Sri Sharada Institute Of Indian Management - ResearchApproved by AICTE

MANAGEMENT OF TECHNOLOGY Project ReportONTECHNOLOGY LIFE CYCLE AND CHANGE MANAGEMENT

Submitted To: - Submitted By:- Prof. N.Venkatesan kumara swamy(20120105)

Declaration

I hereby declare that the following project report titledTECHNOLOGYLIFE CYCLE AND CHANGE MANAGEMENT is an authentic work done by me. This is to declare that all work indulged in the completion of this work such as research, analysis of activities of an organization is a profound and honest work of mine.

Place: New Delhi Kumara swamy 20120105

ACKNOWLEDGEMENT

I would like to express hearty gratitude to our faculty guide, Prof. N.Venkatesan for giving me the opportunity to prepare a project report on TECHNOLOGY LIFE CYCLE AND CHANGE MANAGEMENT and for his valuable guidance and sincere cooperation, which helped me in completing this project.

Kumara swamy(20120105)PGDM Batch (2012-2014)Sri SIIM

TECHNOLOGY LIFE CYCLEThetechnology life-cycle(TLC) describes the commercial gain of a product through the expense of research and development phase, and the financial return during its "vital life". Some technologies, such as steel, paper or cement manufacturing, have a long lifespan (with minor variations in technology incorporated with time) whilst in other cases, such as electronic or pharmaceutical products, the lifespan may be quite short.The TLC associated with a product or technological service is different from product life-cycle (PLC) dealt with inproduct life-cycle management. The latter is concerned with the life of a product in the marketplace with respect to timing of introduction, marketing measures, and business costs. The technologyunderlying the product (for example, that of a uniquely flavored tea) may be quite marginal but the process of creating and managing its life as a branded product will be very differentThe technology life cycle is concerned with the time and cost of developing the technology, the timeline of recovering cost, and modes of making the technology yield a profit proportionate to the costs and risks involved. The TLC may, further, be protected during its cycle withpatentsand trademarksseeking to lengthen the cycle and to maximize the profit from it.The "product" of the technology may just be a commodity such as the polyethylene plastic or a sophisticated product like the ICs used in asmartphone.The development of acompetitive productor process can have a major effect on the lifespan of the technology, making it shorter. Equally, the loss of intellectual property rights through litigation or loss of its secret elements (if any) through leakages also work to reduce a technology's lifespan. Thus, it is apparent that themanagementof the TLC is an important aspect of technology development.In the simplest formulation, innovation can be thought of as being composed of research, development, demonstration, and deployment.Most new technologies follow a similartechnology maturity lifecycledescribing thetechnological maturityof a product. This is not similar to aproduct life cycle, but applies to an entire technology, or a generation of a technology.Technology adoption is the most common phenomenon driving the evolution of industries along theindustry lifecycle. After expanding new uses of resources they end with exhausting the efficiency of those processes, producing gains that are first easier and larger over time then exhaustingly more difficult, as thetechnology matures.

THE FOUR PHASES OF THE TECHNOLOGY LIFE-CYCLEThe TLC may be seen as composed of four phases:(a) Theresearch and development (R&D)phase (sometimes called the "bleeding edge") when incomes from inputs are negative and where the prospects of failure are high(b) Theascentphase when out-of-pocket costs have been recovered and the technology begins to gather strength by going beyond some Point A on the TLC (sometimes called the "leading edge")(c) Thematurityphase when gain is high and stable, the region, going into saturation, marked by M, and(d) Thedecline(or decay phase), after a Point D, of reducing fortunes and utility of the technology.TECHNOLOGY PERCEPTION DYNAMICSThere is usuallytechnology hype at the introduction of any new technology, but only after some time has passed can it be judged as mere hype or justified true acclaim. Because of thelogistic curvenature of technology adoption, it is difficult to see in the early stages whether the hype is excessive.The two errors commonly committed in the early stages of a technology's development are fitting an exponential curve to the first part of the growth curve, and assuming eternalexponential growth fitting a linear curve to the first part of the growth curve, and assuming that take-up of the new technology is disappointing

