equipment 3.11 352+359
Chemical & chemical products 2.85 24 (excl. 2423)
Machinery & equipment 2.20 29