Sri Sharada Institute Of Indian Management - Research

Approved by AICTE


MANAGEMENT OF TECHNOLOGY
Project Report
ON
TECHNOLOGY 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 CYCLE
The technology 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 in product 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 technology underlying 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 different
The 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
with patents and trademarks seeking 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 a smartphone.
The development of a competitive product or 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 the management of 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 similar technology maturity lifecycle describing
the technological maturity of a product. This is not similar to a product 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
the industry 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 the technology matures.


THE FOUR PHASES OF THE TECHNOLOGY LIFE-CYCLE
The TLC may be seen as composed of four phases:
(a) The research 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) The ascent phase 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) The maturity phase when gain is high and stable, the region, going into saturation,
marked by M, and
(d) The decline (or decay phase), after a Point D, of reducing fortunes and utility of the
technology.
TECHNOLOGY PERCEPTION DYNAMICS
There is usually technology 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 the logistic
curve nature 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
eternal exponential 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 curve
Similarly, in the later stages, the opposite mistakes can be made relating to the possibilities
of technology maturity and market saturation.
Technology adoption typically occurs in an S curve, as modelled in diffusion of
innovations theory. This is because customers respond to new products in different
ways. Diffusion of innovations theory, pioneered by Everett 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 OPTIONS
In 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 phas
There 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 as venture 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 called strategic 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 through initial 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 phase
The 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 be as successful in 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, preferring not to 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 phase
The 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 in joint venture, typically in regions where the technology would be in
the ascent 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 phase
After 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. knowhow which 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, may imply 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 that technical service and technical
assistance contracts take (encountered often in developing country contracts). Alternatively,
consulting agencies may fill this role.
















TECHNOLOGY ADAPTION AND DIFFUSION
Absorbing 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 Design
IMPORTANCE OF TECHNOLOGY DIFFUSION


Technology diffusion plays a major role in most of the countries today. 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
other countries. The technology diffusion 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
the countries achieve higher productivity by taking the technology from 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 approach results in 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 unpackage the 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 desired results.
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 management
Change management is an approach to transitioning individuals, teams, and organizations to a
desired future state. In a project management context, change management may refer to a project
management process wherein changes to the scope of a project are formally introduced and
approved
APPROACH
Organizational 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 as social media and 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 strategies
2. Measurement system
3. Sequence of steps
4. Implementation and organizational change
Regardless 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 environment
2. Developing the necessary adjustments for their companys needs
3. Training their employees on the appropriate changes
4. Winning the support of the employees with the persuasiveness of the appropriate
adjustments
As 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 work
2. 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
organization
4. Counter resistance from the employees of companies and align them to overall strategic
direction of the organization
5. Provide personal counseling (if required) to alleviate any change-related fears
6. Monitoring of the implementation and fine-tuning as required
Examples
Mission changes
Strategic changes
Operational changes (including Structural changes)
Technological changes
Changing the attitudes and behaviors of personnel
Personality Wide Changes