Rogers' bell curveSimilarly, in the later stages, the opposite mistakes can be made relating to the possibilities oftechnology maturityandmarket saturation.Technology adoptiontypically occurs in an S curve, as modelled indiffusion of innovationstheory. This is because customers respond to new products in different ways.Diffusion of innovationstheory, pioneered byEverett Rogers, posits that people have different levels of readiness for adopting new innovations and that the characteristics of a product affect overall adoption. Rogers classified individuals into five groups: innovators, early adopters, early majority, late majority, and laggards. In terms of the S curve, innovators occupy 2.5%, early adopters 13.5%, early majority 34%, late majority 34%, and laggards 16%.The four stages of technology life cycle are as follows: Innovation stage: This stage represents the birth of a new product, material of process resulting from R&D activities. In R&D laboratories, new ideas are generated depending on gaining needs and knowledge factors. Depending on the resource allocation and also the change element, the time taken in the innovation stage as well as in the subsequent stages varies widely. Syndication stage: This stage represents the demonstration and commercialisation of a new technology, such as, product, material or process with potential for immediate utilisation. Many innovations are put on hold in R&D laboratories. Only a very small percentage of these are commercialised. Commercialisation of research outcomes depends on technical as well non-technical, mostly economic factors. Diffusion stage: This represents the market penetration of a new technology through acceptance of the innovation, by potential users of the technology. But supply and demand side factors jointly influence the rate of diffusion. Substitution stage: This last stage represents the decline in the use and eventual extension of a technology, due to replacement by another technology. Many technical and non-technical factors influence the rate of substitution. The time taken in the substitution stage depends on the market dynamics.

