Managing

Technology
and Innovation
Chapter 17
Copyright 2011 by the McGraw-Hill Companies, I nc. All rights reserved. McGraw-Hill/I rwin
Learning Objectives
LO 1 List the types of processes that spur
development of new technologies
LO 2 Describe how technologies proceed
through a life cycle
LO 3 Discuss ways to manage technology for
competitive advantage
LO 4 Summarize how to assess technology needs
17-2
Learning Objectives (cont.)
LO 5 Identify alternative methods of pursuing
technological innovation
LO 6 Define key roles in managing technology
LO 7 Describe the elements of an innovative
organization
LO 8 List characteristics of successful
development projects

17-3
Technology and Innovation
Technology
The systematic
application of scientific
knowledge to a new
product, process, or
service.
17-4
Question
___________ is a change in method or
technology.
A. Innovation
B. Quality
C. Speed
D. Service

17-5
Technology and Innovation
Innovation
A change in method or technology; a positive,
useful departure from previous ways of doing
things.
17-6
Forces Driving Technological Development
1. Must be a need, or demand, for the
technology
2. Meeting the need must be theoretically
possible, and the knowledge to do so must
be available from basic science
3. Must be able to convert the scientific
knowledge into practice in both engineering
and economic terms
17-7
Forces Driving Technological Development
4. The funding, skilled labor, time, space, and
other resources needed to develop the
technology must be available
5. Entrepreneurial initiative is needed to
identify and pull all the necessary elements
together.
17-8
Technology Life Cycle
Technology life cycle
A predictable pattern followed by a technological
innovation, from its inception and development to
market saturation and replacement.
17-9





The Technology Life Cycle
17-10
Figure 17.1
Technology Dissemination Pattern and
Adopter Categories
17-11
Figure 17.2
Diffusion of Technological Innovations
17-12
Innovators
Early
Adopters
Early
Majority
Late
Majority
Laggards
Diffusion of Technological Innovations
An innovation will spread quickly if it
Has a great advantage over its predecessor
Is compatible with existing systems, procedures,
infrastructures, and ways of thinking
Has less rather than greater complexity
Can be tried and tested easily without significant
cost or commitment
Can be observed and copied easily
17-13
Technological Innovation in a Competitive
Environment
17-14
Advantages and Disadvantages of
Technology Leadership
17-15
Table 17.1
Technology Followership
A managers decision on when to adopt new
technology also depends on the potential
benefits of the new technology, as well as the
organizations technology skills
Following the technology leader can save
development expense
17-16
Dynamic Forces of a Technologys
Competitive Impact
17-17
Figure 17.3
Question
What is the process of clarifying the key
technologies on which an organization depends?

A.Managerial audit
B. Benchmarking
C. External audit
D.Technology audit

17-18
Assessing Technology Needs
Technology audit
Process of clarifying
the key technologies
on which an
organization depends
17-19
Measuring Current Technologies
Emerging
technologies are still
under development
and thus are
unproved
Pacing technologies
have yet to prove
their full value but
have the potential to
alter the rules of
competition by
providing significant
advantage
17-20
Measuring Current Technologies
Key technologies
have proved effective,
but they also provide
a strategic advantage
because not everyone
uses them
Base technologies are
those that are
commonplace in the
industry; everyone
must have them to be
able to operate
17-21
Question
What is the process of comparing the organizations
practices and technologies with those of other
companies?

A. Benchmarking
B. Quality control
C. Scanning
D. Environmental scanning

17-22
Assessing External Technological Trends
Benchmarking
the process of comparing the organizations
practices and technologies with those of other
companies
17-23
Assessing External Technological Trends
Scanning
focuses on what can be done and what is being
developed
places greater emphasis on identifying and
monitoring the sources of new technologies for an
industry
17-24
Key Factors to Consider in Technology
Decisions
17-25
Anticipated market receptiveness
Technology feasibility
Economic viability
Anticipated competency
development
Organizational suitability
Framing Decisions about
Technological Innovation
17-26 Table 17.2
Sourcing and Acquiring New Technologies
Make-or-buy decision
The question an organization asks itself about
whether to acquire new technology from an
outside source or develop it itself.
17-27
Sourcing and Acquiring New Technologies
Internal development
Purchase
Contracted
development
Licensing
Technology trading
Research
partnerships and
joint ventures
Acquisition of the
owner of the
technology

17-28
Sourcing and Acquiring New Technologies
Managers should ask the following basic questions:
1. Is it important (and possible) in terms of competitive
advantage that the technology remain proprietary?
2. Are the time, skills, and resources for internal
development available?
3. Is the technology readily available outside the
company?
17-29
Technology Acquisition Options
17-30
Figure 17.4
Question
Which executive is in charge of information
technology strategy and development?
A. COO
B. CEO
C. CTO
D. CIO

17-31
Technology and Managerial Roles
Chief information officer (CIO)
executive in charge of information technology
strategy and development.
coordinate the technological efforts of the various
business units
identify ways that technology can support the
companys strategy
supervise new-technology development
17-32
Technology and Managerial Roles
Technical innovator
A person who develops a new technology or has
the key skills to install and operate the technology
Product champion
A person who promotes a new technology
throughout the organization in an effort to obtain
acceptance of and support for it.
17-33
Technology and Managerial Roles
Executive champion
An executive who
supports a new
technology and
protects the product
champion of the
innovation.
17-34
Organizing for Innovation
Unleashing creativity involves encouraging
creativity and celebrating failure

Bureaucracy busting is necessary because
bureaucracy is the enemy of innovation

17-35
3Ms Rules for an Innovative Culture
17-36
Table 17.3
Organizing for Innovation
Development project
A focused organizational effort to create a new
product or process via technological advances
17-37
Organizing for Innovation
Sociotechnical systems
An approach to job design that attempts to
redesign tasks to optimize operation of a new
technology while preserving employees
interpersonal relationships and other human
aspects of the work
17-38
Compensation Practices in Traditional and
Advanced Manufacturing Firms
17-39
Table 17.4
Destination CEO: Adobe
Discuss the role of
innovation at
Adobe.

If you were a
manager, how
would you
encourage
creativity?
17-40