UNIT 1

INNOVATION AND TECHNOLOGY MANAGEMENT

1.0 Technology: Definitions and Characteristics

Technology is defined as “purposeful intervention by design”, and technological practice as the

activity through which technological outcomes are created and have impact in the world.

Technological outcomes are designed to enhance the capabilities of people and expand human
possibilities. They change the made world in ways that have positive and/or negative impacts on
the social and natural world.

Technology uses and produces technological knowledge. Technological communities endorse

technological knowledge as valid when it is shown to support the successful development of
technological outcomes.

All technology exists within a historical context, influenced by and influencing society and
culture.

Technological practice is becoming increasingly interdisciplinary, relying more than ever on

collaboration between the technology community and people from other disciplines.
1.1 Technology management
Technology management is a set of management disciplines that allows organizations to
manage their technological fundamentals to create customer advantage. Typical concepts used in
technology management are:

• Technology strategy (a logic or role of technology in organization),

• Technology forecasting (identification of possible relevant technologies for the organization,
possibly through technology scouting),
• Technology roadmap (mapping technologies to business and market needs), and
• Technology project portfolio (a set of projects under development) and technology portfolio
(a set of technologies in use).
The role of the technology management function in an organization is to understand the value of
certain technology for the organization. Continuous development of technology is valuable as
long as there is a value for the customer and therefore the technology management function in an
organization should be able to argue when to invest on technology development and when to
withdraw.
 1.1 Component of Technology Management
• Planning.
• Organizing.
• Monitoring.
• Evaluating.
• Implementing and.
• Staffing with the end goal of strategically moving their company forward.

2.0 Technological Environment

The technological environment is part of the company’s external environment related to

developments and changes in technology. Further, the word ‘technology’ is usually associated
with technique and equipment. Their change raises threats and opportunities for the company.

The impact of the technological environment on companiesTechnological developments affect

all aspects of business, not only in products and services. In production, technology can increase
total output through:

• Increased productivity. With the same input, the company can produce more output per unit.
• Cost reduction for example computers and transportation technology

• Product sales technique. For example, more retailers are turning online than physical stores.
These changes certainly have a significant impact on their business strategy.
• Ways of making products. example, process automation
• Market research. Marketers can more easily analyze the market with a database system. The
technology element enables marketers to access data more accurately, allowing them to plan
marketing strategies better.
• Management and operation of the company. Now, employees do not have to attend the office
to work. Instead, they can do work at home, as long as they are connected to the internet.
• The choice of communicating with stakeholders, such as through websites, social media, and
email.
• Needs for new expertise. Companies increasingly need data analysts and programmers for the
interpretation of data and digital information processes.
• Change the needs and desires of consumers.
2.1Technology environment important

It affects various aspects of the business. That could be an opportunity or a threat. And,
companies cannot control technological factors but must respond to them. Therefore, companies
must be able to adapt to new technological developments.

Early adopters of new technology often achieve higher market share and get higher returns.
Therefore, companies need to scan for trends and changes. The aim is to take advantage of
opportunities while minimizing threats. That way, the company can be competitive.

2.3 Technological Environment parameters

1] Pull of Technological Change.

2] Opportunities from New Innovations.
3] Risk of Technological Environment.
4] Role of Research and Development.
2.4 Technology life-cycle

The technology life cycle describes the costs and profits of a product from technological
development to market maturity to decline.

The technology life cycle (TLC) describes the costs and profits of a product from

technological development phase to market maturity to eventual decline. Research

and development (R&D) costs must be offset by profits once a product comes to

market. Varying product lifespans mean that businesses must understand and
 accurately project returns on their R&D investments based on potential product

longevity in the market.

Due to rapidly increasing rates of innovation, products such as electronics and

pharmaceuticals in particular are vulnerable to shorter life cycles (when considered

against such benchmarks as steel or paper). Thus TLC is focused primarily on the

time and cost of development as it relates to the projected profits. TLC can be

described as having four distinct stages:

• Research and Development - During this stage, risks are taken to invest in

technological innovations. By strategically directing R&D towards the most

promising projects, companies and research institutions slowly work their way

toward beta versions of new technologies.

• Ascent Phase - This phase covers the timeframe from product invention to the

point at which out-of-pocket costs are fully recovered. At this junction the goal is

to see to the rapid growth and distribution of the invention

and leverage the competitive advantage of having the newest and

most effective product.

• Maturity Stage - As the new innovation becomes accepted by the general

population and competitors enter the market, supply begins to outstrip demand.

During this stage, returns begin to slow as the concept becomes normalized.
• Decline (or Decay) Phase - The final phase is when the utility and

potential value to be captured in producing and selling the product begins dipping.

This decline eventually reaches the point of a zero-sum game, where margins are

no longer procured.

Product development and capitalizing on the new invention covers the business

side of these R&D investments in technology. The other important consideration is

the differentiation in consumer adoption of new technological innovations. These

have also been distributed into phases which effectively summarize the

demographic groups presented during each stage of TLC:

2.4Technology adoption life cycle

This adoption chart highlights the way in which consumers embrace new products

and services.
• Innovators - These are risk-oriented, leading-edge minded individuals who are

extremely interested in technological developments (often within a particular

industry). Innovators are a fractional segment of the overall consumer population.

• Early Adopters - A larger but still relatively small demographic, these individuals

are generally risk-oriented and highly adaptable to new technology. Early adopters

follow the innovators in embracing new products, and tend to be young and well-

educated.

• Early Majority - Much larger and more careful than the previous two groups, the

early majority are open to new ideas but generally wait to see how they are

received before investing.

• Late Majority - Slightly conservative and risk-averse, the late majority is a large

group of potential customers who need convincing before investing in something

new.

• Laggards - Extremely frugal, conservative, and often technology-averse, laggards

are a small population of usually older and uneducated individuals who avoid risks

and only invest in new ideas once they are extremely well-established.

Taking these two models into consideration, a business unit with a new product or

service must consider the scale of investment in R&D, the projected life cycle the

technology will likely maintain, and the way in which customers will adopt this
product. By leveraging these models, businesses and institutions can exercise some

foresight in ascertaining the returns on investment as their technologies mature.

3.0 Technological Change

In economics, a technological change is an increase in the efficiency of a product

or process that results in an increase in output, without an increase in input. In
other words, someone invents or improves a product or process, which is then used
to get a bigger reward for the same amount of work.
The telephone is an example of a product that has undergone a technological
change. It has undergone many different changes over the years that have made it
more efficient. Processes or products, such as the telephone, move through
technological change in three stages:

• Invention - the creation of a new product or process

• Innovation - the application of the invention for the first time
• Diffusion - how fast others begin to adopt the innovation

3.1 Impacts of Technological change

We have all likely experienced the impact of technology. Let's take a look at the
ways, both good and bad, technological change has impacted our world:

• Creates new products and processes

When telephones were first invented, the object was to be able to verbally
communicate with someone. Due to technological changes, we have multiple ways
to communicate using our phones, such as text, email, or talk.

• Increases efficiency, lower costs

Technology makes it possible to perform everyday tasks faster and with less
energy on our part. For instance, some people have a vacuum cleaning robot.
Instead of spending 30 minutes vacuuming, they push a button and go do
something else. That's efficiency.
 • Helps economies evolve

People are able to increase the ways in which they create wealth. It also has a
ripple effect. When one technological change occurs, it changes how we live