LICENSING OPTIONSIn current world trends, with TLCs shortening due to competition and rapid innovation, a technology becomes technically licensable at all points of the TLC, whereas earlier, it was licensed only when it was past its maturity stage.Large corporations develop technology for their own benefit and not with the objective of licensing. The tendency to license out technology only appears when there is a threat to the life of the TLC (business gain) as discussed later.Licensing in the R&D phasThere are always smaller firms (SMEs) who are inadequately situated to finance the development of innovative R&D in the post-research and early technology phases. By sharing incipient technology under certain conditions, substantial risk financing can come from third parties. This is a form of quasi-licensing which takes different formats. Even large corporates may not wish to bear all costs of development in areas of significant and high risk (e.g. aircraft development) and may seek means of spreading it to the stage that proof-of-concept is obtained.In the case of small and medium firms, entities such asventure capitalists('angels'), can enter the scene and help to materialize technologies. Venture capitalists accept both the costs and uncertainties of R&D, and that of market acceptance, in reward for high returns when the technology proves itself. Apart from finance, they may provide networking, management and marketing support. Venture capital connotes financial as well as human capital.Large firms may opt for Joint R&D or work in a consortium for the early phase of development. Such vehicles are calledstrategic alliances strategic partnerships.With both venture capital funding and strategic (research) alliances, when business gains begin to neutralize development costs (the TLC crosses the X-axis), the ownership of the technology starts to undergo change.In the case of smaller firms, venture capitalists help clients enter the stock market for obtaining substantially larger funds for development, maturation of technology, product promotion and to meet marketing costs. A major route is throughinitial public offering(IPO) which invites risk funding by the public for potential high gain. At the same time, the IPOs enable venture capitalists to attempt to recover expenditures already incurred by them through part sale of the stock pre-allotted to them (subsequent to the listing of the stock on the stock exchange). When the IPO is fully subscribed, the assisted enterprise becomes a corporation and can more easily obtain bank loans, etc. if needed.Strategic alliance partners, allied on research, pursue separate paths of development with the incipient technology of common origin but pool their accomplishments through instruments such as 'cross-licensing'. Generally, contractual provisions among the members of the consortium allow a member to exercise the option of independent pursuit after joint consultation; in which case the optee owns all subsequent development.Licensing in the ascent phaseThe ascent stage of the technology usually refers to some point above Point A in the TLC diagram but actually it commences when the R&D portion of the TLC curve inflects (only that the cashflow is negative and unremunerative to Point A). The ascent is the strongest phase of the TLC because it is here that the technology is superior to alternatives and can command premium profit or gain. The slope and duration of the ascent depends on competing technologies entering the domain, although they may not beas successfulin that period. Strongly patented technology extends the duration period.The TLC begins to flatten out (the region shown as M) when equivalent or challenging technologies come into the competitive space and begin to eat away marketshare.Till this stage is reached, the technology-owning firm would tend to exclusively enjoy its profitability, preferringnotto license it. If an overseas opportunity does present itself, the firm would prefer to set up a controlled subsidiary rather than license a third party.Licensing in the maturity phaseThe maturity phase of the technology is a period of stable and remunerative income but its competitive viability can persist over the larger timeframe marked by its 'vital life'. However, there may be a tendency to license out the technology to third-parties during this stage to lower risk of decline in profitability (or competitivity) and to expand financial opportunity.The exercise of this option is, generally, inferior to seeking participatory exploitation; in other words, engagement injoint venture, typically in regions where the technology would be in theascent phase,as say, a developing country. In addition to providing financial opportunity it allows the technology-owner a degree of control over its use. Gain flows from the two streams of investment-based and royalty incomes. Further, the vital life of the technology is enhanced in such strategy.Licensing in the decline phaseAfter reaching a point such as D in the above diagram, the earnings from the technology begin to decline rather rapidly. To prolong the life cycle, owners of technology might try to license it out at some point L when it can still be attractive to firms in other markets. This, then, traces the lengthening path, LL'. Further, since the decline is the result of competing rising technologies in this space, licenses may be attracted to the general lower cost of the older technology (than what prevailed during its vital life).Licenses obtained in this phase are 'straight licenses'. They are free of direct control from the owner of the technology (as would otherwise apply, say, in the case of a joint-venture). Further, there may be fewer restrictions placed on the licensee in the employment of the technology.The utility, viability, and thus the cost of straight-licenses depends on the estimated 'balance life' of the technology. For instance, should the key patent on the technology have expired, or would expire in a short while, the residual viability of the technology may be limited, although balance life may be governed by other criteria viz.knowhowwhich could have a longer life if properly protected.It is important to note that the license has no way of knowing the stage at which the prime, and competing technologies, are on their TLCs. It would, of course, be evident to competing licensor firms, and to the originator, from the growth, saturation or decline of the profitability of their operations.The license may, however, be able to approximate the stage by vigorously negotiating with the licensor and competitors to determine costs and licensing terms. A lower cost, or easier terms,mayimply a declining technology.In any case, access to technology in the decline phase is a large risk that the licensee accepts. (In a joint-venture this risk is substantially reduced by licensor sharing it). Sometimes, financial guarantees from the licensor may work to reduce such risk and can be negotiated.There are instances when, even though the technology declines to becoming a technique, it may still contain important knowledge or experience which the licensee firm cannot learn of without help from the originator. This is often the form thattechnical serviceandtechnical assistancecontracts take (encountered often in developing country contracts). Alternatively, consulting agencies may fill this role.

TECHNOLOGY ADAPTION AND DIFFUSIONAbsorbing and adapting preexisting and new-to-the-market or new-to-the-firm technologies, may be a necessary condition for a developing country to create R&D capacity and subsequently be able to commercialize the results of R&D to produce new businesses, products and services to address national needs.The capacity to absorb and diffuse existing knowledge is at least as important as the capacity to produce new knowledge.Innovation more frequently entails building the capacity to use technologies that are in widespread use elsewhere but that are new to the country, new to the firm, or used in new ways. To facilitate this type of innovation, countries must build the capacity to find, absorb and use these technologies.Improving the absorptive capability of countries their ability to tap into the global technology pool is an important mechanism for accelerating industrial development, raising productivity of workers, and raising economic growth. Trade flows, foreign direct investment (FDI), research and development (R&D), intellectual property rights (IPRs) (e.g. patents, licensing), and labor mobility and training are key elements for knowledge absorption. Yet the speed and success of this absorption process hinges crucially on having a favorable investment climate along with solid national education and innovation systems. A favorable environment for private sector development can be enhanced at the regional level, as in the case of the industrial districts in Italy, where enough of these enabling factors are present.

