Technology management - integrating technology into business planning

Manufacturing Systems Design – MS2

Abstract

Technology management focuses on the effective management of both new and existing technologies to maintain a stream of products or services to the market. It deals with all aspects of integrating technological issues into business decision making, from strategy to operations. This paper explores practical approaches to technology planning in the context of existing frameworks and a new framework which links technology, new product development and business planning in the company context. It will also present the latest results from a 'fast-start' process for technology roadmapping. Technology roadmapping is an increasingly popular technique for supporting integrated planning within manufacturing companies.

CJP Farrukh, R Phaal and DR Probert

Centre for Technology Management

Institute for Manufacturing

Cambridge University Engineering Department

Mill Lane, CAMBRIDGE, CB2 1RX, UK

INTRODUCTION

The effective integration of technological considerations into business strategy is a key aspect of business planning. These considerations impact on both external and internal aspects of strategy, in terms of the sources of new technology and the strength of competitors' technology, together with the value of technology as a resource within the firm, providing the capability to develop and deliver products and services. In this context, technology strategy should be considered as an integral part of business strategy and planning, rather than as a separate process (e.g. Floyd, 1997; Metz, 1996).

FRAMEWORKS FOR TECHNOLOGY PLANNING

Existing frameworks include the Value Chain (Porter, 1985), the innovation funnel (Wheelwright & Clarke, 1992) and approaches based on company maturity (Betz, 1998). Technology can be best considered in the business context as an important type of resource, and hence there are considerable linkages with resource-based views of the firm (e.g. Grant, 1991; Hamel & Prahalad, 1994; Teece et al., 1997). A new framework has been developed (Fig. 1) which brings together knowledge and resource based concepts, drawing on work by Andreasen and Hein (1987). This framework addresses the area of technology planning and comprises three 'levels'.

Fig. 1 - Technology planning framework

Effective alignment of technology with business objectives requires effective mechanisms for knowledge flow between the levels, in terms of 'pull' to ensure that business and market requirements are understood at the product and technology levels, and 'push' to ensure that technological capabilities are understood at the product and business levels. Knowledge management concepts are important in this context, such as organisational learning, explicit and tacit knowledge (Nonaka, 1991), together with 'dimensions' of knowledge, such as 'know-why', 'know-what', 'know-how', 'know-who' and 'know-when' (Chai et al., 1999). Various types of mechanisms can support knowledge flows and learning across levels, including multidisciplinary teams, staff mobility, communication systems, business processes and management tools. An important example of such a tool includes technology roadmapping (TRM), and research is ongoing to develop practical approaches for applying this method in a range of business types.

THE TECHNOLOGY ROADMAPPING PROCESS

The technology roadmap approach is closely related to the framework described above, as technology, product and market levels, and the time dimension are primary components. Technology roadmapping can support the development and communication of technology strategy and plans. Roadmaps take a variety of specific forms, depending on the particular company context (Barker & Smith, 1995; Willyard and McClees, 1987; Groenveld, 1997). Specific technology programmes or developments are shown on the map, linked to future products and services, and then to market or business opportunities. Technology roadmaps have been applied successfully in a number of industrial organisations, however key practical challenges include defining the scope of the TRM process in terms of aims and resources, and integrating the TRM process into existing business processes and systems. To fill this gap a detailed process is being developed to support the rapid initiation of technology roadmapping, using a 'procedural action' research approach, as set out by Maslen and Lewis (1994); see also Platts (1993). The 'start-up' process comprises a series of four facilitated workshops that bring together various functions in the business, including technical and marketing. The process has been designed to cover the key elements of technology roadmapping in a condensed time-frame, to provide a quick overview of the potential benefits of the technique, to facilitate learning about how to apply TRM in the company context, and explore a particular area of business interest.

APPLICATION RESULTS

The TRM start-up process has been applied six times to date (see Table 1). To assess the effectiveness of each application and in order to improve the process, the success of the process is reviewed at the end of Workshop 4 and after six months.

Table 1 - TRM start-up process assessment

# / Company / Product / Usefulness / Function-ality / Usability / Turnover (£ million)
(range) / Employees
(range)
Company / BU / Company / BU
1* / Company A / Postal services / - / - / - / 5,000 -20,000 / - / >20,000 / 25-100
2* / Company B / Industrial coding systems – inkjet / - / - / - / 100-250 / 10-100 / 1,000 - 5,000 / 25-100
3 / Company B / Industrial coding systems – laser / 3.8 / 3.9 / 4.2 / 100-250 / 1-10 / 1,000 - 5,000 / 25-100
4 / Company C / Security / access systems / 3.4 / 3.1 / 2.9 / 10-100 / - / 100 - 250 / -
5 / Company D / Software / 4.1 / 4.0 / 4.1 / <10 / - / <100 / -
6 / Company E / Surface coatings / 3.5 / 3.8 / 4.2 / 100-1000 / 10-100 / 500-1000 / 100-250

* Exploratory cases

The review after Workshop 4 incorporates participant and facilitator views by means of questionnaires, which assess process effectiveness in terms of three key parameters. Usefulness: how well did the application meet the stated objectives? Functionality: how well did the application meet the generic aims of the TRM start-up process? Usability: how well did the process facilitate application? These parameters are scored on a scale of 1-5, based on a number of questions - see Table 1 for aggregate results. Note, the first two applications were not scored, as they were exploratory in nature. In each company a plan was devised to take the TRM process forward, in the context of company requirements and the strategic planning processes within the business. Evidence of medium to long term change in the organisation will be sought as part of an overall assessment of the success of the TRM start-up application.

SUMMARY AND CONCLUSIONS

Technology roadmapping is a technique that enables technology investment to be linked to future product development and market requirements. There are examples of how this approach has been used successfully in industry, although the initial implementation and ongoing application of the method represents a challenge. The paper describes a process to support the rapid start-up of technology roadmapping in firms which is being tested using a ‘procedural action research' methodology. The testing has revealed a range of application types (e.g. product concept development, new product introduction, technology insertion). This testing stage will be continued within a wider range of companies over the next year to build confidence about the range of industrial contexts within which the approach works. Working with the TRM technique is illuminating the wider domain of technology planning. Due to the structural similarity of the proposed technology planning framework and the technology roadmap, a dynamic method of reflecting upon the framework is provided. Further work planned includes ongoing validation against existing models of technology strategy and investigating and documenting mechanisms for knowledge flow.

REFERENCES

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Proceedings of the Eleventh Annual Conference of the Production and Operations

Management Society, POM-2000, April 1-4, 2000, San Antonio, TX.