12/1/2020 Technology Management

EXPLOITATION

Group Members
Safeera Azhar 20010856-002
Farzeen Walayat 20010856-009
Zunaira Tariq 20010856-007
Kainat 20010856-011
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EXPLOITATION
Introduction
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.
Exploitation of technological capability is more than just commercialization, since the expected
benefits might be accrued 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
Definition:
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.
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.
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.
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 inhouse or acquired
externally. This is why the marketing of technological products and services is highly critical.
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Marketing processes:
There are four major marketing processes:
1. Market preparation.
2. Targeting.
3. Positioning.
4. Execution
Market preparation:
Preparing the market refers to readying customers and other companies for the change by
educating the market on a product or service. This stage might take place while the product is still
in development. In the case of technology marketing, getting the market ready involves building
awareness of the new technology as well as forming relationships with customers and suppliers. As
technology products are complex and expensive, educating customers beforehand may improve
the perception of the product.
Targeting:
Targeting refers to finding the right customers and learning their characteristics in order to decide
on the marketing features to direct to the varying customer segments, for which it is important to
understand adopter types. The innovation adoption curve is a model that classifies innovation
adopters into various categories, based on the idea that certain distinguish the firm from its
competitors.
Positioning:
Technology marketing builds its positioning according to the adopter type. While innovators might
be interested in technological superiority, the early-majority type is likely to be motivated by a
well-functioning, low-cost version of the new technology. Once the product/ application works,
marketing to the early majority type is a matter of:
• Attending industry conferences and trade shows.
• Frequent mentions in industry magazines.
• Being installed in other companies in the same industry.
• Developing industry-specific applications.
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• Alliances with other key suppliers to the industry.

Execution:
The final step is to deploy company's resources to one or two specific niche markets where it can
dominate rapidly and force out competitors. This progressive approach will ultimately build a
winning image and develop the trust of customers in the company.

Technology transfer
Definition:
Technology transfer is the process by which the technology, knowledge and information developed
by a creator is applied and utilized by an applier (Khalil, 2000).
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. If either the creator or applier is from a different country, technology
transfer takes place at the international level.
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 of the application is high.
• The existence of an advocate of the transferred technology.
• Joint programs 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.
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 evolving 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. Instead, new technologies are usually subjected to experimentation, refinement and
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increasingly realistic testing. Once the technology is sufficiently proven, it can be incorporated into
a system/sub-system. However, this is easier said than done.
Pre-transfer activities:
Formal technology transfer relies on legal documentation, a contract including binding conditions on what
will be transferred, between whom, when, how and for what price. Depending on the actors involved in the
agreement, the type and extent of the contract might change. For reliable partners, the contract might be
more flexible, while for developers who are not trusted, it might need to be more detailed. The contract
preparation is even more complicated when the technology transfer is international, since the contract should
be structured according to international regulations.

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 arise and to accommodate unforeseen application needs. These installations may
necessitate additional site arrangements such as updating electricity and transport infrastructure.
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.
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.

Technology utilization
Definition:
Although the technology transfer might have been successful, the results from the exploitation of
technology might not be as expected or designed. Technology utilization might be considered in
the lines of re-engineering and total quality management (TQM), since the goal is either
maintenance or continuous improvement of the use of existing technologies.
Utilization processes consist of three major steps:
1. Measure technology utilization/performance.
2. Identify priorities and develop a business case to improve utilization.
3. Implement changes.
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Measure technology utilization/performance:

• Technology investments may have a substantial but far less visible impact on the
business, especially in the short term. In the long run, the firm may have a better
product.
• Technology evaluation raises the following questions for technology managers:
What is to be evaluated? Who is to be involved in evaluation? What roles do they
play? What criteria arc to be used in the evaluation?
In the input-process-output model:
• Input measures are the time and resources required, such as people or information
technology.
• Process measures are the indicators of efficiency of the innovation process within an
organization, such as the time required to bring an innovation to market.
• Output measures are directly related to the commercial impact of innovations, such as
revenues generated by a new service or product.

Identify priorities and develop a business case to improve utilization:

Performance evaluations can give conflicting results and prioritizing the improvements might be
difficult, so criteria should be established for determining which measures are most appropriate
and helpful.
• One consideration is to understand the role of the external environment in utilizing the
technology.
• Another mechanism is diversification. The core technology approach suggests focusing on
core technologies that make it possible to diversify the product/market range based on the
core capabilities developed.
• Demand changes in the market can initiate a chain effect within the company.
• Reliability concerns are also important when prioritizing improvement efforts.

Implement changes:
Improvement projects are similar to new product or process projects and need to be implemented
following approaches similar to those for R&D management. Improving performance requires the
management of a wide range of issues, including ideas, technologies, culture and organizational
change. Therefore learning and change management become indispensable parts of the
implementation.
Reverse innovation:
Emerging markets/rapidly growing developing countries such as China arc becoming centers of
attention for many businesses around the globe (Khanna and Palcpu, 2010). This is because
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emerging markets offer many business opportunities to aspiring firms who wish to grow their
businesses and do so rapidly: these are markets with high population and economic growth,
revolution in consumers' rising expectations, urbanization, increasing numbers of middle and upper-
middle-income segments composed of consumers who are hungry for goods and services, expanding
distributor and telecommunication networks and exploding market demand.

Case Study
Managers cannot relax once technology is in place, since technological exploitation depends on how
efficiently and effectively managers handle commercialization, trans-fer and utilization. The case of BICC
Cables Ltd, the UK's largest cable manufacturing company in the 1990s, with annual revenues of
approximately E1.3bn and employing about 10,000 people, illustrates how technology transfer and
utilization activities arc carried out for an internal R&D invention.

BICC Cables Ltd:

The process technology was designed and developed at BICC Cable's Helsby Technology Centre
(HTC). The technology-receiving factory, BICC Brand-Rex, was based at the same site. Two reasons
motivated the choice of in-house production: high demand and the high cost of bought-in fibre.
The involvement of Brand-Rex senior management in this project was seen as a major catalyst for
promoting successful technology transfer. The marketing information was consistent in outlining sales
forecasts for the months ahead, the technology transfer process was driven by external market
signals and the R&D department was aware of the wider business implications for tight buffered
fibre cable development. This ensured that everyone involved in developing and transferring this
technology within BICC was also aware of the wider business implications. This meant, in turn, that
everybody involved realized that this was not just a speculative R&D project but had real goals
and targets to achieve.

Summary:
The exploitation activity consists of a number of critical sub-processes, the three major ones bring
commercialization/marketing, technology transfer and utilization. All these sub-processes help to
find the right business models for commercialization, transferring technology in an effective and
efficient manner and achieving incremental improvements continuously in order Technology
Management: IT-hub Students Notes Compiled by: Prof. Dr. M. A. Pasha Page 21 to achieve day-
to-day operational efficiency. If exploitation capabilities are not developed, returns on
technologies are low.