• Abstract
• Introduction
• Rationale
• Issue of Technology Strategy Management
• A framework of technology information for technology strategy management
• Conclusion

Abstract

Technological information is often ignored by strategists although it is of paramount importance in the strategic management of business. This study attempts to identify the information required for technology strategy management at the firm level. It clearly shows that for technology strategy management, information is necessary in four major areas - technology resources, technology capabilities, technology infrastructure, and technology climate. These kinds of information can broadly be classified into two categories - internal technological information and external technological information. Internal information can be gathered from within the company while, external information is subject to the scanning of the operating environment of the company. It is also evident from the study that this information should be considered carefully for formulating technology strategies. Considering the importance of technological information for the practitioners, a framework of technological information for technology strategy management is proposed in this study.

1. Introduction

In the era of information, technology strategies in business have been greatly affected by technology-related information. It clarifies risks and gains, inputs and outputs, prerequisites and results and all the conditions involved in making the right technology strategy. The strategists need as much information as is required to clarify significant aspects of the decisions in all regards. But technological information, although important, is often ignored by them. This is not to say that technology information is altogether absent from the technology strategy, but it generally appears in a fragmented fashion as part of other functional strategies such as marketing (Burgelman and Maidique, 1988). Many economists considered technology as a residual factor. However, after understanding the importance of technology, many researchers expressed the importance of identifying technology information in the strategic management of business (Friar and Horwitch, 1985; Horwitch 1986; Mitchell, 1985; Stacey and Aston, 1990; Sharif 1994). Hence, there is a necessity to design a framework of technological information that would facilitate the formulation and implemention of technology strategies of a company. In a developing country context, the technology information is rather more important because the availability of this information to companies in this region is inadequate.

2. Rationale

Relevance - Information that is often obtained for technology is scientific information which is freely available in the public domain at almost no cost. Technological information differs from scientific information in that it is intended for use to produce an added value and a profit. Hence, it is a commodity that may have a price tag on it and it is traded in a free market (UNIDO, 1996). However, due to a lack of infrastructure for the collection, processing, storage and dissemination of information, companies in developing countries have a tendency to depend on the public mechanism rather than on the free market to obtain technological information (Sharif, 1986).

Adequacy - The information revolution has been taking place everywhere. Unfortunately, the present management information systems (MIS) are not designed in a way that gives companies information regarding technology to manage their technology strategy. Earl (1989) distinguishes between the data processing (DP) era (the first 30 years of computing) and the (subsequent and still current) Information Technology (IT) era. One characteristic of the IT era, Earl and others explained, is that IT is regarded as a management function alongside finance, accounting, production, marketing and the like (Earl, 1989; Turban et.al, 1996). Ward’s model (1987) consists of three eras: a DP era, a management information systems (MIS) era, and a strategic information system (SIS) era. During the DP era, IT is used primarily to improve operational efficiency by automating information-based processes. In the MIS era, the prime objective is to increase management effectiveness by satisfying management information requirements. And in the SIS era, the prime objective in using IT is to improve competitiveness by changing the nature of the business. The situation can be better explained in Table 1.

A detailed study of the SIS frameworks reveals that the majority of them are based on the work of Michael Porter and Gregory Parsons (Porter, 1980; Parsons, 1983). In Porter’s value chain model, for instance, SIS provides an analysis for technology development through improving products and processes and/or R&D. But the framework does not precisely prescribe particular technologies or their applications.

Parson’s (1983) trilevel framework (industry level, firm level, and strategy level) mainly shapes the impact of IT on the firm and industry. The framework rather helps shifting the focus from technology strategy to the firm’s strategy. Development of a framework of technology information should, therefore, complement the domain of MIS in a broad sense. Graphically, the situation can be described in Figure 1.

Certainty - According to Tushman and Nelson (1990), technology and technological change are consistent sources of uncertainty for business organizations. Accurate information about technology is essential for this purpose.

Thus, the exercise of identifying technological information (TI) is of great importance. In this circumstance, the managers in the organization will have a better understanding of all the information required in technology strategy management.

Table 1 Functional focus of MIS

Period	Finance	Accounting	Production	Marketing	Human Resource	Technology
DP Era		X	X
MIS Era	X	X	X	X	X
SIS Era	X		X	X	X	X

Figure. 1 Technology Information (TI) contributing to the domain of MIS

3. Issues of Technology Strategy Management

In order to develop a framework of technology information for technology strategy management, it is essential to describe the technology strategy, its dimensions, and the components of technology strategy management with the required information in detail.