These proceedings provide a prcis of the main issues and conclusions presented at the Forum by an outstanding group of academics, practitioners, and policymakers.2 It also encapsulates the key results of the ECAKE II Report on the role of trade, FDI and IPRs in promoting economic growth. It reviews the Italian industrial cluster experience that occupied center-stage at the Forum and discusses the replicability of this success story in the context of ECA countries, and draws lessons for technology absorption by innovative small and medium enterprises.1. The socio-political environment in developing countries differs profoundly from the environment in developed countries. The former face some obstacles, or better said show a significant amount of incompetence in promoting and/or adopting/adapting innovation. By innovation is not understood only technology innovation or invention, but business innovation as well, new approaches to marketing, management or supply chain. The obstacles originate from inadequate education system, poor business conditions, undeveloped infrastructure, no relation between the universities and industry, improper government polices. However it is not about the formal set of regulations, but their implementation in practice. In most of the cases the implementation is the weakest link in the value chain. Behind this general and simplified approach the detailed picture is much more complicated. The innovation landscape in developing countries is burden by differences in cultural and historical heritage, level of the development, mentality of the people etc. Hence, the innovation policies have to be customized to country specific or region specific conditions.

One common attribute of majority of low income countries is lack of technology infrastructure. Consequentially, the main concern of the innovation policies should be development of technology infrastructure. The other peculiarity associated with developing countries is indigenous knowledge. It is a non written, non documented knowledge, in possession of local communities, usually related to some traditional healing or agriculture methods. However this knowledge is very important for local population and it has to be used as a basis for creating innovations. Talking about innovations in developing countries, one has to clarify that the innovations have to be designed according to the needs of the people who live there and has to add value to their lives. By no meaning they have to be compared with the innovations invented in developed world, since the standard of living is very different. Thus, it should be something new or some improvement in local context.

The other point is whether the experience and/or model of transferring scientific solutions into business practice from the technologically more advanced countries can be mapped to the less developed ones. For instance knowledge advanced countries are characterized by strong IP protection policy. Would this type of policy if applied in a country with few innovations resources and limited infrastructure rather foster or hinder the innovation climate? The IP policy could be an instrument to protect the rights of the inventor and those who share the endeavor with him/her, and acts as perk of working for the companies who compete in innovations abundant landscape, but for the countries where the innovations are rare its role would be definitely opposite. Open innovation model would fit better to the developing countries' environment, since it offers collaboration, open network and support to those who focus their effort in enhancing the awareness of the importance of the innovation in the economical development of the country.2. Balancing limited resources between supporting both diffusion and commercialization to achieve outcomes superior to those of diffusion alone in the short and long term.3. Experience of developing countries with open innovation and open business models in supporting and extending technology absorption and adaptation.4. Forward versus Reverse DesignIMPORTANCE OF TECHNOLOGY DIFFUSION

Technology diffusion plays a major role in most of thecountriestoday. The barriers to technology diffusion help us to determine the magnitude of technology diffusion. These barriers determine the volumes of diffusion. Diffusion enlarges the set of available technologies and increases the productivity of the country. In case of diffusion, productivity is determined by the domestic technology in the production country and the diffusion technology from othercountries.The technologydiffusion plays more important role in the sector of goods that are not tradable, than the sector with the tradable goods.

The free technology diffusion generates more gains compared to that of the free merchandise trade. We can increase the merchandise trade by removing the diffusion barriers since thecountriesachieve higher productivity by takingthe technologyfrom the diffusion process.

