Page 291 - DMGT401Business Environment

Business Environment

Notes 14.1 Technological Advancement

Technology is rapidly changing our world. It is bringing us advantages beyond our grandparents'
wildest dreams. It seems that with each year the pace of change quickens. Each new process or
invention makes even further advances possible.

Example: Such 19th and 20th century inventions such as the telephone, the phonograph,
the wireless radio, the motion picture, the automobile, and the airplane only to enhanced served
only to add to the nearly universal respect that society in general felt for technology.
With the development of assembly-line mass production of automobiles and household
appliances, and the building of ever taller skyscrapers, acceptance of innovations became not
only a fact of everyday life but also a way of life in itself. Society was being rapidly transformed
by increased mobility, rapid communication, and a deluge of available information from mass
media. Since the 1950s, technology in R&D activities has also advanced significantly.
There are numerous factors that have contributed to these changes. Rothwell and Zegveld (1985)
(Reindustrialization and Technology, Longman, London) identify three important factors:
1. Technology Explosion: Both authors surmise that 90% of our present technical knowledge
has been generated during the last 55 years.

2. Shortening of the Technical Cycle: The technology cycle includes scientific and technological
developments prior to the traditional products life cycle. These cycles have been slowly
shortening, forcing companies to focus their efforts on product development. As a result,
the market life of a model of a motor cycle has reduced drastically. Earlier, a model
proved to be a cash cow for an organization for years. But today companies are launching
new models every next year, sometimes even within the same financial year.
3. Globalization of Technology: Countries of the Pacific Rim have demonstrated the ability
to acquire and assimilate technology into new products. This has resulted in a substantial
increase in technology transfer in the form of licensing and strategic alliances.
14.1.1 Application of Technology

There was a time when the United Kingdom begged the maximum number of Nobel Prizes
while Japan was getting wealthy. During this Japan was not giving any significant emphasis on
basic research. Thus, wealth lies not in inventing and discovering technology but in its application.
Application of technology requires a set of specific capabilities. These capabilities are different
in nature from those involved in innovation or invention.
Technology also requires the ability to make effective use of technological knowledge.
Technological capabilities require better application of technology including the ability to
acquire, use, assimilate, adapt, change and create technology. Four different kinds of technological
capabilities are identified: acquisitive, operative, adaptive, and innovative. While operative
capabilities pertain to production know-how, adaptive and innovative capabilities relate to
technological efforts that are central to the effective assimilation of technology and to
simultaneous as well as subsequent adaptation to fit local circumstances better.

Example: Two examples of market innovations based on existing technology:
1. The walkman - the invention of the walkman meant no new technologies, only a new
application of technology.

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