3.1 Technology Strategy: Definitions and Dimensions

Technological considerations are found somewhat implicit in many contemporary strategic studies. Porter’s (1980, 1985, 1990) three elegant and popular strategic models - Market Structure, Value Chain, and National Diamond, Boston Consulting Group’s product portfolio analysis, and Arthur D. Little’s portfolio life-cycle analysis used technology in an implicit manner. According to Michael Porter, technology strategy is a firm’s approach to the development and use of technology. He perceived technology as an important dimension that should have its own separate strategy. However, the literature suggests that success in the global market-place requires companies to employ technology strategically by linking it to a firm’s competitive strategy (Friar, et al., 1985; Mitchell, G.R, 1985; Stacey, 1990, Sharif, 1994).

Numerous definitions regarding technology strategy are found in literature given by different scholars. Rieck and Dickson (1993) defined technology strategy as the process by which firms utilize their technological resources to achieve corporate objectives while Hampson and Tatum (1997) defined it in a firm’s perspective which includes plans and actions to anticipate and acquire technology that can improve performance. Clarke and his associates (1995) explained technology strategy as that which involves decisions of resource allocation for acquisition of technological competence, organization of exploitation of technology, and the notion of technological position of the company and its significance for competitive positioning. Boden (1994) viewed it as the process of interactions between competition, technology, and organization, wherein the firm seeks to identify and exploit technologies in the pursuit of competitive advantage through and within its organizational structures and practices. Maidique and Patch (1988) defined technology strategy as a portfolio of choices and plans that a company uses to address the technological threats and opportunities in its external environment. While others (Burgelman and Rosenbloom, 1989) identified different issues of technology strategy consisting of a company’s interrelated decisions on technology choice, level of technology competence, level of funding for technology development, timing of technology introduction in new products and services, and organization for technology application and development. The definitions of technology strategy suggest a few common notions. They are (i) technology strategy is a long term plan that guides a company’s resource commitments to and use of technology, (ii) it is linked with business strategy, and (iii) it is multidimensional.

Since different dimensions of technology strategy are revealed in the literature, the study summarizes (Table 2) the required information of technology strategy management for the convenience of comprehensive analysis and better understanding.

3.2 Components of technology strategy management

Most definitions of strategy can be explained from matching dimensions where strengths and weaknesses of the company should be matched with opportunities and threats. Developing strategies for technology is not an exception to it. Sharif’s (1995) technology strategy management framework shows that technological resources and technological capabilities can be used as the strengths and weaknesses while technological climate and its infrastructure can be used as opportunity and threat. He also mentioned that resources and capabilities of the organization lead a company’s decision towards leapfrogging while technological climate and infrastructure lead toward networking with the existing facilities. Hence, the four components of technology strategy management (technological resources, technological capabilities, technological climate, and technological infrastructure) and the required information are studied here.

3.2.1 Technological Resources

According to Sharif (1995, 1997) and Ramanathan (1994a), technology resources can be discerned into four components: technoware, humanware, inforware, and orgaware. In this classification, technoware refers to the tangible and palpable part of the machineries; humanware refers to human skills needed to realize the potential of technoware; orgaware refers to the support net of principles, practices and arrangements that govern the effective use of technoware by the humanware; and, inforware refers to accumulated knowledge needed to realize the full potential of the technoware, humanware, and orgaware. In this section, information needed for each technology resource component is discussed. It is important to note that technological resources are function specific and all the components are required to be present for a particular function. Absence of any component will produce no value for the function. Thus, the components should be considered from a functional point of view.

The information required for the four components of technology resources have been scanned from Technology Atlas (1989) in Table 3.

3.2.2 Technology Capabilities

Many attempts have been made by different authors to define and measure technological capability in the Third World. Fransman (1984), one of the pioneers in this area, identified the following elements:

1. Capability to search for available alternative technologies and to select the most appropriate technology for importation;
2. Capability to master imported technology and successfully use it for the transformation of inputs into outputs.
3. Capability to adapt imported technology in order to suit local production conditions;
4. Capability to further develop the adapted technology as a result of local incremental innovation
5. Capability to institutionalize the search for more important innovations and breakthroughs with the development of local R&D facilities; and
6. Carrying out basic research for further upgrading the technology.

The first four mainly focus searching and selecting appropriate technology, transformation, adaptation and incremental innovation. The last two are concerned with breakthrough innovation, with R&D and with basic research for further upgrading which are complex and costly in nature.

Technological capability has also been defined by Dore (1984) as the combination of three kinds of independent capabilities, namely, an independent world technological trend monitoring capability; an independent technology learning capability; and, an independent technology creation capability. He is one of the first to link up the monitoring-learning-creating chain. But his model does not specify clear interactions among the three capabilities.

Bell (1984) analyzed the determinants of indigenous technological capacity and indicated that it consists of: learning by operating, learning by changing, learning from performance feedback, learning from training, learning by hiring, and learning by searching. On the other hand, Desai (1985) defined technological capability as: abilities for purchasing technology, abilities for plant operation, abilities for duplication and expansion and abilities for innovation.