A well-managed technology diffusion system enables an organization to plan its technology development projects in a more meaningful manner as well as transfer the technologies more successfully. Such an approachresultsin better returns for the investments made in R&D and technology development systems.BENEFITS OF TECHNOLOGY ABSORPTION

Repeated collaborations for the same product/ process are avoided. Acquisition of further technologies becomes selective. Ability is developed to unpackagethe technology. Savings can be affected in foreign exchange due to indigenisation /use of indigenous alternatives. Effective utilisation is made of available indigenous research expertise and facilities to achieve the desiredresults. Know-why and technology upgradation capabilities are built-up. Exports are increased. Technically competent groups of scientists and engineers trained in technology absorption get matured and strengthened. The base for technological self-reliance is enhanced.

Change managementChange managementis an approach to transitioningindividuals,teams, andorganizationsto a desired future state.In aproject managementcontext, change management may refer to a project management process wherein changes to the scope of a project are formally introduced and approvedAPPROACHOrganizational change is a structured approach in an organization for ensuring that changes are smoothly and successfully implemented to achieve lasting benefits. Globalization and the constant innovation of technology result in a constantly evolving business environment. Phenomena such associal mediaand mobile adaptability have revolutionized business and the effect of this is an ever increasing need for change, and therefore change management. The growth in technology also has a secondary effect of increasing the availability and therefore accountability of knowledge. Easily accessible information has resulted in unprecedented scrutiny from stockholders and the media and pressure on management. With the business environment experiencing so much change, organizations must then learn to become comfortable with change as well. Therefore, the ability to manage and adapt to organizational change is an essential ability required in the workplace today. Yet, major and rapid organizational change is profoundly difficult because the structure, culture, and routines of organizations often reflect a persistent and difficult-to-remove "imprint" of past periods, which are resistant to radical change even as the current environment of the organization changes rapidly.Due to the growth of technology, modern organizational change is largely motivated by exterior innovations rather than internal moves. When these developments occur, the organizations that adapt quickest create a competitive advantage for themselves, while the companies that refuse to change get left behind. This can result in drastic profit and/or market share losses.Organizational change directly affects all departments from the entry level employee to senior management. The entire company must learn how to handle changes to the organization.When determining which of the latest techniques or innovations to adopt, there are four major factors to be considered:1. Levels, goals, and strategies2. Measurement system3. Sequence of steps4. Implementation and organizational changeRegardless of the many types of organizational change, the critical aspect is a companys ability to win the buy-in of their organizations employees on the change. Effectively managing organizational change is a four-step process:1. Recognizing the changes in the broader business environment2. Developing the necessary adjustments for their companys needs3. Training their employees on the appropriate changes4. Winning the support of the employees with the persuasiveness of the appropriate adjustmentsAs a multi-disciplinary practice that has evolved as a result of scholarly research, organizational change management should begin with a systematic diagnosis of the current situation in order to determine both the need for change and the capability to change. The objectives, content, and process of change should all be specified as part of a Change Management plan.Change management processes should include creative marketing to enable communication between changing audiences, as well as deep social understanding about leaderships styles and group dynamics. As a visible track on transformation projects, Organizational Change Management aligns groups expectations, communicates, integrates teams and manages people training. It makes use of performance metrics, such as financial results, operational efficiency, leadership commitment, communication effectiveness, and the perceived need for change to design appropriate strategies, in order to avoid change failures or resolve troubled change projects.Successful change management is more likely to occur if the following are included:1. Benefits management and realization to define measurable stakeholder aims, create a business case for their achievement (which should be continuously updated), and monitor assumptions, risks, dependencies, costs, return on investment, dis-benefits and cultural issues affecting the progress of the associated work2. Effective communication that informs various stakeholders of the reasons for the change (why?), the benefits of successful implementation (what is in it for us, and you) as well as the details of the change (when? where? who is involved? how much will it cost? etc.)3. Devise an effective education, training and/or skills upgrading scheme for the organization4. Counter resistance from the employees of companies and align them to overall strategic direction of the organization5. Provide personal counseling (if required) to alleviate any change-related fears6. Monitoring of the implementation and fine-tuning as requiredExamples Mission changes Strategic changes Operational changes (including Structural changes) Technological changes Changing the attitudes and behaviors of personnel Personality Wide Changes