UNIDO (1986) has identified elements of technology capability building as ability to train manpower, ability to carry out basic research, ability for testing basic facilities, ability to acquire and adapt technologies, and ability to provide information support and networking.

The World Bank (1985) has subdivided technological capability building as a combination of three independent capabilities, namely (i) Production capability, consisting of: production management, production engineering, maintenance of capital equipment, and marketing of produced output; (ii) Investment capability, consisting of: project management, project engineering, procurement capabilities, and manpower training; and, (iii) Innovation capability, consisting of creating and carrying new technical possibilities through to economic practice.

In all the above technological capabilities, interactions of elements are not clearly outlined. However, Ramanathan (1994) identified four capabilities showing interactions among each other. The capabilities are as follows:

1. Operative capabilities - Ability for operating and controlling plant and equipment, planning and controlling production activities, providing information support and networking for operations, maintaining the plant and equipment in good order.
2. Acquisitive capabilities - Ability to carry out a detailed engineering study, independently searching for good technology sources, assessing technologies offered, deciding technology transfer mode, and negotiating terms of technology transfer.
3. Innovative capabilities - Ability for duplicating acquired technology, adopting and carrying out improvements in imported technology, and carrying out own technology development plan.
4. Supportive capabilities - Ability for undertaking project planning and execution, obtaining funds for prototype development and modernization, planning and implementing human resource development, and identifying and developing new markets for the firm’s existing and new products.

Ramanathan’s technological capabilities are interlinked with each other. But he did not categorically mention which capabilities are appropriate for what level of organization. Rather, he drew an analogy for the capabilities with a ‘stool with four legs and supports connecting the legs’. It indicates that all four capabilities are needed simultaneously for a company.

Sharif (1995) developed six types of technological capabilities, namely acquiring, converting, vending, modifying, designing, and generating. He also mentioned that all the capabilities are not necessary for a company at any single time. The first three capabilities are needed for a company with the lowest technological status. As the company grows with a higher technology status, capabilities need to be added.

The basic difference between Ramanathan and Sharif’s classification of technological capabilities is that the former one is multiplicative while the latter is additive in nature. Since Sharif’s six capabilities are most rational for a company’s development stages compared to others mentioned above, the study uses them for identifying required information. Information required for various technological capabilities are shown in Table 4.

3.2.3 Technology Infrastructure

Technology infrastructure is a major determinant of technology-based activities in a firm. Ramanathan (1993) identified three major categories of infrastructure, namely: (i) Supportive Physical Infrastructure (ii) Technology Activity Guiding Infrastructure, and (iii) Technological Activity Strengthening Infrastructure. Information needed for technology infrastructure is summarized in Table 5.

3.2.4 Technology Climate

The national technology climate is influenced by four major actors (Ramanathan, 1993). These are: the customers, the owners; the rivals; and the clusters. The information needed for each of the actors are identified and presented in Table 6.

Table 6 Information needed for technology climate assessment

Actors	Purpose	Information needed
Customers	Creation of technology demand Export-oriented/ local Licensing/ Joint Venture	Degree of customer sophistication Size of the local market Customer Preference for local Goods
Owners	Technology transfer/ R&D	Attitude towards investment and risk Long/Short term orientation
Rivals	Innovation pressure Proprietary technologies	Number of companies producing same/similar product Market share of the nearest competitor Location of the nearest competitors market (same / different)
Clusters	Extent of value addition Exchange experience	Existence of related industries (many/few) Dealer-Manufacturer network (strong /weak)

4. A framework of technology information for technology strategy management

The information, as seen in the Figure 2, are grouped into two categories - internal and external. In the framework, this information is considered to be the input into the process of technology strategy management. It also depicts the information requirement of different components of technology strategy management. The detailed information for each item can be looked at in the corresponding tables. Inf ormation regarding technological resources and technological capabilities originate from within the company while the same for technological infrastructure and technological climate are derived from external environment. The output of the technology strategy management process is beyond the scope of the study. However, feedback is required to be obtained in a regular basis from the process as well as the output to review the information from internal (controllable) operations of the company.

5. Conclusion

The study is aimed at identifying technological information for technology strategy management. In this study different components of technology strategy management, various dimensions of technology strategy, and required information are described in detail from a company perspective. It classifies the technological information for various areas of technology strategy management. The information is classified into two groups - internal and external. Internal technological information is obtained from internal company sources and external information is collected from the operating environment of the company. This study also suggests a framework of technological information for technology strategy management. It will provide twofold benefits for managers. Firstly, it will help them to improve their knowledge about the importance and various aspects of technology strategy management and required information. Secondly, through computerization of the technology information systems, it will give them convenience in the process of technology strategy management. The study has been completely based on a literature review. The framework of technological information developed in this study has not been empirically tested. Hence, for practicability, it needs to be used for testing in real business situations.

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